(The Center Square) — South Carolina senators will soon consider a fiscal 2024-25 budget for the state, a plan that includes nearly $100 million to speed up a personal income tax reduction.
Last week, the Senate Finance Committee gave the thumbs up to its version of a state budget, H.5100, and a Capital Reserve Fund, H.5101, sending both to the full Senate for consideration.
The budget includes a beginning base of $11.6 billion for state agencies and nearly $2.2 billion in additional general fund allocations, including $657.2 million in recurring funds and more than $1.1 billion in nonrecurring provisos. It also includes $390.1 million from the Capital Reserve Fund.
Combined, the state general fund spending totals roughly $13.8 billion.
Overall, the Senate Finance Committee’s spending plan totals $40.8 billion, including other funds such as federal tax dollars. According to a budget document, allocations include $15.2 billion for health and human services, $8.4 billion for K-12 education, $7.9 billion for higher education and nearly $3.9 billion for transportation.
The budget started with a $13.2 billion General Fund revenue forecast the Board of Economic Advisors handed down. The Senate Finance Committee’s estimate calls for transferring $800.8 million to the Tax Relief Trust Fund, leaving a $12.4 billion net General Fund revenue forecast.
After subtracting the $11.6 billion base, the state had what budget writers called “new recurring revenue” of $776.8 million.
The budget’s “enhancements and adjustments” include $99.8 million for the third year of the Comprehensive Tax Cut of 2022, codified by S.1087, which lowers the personal income tax rate from 6.4% to 6.3%. The budget includes an additional $99.6 million to accelerate the personal income tax rate to 6.2%.
Adding a wrinkle to this year’s budget discussions is a $1.8 billion balance officials found in a state account. The discovery comes after South Carolina Comptroller General Brian Gaines sent a letter on Oct. 31, 2023, to South Carolina Treasurer Curtis Loftis, directing Loftis to research the account’s origins.
It marked the start of a months-long Senate investigation that exposed financial irregularities in the state treasurer’s office.
