Current Status Introducing Body:Senate Bill Number:204 Primary Sponsor:Drummond Committee Number:06 Type of Legislation:CR Subject:State's AAA Credit Rating Residing Body:Senate Current Committee:Finance Companion Bill Number:3076 Computer Document Number:JIC/5292HC.93 Introduced Date:19930113 Last History Body:Senate Last History Date:19930113 Last History Type:Introduced, referred to Committee Scope of Legislation:Statewide All Sponsors:Drummond Type of Legislation:Concurrent Resolution
Bill Body Date Action Description CMN Leg Involved
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204 Senate 19930113 Introduced, referred to 06
Committee
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ADOPTING THE PLAN APPROVED AND SUBMITTED BY THE STATE BUDGET AND CONTROL BOARD ADDRESSING CERTAIN ACCOUNTING AND BUDGETARY CONCERNS IN AN EFFORT TO PRESERVE THE STATE'S AAA CREDIT RATING.
Whereas, the South Carolina economy has been severely affected over the past three years by the recession that the nation has been experiencing; and
Whereas, this recession has extended over a much longer period than any other recession since World War II; and
Whereas, these conditions made revenue forecasting more difficult and less accurate than in more normal economic times; and
Whereas, the State over withholds on state income taxes which causes the State to accumulate excessive liability for income tax refunds; and
Whereas, the shortfalls in revenue have resulted in the State overspending and along with excessive withholding on state income tax, has caused the State to accumulate a CAAP deficit of approximately 260 million dollars; and
Whereas, this accumulated GAAP deficit and these budget problems caused Standard and Poor's Rating Service to place the State on CreditWatch with negative implications; and
Whereas, the State Budget and Control Board has adopted a four-part plan to address these issues and submits the plan which follows to this Honorable Body for concurrence and adoption. Now, therefore, Now, therefore,
Be it resolved by the Senate, the House of Representatives concurring:
That the four-part plan adopted and recommended by the State Budget and Control Board to preserve and protect the State's AAA Credit Rating and to bring stability to the appropriation process is approved as follows:
(1) Change income tax withholding tables to reduce withholdings by 270 million dollars and reduce the income tax refund liability (Tax Refunds Payable) by 135 million dollars over a period not to exceed eight years.
(2) Replenish the General Reserve Fund in accordance with constitutional requirements. Additionally, beginning in Fiscay Year 1992-93, transfer funds in excess of the annual operating expenditures, if any, to the General Reserve Fund until it is fully funded, as required by statute.
(3) Request the General Assembly to appropriate the amount necessary of the Capital Reserve Fund in Fiscal Year 1993-94 to fund fully the General Reserve Fund.
(4) Beginning with the budget prepared for Fiscal Year 1993-95, request the General Assembly to limit annual appropriations to the lower of (a) actual recurring revenues for the most recent completed fiscal year plus seventy-five percent of the Board of Economic Advisors' estimated recurring revenue growth or (b) the BEA's revenue projection.