1985-1986 Bill 2067: Spending limitation - South Carolina Legislature Online

South Carolina General Assembly
106th Session, 1985-1986

Bill 2067

                    Current Status

Bill Number:               2067
Ratification Number:       14
Act Number:                10
Introducing Body:          House
Subject:                        Spending limitation

View additional legislative information at the LPITS web site.

(Text matches printed bills. Document has been reformatted to meet World Wide Web specifications.)

(A10, R14, H2067)

AN ACT RATIFYING AMENDMENTS TO SECTION 7 OF ARTICLE X OF THE CONSTITUTION OF SOUTH CAROLINA, 1895, RELATING TO THE LEVY OF TAXES TO MEET EXPENSES AND DEFICITS OF STATE GOVERNMENT, SO AS TO REPHRASE A PORTION OF THE SECTION TO PROVIDE THAT THE GENERAL ASSEMBLY SHALL PROVIDE BY LAW THAT THE ANNUAL STATE BUDGET MUST BE BALANCED, AND TO PROVIDE THAT THE GENERAL ASSEMBLY SHALL PRESCRIBE BY LAW THAT ANNUAL INCREASES IN STATE APPROPRIATIONS MAY NOT EXCEED THE AVERAGE GROWTH RATE OF THE ECONOMY OF THE STATE NOR MAY THE ANNUAL INCREASE IN THE NUMBER OF STATE EMPLOYEES EXCEED THE AVERAGE GROWTH OF THE POPULATION OF THE STATE AND TO PROVIDE A PROCEDURE BY WHICH LIMITATIONS MAY BE SUSPENDED, AMENDED, OR REPEALED; TO PROVIDE THAT DURING THE REGULAR SESSION OF THE GENERAL ASSEMBLY IN THE YEAR 1990 AND DURING EVERY FIFTH ANNUAL REGULAR SESSION THEREAFTER, THE GENERAL ASSEMBLY SHALL CONDUCT AND COMPLETE A REVIEW OF THE LAW IMPLEMENTING THE PROVISIONS OF SUBSECTION (c) OF THIS SECTION, AND TO PROVIDE THAT DURING SUCH SESSION THE GENERAL ASSEMBLY MAY CHANGE THE EXISTING LIMITATION ON APPROPRIATIONS; RATIFYING AN AMENDMENT TO SECTION 13 OF ARTICLE X OF THE CONSTITUTION OF SOUTH CAROLINA, 1895, RELATING TO GENERAL OBLIGATION DEBT, SO AS TO PROVIDE THAT THE DEBT SERVICE ON GENERAL OBLIGATION BONDS AS DEFINED IN THE SECTION MAY NOT EXCEED FIVE RATHER THAN SEVEN PERCENT OF THE GENERAL REVENUE OF THE STATE FOR THE PREVIOUS FISCAL YEAR, TO PROVIDE THAT THE PERCENTAGE RATE OF GENERAL REVENUES MAY BE REDUCED TO FOUR OR INCREASED TO SEVEN PERCENT BY THE GENERAL ASSEMBLY; TO PROVIDE THAT DURING THE REGULAR SESSION OF THE GENERAL ASSEMBLY IN THE YEAR 1990 AND DURING EVERY FIFTH ANNUAL REGULAR SESSION THEREAFTER, THE GENERAL ASSEMBLY SHALL CONDUCT AND COMPLETE A REVIEW OF THE LAW IMPLEMENTING THE PROVISIONS OF ITEM (c) OF SUBSECTION (6) OF THIS SECTION, AND TO PROVIDE THAT DURING SUCH SESSION THE GENERAL ASSEMBLY MAY CHANGE THE EXISTING PERCENTAGE RATE; RATIFYING AN AMENDMENT TO SECTION 36 OF ARTICLE III OF THE CONSTITUTION OF SOUTH CAROLINA, 1895, RELATING TO THE STATE GENERAL FUND RESERVE, SO AS TO REDUCE SUCH RESERVE FROM FIVE TO FOUR PERCENT OF THE GENERAL FUND REVENUE OF THE LATEST COMPLETED FISCAL YEAR AND PROVIDE FOR THE WITHDRAWAL OF FUNDS FROM THE RESERVE TO COVER OPERATING DEFICITS OF STATE GOVERNMENT, TO REQUIRE THE GENERAL ASSEMBLY TO PROVIDE FOR THE ORDERLY RESTORATION OF THE RESERVE FROM FUTURE REVENUES, TO PROVIDE THAT THE PERCENTAGE RATE OF GENERAL FUND REVENUE MAY BE REDUCED TO THREE OR INCREASED TO FIVE PERCENT BY THE GENERAL ASSEMBLY, TO PROVIDE THAT DURING THE REGULAR SESSION OF THE GENERAL ASSEMBLY IN 1990 AND DURING EVERY FIFTH ANNUAL REGULAR SESSION THEREAFTER THE GENERAL ASSEMBLY SHALL CONDUCT AND COMPLETE A REVIEW OF THE LAW IMPLEMENTING THE SECTION, TO PROVIDE THAT THE EXISTING PERCENTAGE RATE SHALL REMAIN UNCHANGED UNLESS DURING THE SESSION, THAT REVIEW RESULTS IN AN AMENDMENT TO OR REPEAL OF THE LAW IMPLEMENTING THE SECTION, AND PROVIDE THAT ONE PERCENT OF THE GENERAL FUND REVENUE OF THE LATEST COMPLETED FISCAL YEAR MUST BE RESTORED TO THE RESERVE FUND WHEN USED TO COVER A YEAR-END OPERATING DEFICIT DURING THE FIRST TWO FISCAL YEARS FOLLOWING THE DEFICIT INSTEAD OF IN THE FIRST FISCAL YEAR FOLLOWING THE DEFICIT AND REQUIRE THAT TWO PERCENT OF THE GENERAL FUND REVENUE MUST BE RESTORED TO THE RESERVE FUND THE THIRD FISCAL YEAR FOLLOWING THE DEFICIT INSTEAD OF IN EACH OF THE NEXT TWO SUCCEEDING FISCAL YEARS FOLLOWING THE DEFICIT, DELETE THE PROVISIONS AUTHORIZING THE GENERAL ASSEMBLY BY A TWO-THIRDS APPROVAL OF THE MEMBERSHIP OF EACH HOUSE TO USE THE RESERVE FUND FOR PURPOSES OTHER THAN FOR A DEFICIT OR PRIORITY PURPOSES.

Be it enacted by the General Assembly of the State of South Carolina:

Constitutional amendment ratified

SECTION 1. The amendment to Section 7 of Article VI of the Constitution of South Carolina, 1895, proposed under the terms of Joint Resolution 520 of 1984, having been submitted to the qualified electors at the general election of 1984 as prescribed in Section 1 of Article XVI of the Constitution of South Carolina, 1895, and a favorable vote having been received thereon, is ratified and declared to be a part of the Constitution, so that subsection (a) of Section 7 of Article X is amended to read:

"(a) The General Assembly shall provide by law for a budget process to insure that annual expenditures of state government may not exceed annual state revenue."

SECTION 2. The amendment to Section 7 of Article X of the Constitution of South Carolina, 1895, proposed under the terms of Joint Resolution 520 of 1984, having been submitted to the qualified electors at the general election of 1984 as prescribed in Section 1 of Article XVI of the Constitution of South Carolina, 1895, and a favorable vote having been received thereon, is ratified and declared to be a part of the Constitution, so that subsection (c) is added to Section 7 of Article X to read:

"(c) The General Assembly shall prescribe by law a spending limitation on appropriations for the operation of state government which shall provide that annual increases in such appropriations may not exceed the average growth rate of the economy of the State as measured by a process provided for by the law which prescribes the limitations on appropriations; provided, however, the limitation may be suspended for any one fiscal year by a special vote as provided in this subsection.

During the regular session of the General Assembly in 1990 and during every fifth annual regular session thereafter, the General Assembly shall conduct and complete a review of the law implementing this subsection. During such session, only a vote of two-thirds of the members of each branch present and voting shall be required to change the existing limitation on appropriation. Unless that is done, the existing limitations shall remain unchanged.

Upon implementation of the provisions of this subsection by law, such law may not be amended or repealed except by the special vote as provided in this subsection.

The special vote referred to in this subsection means an affirmative vote in each branch of the General Assembly by two-thirds of the members present and voting, but not less than three-fifths of the total membership in each branch."

SECTION 3. The amendment to Section 7 of Article X of the Constitution of South Carolina, 1895, proposed under the terms of Joint Resolution 520 of 1984, having been submitted to the qualified electors at the general election of 1984 as prescribed in Section 1 of Article XVI of the Constitution of South Carolina, 1895, and a favorable vote having been received thereon, is ratified and declared to be a part of the Constitution, so that subsection (d) is added to Section 7 of Article X to read:

"(d) The General Assembly shall prescribe by law a limitation on the number of state employees which shall provide that the annual increase in such number may not exceed the average growth rate in the population of the State measured by a process provided for in the law which prescribes that employment limitation; provided, however, the limitation may be suspended for any one fiscal year by a special vote as provided in this subsection.

Upon implementation of the provisions of this subsection by law, such law may not be amended or repealed except by the special vote provided in this subsection.

SECTION 4. The amendment to item (c) of subsection (6) of Section 13 of Article X of the Constitution of South Carolina, 1895, proposed under the terms of Joint Resolution 520 of 1984, having been submitted to the qualified electors at the general election of 1984 as prescribed in Section 1 of Article XVI of the Constitution of South Carolina, 1895, and a favorable vote having been received thereon, is ratified and declared to be a part of the Constitution, so that item (c) of subsection (6) of Section 13 of Article X is amended to read:

"(c) General obligation bonds for any public purpose including those purposes set forth in (a) and (b) may be issued; provided, that the maximum annual debt service on all general obligation bonds of the State thereafter to be outstanding (excluding highway bonds, state institution bonds, tax anticipation notes and bond anticipation notes) must not exceed five percent of the general revenues of the State for the fiscal year next preceding (excluding revenues which are authorized to be pledged for state highway bonds and state institution bonds).

Upon implementation of the provisions of this item by law, the percentage rate of general revenues may be reduced to four or increased to seven percent by legislative enactment passed by a two-thirds vote of the total membership of the Senate and a two-thirds vote of the total membership of the House of Representatives.

During the regular session of the General Assembly in 1990 and during every fifth annual regular session thereafter, the General Assembly shall conduct and complete a review of the law implementing this item. Unless during such session that review results in an amendment to or repeal of the law implementing this item, which must be accomplished by legislative enactment passed by a two-thirds vote of the total membership of the Senate and a two-thirds vote of the total membership of the House of Representatives."

SECTION 5. The amendment to Section 36 of Article III of the Constitution of South Carolina, 1895, proposed under the terms of Joint Resolution 520 of 1984, having been submitted to the qualified electors at the general election of 1984 as prescribed in Section 1 of Article XVI of the Constitution of South Carolina, 1895, and a favorable vote having been received thereon, is ratified and declared to be a part of the Constitution, so that Section 36 of Article III is amended to read:

"Section 36. The General Assembly shall provide for a General Fund Reserve of four percent of the general fund revenue of the latest completed fiscal year. Funds may be withdrawn from the reserve only for the purpose of covering operating deficits of state government. The General Assembly must provide for the orderly restoration of funds withdrawn from the reserve from future revenues.

The General Assembly shall provide by law for a procedure to survey the progress of the collection of revenue and the expenditure of funds and to authorize and direct reduction of

appropriations as may be necessary to prevent a deficit.

Upon implementation of the provisions of this section, the percentage rate of general fund revenue may be reduced to three or increased to five percent by the special vote provided in this section.

During the regular session of the General Assembly in 1990 and during every fifth annual regular session thereafter, the General Assembly shall conduct and complete a review of the law implementing this section. Unless during such session that review results in an amendment to or repeal of the law implementing this section, which must be accomplished by the special vote provided in this section, the existing percentage rate shall remain unchanged.

The special vote referred to in this section means an affirmative vote in each branch of the General Assembly by two-thirds of the members present and voting, but not less than three-fifths of the total membership in each branch.

In the event of a year-end operating deficit, so much of the reserve fund as may be necessary must be used to cover the deficit; and the amount must be restored to the reserve fund within three fiscal years of future revenues until four percent general fund reserve is again reached and maintained. Provided, that one percent of the general fund revenue of the latest completed fiscal year must be restored to the reserve fund the first two fiscal years following the deficit and two percent of the general fund revenue of the latest completed fiscal year must be restored to the reserve fund the third fiscal year following the deficit."