FY 2024-2025 Budget Brief: House Ways & Means Committee Version

The House Ways & Means Committee (HWM) met February 20 and 21 to debate and vote on the FY 2024-2025 General Appropriations bill and the Capital Reserve Fund bill. The total budget is slightly more than $41B:

  • $13.19B State recurring and nonrecurring funds (general funds);

  • $14.19B Other recurring and nonrecurring funds (other state funds such gasoline excise tax);

  • $13.62B Federal funds (formula and grant funds).

Below is a review of big ticket items, but there is plenty more material to review and discuss before the budget bill hits the House floor the week of March 11. When dollar figures are discussed, these are new, incremental dollars and not the total appropriation for a budget line item. Example: in the base budget a line item has an appropriation of $10M and in the HWM budget there is $1M appropriation in new recurring funds. That line item has a new total appropriation of $11M ($10M base + $1M from the summary control document).

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Resources

FY 2024-2025 General Appropriations bill versions

Summary Control Document

Provisos February 20

Provisos February 21

Nonrecurring Revenue Proviso

Big Ticket Items

1. Property tax relief. While not technically included in the summary control document, the committee announced that an additional $500M would be sent to all 46 counties from the Homestead Exemption Fund for the purposes of property tax relief. The HWM budget includes $800.8M in property tax relief already required by statute.

2. K-12 education. The committee allocated $200M in State recurring funds and $29.7M in Education Improvement Act (EIA) recurring funds for a total of $229.7M recurring funds for the State Aid to Classrooms budget line. The committee increased the teacher state minimum salary schedule with a starting salary of $47,000 and increased the experience factor from 23 years to 28 years. Not every cell in the schedule received the same increase and school district boards ultimately decide how to structure their salary schedules, so long as it complies with the state minimum salary schedule. Instructional materials were allocated $73.5M in new nonrecurring appropriations and additional spending authorization. The budget allocates $35M in nonrecurring lottery funds for the purchase or lease of school buses. State Superintendent Ellen Weaver had her requests for $30M for the new Education Scholarship Trust Fund program and $10M for the Palmetto Math Project fully funded, in addition to her request to increase teacher pay.

3. Infrastructure. The committee echoed Governor Henry McMaster’s call for an investment in bridges with a $200M bridge modernization program funded with State nonrecurring funds. Three commercial airports - Charleston, Myrtle Beach, and Greenville, would receive investments of $20M, $5M, and $4M State nonrecurring funds respectively. The State Ports Authority would receive $55M from the Capital Reserve Fund bill for land acquisition in North Charleston.

4. State employees. Not only was the $107.5M state health plan annualization funded but the committee allocated $41.1M for state employee pay raises: $1000 per FTE earning $66,667 and under annually, and 1.5% increase in base salary for FTEs earning more than $66,667 annually.

5. Student tuition and scholarships. The committee allocated $57.5M to the state’s public 4-year institutions, MUSC, and 2-year USC branch campuses in exchange to freeze in-state tuition for FY 2024-2025. However, no funds were allocated to the state’s sixteen technical colleges for tuition mitigation. Gov. McMaster has proposed tuition freezes for the past five years and the General Assembly has agreed with him for the past four budgets. Over $538M in lottery funds were allocated to various post-secondary scholarship programs, including the SC Workforce Industry Needs Scholarship (SC WINS) program with $95M, which is one of Gov. McMaster’s top priorities. The new veterinary school at Clemson University would receive $22M from the Capital Reserve Fund bill; during the previous budget the amount of funds allocated for this project was one of the most debated topics during the conference committee. Lastly, the committee allocated $3M for a study on the future of the higher education system, which was one of Governor McMaster’s highest priorities.

6. Health and social services. The Department of Health & Human Services was allocated $105.1M for Medicaid maintenance-of-effort requirements and to increase provider rates. But most other health and social service agencies received allocations only for their portion of the new health agency campus that is soon to be occupied by several state agencies and very few new program funds.

7. Department of Veterans’ Affairs. One of the newest state agencies received a significant investment of over $89M for its veterans nursing homes and military enhancement fund to support local military communities. More than half of the committee’s recommendation - $49M - would be spent on capital improvements to existing veterans nursing homes as well as the state match for federal funds for a new veterans nursing home in Lexington County. Additionally, $5M was allocated to Stone Pavilion, a veterans nursing home currently operated by the Department of Mental Health that will transfer to the Department of Veterans’ Affairs on July 1, 2025.

8. SC Nexus. The committee allocated $50M from the Capital Reserve Fund bill to support the SC Nexus initiative. Requested by Gov. McMaster, this consortium housed at the South Carolina Department of Commerce has the goal of increasing the availability, resiliency, and security of advanced energy technology. In October 2023, SC Nexus was named one of 31 Regional Technology and Innovation Hubs by the United States Department of Commerce.

9. Parks and recreation. The Department of Parks, Recreation and Tourism would receive over 44M in new money, almost all of which is State nonrecurring funds, for various initiatives. Included in this funding was $11.45M for destination specific grants, $10M for film incentives, and $5M for sporting event marketing.

10. Resilience. Another new state agency, the Office of Resilience, was allocated $30M for the state’s disaster relief and resilience reserve fund. After a federally declared disaster, such as a hurricane, this state fund can be used to provide financial assistance to state and local governmental entities; make infrastructure repairs for homeowners and communities that are not eligible for federal funding assistance; and provide financial assistance for verifiable losses of agricultural commodities due to a natural disaster.

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