Haley bashes House budget-writers for their spending plan
COLUMBIA -- South Carolina Gov. Nikki Haley lambasted the House budget-writing committee Wednesday for not including her proposal to cut $140 million worth of taxes in their spending plan for the coming year. Republican leaders fired back that their much larger tax overhaul is on its way.The Republican governor said she's going to loudly criticize legislators daily until they put her plan to cut corporate and personal income taxes in the 2012-13 budget. That includes going on the campaign trail in a year every legislator faces re-election.•This is a call to action. This is the beginning of me getting very loud,• Haley said at a South Carolina Association of Taxpayers luncheon to honor lawmakers deemed a •friend of the taxpayer.••Enough is enough,• she said. •I've got a Republican Legislature that doesn't know how to act like one.•Floor debate on the Ways and Means Committee's $6.5 billion spending plan is scheduled next week.House Republicans have been working on a package of bills they tout as wholesale tax reform that includes what Haley wants. The caucus hopes to introduce them this week after months of meetings, next week at the latest.Haley's public rebuke and warning hearkens back to the contentious relationship between former GOP Gov. Mark Sanford and the Republican-controlled Legislature. Haley, a former House member, ran for office promising a more collegial relationship. But any pretense of that may be gone.Ways and Means Committee Chairman Brian White said her attack is disappointing, considering the caucus' efforts since last summer. He said he takes great offense to the governor accusing the GOP majority of not behaving like Republicans. Since the GOP took over the House in 1994, he said, the Legislature has approved a cumulative $20 billion worth of cuts in sales, property and income taxes.•We've been doing it and will continue to do it,• said White, R-Anderson.Haley said Republicans' impending bills can't be enacted soon enough. She wants her proposal in the budget. Out of $6.5 billion, they should be able to find $140 million, especially since she showed them how, she said.•We've given them the most direct way to give tax reform,• she said.Haley's plan for the fiscal year that starts July 1 would begin eliminating the state's corporate income taxes. The first of her four-year phase-out would reduce revenues by $62 million. An additional $78 million reduction would give most taxpayers an $84 reduction in their state income taxes. A substantial number of tax filers would receive no break.White said tax reform needs to be approved through legislation. Putting tax cuts into the budget rather than state law means they last only for the duration of that fiscal year and would need to be debated yearly as part of the spending plan.The biggest difference is that his committee's budget plan would add rather than cut money for classrooms, White said.Haley's overall plan would reduce education spending by about $80 million, while the committee's plan increases by $153 million a key funding source that primarily pays teacher salaries. Even that increase is far from restoring education funding to what a state formula calls for, after years of recession-era budget cuts.The committee also gives state workers a 2 percent raise, while Haley would give them a fourth year without a pay raise.Haley said there is nothing more important than tax relief.•They can decide to spend however they want, but the most important thing we can do is give $140 million in tax reform,• she said. •There's no spending that will justify not including $140 million in tax relief.•Areas where the committee adopted Haley's recommendations include additional law enforcement and health care, providing coverage to 80,000 more poor children who already qualify for Medicaid under state law.Haley accuses the Ways and Means Committee of spending every penny.However, both plans put nearly $100 million of surplus from previous fiscal years into a state savings account, $60 million more than state law requires the budget to add this year. And both include $550 million in tax relief required to be taken off the top because of previously passed laws.Differences in the use of one-time money from prior year surpluses include money set aside for ports. Haley puts $25 million into a newly created trust fund, while the committee puts $180 million toward deepening the Charleston Harbor. That money represents the full state match for the $300 million project.It's the result of another public feud between legislators and the governor in recent months.They have widely criticized her for asking a board she appointed to hear Georgia's appeal on a water quality permit allowing the expansion of a competitor port in Savannah, Ga., as they unanimously passed a measure retroactively suspending the Department of Health and Environmental Control's ability to issue permits on dredging - then overrode her veto with only one legislator among 170 dissenting.House Speaker Bobby Harrell said the $180 million designation means legislators are •acting like South Carolinians by protecting our state's ports ... and fighting Gov. Haley, her DHEC board and the state of Georgia over the Savannah River dredging.•As for other differences, Ways and Means put $47 million toward paying down debt in the unemployment insurance trust fund. Haley put no money toward that but proposed putting $75 million toward a buyback initiative encouraging local governments to take over maintenance of some state roads.