Education, health care will bear brunt of new state budget reductions; total losses top $1 billion
By JOHN O’CONNOR
joconnor@thestate.com
A state oversight panel trimmed $383 million from agency budgets Thursday, bringing the total amount of cuts since July to more than $1 billion.
Education and health care, which make up roughly two-thirds of the state budget, will bear the brunt of the 7 percent across-the-board cuts. Earlier cuts tried to spare public schools and health care at the expense of state colleges and others.
Most state agencies said Thursday they do not know how they will implement the cuts or what services might be affected.
But it is likely school class sizes could increase and low-income or disabled residents will not receive the same medical coverage, among other reductions.
Agencies could not say if they were planning to lay off state workers. About 100 state workers already have been laid off, according to state data, and dozens of temporary, contract or retired employees have been let go.
Thursday’s cut means schools across the state will need to eliminate $364 million from their budgets. Department of Education spokesman Jim Foster said that number almost equals the $402 million cut between 2001 and 2005, the last time state revenues declined.
“It’s too big,” he said of Thursday’s reduction. “There’s really no way to protect them.”
Schools, Foster said, may not be able to fill vacant teacher positions. During the last downturn, many districts lived off their savings, Foster said, but he did not know if districts had replenished those funds.
A recent change to the way schools are funded could also play a role, since the law now limits how much school districts can raise their property taxes.
The Department of Health and Human Services said they have few options.
“There will be reductions in services and the number of people receiving Medicaid,” said agency spokesman Jeff Stensland. “There will be significant program changes.”
When lawmakers approved cuts in October, they also forbid HHS from reducing the amount they pay hospitals, nursing homes and others for services. Stensland said that gives the agency fewer options to deal with cuts.
The agency would like the rule repealed.
Thursday’s cuts mean the agency will lose $61 million plus an additional $398 million in federal matching money.
Bill Byers, director of the Department of Juvenile Justice, said the agency risks federal takeover if it cuts its budget too much. Byers said the agency might have to ask to run a deficit, as Corrections has done this year.
For Winthrop University employees, the cut will mean three extra days without pay. The university announced that employee furloughs would increase to nine days from six days.
Some state agencies said they had planned for additional budget cuts.
Department of Commerce spokeswoman Kara Borie said the agency has been floating open positions, may not spend some marketing money and has consolidated its offices to two floors from three floors in its downtown Columbia office space.
At the Department of Consumer Affairs, the agency’s budget is mostly staff. To prevent layoffs, workers volunteered for unpaid leave. Director Brandolyn Pinkston did not expect any other cuts would be needed.
Others, such as the Arts Commission and the departments of Public Safety; Corrections; Parks, Recreation and Tourism; and Natural Resources said they would weigh their options over the next few days.
The five-member State Budget and Control Board disagreed about how to handle the cuts.
Gov. Mark Sanford wanted lawmakers to target cuts when they return in January. The board’s other four members argued the cuts needed to be made now to allow agencies more time to implement savings.
Senate Finance Committee chairman Hugh Leatherman, R-Florence, said lawmakers probably could not finish revising the budget until February or March. Comptroller General Richard Eckstrom noted that over half a year, the impact of the 7 percent cuts was doubled. The longer the state waits, he said, the worse it becomes for agencies.
Still, Sanford said lawmakers were avoiding responsibility for tough decisions.
“Y’all want to shield legislators from making targeted cuts,” Sanford said, noting they quickly take credit for new spending in the budget. “Across-the-board cuts are simply a bailout for politicians.”
Where the cuts were made
Higher education
Will lose $36 million. Schools are furloughing workers and not filling open positions.
K-12 education
Will lose $164 million. Classrooms are expected get more crowded as new teacher hiring slows.
Health care
Will lose $61 million. The ability to cover the poor is weakened as unemployment is rising.
Cutting jobs, services
These state agencies have made public their plans to deal with shrinking revenues. Others are still figuring out how to deal with budget cuts. Many of these agencies will have to revise those plans to deal with Thursday’s $382 million cut. To view a running list of how agencies are operating with less, visit thestate.com/layoffs.
COMMERCE
Action: No layoffs or buyouts are planned; hiring freeze and cost-cutting measures are in effect.
CORRECTIONS
Action: No staff cuts or program cuts yet, but starting this month employees can opt to take two unpaid days off a month through the end of the fiscal year. Inmates are paying more for health care and canteen items.
ETV
Action: Laid off 43 workers. Furloughs for rest of employees.
FORESTRY COMMISSION
Action: All employees will be required to take five days of unpaid leave. Agency is also cutting travel and delaying equipment purchases.
HIGHER EDUCATION
Action: Colleges are cutting some part-time faculty, furloughing workers, limiting travel, delaying the purchase of equipment.
JUVENILE JUSTICE
Action: Three of five group homes are closed or are being closed, said director Bill Byars. Since July, about 120 employees have been laid off. Agency is also furloughing workers.
MENTAL HEALTH
Action: Cut 21 jobs, let 29 contract and temporary workers go and closed five centers.
NATURAL RESOURCES
Action: Closed Conway office. Offering voluntary separation program to reduce staffing.
OFFICE OF REGULATORY STAFF
Action: No layoffs or buyouts are planned; hiring freeze and cost-cutting measures are in effect.
PARKS, RECREATION AND TOURISM
Action: Laid off 49 temporary workers at central office and welcome centers, instituted hiring freeze, and offered retirement bonus for longtime employees. Operating parks fewer hours.
PUBLIC SAFETY
Action: All vacant positions and promotions have been frozen. Overnight travel has been eliminated.
PUBLIC SERVICE COMMISSION
Action: No layoffs or buyouts are planned; hiring freeze and cost-cutting measures are in effect.
SLED
Action: Cut 40 jobs or about 7 percent of total staff. More layoffs or furloughs are likely.
Staff writers Rick Brundrett, Jeffrey Day, Joey Holleman and Jeff Wilkinson contributed. Reach O’Connor at (803) 771-8358.
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