Mar 11 2009
STATE OF SOUTH CAROLINA
OFFICE OF THE GOVERNOR
MARK SANFORD, GOVERNOR
FOR IMMEDIATE RELEASE
Contact: Joel Sawyer
Governor Sanford: Use Stimulus to Pay Down State Debt
GOVERNOR TO ASK WHITE HOUSE FOR WAIVER
TO PAY DOWN STATE LIABILITIES
Columbia, S.C. – March 11, 2009 – Governor Mark Sanford today announced his decision on seeking roughly $700 million in stimulus money under his discretion, saying he will ask for a waiver from the White House so that the stimulus money can be used to pay down the state’s debts and contingent liabilities.
Governor Sanford has opposed the federal stimulus package because he doesn’t believe we should spend money we don’t have, because we shouldn’t pass on a substantial bill for today’s government services on to future generations, and because the massive run-up in government spending could devalue the American dollar.
Only about one quarter of the $2.8 billion slated to be spent in South Carolina comes under the governor’s discretion, with the rest being programmatic funding that comes to the state through formulas. The governor said since the federal spending represents more in the way of accumulated debt, it makes sense for South Carolina to be able to use the money to pay off existing debts taxpayers are already on the hook for, rather than funding ongoing government needs.
“Families and small businesses across South Carolina are making incredibly difficult choices without the benefit of checks from Washington D.C., and in the long run we believe these stimulus funds will be better used in shoring up our state debts, which over time will have a stronger impact on the state economy, ” Gov. Sanford said. “Just as this stimulus bill piles debt upon future generations, we have substantial unpaid for political promises at the state level that will prove to be equally burdensome on future generations of South Carolinians. For that reason, we believe it fitting for us to be granted flexibility with these stimulus dollars to indeed begin the process of addressing those substantial debts so that future generations aren’t stuck with the double pain of paying back unsustainable federal and state spending.”
South Carolina currently has roughly $20 billion in unfunded political promises in its retirement system, and stands at number one in the entire Southeast in per capita debt. The state is 57 percent above the Southeastern average and three times higher than neighboring Georgia in its per capita debt load. The proposed stimulus dollars would annualize – spend one time money on recurring needs – over $1.2 billion in the next two years, which amounts to approximately 10 percent of the state’s budget. This level of new annualized spending would be the largest recorded level of annualizations in state history.