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It’s been more than six weeks since our media outlet first reported on a bizarre development at the South Carolina State House. An unexpected $1.8 billion in surplus funds was discovered sitting untouched in a pass-through account – for five years. The discovery of this money has sparked a furious debate at the S.C. State House – with some lawmakers wanting to return it to taxpayers and others wanting to spend it.
Now, mainstream media is starting to pay attention to the debate …
Our position on this money has remained clear from the beginning.
“Individuals, taxpayers, and small businesses are struggling mightily right now,” I noted at the time. “And while permanent tax cuts are infinitely preferable to one-time rebates, this pot of money could be a lifeline for these taxpayers and businesses – and the people who are relying on them to make ends meet.”
How big of a lifeline?
If every penny of this recently discovered “anomaly” were to be earmarked toward tax relief, the potential windfall would average a little more than $1,250 for more than 1.44 million working South Carolinians.
Standing in the way of that rebate? State senator Larry Grooms, a so-called “Republican” who is on a mission to spend the money – and place the blame for the accounting error on state treasurer Curtis Loftis.
(Click to View)
Loftis fired back recently with a letter to Grooms in which he accused interim comptroller general Brian Gaines of misleading lawmakers about the money – and failing to perform his statutory duty as the state’s accountant.
“The bottom line is that the Treasurer is the state’s bank and responsible for investing funds, whereas the comptroller general is the state’s accountant,” Loftis wrote in his letter (.pdf).
In an accompanying statement, Loftis said his office did its job.
“The money in question, a $1.8 billion fund arising from a statewide computer conversion, has always been accounted for by ‘the bank,’” he said. “The funds have been managed and invested in accordance with state law, and the legislature has spent the investment earnings of approximately $250 million.”
Wait … what?
That’s right … this could have been a $2 billion windfall for taxpayers.
According to Loftis, “the taxpayers of South Carolina deserve to have this issue resolved.” He also called on Gaines’ office to “respond to my many requests for coordination to make our finance system stronger, not weaker.”
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“We are perplexed by the lack of cooperation and finger-pointing by the comptroller general’s office and others since the restatement error came to light,” Loftis added in his letter.
The fireworks are expected to continue next week when Loftis and Gaines are scheduled to testify before lawmakers.
Once again, I am less concerned with how this pot of money came to be and more concerned with what is to become of it. As I noted earlier this month, “Republican” supermajorities in Columbia, S.C. have been blowing through tax dollars of late – including a record $38.8 billion in the current fiscal year budget – which ends on June 30, 2024. They are currently in the process of writing the budget for fiscal year 2024-2025, which currently totals $40.1 billion.
Despite campaigning as “conservatives,” GOP members of the S.C. General Assembly have grown government faster than taxpayers’ ability to pay for it for decades, repeatedly ignoring calls for broad-based income tax relief while consistently embracing bloated, ineffectual bureaucracies and crony capitalist schemes.
They need to start reversing that trend now by sending this surplus back … all of it.
BANNER: Travis Bell Columbia SC Photographers
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ABOUT THE AUTHOR …
Will Folks is the founding editor of the news outlet you are currently reading. Prior to founding FITSNews, he served as press secretary to the governor of South Carolina and before that he was a bass guitarist and dive bar bouncer. He lives in the Midlands region of the state with his wife and seven (soon to be eight) children.
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6 comments
Curtis Loftis is the last friend on the taxpayer in Columbia. Larry Grooms is an establishment hack.
I know who I trust.
Why did republican governor Henry McMaster appoint a black democrat to a statewide position?
The comptroller general’s office did not balance the books for a decade and now Grooms believes them? I want to sell Grooms a bridge in Arizona.
This goes back to 2 yrs ago when they realized SC had a $6Billion surplus. Our elected officials were like kids in a candy store on trying to decide what to do with it .
Simple solutions, apply all these extra funds to our SC State Pension fund that is $20 BILLION plus in the whole. Will not fix it but it is a start
Guess this too simple and does not buy votes
Ole’ Senator Leatherman always seemed to have funds stashed away in some agency’s account that he could somehow resort to when he needed to dole out a political favor or create a contract job for a donor- there were plenty of stories in the news about how DNR, PRT or DHEC, etc. would find out they had some extra money allocated that had a nebulous description on it, and then they would receive a call from Leatherman’s office telling them what the money was REALLY for….could part of this accounting issue be that over the accumulation of years some of that “stash money” likewise accumulated? And when it came time to switch over from one accounting system to another that no-one could figure out where the extra money came from, and so it had to be placed in a seperate account for the CG to figure out where it goes?Could it be possible that people in the Senate who are still there but worked for/with Leatherman are trying to hide something and in so doing trying to get rid of the Treasurer so they can get someone on their side installed instead who will abet them in hiding the grift?
I’ve heard from people in and around state government that these funds were “slush funds” that were exposed by the change in computer systems and the death of a certain senator. They want to get rid of Treasurer Loftis because they are afraid he will disclose the problem. I say fix the damn roads or send it back to us.