How South Carolina “Shrunk” Its Budget By $1.5 Billion

HINT: IT DIDN’T SHRINK ANYTHING … South Carolina’s state budget for the coming fiscal year is currently slated to grow from $22.8 billion to $23.6 billion – most of it thanks to S.C. Gov. Nikki Haley’s massive Medicaid expansion. But is this $23.6 billion total (which is expanding at a…


South Carolina’s state budget for the coming fiscal year is currently slated to grow from $22.8 billion to $23.6 billion – most of it thanks to S.C. Gov. Nikki Haley’s massive Medicaid expansion.

But is this $23.6 billion total (which is expanding at a time when citizens’ income levels are stagnant and labor participation is at a record low) really reflective of how much money state lawmakers disburse?

No … the actual total is $25.1 billion (at least).

Last year, South Carolina budget writers played a clever little trick on us … “shrinking” total state spending by nearly $900 million at a time when all indications pointed to considerable growth. So … how did they do it?

That’s easy: They didn’t do it. Budget writers – with approval from Haley – simply moved $1.5 billion worth of spending off of the books, turning a $600 million expansion of state spending into a $900 million reduction.

What $1.5 billion are we referring to? Food stamps …

Here, take a look at this screen grab from the FY 2013-14 budget’s summary control document showing the “transfer to unbudgeted account” of the state’s “food stamp assistance payments.”

food stamps

Oh, and here’s the amount (note the corresponding line) …

food stamps 2

Amazing …

That, ladies and gentlemen, is how “Republicans” in South Carolina cut spending … they simply move it someplace you can no longer see it.

Food stamps in South Carolina are administered by the S.C. Department of Social Services (SCDSS) – perhaps the worst-managed agency in Haley’s cabinet. Two years ago, this website uncovered a major scandal at SCDSS involving the food stamp program – which at the time totaled $1.3 billion.

Not long after we revealed cooked books at the agency relating to food stamp error rates and other data, sources tell FITS that Haley’s administration began a push to remove the program from the state budget.

They succeeded  … and nobody caught the missing money until this month.

Reporter Rick Brundrett of The Nerve gets credit for the scoop, although he “buried the lede” in a story written last week about the pay raises lawmakers are awarding to themselves in the coming budget.

That $2 million also isn’t included in a line item within the state budget …

Crazy …

South Carolina’s governor campaigned on transparency. Not only that, she made a huge stink about forcing lawmakers to cast on-the-record votes for individual sections of the state budget. But then – when a major scandal strikes one of the largest welfare programs administered by her cabinet, she leads an effort to hide $1.5 billion of your money?

That’s totally unacceptable …

In fact this year’s budget not only removed the $1.5 billion, it removed any reference to it being transferred.

Wow. Not even Kaiser Soze can disappear like that, people.

For years, FITS has argued in favor of real spending transparency – specifically the creation of a searchable “online checkbook” that would track every single expenditure made by government and categorize every penny according to purpose, authorizing agency, etc. Of course lawmakers – including fiscally liberal S.C. Sen. Larry Martin – have said they don’t have $1 million to spend on such a database.

Really? But they have $2 million to spend on raises for themselves?

Oh right … like the $1.5 billion in food stamp payments, you won’t find that money anywhere in the state budget.

Both are like Andy Dufresne in The Shawshank Redemption, they “up and vanished like a fart in the wind.”

South Carolinians deserve to know where every dime of their money is being spent: That was the whole point of the “transparency” Nikki Haley campaigned on four years ago.

Sadly, Haley is once again leading the effort in the opposite direction …

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GrandTango May 27, 2014 at 12:42 pm

It seems ALL of FITS’ hammers used to bludgeon Haley are liberal federal programs that are, and have been, wildly out of control for decades, thanks to democrats…

Save it FITS: The Federal Government forces Welfare, Medicaid and Food Stamps, among others. The fact that Republicans are charged w/ managing your folly, hardly is a legitimate reason for you to remove her, and replace her w/ a democrat, the original source of waste and failure……

Eliminate liberal hand-out programs, w/ democrats…otherwise STFU….

The Fed May 27, 2014 at 1:46 pm

Then, what would happen if you lost your Medicaid, Tango??

Accounting for nothing May 27, 2014 at 1:02 pm


They learned that trick from the Feds in how they treat the SS budget. It’s why on geniuses come on saying “But Clinton balanced the budget!”


Rocky May 27, 2014 at 1:06 pm

Well just think how much it will change once they accept Medicare expansion.

GrandTango May 27, 2014 at 1:11 pm

SC REJECTED it, you Dumb@$$…it’s why Haley is slated for re-election…

Smirks May 27, 2014 at 1:22 pm

Seriously, if Haley wants to expand Medicaid, do it for real, and have it 90% paid for by the feds.

Uh huh May 27, 2014 at 1:23 pm

“and have it 90% paid for by the feds”-*

*for three years

Smirks May 27, 2014 at 1:37 pm

The “three years” part applies to how long it is fully (100%) funded. The 90% funding is not set to expire.

Uh huh May 27, 2014 at 1:40 pm

I suppose you don’t see the ongoing Federal deficit spending or debt monetization as a problem the, correct?

I suppose to you the ongoing magic money machine can last indefinitely, or you think that somehow someone is going wave a magic wand and make it go away.

The Feds are going to shovel the shit, and the states are going to get buried in it…

Ask yourself Smirks, would sign a deal with some paying your bills for three years and as long as you run them up with no guarantee for future payment after?

Smirks May 27, 2014 at 1:47 pm

SCOTUS ruled that states have the option to opt out of the Medicaid expansion, that the Feds cannot force states to take it. It stands to reason that if the Feds changed what they were willing to chip in, then states who chose to expand it could obviously jump ship later on.

If someone paid my bills for three years and then told me to pay them 100% myself, I still would’ve gone 3 years bill-free. How much is Haley’s expansions costing us?

Uh huh May 27, 2014 at 1:51 pm

“I still would’ve gone 3 years bill-free. How much is Haley’s expansions costing us?”

You are conflating two separate issues.

If Haley takes the money, the expansions are larger than they already are.

It’s all unaffordable. If you’d really take a deal to run up your debt with someone service the payments for three years(but not paying it off-just servicing), then you are not as smart as I was inclined to believe.

Smirks May 27, 2014 at 2:24 pm

It is unaffordable, even though most of our peers have some form of universal health care?

The Medicaid expansion will cost a lot of money, which is why other parts of the ACA offsets those costs.

As far as I’m concerned, Haley is expanding Medicaid at a direct cost to SC taxpayers, so we are paying for an inferior expansion when we could be getting a free trial of a far better one, not to mention a huge discount once we actually have to directly pay for it. If it does raise the deficit, that should be handled by the feds, and the states should react to any changes produced by the feds accordingly.

Uh huh May 27, 2014 at 3:19 pm

“It is unaffordable, even though most of our peers have some form of universal health care?”

I suppose with that reasoning, if most of your neighbors have a new Mercedes in their driveway and you work at McDonalds you just haven’t found a way to shuffle your budget around to make room…so to hell with it…just go out and buy one anyway, right? The money fairy will always be around to pick up the tab a few years from now.

No need to even look at a balance sheet.

Charlie Koch May 27, 2014 at 4:12 pm

I’m with you Bo

The HELL with them poor bastards!Tough damn luck!

Uh huh May 27, 2014 at 4:19 pm

Eat a dick Koch.

Sandi Morals May 27, 2014 at 4:23 pm

Wrong idiot. Several states are already in trouble because of the huge number of medicaid sign ups for Obamacare.

ted May 27, 2014 at 3:38 pm

She’s real good at expanding things….like her ass by 300%. Step away from the fork, girlfriend.

Elfego May 27, 2014 at 1:33 pm

Most every government entity in the country plays this way with the books and so does the Federal Government.
On top of that anytime you have a government entity claim they are cutting taxes they add them somewhere else. There is a move on to cut state taxes by getting them from somewhere else to save taxes on homes. Who benefits from this the rich with luxury and more than one home.
All of government be it Democrat or Republicans screw the working class person.

euwe max May 27, 2014 at 1:33 pm

That’s a lot of outhouses and shit-shovelin’!

junior justice May 27, 2014 at 1:41 pm

+10 x 5 .. hah!

junior justice May 27, 2014 at 1:46 pm

My CPA knows that the best method is to —-

mark May 27, 2014 at 1:43 pm

I say to the good citizens of SC……take Will Folk’s lead and dump Nikki.

Cleveland Steamer May 27, 2014 at 9:30 pm

I think you mean to say “Will Fold’s lead, take a dump on Nikki.”

easterndumbfuckastan May 27, 2014 at 2:05 pm

This is Standard Operating Procedure for most governmental entities, and large companies. You play with the accounting and what is carried where on the books until you get them to look like the higher-ups want them to look and so you can “claim” to do more with less.

I’ve prepared budgets for a small department (around 100 employees) in a Fortune 500 company. It’s a nightmare of inefficiency mixed with feel-goodism and just stupidity.

Bible Thumper May 27, 2014 at 6:13 pm

If it is on the Federal budget, why should it also be on the state budget. It is not being spent twice. If you were to total Federal and state spending, you would get exaggerated numbers. Besides there is no Food Stamp Assistance Payments. They replaced it with Supplemental Nutrition Assistance Program (SNAP).

Kevin May 30, 2014 at 6:19 pm

Ever hear of inflation and just how much of this increase is state $$$. Sometimes you are really amazing at the BS YOU,CAN put out

GreenvilleGirl June 12, 2014 at 2:34 pm

What in the world happened to GAAP? The last time I checked, 1+1=2, not -4. I guess they teach Political Science Accounting Bullsh*t (SCAB) in lieu of Accounting 101 when politicians are in college.


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