OVERVIEW OF OTHER FUNDS IN THE STATE BUDGET Presented to SOUTH - - PowerPoint PPT Presentation

OVERVIEW OF OTHER FUNDS IN THE STATE BUDGET

Presented to SOUTH CAROLINA HOUSE WAYS AND MEANS COMMITTEE December 7, 2016

By Les Boles Director, Budget Development

South Carolina Revenue and Fiscal Affairs Office 1000 Assembly Street Rembert Dennis Building, Suite 402 Columbia, SC 29201 (803) 734-2265 www.rfa.sc.gov 1

FY 2016-17 GENERAL APPROPRIATION ACT

General Funds = $7,579.5 million Other Funds = $9,820.1 million Federal Funds = $8,359.3 million Total Funds = $25,759.0 million

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$0 $1,000 $2,000 $3,000 $4,000 $5,000 $6,000 $7,000 $8,000 $9,000 $10,000 GENERAL FUND FEDERAL FUNDS OTHER FUNDS (Millions of Dollars)

FY 2016-17 APPROPRIATIONS BY FUND

Source: Revenue and Fiscal Affairs Office - JCS 9/1/16

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$0 $2,000 $4,000 $6,000 $8,000 $10,000 $12,000 $14,000 $16,000 $18,000 $20,000 $22,000 $24,000 $26,000 FY 90 FY 91 FY 92 FY 93 FY 94 FY 95 FY 96 FY 97 FY 98 FY 99 FY 00 FY 01 FY 02 FY 03 FY 04 FY 05 FY 06 FY 07 FY 08 FY 09 FY 10 FY 11 FY 12 FY 13 FY 14 FY 15 FY 16 FY 17 (Millions of Dollars)

TOTAL APPROPRIATIONS BY FUND FY 1989-90 to FY 2016-17

General Funds Federal Funds Other Funds

Source: Revenue and Fiscal Affairs Office - JCS 9/1/16

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0.0% 5.0% 10.0% 15.0% 20.0% 25.0% 30.0% 35.0% 40.0% 45.0% 50.0% FY 90 FY 91 FY 92 FY 93 FY 94 FY 95 FY 96 FY 97 FY 98 FY 99 FY 00 FY 01 FY 02 FY 03 FY 04 FY 05 FY 06 FY 07 FY 08 FY 09 FY 10 FY 11 FY 12 FY 13 FY 14 FY 15 FY 16 FY 17

PERCENT OF TOTAL AUTHORIZATION BY FUND FY 90 to FY 17

GF % of Total Fed % of Total Other % of Total

Source: Revenue and Fiscal Affairs Office - JCS 9/1/16

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South Carolina Code of Laws

SECTION 11-11-160 The General Assembly shall appropriate all state funds and authorize or appropriate, or both, the use of all federal and other funds for the operations of state agencies and institutions for the current fiscal year…

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DEFINITIONS

• In general, Other Funds consists of a variety of revenues such

as taxes, fees, tuition, licenses and other miscellaneous receipts.

• The largest revenue items in Other Funds are higher education

tuition and fees and auxiliary services, state and federal motor fuel user fee revenue, EIA sales taxes, and Lottery proceeds.

• Other Funds are often categorized as either Earmarked or

Restricted.

• The difference between Earmarked and Restricted is whether

interest earnings on these funds accrue to the General Fund (Earmarked funds) or are retained by the Other Fund (Restricted funds).

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Sources of Other Fund Revenue

• Taxes, Court Fines, Lottery
• Earned revenue from other state agencies, school

districts, or local governments (ex. DOA-fleet management, state building rent)

• Earned revenue from private sector individuals or

businesses, or clients/customers (ex. DNR boat registration fee, Higher Education tuition and fees, PRT park fees)

• Other (ex. sale of assets)

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EXAMPLES OF OTHER FUNDS TAXES

• Taxes that appear in Other Funds:
• Motor Fuel User Fees ($553.4 million; Transportation, others)
• EIA – 1% Sales Tax ($751.6 million; Dept. of Education, others)
• Documentary Stamp Tax ($15 million; S.C. Conservation Bank, others)
• Admissions Tax ($10.5 million)
• Bingo ($3 million; PRT, Lt. Governor’s Office)
• Insurance Tax ($3.2 million; Forestry Commission)
• Cigarette Surcharge ($133.0 million; Medicaid)
• Electric Power Tax ($28.2 million; Commerce)
• Some taxes are “off-budget” (trust funds) and therefore do not appear in

appropriated totals:

• Homestead Exemption Fund HEx) – 1% Sales Tax (property tax relief)
• Unemployment Compensation Insurance Tax ($451.8 million;

unemployment benefits)

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Source: Revenue and Fiscal Affairs Office - JCS 9/1/16

$0 $200 $400 $600 $800 $1,000 $1,200 $1,400 $1,600 $1,800 $2,000 $2,200 $2,400 $2,600 $2,800 $3,000 $3,200 (Millions of Dollars)

OTHER FUNDS REVENUE SOURCES

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AUTHORIZATION VS REVENUE

• In the Appropriation Act, General Fund appropriations equal

budget authorization, which also equals revenue. The General Assembly balances General Fund Revenue and Appropriations.

• With Other Funds, however, agencies are granted an

authorization, which may be higher or lower than actual revenue. Agencies can spend the lesser of actual revenue or the amount authorized in the budget. (In the event revenue exceeds authorization, agencies are usually allowed to retain these funds for use in future years.)

• The agencies with the largest Other Funds authorization are

Higher Education, Transportation, Health and Human Services,

• Dept. of Education, and Dept. of Disabilities and Special Needs.

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An agency must have both revenue receipts (cash) and authorization to spend Other Funds

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Source: Revenue and Fiscal Affairs Office – JCS 9/1/16

$0 $500 $1,000 $1,500 $2,000 $2,500 $3,000 $3,500 $4,000 Higher Education Transportation Health and Human Services

• Dept. of Education

Disabilities and Special Needs State Infrastructure Bank Mental Health County Transportation Funds Health and Environmental Control

• Dept. of Administration

Corrections/Juvenile Justice Social Services Commerce All Other Agencies (Millions of Dollars)

OTHER FUNDS AUTHORIZATION FY 2016-17

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5 out of 106 Agencies Operate Solely on General Funds

• A01 - Senate
• A05 – House of Representatives
• A17 – Legislative Services
• D05 – Governor’s Office – Executive Control of State
• D25 – Office of Inspector General

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10 out of 106 Agencies Operate Solely on Other Funds

• A85 – Education Oversight Committee
• E19 – Retirement System Investment Commission
• P36 – Patriots Point Development Authority
• P40 – SC Conservation Bank
• R04 – Public Service Commission
• R12 – State Accident Fund
• R14 – Patients’ Compensation Fund
• R23 – Board of Financial Institutions
• U15 – Infrastructure Bank Board
• U200 – County Transportation Funds

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Proviso 117.74 – Fines and Fees Report

• Sent to Ways and Means Committee and Senate

Finance Committee

• Posted on agency websites
• Report Shall Include:
• Statutory Authorization
• Amount of fee or fine
• Amount received by source
• How the funds were used

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Proviso 91.20 – Joint Other Funds Oversight Committee

• The committee shall review each agency request for

interim increases in “Other Funds” budget authorization and recommend appropriate action

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Governor’s Executive Order 2016-22

Directs Agencies to prepare an Other Funds Report by November 1st. The report is to include:

• Statutory Authority
• Program/activity supported by the revenue
• Statutory authority to carry forward the revenue
• How the revenue is generated (fee, fine, or charge)
• Amount collected in the previous FY and estimates for current

and upcoming FY

• Actual amount expended in previous FY
• Cash balance at end of previous FY
• Explanation of need for carry forward

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