Comptroller says stimulus money growing government instead of economy

By Andy Owens
aowens@scbiznews.com 
Published Sept. 25, 2009

State Comptroller Richard Eckstrom reported this week that more than $600 million in federal stimulus money has been received by state agencies in South Carolina, and he doesn’t think that’s really a good thing in the long run.

“Too much is going toward expanding government, and too little is going toward things like roads and bridges and putting people back to work,” Eckstrom said in a statement.

The comptroller has been tracking stimulus spending online, along with his efforts to publicize how state agencies and local governments spend tax dollars. Eckstrom said the recession has been used as an excuse to borrow and spend money on things that don’t help the economy.

Richard EckstromTwelve state agencies were listed in the comptroller’s report along with the amounts of stimulus money they have received. The S.C. Department of Health and Environmental Control said the $3.2 million it received in federal money is helping offset the 30% budget reductions the agency has experienced over the last two fiscal years to some degree.

“We’re no different than any other agency,” said DHEC spokesman Thom Berry. “The environment in which we find ourselves today based on the economy—it’s been difficult, and it’s certainly stretched us.”

Berry said the strict federal guidelines for spending the money received under the American Investment and Recovery Act is like any other federal money in that it has to be thoroughly documented.

Eckstrom’s spokesman, R.J. Shealy, said the comptroller doesn’t think state agencies are doing a poor job of spending the money. He just thinks the legislation allocating the money was wrong to begin with.

“No, it’s not that the state agencies are misspending. They’re spending on the things they’re allowed to under the stimulus act,” Shealy said. “But he believes the stimulus act passed by Congress was flawed. There’s too much money for things that have nothing to do with economic development, such as the $50 million for the arts.”

Berry offered a detailed breakdown of how DHEC has spent the $3.2 million in stimulus money, including:

  • $1.3 million for food under the Women, Infants, and Children program.
  • $942,000 for the state clean diesel program to encourage the replacement of older diesel engines with engines that use the cleaner diesel technology.
  • $919,000 for the Jasper Disabilities and Special Needs board’s BabyNet program.

In August, Eckstrom reported the state closed the fiscal year 2008-2009 with a $98 million deficit, which was after the Budget and Control Board had ordered more than $1 billion trimmed in several mid-year across-the-board budget cuts.

DHEC has been able to fill some of the state budget gap by moving some personnel from state payrolls to federally funded positions.

“It is helpful in that we can defray some of our personnel costs,” Berry said. “We have had at one time, I guess within the last 10 years, nearly 6,000 employees. We now have under 4,000 employees. The number of programs we now administer has not shrunk.”

Eckstrom’s spokesperson said that part of the money from the federal government will go toward offsetting the budget cuts, but that has been erroneously described as stimulus money, mostly in the media.

“That’s the $700 million the governor was resisting. It was erroneously referred to by the media as ‘stimulus’ money, but it is actually Fiscal Stabilization Funds, and its ostensible purpose was to prevent government layoffs and reduction of government services,” Shealy said.

Eckstrom said the unfortunate fact is that future generations will be paying this money back.

“It’s for that reason we have a special obligation to follow these stimulus dollars to ensure they’re spent with transparency and accountability, and to guard against fraud or mismanagement,” Eckstrom said. “We owe it to future generations. We’re eating their seed corn.”

Calls to the S.C. Department of Commerce were not returned by press time Friday afternoon.

Stimulus money tracked by the State Comptroller’s office:

· Department of Health and Human Services, $372.5 million.

· Employment Security Commission, $93.0 million.

· Department of Social Services, $66.6 million.

· Department of Public Safety, $23.2 million.

· Department of Education, $18.8 million.

· Governor’s Office, $13.9 million.

· Department of Commerce, $7.3 million.

· Department of Health and Environmental Control, $3.2 million.

· Department of Transportation, $1.0 million.

· Lieutenant Governor’s Office, $419,000.

· Vocational Rehabilitation, $194,000.

· Budget and Control Board, $19,000.

Total: $600.1 million

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Comments:

Added: 25 Sep 2009

Very good analysis by Mr. Eckstrom. To call this a stimulus bill is a misnomer. This is what happens when no one reads or understands legislation that is passed. It was sold to the American people as emergency funding to help "stimulate" the economy. What it has turned out to be is a big redistribution of wealth for more social services. We need economic growth and job creation so more people can get back to work and depend less on government.

Jim Pascutti


Added: 25 Sep 2009

Our state government is complicit in this scam. Where will the money come from next year when the Fed is broke? According to how my parents raised me, telling someone one thing to convince them and then doing something else is called "lying". Every legislator in the Statehouse and Congress that voted for this should be ashamed of themselves. They knew it was wrong, so they called it something that would not fire people up, which is just another lie.

Dishonesty


Added: 25 Sep 2009

Fifty-million dollars for the arts?!?!?! I agree with Eckstrom, this was not about growing the economy it was about growing government.

rich


Added: 25 Sep 2009

This is crazy. $600 million and an 11 percent unemployment rate.

Rich


Added: 26 Sep 2009

What did the governor's office do with $13.9 million and the lt. governor's office do with $419,000?

NotforHire