Budget Update

Current as of May 10, 2012

Dear Colleagues,

Late last night, the Senate Finance Committee completed work on its budget recommendations for the fiscal year beginning July 1. The plan it will take to the Senate floor in coming days echoes the funding levels for Winthrop found in the House-adopted spending plan, with one addition.

Our operating funding will remain level with the current year in both the House and Senate plan, though some funds will be provided toward a pay increase. The Senate Finance Committee plan calls for a 3 percent increase for state employees, an increase from the House-recommended 2 percent.

As I have shared with everyone previously, such an increase is well-deserved, yet it does create an unfunded mandate for Winthrop, since not all our employee raises are state-funded. That means Winthrop has to use other resources to provide the increase as directed; each percentage point costs Winthrop about $375,000 that is not provided by the state. The same holds true for health insurance increases if the legislature determines those will be agency paid, rather than employee-paid, as the Senate Finance committee proposes this year. We are presently calculating what those additional costs to Winthrop would be.

Through the work of York County Senators Wes Hayes and Harvey Peeler, the Senate committee is recommending a $600,000 increase in one-time funding for one-time campus maintenance needs, and is supporting a House-adopted technology allocation of $500,000 put forth by Rep. Gary Simrill.

Please keep in mind these numbers are a committee recommendation only, and still must be adopted by the full Senate. Because the plan differs from the House, whatever measure is approved by the Senate will return to the House for their consideration of the additional spending. If House members do not agree, a conference committee will be appointed toward the end of the month.

Once the legislative branch has reached agreement on a plan both chambers support, Governor Haley will review the budget for possible vetoes. Given her earlier calls for a cap on spending, she likely will issue some vetoes that will have to return to the General Assembly to be either sustained or overridden.

In recent years, this process has taken well into June, making it imprudent for us to finalize recommendations to the Board of Trustees for a Winthrop spending plan and tuition recommendation for the coming year until after their regular June board meeting. It appears that will be the case again this year, but we will know more as the process continues. Please be assured we will provide updates as the situation warrants.

Sincerely,

Tony DiGiorgio
President