Current as of July 16, 2009
As you may see in news reports over the next few days, the state of South Carolina’s economic situation continues to worsen. The Board of Economic Advisers reported today that revenue collections continue to decline, leading the board to recommend to the General Assembly that spending be reduced 3.5 percent overall. This expands the 2 percent reduction in the revenue estimates last month. Likewise, unemployment continues to rise in the state, with figures that will be reported soon expected to confirm a statewide unemployment rate of beyond the current 12.1 percent, with predictions that unemployment will reach 14 percent by Fall, leading to further reductions in income tax collections that are a key part of the state’s revenue base.
If the General Assembly or the Budget and Control Board passes these reductions along to agencies in an across the board manner, it would mean a reduction of $624,362 in spending at Winthrop over the course of the new academic year. While our budget plan for the fiscal year that began July 1 – barely two weeks ago -- had anticipated that a reduction of this magnitude in state support was likely, given current economic trends, please know that this reduction in our state appropriation this early in the budget cycle fundamentally will absorb the bulk of our cushion for the entire fiscal year.
Winthrop will continue to spend its operating resources as conservatively as possible, as the current trend line is anything but promising for the months ahead. We are continuing to monitor all aspects of this situation as closely as possible, and will keep you updated as events warrant.