House Introduces Spending Limit & Reserve Fund Bills

Raising reserve fund and limiting spending will stabilize future budgets

Today, the South Carolina House of Representatives introduced two major bills that will help stabilize future budgets and better insulate our state during times of recession. “Our current economic climate highlights the need for these measures. It’s the responsible thing to do,” said House Speaker Bobby Harrell.

Speaker Harrell continued, “The House has consistently pushed for more restraint when it comes to spending – passing spending limit bills 5 times in the past decade. Passing these two measures will eliminate the ‘peak & valley’ approach to spending that governments are prone to and will help secure future budgets during times of economic crisis.”

The Spending Limit Bill (H. 3397) will cap what legislators are allowed to spend in each year’s budget at a growth rate of population plus inflation. The Reserve Fund Bill (H. 3395 & H. 3396) will expand the state’s General Reserve Account from 3% of the total budget to 5% of our state’s total budget.

“The Office of State Budget reports that spending as grown 2.8% annually since Republicans have been writing the budget,” said House Ways & Means Chairman Dan Cooper. “While this growth is sustainable and below proposed growth rates, implementing a spending limit will make the year-to-year growth more consistent with our long-term growth. Holding the line on spending and expanding our reserves will loosen the stranglehold economic recessions have on our state’s budget.”

Both bills were referred to the House Ways & Means Committee.