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Haley: Added state money should go to taxpayers, not schools

Jun 15, 2011 3:35:00 PM - thestate.com
Gov. Nikki Haley said Wednesday that she disagrees with a state Senate budget proposal that would add $105 million to K-12 education spending, arguing the money instead should be used for tax cuts or to pay off state debt.

Haley also said that, in the future, anytime a three-member panel of state economists increases projected state revenues, as they did last month, the added state money should go for tax cuts or payments on the state's debt.

The Board of Economic Advisors added $210 million to state coffers last month, as the state's recovering economy generated more tax and fee revenue than expected. But that money has created problems between House and Senate lawmakers trying to work out a final compromise on the state's $5.8 billion spending plan for its fiscal year that starts July 1.

The Senate -- who had the first opportunity to spend the new money -- added $105 million for K-12 education and $100 million to help businesses pay off nearly $1 billion in federal loans that the state had to take to be able to continue paying jobless benefits after the state's unemployment fund went bust. Some businesses say their unemployment insurance bills have increased six-fold after lawmakers voted to raise rates to repay the loan.

The House earmarked $146 million for business tax relief, trimming that money from higher K-12 spending. House members argued that providing businesses with additional tax relief might encourage them to hire more employees.

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