South Carolina General Assembly
107th Session, 1987-1988

Bill 3822

                    Current Status

Bill Number:               3822
Ratification Number:       413
Act Number                 385
Introducing Body:          House
Subject:                   General Reserve Fund and Capital Reserve
                           Fund
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(Text matches printed bills. Document has been reformatted to meet World Wide Web specifications.)

(A385, R413, H3822)

AN ACT TO AMEND ARTICLE 3, CHAPTER 11, TITLE 11, CODE OF LAWS OF SOUTH CAROLINA, 1976, RELATING TO THE RESERVE FUND, AND OTHER FISCAL MATTERS, SO AS TO RETITLE THE ARTICLE TO INCLUDE THE CAPITAL EXPENDITURE FUND AND RENAME THE GENERAL FUND RESERVE THE GENERAL RESERVE FUND, ELIMINATE OBSOLETE FINDINGS AND LANGUAGE, MAKE GRAMMATICAL AND TECHNICAL CHANGES, REDUCE THE AMOUNT WHICH MUST BE MAINTAINED IN THE GENERAL RESERVE FUND FROM FOUR TO THREE PERCENT OF THE GENERAL FUND REVENUE OF THE LATEST COMPLETED FISCAL YEAR, RENAME THE CAPITAL EXPENDITURE FUND THE CAPITAL RESERVE FUND AND PROVIDE THAT THE APPROPRIATION TO THE CAPITAL RESERVE FUND MUST EQUAL TWO PERCENT OF GENERAL FUND REVENUE OF THE LATEST COMPLETED FISCAL YEAR EFFECTIVE FOR FISCAL YEAR 1988-89 AND SUCCEEDING FISCAL YEARS RATHER THAN TWO PERCENT, AND BEGINNING IN 1989-90 TWO AND ONE-HALF PERCENT, OF ESTIMATED GENERAL FUND REVENUES, PROVIDE WHEN AND THE PURPOSES FOR WHICH THE MONIES FROM THE FUND MAY BE EXPENDED; TO AMEND SECTION 11-11-70, RELATING TO THE REQUIREMENT THAT THE STATE BUDGET AND CONTROL BOARD SHALL SUBMIT TO THE PRESIDING OFFICER OF EACH HOUSE PRINTED COPIES OF A BUDGET, SO AS TO REQUIRE THAT THE BUDGET WHICH IS SUBMITTED MUST CONFORM TO THE FUNDING REQUIREMENTS CONTAINED IN SECTION 36 OF ARTICLE III OF THE CONSTITUTION OF THIS STATE; TO REPEAL SECTION 11-9-900, RELATING TO THE REQUIREMENT THAT IN THE EVENT OF A PROJECTED DEFICIT, THE BUDGET AND CONTROL BOARD MUST REDUCE THE APPROPRIATION TO THE CAPITAL EXPENDITURE FUND PRIOR TO MANDATING ANY CUTS IN OPERATING APPROPRIATIONS; AND TO PROVIDE THAT THE PROVISIONS OF THIS ACT TAKE EFFECT UPON APPROVAL BY THE GENERAL ASSEMBLY OF JOINT RESOLUTION H. 3823 (R. 414 OF 1988).

Be it enacted by the General Assembly of the State of South Carolina:

General Reserve Fund and Capital Reserve Fund

SECTION 1. Article 3, Chapter 11, Title 11 of the 1976 Code is amended to read:

"Article 3

General Reserve Fund and Capital Reserve Fund

Section 11-11-310. (A) The State Budget and Control Board shall provide for a General Reserve fund. Funds accumulating in excess of the annual operating expenditures must be transferred to the General Reserve Fund and the transfer must continue to be made in succeeding fiscal years until the accumulated total in this reserve reaches an amount equal to three percent of the general fund revenue of the latest completed fiscal year.

(B) If there is a year-end operating deficit, so much of the General Reserve Fund as is necessary must be used to cover the deficit. The amount so applied must be restored to the General Reserve Fund out of future revenues as provided in Section 36 of Article III of the Constitution of this State and out of funds accumulating in excess of annual operating expenditures as provided in this section until the three percent maximum is again reached and actually maintained.

Section 11-11-320. (A) The General Assembly, in the annual general appropriations act, shall appropriate, out of the estimated revenue of the general fund for the fiscal year for which the appropriations are made, into a Capital Reserve Fund, which is separate and distinct from the General Reserve Fund, an amount equal to two percent of the general fund revenue of the latest completed fiscal year.

(B) This appropriation must be contained in the Ways and Means Committee report on the general appropriations bill, the general appropriations bill at the time of third reading in the House of Representatives, the Senate Finance Committee report on the general appropriations bill, the general appropriations bill at the time of a third reading in the Senate, and in any conference report on the general appropriations bill.

(C) Revenues in the Capital Reserve Fund only may be used in the following manner:

(1) If, before March first, the Board of Economic Advisors' revenue forecast to the State Budget and Control Board for the current fiscal year projects that revenues at the end of the fiscal year will be less than expenditures authorized by appropriations for that year, then the current year's appropriation to the Capital Reserve Fund first must be reduced by the Board to the extent necessary before mandating any reductions in operating appropriations.

(2) After March first of a fiscal year, monies from the Capital Reserve Fund may be appropriated by the General Assembly in separate legislation upon an affirmative vote in each branch of the General Assembly by two-thirds of the members present and voting but not less than three-fifths of the total membership in each branch for the following purposes:

(a) to finance in cash previously authorized capital improvement bond projects;

(b) to retire interest or principal on bonds previously issued;

(c) for capital improvements or other nonrecurring purposes.

(D) (1) Any appropriation of monies from the Capital Reserve Fund as provided in subsection (C) of this section must be ranked in priority of expenditure and is effective thirty days after completion of the fiscal year. If it is determined that the fiscal year has ended with an operating deficit, then the monies appropriated from the Capital Reserve Fund must be reduced by the State Budget and Control Board based on the rank of priority, beginning with the lowest priority, to the extent necessary and applied by the Board to the year-end operating deficit before withdrawing monies from the General Reserve Fund.

(2) At the end of the fiscal year, any monies in the Capital Reserve Fund that are not appropriated as provided in subsection (C) of this section or any appropriation for a particular project or item which has been reduced due to application of the monies to a year-end deficit must lapse and be credited to the General Fund."

Budget to conform to constitutional requirements

SECTION 2. Section 11-11-70 of the 1976 Code is amended to read:

"Section 11-11-70. (A) Within five days after the beginning of each regular session of the General Assembly the State Budget and Control Board shall submit to the presiding officer of each house printed copies of a budget, based on its own conclusions and judgments, containing a complete and itemized plan of all proposed expenditures for each state department, bureau, division, officer, board, commission, institution, or other agency or undertaking, classified by functions, character, and object, and of estimated revenues and borrowings for each year, beginning with the first day of the next fiscal year. Opposite each item of the proposed expenditures the budget must show in separate parallel columns the amount appropriated for the last preceding appropriation year, for the current appropriation year and the increase or decrease.

(B) The budget which is submitted by the board to the presiding officer of each house must conform to the funding requirements contained in Section 36 of Article III of the Constitution of this State."

Repealed

SECTION 3. Section 11-9-900 of the Code is repealed.

Time effective

SECTION 4. This act takes effect upon approval by the General Assembly of Joint Resolution H. 3823 (R. 414 OF 1988)