South Carolina Democratic Party Position on
the Two Constitution Amendments on the Ballot.
Amendment 1
Must Section 36(A), Article III of the Constitution of this State, relating to the General Reserve Fund, be amended to provide that the General Reserve Fund of five percent of general fund revenue of the latest completed fiscal year must be increased each year by one-half of one percent of the general fund revenue of the latest completed fiscal year until it equals seven percent of such revenues? Explanation: A ‘Yes’ vote will increase the amount of money state government must keep in the General Reserve Fund (its "rainy day" fund) from 5% of the previous year's revenue to 7% of the previous year's revenue.
Democratic Position & Explanation:
We urge you to vote Yes.
The General Reserve Fund was originally championed and created by longtime Democratic State Treasurer Grady L. Patterson, Jr. The purpose of this fund is to pay for the government functions in a current fiscal year in which a shortfall occurs at the end of the fiscal year. Essentially, it protects against year-end shortfalls when all other options have been exhausted.
This “Rainy Day Fund” is akin to placing money in an emergency account designed to cover budget shortfalls in the current fiscal year as the result of a downturn in the economy or natural disaster.
Amendment 2
Must Section 36(B), Article III of the Constitution of this State be amended so as to provide that the Capital Reserve Fund of two percent of the general fund revenue of the latest completed fiscal year be increased to three percent of the general fund revenue of the latest completed fiscal year and to provide that the first use of the Capital Reserve Fund must be to offset midyear budget reductions? Explanation A ‘Yes’ vote will increase the amount of money state government must appropriate to the Capital Reserve Fund (the “reserve and capital improvements” fund) from 2% of the previous year’s revenue to 3% of the previous year’s revenue and require that the Capital Reserve Fund’s first priority is to offset midyear budget cuts at state agencies.
Democratic Position & Explanation:
We urge you to vote Yes.
The Capital Reserve Fund was originally championed and created by longtime Democratic State Treasurer Grady L. Patterson, Jr. This is a mid-year option that would be the first line of defense before cutting programs for which money has been appropriated and money is being spent. This fund is used when the Board of Economic Advisors cuts or adjusts revenue projections during a fiscal year for which a budget has already been passed and revenues are not keeping pace.