§ 11-11-320 — Capital Reserve Fund.

South Carolina § 11-11-320

• Jurisdiction: South Carolina
• Title 11: PUBLIC FINANCE
• Ch. 11: STATE BUDGET SYSTEM

Text

(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 three 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 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 Executive Budget Office 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 on September first of the following 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.

Legislative History

HISTORY: 1988 Act No. 385, SECTION 1; 2005 Act No. 156, SECTIONS 1, 6; 2010 Act No. 152, SECTION 2.A., eff May 8, 2012; 2022 Act No. 238 (H.3346), SECTION 2.A, eff February 28, 2023. Validity For the validity of (C)(2) of this section, see Pinckney v. Peeler, 862 S.E.2d 906 (S.C. 2021). Code Commissioner's Note At the direction of the Code Commissioner, reference in this section to the former Budget and Control Board has not been changed pursuant to the directive of the South Carolina Restructuring Act, 2014 Act No. 121, SECTION 5(D)(1), until further action by the General Assembly. Editor's Note 2010 Act No. 152, SECTION 2.C., provides: "This section takes effect upon ratification of an amendment to Section 36, Article III of the Constitution of this State authorizing its terms submitted to the electors of this State at the 2010 general election and first applies for the state fiscal year beginning after that date." 2022 Act No. 238, SECTION 3(B), provides as follows: "[SECTION 3.](B) The provisions of SECTION 2 of this act take effect upon the ratification of an amendment to Section 36(B), Article III of the Constitution of this State to allow the Capital Reserve Fund to be used first to offset midyear budget reductions and raising the Capital Reserve Fund from two percent of the general fund revenue of the latest completed fiscal year to three percent of such revenues and first applies to the state fiscal year beginning thereafter." The amendment was ratified on February 28, 2023, in 2023 Act No. 5 (S.381), SECTION 1.B. Effect of Amendment The 2010 amendment rewrote subsection (C)(1) and in subsection (C)(2), substituted "Subsequent to appropriations required by item (1)," for " After March first of a fiscal year,". 2022 Act No. 238, SECTION 2.A, in (A), substituted "three percent" for "two percent"; rewrote (C); and made nonsubstantive changes.