State Economists Increase Revenue Forecast

Last week, the South Carolina Board of Economic Advisors (BEA) announced that state budget writers will have an additional $610 million to appropriate when they return to Columbia in the coming weeks to finalize the state’s FY2024-25 budget. Of the $610 million, $143 million is recurring revenue that can be used for multiyear expenses while $467 million is nonrecurring revenue that will likely be used on one-time expenses. All told, budget writers have a total of $816 million in recurring revenue and $1.33 billion in nonrecurring revenue at their disposal for the FY2024-25 budget.

The revenue increase was driven largely by better-than-expected corporate income tax collections and investment earnings. Sales tax revenues, income tax revenues, and corporate license fee revenues were also higher than anticipated, albeit at lower levels than corporate income tax collections and investment earnings.

Members of the FY2024-25 budget (H.5100) conference committee will be able to use this additional revenue to iron out differences between the $13.8 billion House and Senate spending plans. Many SC Chamber priorities are included in both versions of the proposed FY2024-25 budget including a reduction in the individual income tax, investments in all facets of the state’s critical infrastructure, funding for technical college scholarships for critical-needs jobs, and teacher pay increases.