South Carolina State Finances Get a "D" Grade!

South Carolina continues to be a sinkhole state when it comes to state finances. Repeated decisions by state officials have left the state of South Carolina with a staggering debt burden of $14.1 billion, according to Truth in Accounting's (TIA) analysis of South Carolina's most recent financial filings. That burden equates to $10,100 for every South Carolina taxpayer.

These statistics are troubling, but what's more troubling is that state government officials continue to obscure large amounts of retirement debt on their balance sheets, despite new rules to increase financial transparency. This skewed financial data gives state residents a false impression of their state's overall financial health.

Truth in Accounting is a Chicago-based nonprofit think tank that analyzes state financial reports when they are published. According to its report for 2016, South Carolina only has $14.1 billion of assets available to pay bills totaling $28.2 billion. This means that the state has 14.1 billion shortfall and a $10,100 taxpayer burden, which is each taxpayer's share of state bills after its available assets have been tapped. TIA's Taxpayer Burden™ measurement incorporates both assets and liabilities, not just pension debt.

Because of an accounting rule implemented last year, South Carolina had to report its pension debt on its balance sheet.This year, the state's reported pension debt grew from $5.1 billion in 2015 to $6 billion in 2016. Despite reporting most of its pension debt, the state continues to hide all of its retiree health care debt, which amounts to $9.9 billion. A new accounting standard will be implemented in two years that will require states to report this debt on the balance sheet.

The bottom line is that South Carolina would need more than $10,000 from each of its taxpayers to pay all of its bills, so it received a “D” for its finances.

See how South Carolina compares to Georgia, North Carolina, and Tennessee: http://www.statedatalab.org/c/CNdPJ7ln249d5ac
Click on the link to go to an interactive chart at Truth in Accounting’s State Data Lab.