Changes made to the Local Government Fund formula by the General Assembly in 2019 mean that distributions to both municipalities and county governments are updated going forward. The transformation changes the way that the amounts are calculated beginning with FY 2020-2021.
SC Code Section 6-27-30 now requires that the Local Government Fund increase or decrease every year by the same percentage that the state general fund is projected to increase or decrease. The amount of change cannot, however, exceed 5% compared to the appropriation of the previous fiscal year. Before now, the funding mechanism was backward-looking, meaning that it was based on the previous fiscal year of the state's general fund revenue.
The General Assembly based the new, forward-looking model on the next year's revenue projections. In doing so, the state legislature created a formula that provides a more reliable funding level for cities and towns. Greater LGF reliability was one of the Association's Advocacy Initiatives for the 2019 – 2020 legislative session
The new calculation represents a significant change from the pattern that began in 2009, when the General Assembly decreased the LGF funding in response to the Great Recession. For the next decade, funding was unpredictable and generally trended toward either little or no growth. This trend remained the case even as the state's economy grew.
In May 2019, the General Assembly approved the FY 2020-2021 state budget. That budget included the addition of $11.1 million to the LGF base amount, creating a new base amount of $233.7 million.
The SC Revenue and Fiscal Affairs Office has compiled the LGF distributions available to each of the state's 271 municipalities. Find this list online where the estimated amounts for FY 2020-2021 are available for each municipality. The list also includes a comparison to the FY 2019-2020 appropriations. The LGF webpage includes a history of distributions since 1991.