WASHINGTON - A panel of South Carolina lawmakers gave preliminary approval Thursday to a $5.6 billion fiscal 2010 budget that would provide almost $1 billion in new spending for education and health care providers while cutting money for local governments by 42%, a move which may halt some capital projects.

The new education and health care measures are needed for the state to meet the requirements of the $787 billion federal stimulus package, local government issuers and advocates said. The draft budget increases K-12 spending by $323.2 million and higher education by $119.6 million. The balance of the new spending, $534.3 million, would go to health care providers.

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