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Down to the wire

Posted: June 22, 2012 1:33 p.m.
Updated: June 25, 2012 5:00 a.m.

Often as summer officially begins, the General Assembly is wrapping up its business for the year.  However, when legislators returned to Columbia on June 19 there were several important issues left to be addressed. During the week, progress was made on one major issue, another major issue died, and one still remains to be resolved.

Progress was made on the key issue of securing long term health for South Carolina’s employee pension plans as the General Assembly approved legislation making comprehensive revisions to our various retirement systems.  The poet Ralph Waldo Emerson described progress as “The activity of today and the assurance of tomorrow.”  Notably, the legislation creates the Public Employee Benefits Authority to administer the day-to-day operations of the retirement systems and the Employee Health Insurance Program.  It revises eligibility criteria for the South Carolina Retirement System (SCRS), which serves public school teachers and most state and local government employees, by requiring new employees, who become members of the system after June 30, 2012, to attain the age of sixty or satisfy what is known as the “Rule of ninety,” meaning that their ages and years of service added together must total at least ninety in order to be eligible to retire with full benefits. Current employees invested in SCRS retain their twenty-eight-year eligibility.

The legislation creates a twenty-seven-year service requirement for new employees to be eligible for Police Officers Retirement System (PORS) retirement; current employees invested in PORS retain their twenty-five-year eligibility.

It phases out the Teacher and Employee Retention Incentive (TERI) Program.  The legislation eliminates the current provisions for awarding retirees in SCRS and PORS cost of living adjustments that tie COLAs to inflation and, instead, establishes benefit adjustment provisions that allow a 1% automatic benefit adjustment yearly (to a maximum of $500).

The legislation phases in a 1.5% total increase in employee contribution rates over three years for both SCRS and PORS; any necessary future increases require the employee and employer rates to increase in equal proportions.  Legislators are not exempt from revisions as it closes the General Assembly Retirement System for newly elected officials as well as increases by 1% contribution rates for existing GARS participants.  These are just the highlights of this comprehensive legislation.

The issue that died was government restructuring since the “South Carolina Restructuring Act of 2012” failed to pass in the Senate. Along with establishing a Department of Administration under the authority of the Governor, the legislation would have authorized legislative oversight of executive departments by allowing committees of the General Assembly to conduct investigations on the effectiveness of state government programs.  Over the years, I have supported this and other restructuring efforts, including efforts to increase legislative oversight responsibilities.

The most important legislative issue that remains is the state budget; House and Senate budget conferees continue to negotiate.  Issues in contention over the budget include the manner in which to provide small business tax relief, raises for state employees, and assistance for local governments. The General Assembly has retained the authority to take up a report from the budget conference committee when it comes back next week.  With the uncertainty of the budget, the House adopted and sent to the Senate a continuing resolution so as to provide funding for state government at the current levels when the fiscal year ends June 30. If the budget conferees are unable to agree on a budget plan by next week and should the Senate take up the continuing resolution, it is my hope that they will amend the resolution to allow teacher pay increases and education funding to go forward, despite a stalemate on other items.

The South Carolina General Assembly will reconvene this week to address any further vetoes that the Governor may have and continue to work to put in place measures to fund state government in time for the new fiscal year to begin July 1. In sum, I regret to report the business of the General Assembly remains far from finished this summer.


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