State House Report

Restructuring or Fine-Tuning?

State Government Restructuring Likely to Pass, But How Much Will it Change?

By Bill Davis
Wednesday, January 22, 2014

South Carolina’s state government moved a half step closer to resembling the federal model last week after a “restructuring” compromise bill was passed by a handful of legislators.

Three state senators and three state representatives met Jan. 16 in public and in private to discuss and ultimately approve S.22, a bill that could subtly change how state government conducts its business.

This week, the bill is being debated on the floors of the House and Senate. If it clears both chambers, which is likely, it will be sent to Gov. Nikki Haley, a big restructuring supporter, for signing or vetoing.

The bill would create a new Department of Administration, which would place the day-to-day business of the state firmly and squarely under the auspices of Haley and the executive branch.

But while the bill would do away with the current Budget and Control Board, a political target of many elected Republicans since Mark Sanford was governor, it would create a very similar organization, the State Fiscal Accountability Authority.

That authority, just like the board, would be comprised of the governor, treasurer, comptroller general and the chairmen of the House Ways and Means and the Senate Finance committees.

The authority would be charged with spending big chunks of money, buying bonds and the like, referred to generally as “procurement.”

Going forward, House Speaker Pro Tempore Jay Lucas (R-Hartsville) says the issue of procurement would be the biggest issue to be debated in the days ahead.

Senate Finance Chairman Hugh Leatherman (R-Florence) dug in his heels last year, refusing in committee meetings to hand over procurement to the governor.  The thinking was that procurement placed too much power in the hands of a single elected official.

Others in both chambers, who favored the creation of the authority, took the stance that to hand procurement powers to a governor would violate the state’s constitutional division of powers. That division allows for the Legislature to be in charge of raising money and designating expenditures, and limits the governor to only carrying out the Legislature’s decisions.

A request for comment from Haley’s office went unanswered by press time, though Haley has previously supported the Department of Administration bill. There is no word as to whether the current bill stands up to her criteria for restructuring.

One of the biggest supporters of the bill, state Sen. Vincent Sheheen (D-Camden), will once again run against Haley in the upcoming gubernatorial election next year.
Sheheen, the bill’s primary author, who has shepherded the bill since its inception, argued Thursday that the biggest change the restructuring measure would provide is in the structure and oversight of state government.

The bill, according to Sheheen, would give legislative oversight of all state agencies to the General Assembly in much the same way Congress oversees federal agencies. That way, he said, state government would become more “transparent and accountable,” he said, borrowing two of Haley’s mantras.

Sheheen pointed to a series of crises and scandals in Haley’s cabinet agencies that, he said, demanded better management practices and oversight the Legislature could provide.

“Pretty much all the problems we in the Legislature have seen in state agencies have come from her cabinet,” said Sheheen, referencing solvency issues at the Department of Employment and Workforce, a historic hacking incident at the Department of Revenue and deficits at several agencies.

The bill would force agencies to come to the Legislature, and not the governor, if they faced a looming deficit, which Sheheen said would force agency heads to create more realistic budgets.

Crystal ball: Tea party-aligned members in the House and Senate are going to hate this bill, as it not only creates a new agency, but will be seen as merely changing the board’s title and not its most important duties. Haley’s support may change, as it becomes more clear how little true restructuring the bill provides — it keeps her out of the money, but gives her more responsibility. The bill will likely pass both chambers, but can it survive a higher vote requirement if Haley vetoes it? Tough to say.

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