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House Axes Budget and Control Board in New Restructuring Plan

The S.C. House passed a counter-proposal Wednesday to a Senate plan for restructuring state government, going much further than the House’s original blueprint and outstripping the Senate in some areas.

House Speaker Bobby Harrell, R-Charleston, and House Majority Leader Kenny Bingham, R-Lexington, released their latest restructuring proposal in a morning news conference at the State House in Columbia.

About two dozen members of the House Republican Caucus flanked Harrell and Bingham as they talked about their new plan.

Unlike the House’s first pass at restructuring in this legislative session, the new iteration appears to eliminate the Budget and Control Board (BCB).

It might not be 100 percent the way some observers would like to see restructuring done, but Harrell said it would move “90 percent of the money and 82 percent of the employees” from the BCB into a cabinet-level Department of Administration.

Creating such an executive branch agency with a director appointed by the governor, and doing away with the Budget and Control Board, constitutes the heart of a decades-long debate about overhauling Palmetto State government.

The BCB consists of two parts:

  • One is a five-member board that oversees state finances: the governor, treasurer, comptroller general and the chairmen of the Senate Finance and House Ways and Means committees.
  • The other part is an agency that carries out many day-to-day ministerial activities.

Critics contend the BCB is inefficient, unaccountable and, because it mixes executive and legislative authority, unconstitutional.

Following the news conference Wednesday, the House passed its new restructuring plan on a 71-33 vote. In the form of an amendment, the approach totally reworks House bill 3066 sponsored by Rep. Garry Smith, R-Greenville.

“This isn’t an amendment to send back to the Senate to start a negotiation,” Harrell said during the media event.

He added that the House will “certainly negotiate with the Senate.” But Harrell said he and other leaders of the chamber crafted the latest plan so that it could stand on its own.

The House’s new restructuring blueprint would create a Department of Administration with a director appointed by the governor. The executive branch agency would house the following Budget and Control Board functions:

  • Procurement;
  • General services;
  • Information technology;
  • Human resources;
  • Executive budget duties;
  • Administration of state employees’ health and retirement benefits; and
  • The Confederate Relic Room.

With those components, the Department of Administration would assume control of the vast majority of BCB funding and employees, according to the amendment.

The House leaders’ new plan also would form a seven-member State Contracts and Accountability Authority.

That entity would oversee bonding, policy decisions about state employee benefits, and insurance services. The State Contracts and Accountability Authority also would house the state auditor and the state inspector general, along with a panel to review procurement practices of the new Department of Administration.

The seven members of the authority would be the governor, lieutenant governor, comptroller general, treasurer, attorney general, one House speaker appointee and one Senate president pro tempore appointee.

The amended House bill also creates a Revenue and Fiscal Affairs Office. It would consist of the Office of State Budget and the Board of Economic Advisors.

The Revenue and Fiscal Affairs Office would be overseen by three appointees, one each designated by the governor and the House and Senate appropriations committee chairmen.

House leaders say the new restructuring plan also eliminates 147 vacant Budget and Control Board positions.

Some observers closely involved in the restructuring issue reacted coolly to the House’s latest version.

“I kind of chuckled about this seven-member authority they’re creating,” said Sen. Shane Massey, R-Edgefield. Massey described the State Contracts and Accountability Authority as going from a “five-headed monster” with the BCB to a “seven-headed monster.”

“But beyond that I think there are some good ideas in here,” added Massey, who played a major role in the Senate’s restructuring plan.

Originally, the House passed Smith’s bill in March 2011, but in a form that kept the Budget and Control Board intact.

When the measure got to the Senate, Massey worked with Sens. Tom Davis, R-Beaufort, and Vincent Sheheen, D-Kershaw, to overhaul it and abolish the BCB. The Senate passed its plan in February and sent it back to the House.

But while the House has gone much further with it this go-round, the chamber’s co-mingled powers in some areas remain problematic to some reform advocates.

“The State Contracts & Accountability Authority is still a hybrid board, worse than the B&CB because it adds two new members – the Lt. Governor and the Attorney General,” says Talbert Black, a Lexington County grassroots activist.

The new authority “still will have authority over state bonding,” says Black, state coordinator of the Campaign for Liberty and founder of the Palmetto Liberty Political Action Committee. “State bonding is an appropriation and should be completely under the General Assembly.”

The House’s new plan now goes back to the Senate. If that chamber concurs with the changes, it then goes to the governor. If not, the House and Senate would have to work out their differences in a conference committee in order to pass restructuring this year.

Reach Ward at (803) 254-4411 or eric@thenerve.org.

Accountability Budget and Control Board General Assembly Legislation State Retirement System Transparency

S.C. House Speaker Bobby Harrell S.C. House Majority Leader Kenny Bingham Sen. Shane Massey Talbert Black