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State Health Insurance Uproar Shows BCB Power Plays Cut Both Ways

Editor’s note: Nerve Citizen Reporter Talbert Black and state Sen. Larry Martin, R-Pickens, talk about eliminating the S.C. Budget and Control Board in the embedded video clip at the end of this article. Nerve videographer intern Katie Geer produced the clip.

It cuts both ways.

To legislators upset with the Budget and Control Board’s recent vote to override their will on state employee health care premiums, that’s the reality of the BCB’s mixed legislative and executive authority.

Typically, South Carolinians have heard voices like former Gov. Mark Sanford’s criticizing the Budget and Control Board for breeding dysfunction and cronyism, and encroaching on executive authority.

But the BCB’s decision last week not to use millions of dollars the way the General Assembly intended – to cover employees’ share of higher state health insurance premiums – shows that sometimes, the proverbial shoe lands on the other foot.

In those cases, the Budget and Control Board’s executive arm reaches into the legislative realm.

That’s what happened with state health insurance costs.

Sanford, who fought throughout his two terms to decommission the BCB, told The Nerve on Tuesday that he wasn’t aware of this latest dustup over the entity.

“But what I would say is, regardless of which way the knife cuts, it gets bloody when there’s too many cooks in the kitchen,” Sanford said.

Talbert Black, a Lexington County grassroots leader and a Citizen Reporter for The Nerve, has followed the debate about the Budget and Control Board closely.

Black notes that the BCB’s action on state health premiums saves taxpayers money, and he says that’s a good thing. “But the Budget and Control Board should never have the authority to override what the Legislature did,” he says.

What the Legislature did was appropriate $51.5 million to cover the full cost of higher premiums this fiscal year.

But last week, the five-member BCB voted 3-2 to make employees pick up part of the increase.

The workers’ out-of-pockets costs will go up 4.6 percent, or an average of $7.24 per month per state employee beginning in January, according to figures from the newly created S.C. Public Employee Benefit Authority.

Megan Lightle, interim spokeswoman for the Benefit Authority, did not provide a total yearly dollar figure for the employees’ increased premiums when asked for the number Tuesday.

During this year’s legislative session, lawmakers created the Public Employee Benefit Authority to take over management of the state retirement systems and the state health plan from the Budget and Control Board.

That change is still in the works.

Also this session, lawmakers came close to passing a bill to abolish the BCB.

In its place, the bill would have created a Department of Administration in the governor’s cabinet, and a few other entities with differing lines of authority, to absorb the Budget and Control Board’s operations.

The bill, H. 3066, was the most far-reaching effort to restructure state government in two decades. But while the measure cleared the House and Senate in different forms, the two chambers did not agree on a final version of it before the session ended.

Thus, even after the Public Employee Benefit Authority is up and running, the Budget and Control Board will maintain final say over its decisions.

The BCB is both an agency, which controls many day-to-day functions of state government; and a board, which oversees bonded debt and other key areas of state finances.

The board has three executive branch members – the governor, treasurer and comptroller general – and two legislative branch members, the chairmen of the Senate Finance and the House Ways and Means committees.

Haley proposed the board’s move to make employees pay part of the higher state health insurance costs. Treasurer Curtis Loftis and Comptroller General Richard Eckstrom agreed.

Senate Finance Chairman Hugh Leatherman, R-Florence, and Ways and Means Chairman Brian White, R-Anderson, opposed it.

In media reports, the 3-2 decision provoked howls among state workers and legislative leaders, who charged that the Budget and Control Board illegally subverted the General Assembly's authority.

A University of South Carolina professor has filed a class action lawsuit seeking to overturn the BCB’s action.

Loftis says he’s satisfied that the board’s vote “was good public policy” to share the higher state health care costs. And he says the fact that the BCB has final say over the matter means “it’s clear that authority exists.”

The treasurer also says if it’s demonstrated to him that the BCB would lose a legal challenge on the issue, “I would ask to revisit this vote quickly.”

To observers like Sanford and Black, there’s a certain irony in legislative leaders bemoaning the Budget and Control Board trumping the General Assembly when two of the Legislature’s top members sit on a board that oversees part of the executive branch.

“It is just dysfunctional by design,” Sanford says of the BCB.

Black: “It’s just another demonstration of why we need to get rid of the Budget and Control Board and anything like it; and have three separate, equal branches of government in South Carolina.”

Senate President Pro Tempore John Courson, R-Richland and a critic of the BCB’s move on state health insurance premiums, agrees. “That’s why during the restructuring debate (this session) I was in favor of eliminating the Budget and Control Board,” Courson says.

Sen. Shane Massey, R-Edgefield, says he finds the legislative outrage on this one somewhat amusing. Massey played a leading role in the Senate version of the bill to erase the BCB.

“I think it acts as a shadow government,” he says. “It needs to go, and it needs to go yesterday.”

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

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

Mark Sanford Sen. John Courson Treasurer Curtis Loftis Sen. Shane Massey Department of Administration Talbert Black Budget and Control Board