Legislative Ethics Chairmen Want to Consider More Income Disclosure

The chairmen of the S.C. House and Senate Ethics committees said Wednesday they are open to discussions in their respective chambers about requiring lawmakers to declare legislative pensions on state income-disclosure forms.

At least 27 sitting lawmakers would be affected, though the list likely would be smaller next year because of several retirements and unsuccessful re-election bids.

In interviews with The Nerve, Rep. Roland Smith, R-Aiken and the House Ethics Committee chairman; and Sen. Wes Hayes, R-York and the Senate Ethics Committee chairman, said they believe their respective chambers also should consider requiring other types of lawmaker income to be reported on disclosure forms, including private pay from “lobbyists’ principals,” or employers that hire State House lobbyists.

Smith said the House Ethics Committee is considering drafting a formal opinion requiring House members to declare income they earn from lobbyists’ principals on their annual statements of economic interests filed with the State Ethics Commission.

The six-member House committee would have to approve any such opinion before it could go into effect, Smith said, adding that the full House could vote to reject it.

Exactly how many lawmakers that would involve is unknown. The House committee’s effort comes amid its ongoing investigation into allegations that Gov. Nikki Haley, a Lexington County Republican, engaged in illegal lobbying while a House member, charges which she has repeatedly denied.

Public testimony in Haley’s case is scheduled to begin next week. Smith declined Wednesday to discuss the case with The Nerve.

Asked if a formal opinion by the House Ethics Committee would include requiring House members to report legislative pensions on their statements of economic interests, Smith replied, “I think that will be in the mix.”

“It (reporting legislative pensions) should be a requirement,” he said. “That’s why I do it.

“The public not only should know what my salary is, if I have a salary,” Smith continued, “but they should see whatever other income I have from the state and where it comes from.”

Hayes receives a state pension but unlike Smith, didn’t report it on his most recent statement of economic interests. Hayes and Smith said neither state laws nor House and Senate rules require legislative pensions to be declared on those forms.

Asked if it should be required for senators, Hayes replied, “I’m not saying it’s definitely something we should pass, but I think it’s definitely something we should consider.”

Like Hayes, most lawmakers who receive legislative pensions didn’t report that income on their most recent statements of economic interests, The Nerve found in a review of the forms, which were due to the State Ethics Commission by April 15.

The Nerve first reported in October 2010 that as many as 18 senators and a dozen House members might have been receiving legislative pensions while serving in office, though state retirement officials declined to reveal their identities, citing privacy laws.

State law requires legislators to give up their annual base $10,400 legislative salary if they receive a legislative pension. General Assembly expense records obtained by The Nerve under the S.C. Freedom of Information Act showed that as of late last year, 18 senators and nine House members received no base $10,400 salary, indicating they receive a state pension.

Their retirement pay typically is far bigger than their base salary, based on The Nerve’s review of Ethics Commission records of those lawmakers who declared their pensions. And legislators who receive pensions can continue to collect $12,000 in annual “in-district” expense payments, which are considered income and factored into their state retirement benefits.

House Clerk Charles Reid in a written response to The Nerve in September confirmed the identities of the nine House members receiving state pensions; Senate Clerk Jeffrey Gossett said the 18 senators receiving no base salary were “most likely retired.”

Following is the list of the senators and House members, as reported by The Nerve in April:

Senators: Hayes; Ralph Anderson, D-Greenville; John Courson, R-Richland; Dick Elliott, D-Horry; Mike Fair, R-Greenville; Robert Ford, D-Charleston; John Land, D-Clarendon; Hugh Leatherman, R-Florence; Phil Leventis, D-Sumter; Larry Martin, R-Pickens; John Matthews, D-Orangeburg; Yancey McGill, D-Williamsburg; Harvey Peeler, R-Cherokee; Glenn Reese, D-Spartanburg; Mike Rose, R-Dorchester; John Scott, D-Richland; Nikki Setzler, D-Lexington; and David Thomas, R-Greenville.

Representatives: Smith; Jimmy Bales, D-Richland; Liston Barfield, R-Horry; Grady Brown, D-Lee; Greg Delleney, R-Chester; Jerry Govan, D-Orangeburg; George Hearn, R-Horry; Lonnie Hosey, D-Barnwell; and Denny Neilson, D-Darlington.

Lt. Gov. Glenn McConnell, a Charleston County Republican and the former Senate president pro tempore who became lieutenant governor in March after Ken Ard resigned, also receives a legislative pension, records show.

At least eight lawmakers on the above lists and McConnell reported state pension amounts on their most recent statements of economic interests. Following are those who declared their pension amounts:

Rep. Bales: $78,122 (Bales is a retired Richland School District 1 administrator. It is unclear whether any of his listed pension amount is from the General Assembly Retirement System);
Rep. Hearn: $28,460;
Rep. Hosey: $12,652 (Hosey also reported another $27,450 pension from the general state employee retirement system);
Sen. Leatherman: $36,148;
McConnell: $48,515;
Sen. McGill: $27,859;
Sen. Scott: $27,177;
Rep. Smith: $22,038; and
Sen. Thomas: $32,290.

Other lawmakers reported pension amounts they receive from other government jobs.

As of September, 350 current or former lawmakers, or their beneficiaries, were receiving retirement benefits totaling $6.5 million, The Nerve reported then. The average annual payout for the group at the time was $18,589; the highest recorded yearly benefit was $61,600.

The Nerve’s analysis was based on retirement system records that included a database of monthly benefits paid to every recipient in the system at that time. Retirement officials deleted all identifying information on recipients in the database, citing privacy laws.

Under state law, the House and Senate investigate and discipline their own members for ethical violations. The State Ethics Commission has authority over other elected state and local officials, and certain public administrators.

Contacted Wednesday by The Nerve, Cathy Hazelwood, the Ethics Commission attorney, said in a written response said that public pensions are “not income and therefore not reportable” under the state ethics law covering non-lawmakers.

“I assume the House and Senate Ethics Committees have come to the same conclusion,” she said.

Reach Brundrett at rick@thenerve.org.