Bills Would Restructure Budget and Control Board

February 8, 2011

Investigative Reports

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The NerveThe S.C. Budget and Control planned to meet this morning in a spacious new abode, abandoning the board’s former pint-sized meeting venue after The Nerve exposed the inadequacy of the old location in several stories beginning in July.

As the board was convening today, many eyes were fixed on whether the panel would vote to allow two state agencies to run deficits this fiscal year. (The Nerve also was the first media outlet in South Carolina to raise the deficits issue, in a story published Sept. 21.)

Yet, behind the crucial deficits matter lurk larger questions about the board itself. Formally organized around 1950 with roots tracing to the Reconstruction era, the Budget and Control Board is a mishmash of the executive and legislative branches of state government that is unique to South Carolina.

The unusual hybrid nature of the Budget and Control Board (BCB) has long been an issue in state government. Former Gov. Mark Sanford fought to abolish the BCB.

Short of that, five bills are pending in the General Assembly to retool the Budget and Control Board. Four of the measures call for creating a cabinet-level Department of Administration and moving a bevy of BCB operations into it. Another bill would require auditing of the Budget and Control Board on a running basis.

In addition, a legislative state agency restructuring committee has asked the BCB which of its operations might fit with a Department of Administration. But that request apparently went unfulfilled. And since it was made, a shakeup has occurred in the highest executive ranks of the Budget and Control Board.

Yes, these are the days of change at the BCB.

As an entity, the Budget and Control Board is both a board and an agency.

The board consists of the governor as its chairwoman, the state treasurer, the state comptroller general and the chairmen of the House Ways and Means and Senate Finance committees.

Those are the five elected officials confronted with deciding whether to allow the state Department of Health and Human Services and the S.C. Department of Corrections to operate in the red.

The Department of Social Services had been facing a possible deficit, too. But DSS was not listed on the BCB’s meeting agenda, and The Associated Press reported on Monday that the department had dropped a request it had made to run a deficit.

Today’s Budget and Control Board meeting was scheduled to begin at 9:30 a.m. in room 110 of the Blatt Building on the grounds of the State House. That site can accommodate far more people than the BCB’s previous meeting venue, the governor’s conference room in the Wade Hampton Building adjacent to Blatt.

The Nerve began reporting on crowded conditions in that space in this July 1 story, after which Treasurer Curtis Loftis led a successful effort to change the location of Budget and Control Board meetings.

Regarding the board side of the BCB, it also is the subject of a legislative restructuring proposal.

Sen. Shane Massey, R-Edgefield, is sponsoring a bill to rescind automatic membership on the board for the chairmen of the House Ways and Means and Senate Finance committees, which write the state budget.

Massey’s bill, S. 330, would replace the committee heads with a senator and a House member “selected by a majority of the respective bodies.”

In an interesting twist, the legislation has been referred to the Senate Finance Committee. Republican Hugh Leatherman of Florence chairs the Finance panel.

To underscore the point, Leatherman is a BCB member by virtue of his chairmanship.

As of Monday, no other lawmaker had signed onto Massey’s bill as a co-sponsor.

At the agency level, meanwhile, the Budget and Control Board contains several divisions that perform many executive functions. Those include monitoring and projecting state revenue collections; maintaining state property; and administering the state retirement system.

Sen. Chip Campsen, R-Charleston, is sponsoring one of the Department of Administration bills, S. 134.

When The Nerve asked Campsen why he introduced the legislation after he filed it in December, he replied, “Why is because we’re the only state in the nation with a Budget and Control Board, and we have a lot of the executive branch functions housed in the Budget and Control Board.”

Campsen also is sponsoring the BCB auditing bill, S. 135. It would have the Legislative Audit Council, which acts as the General Assembly’s inspector general, conduct fiscal, management and performance reviews of various Budget and Control Board components on a continuing, rotating basis.

Toward the end of the 2010 legislative session, lawmakers created a committee to look at ways to streamline state government and save money. Leatherman and Ways and Means Chairman Dan Cooper, R-Anderson, are co-chairmen of the panel. It has a few subcommittees, including one focused on the Budget and Control Board.

In an Oct. 21 meeting of that subcommittee, Leatherman asked then-BCB agency director Frank Fusco to provide to its members by mid-November information as to which Budget and Control Board operations could be transferred to a Department of Administration.

Fusco apparently never did before he resigned in January. Around the same time, BCB chief of staff Eddie Gunn also departed. And right before that, longtime Budget and Control Board public information director Mike Sponhour left to take a job in Ohio.

Eleanor Kitzman has replaced Fusco as BCB director. Marcia Adams is the new chief of staff.

An application period for the Budget and Control Board public information position, posted on a state government jobs bank, closed on Monday. The advertised salary was approximately $54,000 to $101,000.

The Nerve recently asked BCB secretary Delbert Singleton, who is handling public information duties in Sponhour’s absence, for a copy of what Budget and Control Board administrators provided to the legislative BCB restructuring committee.

“We are not aware of any further information Mr. Fusco provided to the Committee,” Singleton responded in an e-mail.

Did Kitzman, Adams or anyone else supply the requested information?

“Nothing has been requested nor presented,” Singleton said in a follow-up e-mail.

On Friday afternoon, The Nerve sent e-mails to Leatherman and Senate President Pro Tempore Glenn McConnell, R-Charleston and a member of the subcommittee, asking whether they had received the information.

Leatherman and McConnell did not respond prior to publication of this story.

As for the Department of Administration bills, Campsen’s had picked up one co-sponsor, Republican Sen. Mike Rose of Dorchester, and was awaiting action in a Senate Judiciary subcommittee as of Monday. McConnell chairs that committee. Sen. Larry Martin, R-Pickens, chairs the subcommittee.

Martin, as it happens, has his own bill, S. 238, and it too has been assigned to his subcommittee. His legislation has garnered three other backers.

Likewise, S. 261 by Sen. Vincent Sheheen, D-Kershaw, is pending before Martin’s subcommittee and it has attracted five co-sponsors.

Lastly, H. 3066 by Rep. Garry R. Smith, R-Greenville, is before the House Judiciary Committee with nine other representatives having signed onto it. The panel’s Judiciary Laws Subcommittee was scheduled to take up that legislation today after the House adjourns.

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