Study: S.C. Lawmakers Should Get Big Pay Raises

May 19, 2014

Investigative Reports

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By RICK BRUNDRETT

 

S.C. lawmakers would see salary hikes of up to 192 percent, while certain legislative leaders, including House Speaker Bobby Harrell, would receive additional pay increases, based on recommendations of a salary study quietly authorized two years ago by the General Assembly.

The study by the international consulting firm Hay Group, based in Philadelphia, first came to light Wednesday during a Senate floor debate on a budget amendment by Sen. Ray Cleary, R-Georgetown, to allow lawmakers to claim an additional $12,000 yearly in “in-district” payments – doubling the amount they currently are eligible to receive. The Senate approved the budget proviso (Proviso 91.29) by a 25-20 vote.

“I want to give you real information,” said Sen. John Scott, D-Richland, to Sen. Paul Thurmond, R-Charleston, during the floor debate, citing findings by the Hay Group study, which compared lawmaker pay in South Carolina to other states.

Scott, who voted in favor of the amendment, didn’t reveal the study’s recommendations about S.C. lawmaker pay, though he cited a finding in the report that said legislators’ annual salaries are “significantly below” the Southern regional and national averages.

The Nerve’s review of the study, however, found that those findings didn’t include the yearly $12,000 in-district payments, which are considered taxable income in South Carolina. Combined with their annual $10,400 base salary, most lawmakers make at least $22,400 yearly, which is more than $3,000 above than the Southern regional average salary of $21,109 cited in the study.

The national average for legislative salaries was listed at $31,643, though the study didn’t compare the length of legislative sessions nationwide. South Carolina’s regular legislative session starts the second Tuesday in January and ends the first Thursday in June; an appendix in the study noted that S.C. lawmakers are “technically part-time,” though they have a “variety of responsibilities that require time and attention throughout the year.”

The Nerve obtained a copy of the 60-page study Thursday afternoon from the Senate Finance Committee. The study recommended that:

  • Hiking the base annual salary of the 124-member House and 46-member Senate by $10,000 to $20,000; the new base salary would be $20,400 to $30,400, an increase ranging from 96 percent to 192 percent. If all 170 members received the recommended raise at either end of the range, the additional annual cost to S.C. taxpayers would range from $1.7 million to $3.4 million.
  • Increasing the annual pay of committee chairmen to $2,000 from $600, a jump of 233 percent. There are 15 standing Senate committees and 11 standing House committees; if approved, the raise would cost taxpayers a collective additional $36,400 annually.
  • Raising the House speaker’s and Senate president pro tempore’s annual pay to $15,000 from $11,000, a 36 percent increase. On his most recently filed income-disclosure statement with the State Ethics Commission, Harrell, R-Charleston, listed his total legislative salary and benefits last year at $44,772, though he didn’t break out his speaker’s pay; Sen. John Courson, R-Richland, listed his president pro tempore’s pay on his form.

Although the Senate last week voted to allow lawmakers to double their in-district pay, the Hay Group’s study said South Carolina’s “office and staffing allowance,” which it defined as the $12,000 annual in-district payments, as well as separate yearly Senate and House office allowances of $3,400 and $2,400, respectively, for each member, “appears to be within the range provided among the states in its region.”

Lawmakers slipped in the authorization for the study at the end of Act 278 of 2012, which made changes to the state retirement system, including closing the lawmaker retirement system to incoming legislators.

Officials with the Hay Group and  the S.C. Budget and Control Board (BCB), which was authorized by the 2012 law to do the legislative pay study, did not immediately respond to written or phone messages last week from The Nerve. Online records with the state Comptroller General’s Office show that the BCB paid the Hay Group $60,363 last fiscal year, which ended June 30, though there were no specifics listed about the purpose of the payments.

Contacted Friday by The Nerve, Scott said he first obtained a copy of the study, which is dated January 2013, last month. The study was not mentioned during the April 30 Senate Finance Committee meeting, where the proposed 100-percent hike in in-district pay – to $24,000 from $12,000 annually – was first discussed publicly and approved. Scott does not serve on the finance committee. The full Senate on Tuesday initially rejected the pay hike, though it reversed itself on Wednesday.

The Nerve in a May 8 story revealed, citing legislative sources who didn’t want to be named, that Sen. Hugh Leatherman, R-Florence and the Senate Finance Committee chairman, initially proposed the in-district pay hike at an earlier closed Senate Republican Caucus meeting.

Lawmaker Goody Bag

In addition to state-funded, in-district payments, counties are required under state law to provide office space, equipment and personnel for their legislative delegations. Some counties that don’t provide delegation offices make substitute payments – which can total thousands annually – to lawmakers, as The Nerve revealed last week.

Legislators also receive a number of other benefits, such as mileage reimbursement and $140 daily “subsistence” payments for hotel and meals during legislative sessions. The Hay Group study described the “subsistence” payments as “per diem” pay for committee work, though it can be claimed by any lawmaker present in Columbia during session weeks. The Nerve previously has questioned the practice of Midlands lawmakers receiving “subsistence” payments, given that they live relatively close to the State House.

Some lawmakers, including Courson, Leatherman and Scott, also have generous legislative pensions, as The Nerve reported in 2012, though by law they can’t receive the base $10,400 annual salary at the same time. Courson’s legislative pension is $32,348; Leatherman’s, $36,148; and Scott’s, $27,177, records show.

A 2010 study by The Nerve found that lawmakers receive on average about $32,200 yearly in combined salary, reimbursements and expense payments for serving part time in the Legislature.

In comparison, the total salary and benefits package, including retirement benefits, for Leatherman, who sits on the five-member BCB and chairs the state Agency Head Salary Commission, was $69,236 last year, according to his annual income-disclosure statement filed in March with the State Ethics Commission.

And for some lawmakers, their legislative pay doesn’t come close to what they make in their private jobs or through their investments because of their connections to state or local government. The Nerve revealed last year, for example, that a concrete company with ties to Leatherman received more than $30 million over the past 20 years from the state, mostly through contracts with the S.C. Department of Transportation.

The Nerve also reported last year that medical businesses with ties to five S.C. lawmakers – Sen. Kevin Bryant, R-Anderson; Rep. Kris Crawford, R-Florence; Sen. Ronnie Cromer, R-Newberry; Rep. Murrell Smith, R-Sumter; and Rep. Kit Spires, R-Lexington – collectively received more than $10 million in Medicaid payments over the previous six fiscal years.

A number of lawyer-legislators also have done very well representing clients before the state Workers’ Compensation Commission. The Nerve revealed last year, for example, that Sen. Luke Rankin, R-Horry and the Senate Ethics Committee chairman, received more than $2.8 million in legal fees from workers’ compensation cases from 2007 through 2012.

‘Grossly Underpaid’

Still, Scott, who runs real estate and transportation consulting businesses, believes that lawmakers are “grossly underpaid.”

“This is a full-time job with part-time pay,” said Scott, who was elected the House in 1990 and joined the Senate in 2008, in his interview Friday with The Nerve.

Scott said the $12,000 he receives annually in in-district payments is “actually eaten up in expenses,” noting he deducts the full amount of his net in-district pay on his federal income tax return. State law doesn’t require lawmakers to publicly disclose records verifying in-district expenses.

Scott also took issue with a Facebook message Wednesday from Gov. Nikki Haley criticizing the Senate’s vote on in-district payments.

“In a time where we should be focused on real budget priorities – things like education, roads, and public safety – it makes zero sense to me that the Senate just voted themselves a pay raise,” Haley said. “There is no excuse for a Senator to pay themselves before taking care of state business – especially considering they all knew what this job paid when they ran for office.”

Scott said he doesn’t believe the Republican Haley, a former House member, should be critical of lawmakers’ efforts to raise their pay, contending that her annual pay and benefits, including living cost-free in the Governor’s Mansion with her family, cost taxpayers at least $300,000 annually.

“You’re raking in three hundred grand, and you’re talking about some folks who make $22,400?” Scott said. “That’s unfair.”

Scott said he expects Haley to veto the in-district-payment amendment, should it survive the Legislature’s final version of the fiscal 2015 state budget. He also said it wouldn’t necessarily surprise him if there weren’t enough votes in both chambers to override an expected veto.

“But it still won’t erase the fact that members of the General Assembly are grossly underpaid,” he added.

Reach Brundrett at (803) 254-4411 or rick@thenerve.org. Follow him on Twitter @thenerve_rick. Follow The Nerve on Facebook and Twitter @thenervesc.