COLUMBIA, SC — Here’s a scenario that could chill the hearts of conservative, business-minded S.C. lawmakers: What if the Supreme Court’s decision on gay marriage creates a two-tiered corporate atmosphere that makes states with legalized gay marriage more hospitable to business than states, such as South Carolina, with traditional marriage laws?
Wednesday’s 5-4 decision by the U.S. Supreme Court gives same-sex couples who have married in states that recognize gay unions the same federal tax, health and pension benefits that are now given to all other married Americans. But it left the question of the definition of marriage up to the states. In South Carolina, a 2006 constitutional amendment defined marriage as the union between one man and one woman.
“So much of this is driven by business,” said Clayton King, a Columbia art dealer who has been in a committed relationship with his partner, Jeffery Schwalk for 30 years. “Amazon is going to have a more difficult time recruiting gay and lesbian people to work in South Carolina than Microsoft will in Washington” state, which legalized gay marriage in 2012.
King said when the couple contemplated a move to South Carolina from their native Texas, “I went out on the back porch and googled, ‘Is Columbia, South Carolina, gay-friendly?’” he said.
It turned out the community has been very welcoming, said King, who runs the Artizan art gallery and jewelry store in downtown Columbia. Neither he nor his partner, who plan to marry in October in New York, have experienced any sort of discrimination during their four years here.
“I think the other thing that is being overlooked is that corporate America is in general a strong ally of the gay and lesbian community,” King, a native of Galveston, said. “They recognize there is a vibrant work force in the gay and lesbian community.”
But Rob Godfrey, spokesman for Gov. Nikki Haley, said the governor doesn’t believe the high court’s decision will have any impact on the way South Carolina conducts economic development.
“Governor Haley talks with business leaders about South Carolina every single day, and not once has she heard an objection to our state’s traditional values surrounding marriage,” Godfrey said in a statement. “She will continue to uphold those values and sees no reason to be concerned about any impact on economic development.”
State Sen. Brad Hutto, D-Orangeburg, said he expects corporations will want to make sure that South Carolina does not discriminate against gay employees, part of a routine checklist as companies make relocation decisions. But he does not believe that would be a paramount consideration, given that gay people work at all levels of South Carolina business and government.
“I think most businesses and companies probably have a hierarchy of checks they go through before they consider a move,” he said.
Hutto expects the ruling to have a greater impact on the highly educated individual who is considering a transfer from a state that recognizes his or her marriage “and who may say ‘I just choose not to go to a state that does not recognize my marriage.’”
Many questions surround the high court’s decision, and it likely will take months before the federal government sorts out all the benefit questions, from tax and immigration issues to pension, Social Security and end-of-life legalities. The Supreme Court case originated with a lawsuit filed by Edith Windsor, a New York woman who faced a $363,000 estate tax bill when her longtime partner died.
Joe Tedino, a Chicago-based spokesman for Boeing, said officials at the aerospace giant are aware of the questions that still hang over the DOMA decision, including the issue of same-sex couples who are married in one state and live in another.
But he said the company, which now has a huge presence in Charleston with its 787 Dreamliner facility, would be reluctant to comment on the political climate in any state.
"Boeing has a history of leadership of respecting the rights of lesbian, gay, bi-sexual and transgendered people," he said, noting that the company provides health and retirement benefits to employees in same-sex partnerships as well as traditional marriages.
"It is obviously a group that is very important to us that we respect and support just as we support South Carolina," Tedino said. "South Carolina is a big, important part of the Boeing company." He said Boeing officials are still evaluating the company’s health and retirement plans in the wake of the Supreme Court ruling.
South Carolina officials said this week the issue will be a topic of discussion, although how it plays out in the economic community has yet to be determined.
“Diversity places a big part in what the chamber proposes,” said Otis Rawl, president of the S.C. Chamber of Commerce. “We will just have to see how the issues bubble up at the chamber. I’m sure we will be looking at it.”
The S.C. Department of Revenue and the U.S. Internal Revenue Service are separately studying the decision, said Samantha Cheek, public information director for the revenue department. She said the state would follow the IRS’s lead. Gay couples legally married in one of the 12 states or District of Columbia that recognize same sex-unions could file their federal taxes jointly, but questions remain about filers who live in states that do not recognize gay marriage.
The debate has echoes of the fight over the Confederate battle flag that flew over the State Capitol for decades.
Adherents claimed the flag, hoisted atop the dome during the 1960s as the state commemorated the Civil War’s centennial, represented the heritage of the state. Opponents found in the flag’s prominent display a repudiation of the state’s African-Americans and the gains made during the civil rights era.
For years, the two sides remained at an impasse, with at least one chief executive, former Gov. David Beasley, defeated for a second term because he dared to suggest a compromise. Eventually, the business community, led by the state Chamber of Commerce and religious leaders, resolved the issue with the support of international corporations based in the state.
Steve Parrish, writing in Forbes magazine this week, detailed an expansive web of issues related to defined pensions, health care and other benefits that will require federal explanation.
“Employers with employees in different states will face a tangled web of concerns as to which law applies where,” he wrote.
“Quite honestly, that is one of the fundamental problems with leaving it up to the states to decide,” King said. “It creates so many scenarios that in terms of administering the law, even from a federal standpoint, it is confusing.”
Interestingly, King said he and his partner have always filed singly as required prior to the Supreme Court ruling, but privately calculated their tax liability under the “married, filing jointly” category just to get a sense of what they would owe.
Under the joint scenario, the couple would have paid more taxes, he said.