One of the problems lawmakers will attempt to tackle this year is reform of the state’s indebted pension system for state employees.
The state’s debt to the pension system is estimated at $20 billion by state consultants. Essentially, there’s not enough money going into the system, and over time that has resulted in billions of dollars in unfunded liabilities.
Rep. Gilda Cobb-Hunter, a Democrat from Orangeburg, said there are many ways to fix the pension system, but it can’t come at the expense of state employees.
“Property tax relief fund comes off the top of the budget each year, and we can do the same with our pension system,” she said. “I will not be a part of anything that puts the fix on the backs of state employees who have worked for the state, because they thought they were getting a good retirement. I won’t do anything that jeopardizes their retirement and greatly adds to the cost for state employees.”
Sen. Vincent Sheheen, a Camden-area Democrat also on the pension reform committee, said there needs to be more money for state pensions.
“The problem with pensions is that they’re underfunded,” he said. “There has been poor leadership for at least the past decade that has put South Carolina in a catastrophic position in this area. Our employees pay some of the highest percentage of their salary into the pension system, more than anyone in the state. The state is going to have increase their contribution to the system.”
Sen. Sean Bennett, a Democrat from the Dorchester area, is also on the pension reform committee. He said this problem is one of the biggest for the state.
“Roads and pension are two of the highest dollar figures in state government and two issues that could have the most effect on the state over the next generation,” he said. “They can be tackled at the same time.”
Rep. Tommy Pope, the House speaker pro tempore and a member of the House tax reform committee, said they’re still in the process of looking at viable changes.
“Anything you change has a ripple effect into other areas,” he said. “Where we’re at now, we’re close to having modeling software that will allow us to run various models on those changes.
“We’re going to have to have some openness about who’s getting the breaks and who's suffering from what we have now. We’re tasked with making it flatter and fairer.”