Some S.C. cities say they – and their workers – would be shortchanged under the state Senate’s plan to shore up the state’s embattled pension system.
While both the S.C. House and Senate budget proposals include spending millions in taxpayer money to help local governments cover their employees’ higher pension costs, the two bodies would spend the money in drastically different ways.
That difference is just one of many in each chamber’s roughly $8 billion general budget proposal that has to be worked out over the final weeks of the legislative session. The new state budget takes effect July 1.
The S.C. House approved sending taxpayer money to cover half the higher retirement costs for all local government workers directly to the pension system.
But the Senate approved sending money for local government workers – about $30 million – to the underfunded Local Government Fund, not directly to the retirement system.
That would shortchange some cities, they say.
For example, the city of Columbia would get roughly $900,000 of its workers’ higher pension costs covered by the state under the House plan. But under the Senate plan, Columbia would get only roughly half that amount – $440,000, according to estimates by the S.C. Municipal Association.
Columbia City Manager Teresa Wilson and Chief Financial Officer Jeff Palen issued a joint statement noting the capital city faces about $1.85 million in increased pension fund costs next year.
“Legislators have said that the state will reimburse employers, like the city (of Columbia), half of this increase next year,” the Columbia officials wrote. “The House budget does that, but the Senate budget splits the money unevenly between counties and cities, reimbursing Columbia less than a quarter of our projected increases. We hope the Senate will agree to treat cities and counties the same."
Some cities – which do not have employees in the ailing S.C. Retirement System – would get more money under the Senate plan. However, they would get no added benefits under the House plan.
“More money goes to the needs of cities in the House plan, while we appreciate the Senate plan of giving us recurring dollars into the Local Government Fund,” said Melissa Carter of the S.C. Municipal Association.
The money the Senate would send to the Local Government Fund would be split between cites and counties. About 17 percent goes to 270 incorporated S.C. cities and towns, according to the Municipal Association. Meanwhile, 83 percent goes to the state’s 46 counties.
Counties say that’s fair. They contend they should get more money because they provide state-mandated services.
Municipalities do not help pay for state social services, public safety, and Department of Health and Environmental Control offices, as counties do, said Tim Winslow of the S.C. Association of Counties.
While appreciating the House’s pension funding efforts, Winslow said his group prefers the Senate’s version. “Most, if not all, counties receive more money that way,” Winslow said.
He also noted that sending money directly to the state pension system inadvertently covers the increased costs of non-public-sector employers – such as association members – who also are in the pension system.
Rural schools in poor shape
Lawmakers recently directed the S.C. Department of Education to study the facility needs of 30 poor, rural districts that sued the state for more money in 1993.
The study’s charge was to catalog the condition of the poor schools before the state commits added dollars to help poor districts renovate or build new school facilities.
Now, the findings are in, and they are not good.
▪ Of 500 school buildings in the 30 districts, 25 percent have roofs that are in poor shape, just a notch above being “not operational.”
▪ In another quarter of the buildings, classroom heating and air-conditioning systems also were ranked poor.
▪ Also, three out of four buildings have poor security features.
The condition of roofs, classroom comfort and security were among about two dozen aspects of the school buildings reviewed by the Education Department.
How much will it cost to fix the building problems in the 30 districts?
No one knows.
The General Assembly did not require a cost analysis as part of the study.