House leaders blame Haley for restructuring bill's failure

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COLUMBIA — While Gov. Nikki Haley berates senators for killing her signature issue, House leaders contend she needs to point the finger at herself, too.

In the final days of the legislative session, House and Senate members were still struggling to compromise on their versions of two priority items: pension reform and government restructuring. The latter had been a campaign issue for Haley, who touted in stump speeches that she’d eliminate the Budget and Control Board. The little-understood agency holds bureaucratic duties ranging from property management to budget estimations, and it is controlled by a five-member board of politicians, including the governor.

A law enabling Haley to claim victory on that front was within reach after unanimous approvals in the Senate for its version. While the House has repeatedly passed similar bills, it was a first for the Senate.

With the clock running out on a compromise, Haley called negotiators on the bills into her office.

Furious House members say that’s when the first-term governor made a strategic goof that ensured the restructuring bill’s demise and put pension reform in jeopardy.

Haley backed the Senate’s plan to put a new agency overseeing public employees’ benefits in the pension bill, rather than the so-called Department of Administration bill, over the House’s objections, say House Speaker Bobby Harrell and current and former House majority leaders.

Democrats, especially, wanted a Public Employee Benefit Authority that for the first time gave state employees and retirees a vote in decisions affecting their benefits.

Stripping out that piece from the broader restructuring bill removed the Senate’s incentive to pass it, said House Majority Leader Kenny Bingham, R-Cayce.

“I knew then DOA would die,” he said. “She did not get her DOA bill because they had no reason to give it to her.”

House leaders say they were forced to go along; otherwise, Haley would publicly blame the House for the death of both bills.

“We were backed in a corner, quite frankly,” said Rep. Jim Merrill, R-Charleston, who led a panel that crafted the House’s pension plan.

Haley declined to address the House’s accusations directly. Senators say they never heard such a threat.

Sen. Shane Massey called the House’s finger-pointing a case of flawed “Monday-morning quarterbacking.”

In the end, the Senate debated the restructuring bill without getting to a vote. With less than two hours before the gavel fell, the Senate moved on to the pension bill, which won unanimous approval. An attempt to get back to restructuring failed.

Senate Judiciary Chairman Larry Martin, who held the floor for most of that day as he pleaded for a vote, said it would’ve been impossible to get the super-majority vote needed to keep the benefit agency in the restructuring bill after a compromise with the House on its board makeup.

Senate Labor and Commerce Chairman Greg Ryberg, who led the pension debate in his chamber, said the House’s logic is “absolutely incorrect.” There were too many factions opposed to the restructuring bill, he said, and the benefit agency’s inclusion wouldn’t have bolstered support needed for passage.

Publicly, opponents to the restructuring bill called it “restructuring in name only,” as it divided the Budget and Control Board’s employees and duties into several new agencies. Some argued it would expand government. The agency the bill was named after, the Cabinet-level Department of Administration, would put duties such as computer technology, fleet and property management, and human resources under the governor’s control. Supporters said it rightly put executive functions under the executive branch.

Opponents argued that another agency’s board makeup looked a lot like the Budget and Control Board, only with a couple of extra politicians.

The bill’s inside-baseball nature also contributed to its demise. Unlike pension reform, which prompted a flurry of calls from constituents and was deemed crucial, restructuring of an agency that many voters don’t even know exists, on an issue that’s difficult to put into bullet points, didn’t generate any urgency.

The bill died without much fanfare, compared with last year’s hoopla. When the gavel fell last year without the Senate giving the bill final approval, Haley immediately called a news conference to demand the Legislature return to session to pass her priority bills. The order resulted in a Supreme Court showdown that Haley lost, with the justices saying she lacked that authority.

This time, Haley limited her immediate response to posts on social media.

Next year, the process must start all over again next year, with a new bill.

Haley said she’ll continue the restructuring fight, though she’s frustrated that after two years of effort, it died so close to the finish line.

“It’s still something I can’t believe happened, and I’m so embarrassed for the Senate,” she said.


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