If more money were the answer to the state’s infrastructure woes, the topic would hardly be worth debating. The real trouble with South Carolina’s roads, though, isn’t a lack of money. It’s a lack – indeed, a total lack – of citizen control or influence on road funding.
How do we know more money won’t produce better roads?
Consider the fact that since fiscal year 2011-2012, the Department of Transportation’s (DOT) total ratified budget (from all three parts of the budget – General Fund, federal funds, Other Funds) has grown by more than $500 million, from $1.1 billion in 2011, to more than $1.6 billion in 2016. Further, the State Transportation Infrastructure Bank’s (STIB) has skyrocketed from $50 million in 2014, to a whopping $270 million in 2016.
The state’s transportation budget is growing, then – more money has been put into it – with no discernible improvement.
The common misconception by proponents of a gas tax increase is that the state needs more overall revenue. That’s not the same as supposing we need to spend more of what we have on repair. Consider: in the last fiscal year $396 million of the $1.69 billion in transportation funding was free to be devoted to pavement resurfacing/maintenance.
In reality, though, no one has any idea if the state needs more overall revenue. Why? Because the current system of prioritization and funding of projects is not transparent. For example, $85.1 million of disbursements from the State Transportation Infrastructure Bank have been made to the home county of Florence Sen. Hugh Leatherman – who also happens to be a member of the STIB board. Under our current system, it’s simply impossible to know if these monies were used on the most pressing transportation needs in the state.
Transparency by itself, though, will accomplish very little as long as the underlying problem remains the same – namely that the lion’s share of power over the DOT belongs to two lawmakers for whom the great majority of South Carolinians can’t vote for and have never heard of. Consider:
No reasonable and unbiased person would look at this system – a system dominated by a few people who can’t be held accountable for the total outcome – and conclude that its woes must be due to a lack of money.
Clearly reform must come before any consideration of revenue. But how?
Once these reforms are achieved, lawmakers may begin talking about taking more money from taxpayers and putting it into the transportation system. Not until then.
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Each year during the budget debate, legislators talk about the responsible spending included in the budget. In this year’s debate, for instance, a House leader described the historically high budget as “reining in government spending.” But the numbers tell a different story.
Since 2007, the total budget has climbed over 35 percent — an increase of over $7 billion. This includes the recession cuts and short-lived and ill-advised stimulus funds.
Even more telling is the dramatic rise in “other funds” (fines and fees collected by the state) and federal funds. Budget writers (and some in the media) only talk about the general fund portion of the budget, but these other two portions both consist of public money collected from taxpayers.
It’s extremely difficult to get an accurate sense of the state budget, and that’s by design. The chart below gives you some idea of budget growth in all categories over the last decade.
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A House Ways and Means subcommittee has begun laying groundwork for a bond bill, characterized as a “small” expenditure by subcommittee members. The full committee will consider the bill soon.
While agency requests for bond funding totaled more than $2.6 billion (most of those requests came from the state’s higher education institutions), Ways and Means chairman Brian White stated his intent to keep the final amount around $425 million.
Nearly all of the proposed bonding projects were for building and equipment renovation, and maintenance. The Department of Transportation, for example, asked for over $43 million – not for roads but for rest area renovation. The State Museum Commission requested $10 million for gallery renovation, and the University of South Carolina requested $50 million to renovate an old law school facility, the university having just finished constructing a new law school.
Many of the agencies requesting bond funding did not see major increases in funding in this year’s Ways and Means budget, and lawmakers repeatedly said during budget deliberations that there was little money to spend. At a time when the state pension debt is burgeoning and when lawmakers are pretending the state doesn’t have enough money to pay for a core service like roads, borrowing money to pay for state university wish lists isn’t obviously sound policy. In any case, however, the bonding process itself is murky by design, allowing lawmakers to spend borrowed money with virtually no public awareness or input.
Even more concerning than this singular bill is White’s intent, as he has stated openly, to bring similar bond bills every few years. Except in extraordinary circumstances, routine maintenance and renovation should be funded through the yearly budget – not paid for by debt financing.
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S.248 is an exceedingly short and clear bill. It contains only three lines. The bill would allow anyone who’s held a state-issued professional license for 30 years or more to forego any further continuing education.
The important question here is this: What’s the reason? The legislature has passed laws regulating workers in every conceivable field, from accountants to real estate brokers, from psychology examiners to pyrotechnic safety experts. Of course, neither state bureaucrats nor state-appointed professionals have sufficient knowledge to impose rules on these professions. What would make anybody think Statehouse politicians are right to impose an arbitrary 30-year cut-off date for the continuing education requirement on all these fields?
A cynical observer could be forgiven for suspecting that this looks like a legislative favor to someone who feels he or she has had enough continuing education.
In any case, this isn’t how a free market economy works. In a freer economy than ours, industries themselves would be able to decide on the credentials and certificates necessary to let consumers know whether someone was on the up and up. It wouldn’t be up to state lawmakers acting at the behest of lobbyists.
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Late Tuesday night the House passed by far the largest budget in state history, as it usually does this time of year. The spending plan totals $27.3 billion – a $1 billion increase over last year’s budget. The vote was 113-5.
One significant amendment that passed during yesterday’s debate eliminated the Competitive Grants Review Committee – a committee that doles out money for special “community”-oriented projects around the state. Ways and Means chairman Brian White said that the proviso had been deleted as a result of the governor’s opposition; he asked the House instead to direct the $6 million (via a separate proviso) to the Department of Parks, Recreation, and Tourism for parks.
A number of alternate amendments for this funding were proposed, one of which would have sent the money to the county transportation committees (or CTCs) for roads. That amendment failed 101-13. Ultimately, the money was directed to the Department of Parks, Recreation, and Tourism, as White had proposed – sending the money to counties where legislative delegations could decide on how to spend it. That’s hardly an improvement from the initial Competitive Grants proposal – the money will now be doled out as special favors at the county level instead of statewide.
Rep. Mac Toole sponsored an amendment that would have eliminated the State Transportation Infrastructure Bank (STIB) and moved its functions to the Department of Transportation. He argued that the STIB is “nothing but a political machine.” That amendment failed as well, as did a series of amendments that would have converted the budget to a two-year appropriations bill.
House majority leader Gary Simrill praised the House plan as a “conservative” budget that “reigns [sic] in government spending” – this despite the fact that many state agencies saw substantial budget increases and overall spending increased by $1 billion. The budgetary priority, as in past years, was in spending every last penny.
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The purpose of the federal Freedom of Information Act (FOIA), passed in the aftermath of the Watergate scandal, was to make information possessed by government available to the public. Every state has an equivalent law, and any citizen – whether a member of the news media or not – may submit requests for information to any government agency under the federal or state FOIA laws.
Whether and how these agencies reply is often the subject of dispute, however. Every FOIA law includes exemptions, some necessary, some not, and in many cases government agencies simply refuse to comply – with no immediate repercussions.
Disputes over the effectiveness of South Carolina’s FOIA law has been a subject of debate at the Statehouse for several years, and so recently the South Carolina Policy Council submitted the same FOIA request to eleven state agencies. On November 8, 2016, we asked for:
► the number of FOIA requests the agency has received in the past three fiscal years;
► the number of FOIA requests to which the agency the responded by producing documents over the past three fiscal years;
► the names/identities of those who have submitted FOIA requests to the agency in the past three fiscal years;
► an itemized list of each FOIA charge for the past three fiscal years; and
► an itemized list of each FOIA charge that was collected in the past three fiscal years and a detailed summary how the funds were spent.
The state agencies were these: Clemson University, the Department of Commerce, the Department of Transportation (DOT), the Department of Education, the Medical University of South Carolina (MUSC), the State Ports Authority (SPA), Santee Cooper, the South Carolina Research Authority (SCRA), the University of South Carolina (USC), the South Carolina House of Representatives, and the South Carolina Senate.
First, some parameters about the Freedom of Information law.
South Carolina’s Freedom of Information law has broad application to state entities or “public bodies” – the term applies to any entity that receives or spends public money – and “public records” applies to virtually any papers or electronic documents in possession of state or state-owned entities. Read the definitions in 30-4-20 of the state law code, here.
Public bodies are exempt from FOIA in only a few, mostly common-sense scenarios: personal information; non-public information used by law enforcement for solving crimes; anything that would violate attorney-client privilege; etc. The two exemptions that have proven most doubtful and/or controversial are (1) trade secrets, which the Department of Commerce has frequently cited as exempting the agency from any requirement to reveal details of incentives agreements, and (2) “memoranda, correspondence, and working papers in the possession of individual members of the General Assembly or their immediate staffs.” Lawmakers and their staffs have used this latter exemption many times as a blanket exemption from any obligation to fulfill FOIA requests.
Public bodies must respond to the FOIA request within fifteen business days. Note: the body doesn’t have to supply the requested information within that time-frame; it must only respond by indicating that it will or will not supply the information.
Clemson University responded to the request on November 30 with a pro forma response, basically saying that it would supply the information the law requires it to supply, but not what the law doesn’t require. To date, Clemson has not supplied the information.
The Department of Commerce replied on November 29 with the requested information. From 2013 to November of 2016, Commerce received 122 FOIA requests – 18 in 2013, 45 in 2014, 48 in 2015, and 11 in 2016. Many of the fees were waived, but a few weren’t; total charges came to $171.50. Commerce supplied all of the requesters’ names and brief descriptions of the requests. In 52 cases, Commerce deemed itself exempt from the obligation to fulfill the FOIA request.
The Department of Transportation replied to SCPC’s request on the same date as the request. DOT also supplied the requested information. The agency received 1,512 responses during the 2013-2016 time-frame, averaging about 378 per year: 180 for 2013, 506 for 2014, 504 for 2015, and 322 for 2016. Total charges for this information came to $32,299, money DOT says it placed in the agency’s general operating account. DOT did not supply the names of those who submitted requests, citing the law’s exemption for anything that “would constitute unreasonable invasion of personal privacy.”
The Department of Education responded to SCPC’s request on the same day the request was made, but the agency’s chief communications officer stated that “our records retention policy filed with the state requires us to maintain Freedom of Information Act records for one year. I will be sure to let you know the availability of the documents requested within that one year timeframe.” No further information came from the Department of Education.
The Medical University of South Carolina responded to SCPC’s FOIA request on the day after the request was made. The response indicated that information was forthcoming – the agency’s public affairs director stated that she had “asked for any anticipated costs to be sent to you/me prior to conducting the request and hope to hear back by the end of this week.” No further information came from MUSC.
The State Ports Authority responded to the FOIA request on the day after our request. SPA supplied information for 2014, 2015, and 2016; the agency received 29, 20, and 28 requests, respectively, and produced 52 documents. Costs were waved for most of these requests; in total the agency took in a mere $27.20.
Santee-Cooper responded on the day after our request. The agency supplied information for 2014, 2015, and 2016; it received 17, 28, and 36 requests, respectively, and produced 72 documents. Costs were waved for all but two requests; in total the agency took in $134.69. The money was deposited into the agency’s general operating account.
The South Carolina Research Authority responded three days after our request. Over the past three years, SCRA has received ten FOIA requests. Of these, the agency supplied documents for nine. SCRA did supply the identities of the requesters, and indeed six of the ten were from SCPC and/or The Nerve. SCRA imposed no charges for these requests.
The University of South Carolina never responded to our FOIA request, not even to say the request was received – putting the institution in direct violation of the law.
The South Carolina House of Representatives responded within the 15 workday time-frame. The House received 50 requests from 42 requesters, and supplied the names of the requesters. The House’s response included this note:
In 5 instances, a House member claimed the statutory exemption under SC Code section 30-4-40(a)(8) that applies to memoranda, communications, and other work-product-related documents in a legislator’s possession and can be claimed as exempt from disclosure.
The House imposed no charges.
The South Carolina Senate, which replied within the 15-day time-frame, cited the aforementioned exemption to make the extraordinary claim that supplying simple information about open records requests amounts to an “unreasonable invasion of the personal privacy of those making requests”:
To the extent that that any public documents responsive to your request exist and are in the Senate’s possession, those public documents are exempt from disclosure pursuant to Section 30-4-40(8) of the South Carolina Code. Furthermore, your request for names and other identifying information constitutes an unreasonable invasion of the personal privacy of those making requests which likewise makes those documents exempt from disclosure pursuant to Section 30-4-40(2) of the South Carolina Code.
(1) Agencies’ interpretations of what’s required by the state’s FOIA law vary widely. Education institutions seem to believe they’re not bound by the law at all, with the Department of Education, MUSC, and Clemson technically meeting the requirement to respond but supplying no information, and USC not bothering to respond at all. Other agencies replied with a reasonable degree of promptness and thoroughness.
(2) There is no penalty in the law for agencies that simply don’t respond to open records requests per state law. Citizens may take these agencies to court, but there are obvious financial disincentives to taking that action.
(3) The South Carolina Senate abuses its exemption. The exemption – applying to “memoranda, correspondence, and working papers in the possession of individual members of the General Assembly or their immediate staffs” – shouldn’t exist in the first place. The attorney-client privilege does not apply to the relationship between elected official and their staff, between elected official and other elected officials, or even between elected official and constituent. In any case, SCPC’s request didn’t ask for anything belonging to legislators or their staffs. The Senate clerk seems to think the exemption he cites absolves the chamber from meeting any FOIA requests at all, which it does not.
(4) There simply aren’t that many FOIA requests for agencies to deal with. One of the most popular arguments against tightening the state’s FOIA law goes something like this: If you require agencies to respond more substantively to requests, those agencies’ public information offices will do nothing but respond to fishing expeditions by people looking for scandal. Our study doesn’t support that conclusion. Only the Department of Transportation received a significant number of FOIA requests; other agencies received far fewer. As for DOT, a $2 billion agency with a robust public information office should be able to handle 400 or 500 requests in a year.
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South Carolina has an exemption problem. The number of exemptions to the sales tax enshrined in law is staggering. As a result, the state routinely exempts more money in sales tax than it takes in. This is a direct result of the influence of concerned interest groups lobbying legislators for carve-outs in the tax code. Usually this is something to deplore. Just occasionally, though, there’s humor in it.
H.3841, recently filed to the Ways and Means Committee, is a peculiar piece of legislation. The bill would exempt disposable diapers that are bought by a 501(c)(3) from sales tax. Looking deeper, the bill would only allow this exemption if the 501(c)(3) has as its sole purpose the provision of diapers for low income individuals and families. A cursory Google search shows that there is a single 501(c)(3) in South Carolina that concerns itself with providing diapers to low income families and individuals: The SC Diaper Bank.
In effect, H. 3481 could have been written to say “The SC Diaper Bank will henceforth not have to pay sales tax for any disposable diapers that are purchased for the purpose of giving disposable diapers to low income individuals and families” That would have been a more honest way to write the bill, anyway.
This bill is illustrative of a broader problem in South Carolina. Businesses see the tax code as a way to gain a competitive advantage, and as such funnel money and time into seeking tax handouts instead of improving their own products. And legislators are happy to oblige them in their pursuit of perverse incentives by providing favored businesses with tax breaks and exemptions.
If South Carolina is going to impose a sales tax, perhaps the tax should be levied on all sales, at a low rate, with no exemptions. To do otherwise invites bad behavior on the part of businesses, non-profits, and legislators, and leads to people seeking favors from government rather than focusing on improving their own products or businesses.
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The most frequent criticism made of South Carolina’s form of government – it’s also the most accurate one – is that the legislative branch dominates the other two branches. Nowhere is this more obvious than in the selection of judges: lawmakers pick them, pure and simple. The governor plays no role in the choice. Judicial candidates are screened by a legislative body called the Judicial Merit Selection Commission; candidates who make the cut are voted on by lawmakers in a simple majority-wins contest. In practice, the winner is the one on friendly terms with more lawmakers than any other candidate.
A short and simple bill introduced in February by Sen. Tom Corbin – S.386 – would give South Carolinians the opportunity to radically change that system. If passed, this constitutional amendment would abolish the Judicial Merit Selection Commission and mandate that judges – appeals court judges, circuit judges, Supreme Court justices – be appointed by the governor on advice and consent of the Senate. With a few simple changes to the constitution, this amendment would dramatically limit the legislature’s unilateral power over the judiciary. (The House, meanwhile, is considering a bill that merely tinkers with the system by neutering the Judicial Merit Selection Commission – but the legislature’s hegemony would remain unchanged.)
For years, legislators have argued that by allowing the governor to nominate judges, even if those candidates must be confirmed by the Senate, we would be placing judges at the mercy of the executive branch instead of the legislative branch. So what’s the difference? The difference – as the nation’s founders who wrote article II of the U.S. constitution understood – is that the legislature writes the laws that judges will be tasked with interpreting. Although of course judges shouldn’t be unilaterally appointed by the governor (or president), judges should have as much independence from the lawmaking body as is practically possible. In South Carolina’s system, by contrast, judges interpret laws written by the body that appointed them – making all their decisions, even good ones, prima facie suspect.
The Senate Judiciary Committee should take a close look at S.386.
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Buried in this year’s state budget bill is a proviso establishing a program that may sound familiar. The program is the Competitive Grants Review Committee – a committee that doles out money for special “community”-oriented projects around the state. Gov. Mark Sanford famously termed the program a “legislative slush fund” because the grant allocations often looked indistinguishable from old-fashioned pork. Lawmakers were final pressured into killing the program in 2009.
The stated purpose of the Competitive Grants program is to award “community grants that will benefit the citizens of South Carolina to political subdivisions and nonprofit organizations.” There are six areas in which the program would award grants: health, environmental matters, travel, tourism, economic development, and parks and recreation. As with most other programs and committees with similar aims, the program would be another means by which projects would receive money from the legislature – but outside of the standard budget process.
The program’s Review Committee would have five members, appointed by the usual suspects: president pro tempore of the Senate, the speaker of the House, the chairman of Senate Finance, and the chairman of House Ways and Means. Of note, Senator Hugh Leatherman, Senate president pro tem and Finance chairman, would appoint two fifths of this committee.
Once the members of the committee are selected, they’d be tasked with meeting, developing guidelines for grant applications, and judging potential projects. The members would serve two-year terms, and be required to meet at least twice a year to review grant applications.
Funding for grants comes from the Litigation Recovery Account, which is funded by money recovered by the state in legal proceedings. Recipients of funds from the Competitive Grants Review Committee would have to report on the expenditure of those funds until the funds are completely expended.
In effect, this budget proviso would create yet another avenue through which legislative leaders can funnel money to their friends and reward their allies.
Of course, they can already do that – indeed they do it all the time, through the annual appropriations act – so it’s not clear why another vehicle. A realistic observer could be forgiven for thinking legislative leaders simply need a more innocuous-sounding mechanism by which to deliver pork to their cronies. Having decisions on the distribution of pork made by a committee of non-lawmakers instead of by lawmakers themselves would seem to accomplish that goal.
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