“Republican” lawmakers in South Carolina are contemplating pay raises for state employees in an effort to offset reductions in the generous retirement benefits these employees are entitled to receive, sources tell FITS.
Our legislative sources say that pay raises for state employees will be a “top priority” as GOP budget writers determine how they should spend an estimated $1 billion in new revenue for the coming fiscal year. Last year, state government grew by $1.3 billion to a record $22.1 billion.
South Carolina taxpayers? They received nothing back in the current budget … and aren’t likely to get anything back in the coming budget, either.
Meanwhile, as of November 1, 2011 there were 15,536 full-time state employees in South Carolina who earned more than $50,000 a year – not counting these benefits, obviously. On those salaries alone, taxpayers are shelling out more than $1.1 billion a year. Also, the current unfunded liability of the S.C. retirement system is an estimated $14-17 billion.
The state’s controversial “retirement czar” – the flamboyant, Lamborghini-driving Robert L. Borden – resigned his post earlier this month. Borden’s commission was operating on a $5.8 million budget a year ago – but convinced Gov. Nikki Haley and leaders in the “Republican-controlled” S.C. General Assembly to appropriate another $5.5 million in the current budget. The agency was planning to ask for $19 million in the coming budget – which prompted several fiscal conservatives to begin investigating how the agency was spending its money.
Chief among those? State Treasurer Curtis Loftis, who has been pushing pension fund reforms ever since he was elected.
Some of those reforms are now gaining traction – although it appears as though they will come with a sizable up-front cost to taxpayers.
A proposal introduced by a S.C. House of Representatives subcommittee this year would require state employees to put 7.5 percent of their salaries into the state retirement system (as opposed to the current rate of 6.5 percent).
Employees would also be prohibited from collecting full benefits until they had worked for 30 years and attained the age of 62. Currently, workers can draw full benefits after 28 years of service – with no age restrictions.
Additionally, lawmakers want to begin calculating each employee’s pension amount based on the average of five consecutive years of their highest salary – as opposed to three years. That would reduce the benefit amount – as would a new provision that addresses attempts to “spike” benefits.
Finally, the plan would do away with automatic cost-of-living increases and would require that state lawmakers vote on these increases each year. Also lawmakers have toyed with the idea of closing the costly and controversial Teacher & Employee Retention Incentive (TERI) program to new participants.
We support all of these reforms – in fact, we proposed several of them months ago.
What didn’t we propose? This notion of cutting employees a check in an effort to make up the difference …
South Carolina state employees receive far better salaries and benefits than their private sector peers. And reasonable reductions in their retirement benefits are not only sensible – they are unavoidable.
Unfortunately, rather than making a responsible reduction in state government’s future obligations – lawmakers are trying to pull off some quid pro quo with our tax dollars.
While such a situation would ordinarily call for strong fiscal leadership from our state’s so-called “Tea Party” governor, Haley obviously doesn’t have a leg to stand on when it comes to this issue (click here and here to see what we mean).
Our state should absolutely take steps to reduce its unfunded liabilities. In fact if it doesn’t, taxpayers will be on the hook for an even bigger mess. What it should not do is force taxpayers to subsidize those reforms via unnecessary pay hikes.
***
By BigT December 13, 2011 at 12:22 pm
For years, Unions forced earners to pay lazy or “Made” Union members exorbitant amounts…as a negotiation…
State governments stupidly took that liberal queue and began lavishing government workers, who do nothing but inefficiently enforce more government regulations on the taxpayers…
Remember, Sanford pledged to end that…but the Appalachian Trail was more important than those promises that got him elected…
Now, as those Unions have Crashed their companies, the governments are finding it out, too…
Just be CONSERVATIVE and you won’t have to look over your shoulder when liberalism (as it always does) Collapses.
By ceilidh10 December 13, 2011 at 12:29 pm
Force state government workers to have a 401 k and let that be the retirement. Period. the retirement comes from money they set aside from the their paycheck. They also get a current tax break when they do this.
By Petey December 13, 2011 at 1:23 pm
Unless they’re talking 5-10% raises it’s not worth discussing if they think this will make state employees happy. Most state employees haven’t had a raise or bonus of any kind in 7-8 years. Now they’re talking about taking another 1% for retirement. If they think they can buy state employees off with a 2% raise, they need to think again.
By BigT December 13, 2011 at 1:39 pm
Yeah, Petey: But the goverment workers STILL have a job…
People who pay them, and are employed based on a thriving market, have lost their jobs….because of BAD management by government…
To whine; is why people are SO DISGUSTED w/ government…
You’re like a SPOILED brat who has yet to encounter reality…or the real world…
By PETEY GOT BURRRNEDDD December 13, 2011 at 10:04 pm
BOOOOMMM!!! Petey just got OWNED!!
By Nice December 14, 2011 at 10:43 am
You state workers are just lucky you have jobs, you’ve been living in largese courtesy of the taxpayer as it is.
Keep talking Petey, you’ll earn more enmity from those paying the bills.
By james December 13, 2011 at 1:52 pm
Before spending too much money upfront, most of these changes for existing employees will end up being struck down by the courts
By Crooner December 13, 2011 at 2:01 pm
Wasn’t this the subject of the first Wall Street movie, where Gordon Gekko wanted to by the company just for the cash it had reserved for retirement obligations for their employees? Interesting how previous posters and FITs seem fine with that.
Let’s take the next step. How about to reduce the deficit we simply renege on the promises we’ve made to members of the military? How much would that save? No more retirement after twenty years, no GI bill, no VA hospital benefits.
I was in a cab a week or so ago and heard Rush say he doesn’t expect anyone to pay HIM after he quits working, implying that those who relied on promises from their employers to do just that were dupes who will get what they deserve.
I think it’s important for employers to keep their promises to their workers. I think it’s even more important for government to keep their promises.
For those of you who would throw those folks to the wolves, I say YOU’RE un-American. And I don’t want any part of your country.
By BigT December 13, 2011 at 2:10 pm
LMAO: Crooner: Your basis and guidance for public policy comes from a Charlie Sheen movie…So, so Typical…
Also: As proof that liberals get by on Lies, Myths and Fables…Rush said he has NO CONFIDENCE that the government will meet its promise to give him back the money he paid to them for post-retirement…
No onn will throw anyone to the wolve, despite years of your rhetoric of fear to the simple-minded. But you people who hate “payers” should be figuring out that if you damage those people earning….there is nothing for the GREEDY, and HEARTLESS Leftists to take….
By Nice December 14, 2011 at 10:49 am
“I think it’s important for employers to keep their promises to their workers. I think it’s even more important for government to keep their promises.”
You mean like GM? Where not only did a company break it’s promise but the gov’t helped them by screwing the bond holders. Is that what you mean?
When you file bankruptcy, you screw everyone but at least keep your home.
Bankruptcy is Bankruptcy, that simple. If promises were made that makes our children debt slaves or prevents economic recovery I’m all for breaking them. The recepients of the “promise” will get screwed but our children weren’t the ones making the promises and don’t deserve to live mired in a poor economy and in unsustainable debt forever.
Blame the ones making the promises, the “give it all away” gov’t bureacrats and elected elites. Don’t blame the average Joe that pays taxes for their ridiculously high salary/benefits.
You might think it “un-American”, but at least I won’t allow my children to be eaten over some corrupted concept that may only exist in history books 200 years from now.
By crackahasscrackah December 13, 2011 at 2:23 pm
@ Will – you need to read up on the definition of “quid pro quo.” It literally means “a favor for a favor.” What favor would state employees be doing for the General Assembly in this scenario? Answer: None. The General Assembly holds all the power: It can giveth and it can taketh away.
@ BigT – What in the world are you talking about? Mark Sanford promised to get rid of state employee unions?!?! That would have been big news considering SC state employees have NEVER been unionized (and NEVER will for that matter). Its always convenient when someone you are talking with someone and they start talking about teachers unions or public employee unions in SC because then you know are talking with a moron.
By Jan December 13, 2011 at 2:26 pm
Crooner,
It is better to default on your promises than to raise taxes on those people who contribute money to you. Gordon Gekko is a job creator.
By Cid December 13, 2011 at 2:28 pm
Ah “t” is just a liar
Like his drug addled hero Limbaugh
Just makes stuff up and then runs around hollering “liberal!”
By BigT December 13, 2011 at 2:37 pm
Cid and Crooner: Your answer is: Obama…
Now: Look at the economy….
That should tell us all we need to know about you…
By Cid December 13, 2011 at 2:50 pm
And your answer “t?”
REPUBLICANS
Look at South Carolina
That should tell us ALL we need to know about you
By Cancerman December 13, 2011 at 3:30 pm
Fucking bullshit pay the current employees what they were promised as for them making better than the private sector what a load of horseshit!!
By Ken E. December 13, 2011 at 4:02 pm
“South Carolina state employees receive far better salaries and benefits than their private sector peers.”
FITS, I call bullshit. Where did you get this from? What is considered a “peer”?
By Joe December 14, 2011 at 7:20 am
I work in IT at a public college. You are saying that I make a higher salary + benefits than my peers in the public sector. What is your source on this?
What about our elected officials and other state workers on the deluxe pension plan? Is their plans equally underfunded and will similar steps be taken to correct this? I say do away with pension for every elected official and collapse all remaining plans into a single plan. Any objections?
By Petey December 13, 2011 at 4:14 pm
BigT – Like you know anything about work.
By No Name December 13, 2011 at 4:21 pm
Ditto to Ken E. BULLSHIT.
By Settle Down December 13, 2011 at 4:23 pm
“Big T”: If BS was music you’d be a brass band. You must have appled for state job at one time and was turned down..get a life.
By No Pledge. December 13, 2011 at 5:55 pm
End all benefits for future government employees who don’t risk themselves on the job (Fire, EMS, Police).
Honor previous agreements, but force down the cost of government by deterring people from working there.
There is no competition for workers, labor is valueless, and the taxpayer need not pay better wages than they themselves make.
By Nice December 14, 2011 at 11:01 am
Cato did a nice study with 2009 figures that speaks to the disparity between private and gov’t sector pay/benefits(nationally):
cato.org/pubs/tbb/tbb-59.pdf
You can see on the first page the average gov’t worker, broken down regionally the “south atlantic” which includes SC worked out to be around $34.90/hour for gov’t employee versus $25.33 private sector.
Let the attacks on me via gov’t parasites sitting in cubicles with nothing to do all day commence. :)
By Nice December 14, 2011 at 11:03 am
Please ignore my “reply” no pledge, I mean it to be a general post.
Hopefully Sic will eventually get his comment section to the stage where we can “edit” or “delete” our comments.
By Ken E. December 14, 2011 at 11:16 am
I was hoping someone would bring up this Cato study. Apples and Oranges. There is no comparison of like jobs, education, experience, etc. in this study.
Remember, Cato’s board members include Howard Rich and David Koch. They have an agenda that they are pushing with purposefully misleading data.
By Hey Brooother December 14, 2011 at 11:37 am
Cato has an ideological bent. It would be like going to a liberal think tank looking for data supporting the opposite point of view.
By Slippery When Wet December 13, 2011 at 6:23 pm
Hey, “No Pledge”!…what about teachers? How do they fit into your neat little package??? Is their labor valueless? and there are some very wealthy taxpayers who make good wages….You might want to rethink that one…
By IMHO December 13, 2011 at 6:59 pm
Pensions are a relic that distort the labor market price mechanism. Few 20 year olds that I know factor pensions into their career decisions. Unfortunately, too many 50+ year olds looking for a golden parachute for a few years of work do.
By Blah December 13, 2011 at 7:46 pm
I know very few people that make what the private sector make in the technical field of state government. Most IT people in state government are on call 24×7 and putting in 60 hours without compensation. I hate hearing this bs that state employees are overpaid because it is just not true at least not in my field.
By D-dawg December 13, 2011 at 8:59 pm
“Meanwhile, as of November 1, 2011 there were 15,536 full-time state employees in South Carolina who earned more than $50,000 a year”…
What about the state employees that make considerably less than 50k?
By What about them?? December 13, 2011 at 10:08 pm
That’s just MORE money that we as taxpayers shell out. And for what? 17 guys standing around a pothole with SCDOT on their chest while one fills a hole and the others talk about who’s fart smells worse?
By hopper December 13, 2011 at 10:05 pm
I’m sure the legislature won’t change their retirement or the judiciary’s.
By Hey Brooother December 13, 2011 at 10:11 pm
“South Carolina state employees receive far better salaries and benefits than their private sector peers.”
Haha, too funny. Fixed version below:
“South Carolina state employees enjoy decent medical coverage and far better job security than their private sector peers, while typically being paid less for the same work.”
Don’t read this as a complaint. You work private sector, there’s more risk / reward. You work for the state, you start out making less and good luck getting a raise. But you know that going in.
By Ken E. December 14, 2011 at 5:26 am
Come on, Will. Where did you get the info that state employees are better paid than their peers? I have a suspicion that it came from out of your ass. Just because you were overpaid by the state doesn’t mean everyone else is.
By Yowzer December 14, 2011 at 8:01 am
Boom!!!
By Nice December 14, 2011 at 11:02 am
I meant this to be a general reply(sorry for the repost):
Cato did a nice study with 2009 figures that speaks to the disparity between private and gov’t sector pay/benefits(nationally):
cato.org/pubs/tbb/tbb-59.pdf
You can see on the first page the average gov’t worker, broken down regionally the “south atlantic” which includes SC worked out to be around $34.90/hour for gov’t employee versus $25.33 private sector.
Let the attacks on me via gov’t parasites sitting in cubicles with nothing to do all day commence. :)
By Easy December 14, 2011 at 1:27 pm
“You can see on the first page the average gov’t worker, broken down regionally the “south atlantic” which includes SC worked out to be around $34.90/hour for gov’t employee versus $25.33 private sector”.
Nice
So, the ‘average’ S.C. state government employee makes over 68k per year?
And you say this is a “nice study”?
Are you serious?
By Nice December 14, 2011 at 2:35 pm
I meant “nice” in that it’s informative….nothing more…lmao. I’d love to see them all lose their jobs.
By AnotherAHole December 14, 2011 at 2:47 pm
Most on here feel State Employees are well paid and live like kings. Yeah, they have jobs for now, but I have an idea….Fire all of them…close state government and let those that live on welfare starve. You bi### and moan about state workers…..then see what chaos this state would be in…no more standing in lines at the DMV(Yippeeeee)…No need for drivers licenses….just drive….take your chances on our highways….no state troopers…..I for one would invest in a tank, so I could get to the grocery store. Guess we could all depend on our County Governments to pick up the slack…..Ahhhh, there’s the answer…that will put the state back in the black. Just remember, all haters of State workers…there is probably at least one thing you like “getting” from the state and that will be gone.
By Jack December 21, 2011 at 7:54 pm
just what we need… another stupid idea from our fine government!!!!!! what a JOKE!
By Trey February 8, 2012 at 9:47 pm
SO he talks about how 15,000 state employee’s make more than 50,000 a year. What about the 485,000 state employes that make less than 50k a year? Actually, 60% of state employee’s make between 15,000 and 35,000 a year.