What's it going to take to fix South Carolina's failing pension system?
COLUMBIA, SC (WIS) - South Carolina public workers took personal leave time to express their concerns on the state's failing pension system on Wednesday.
A joint committee of lawmakers discussed plans to fix South Carolina's $25 billion in unfunded pension obligations. State representatives and senators have been meeting to plan the solution to the ballooning deficit for several months.
So far, they have heard testimony from workers to include teachers, firefighters, and law enforcement, urging the committee not to increase the amount employees and employers must contribute toward their promised benefits. Last year, rates went up to a little more than 9 percent of their annual pay. A bill introduced would cap it at 9 percent and push the rate their company pays in to 18 percent.
State Treasurer Curtis Loftis has been warning lawmakers of the mounting debt. The committee has recommended Loftis be removed from the commission that oversees pension funds, the Retirement System Investment Commission. The committee also recommended the State Fiscal Accountability Authority, which is headed by the governor, be removed from the RSIC.
Loftis spoke out following the committee's recommendation.
"Today, the Joint Cmte. on Pensions decides if I, as your state Treasurer, stripped of pension duties and those duties given to the people and entities that have lost billions of your pension dollars," Loftis wrote on his Facebook page. "Prayers appreciated...and let's hope for the best."
Loftis spoke out following the committee's recommendation on his removal, citing an opinion from Attorney General Alan Wilson's office. The opinion states the belief that some practices of the Public Employee Benefits Authority as unconstitutional.
People who came to the meeting had a lot of questions, concerned over the money taken from their pay for their future retirement.
"What is going to be solvent when I need it? I started in 1999. I have about 17 years into the system. How much longer am I going to have to work? What's it going to be like for the people coming after me? What is the attraction for people coming into state employment? We also need to think about that," state worker Julia Lusk said.
Lawmakers say under their plan, the debt would be paid by 2041. Chairman Sen. Vincent Sheheen believes there should be another source of funding because the plan could strain the budgets of state agencies. Sheheen suggests something like a higher tax on cigarettes in South Carolina.
The plan's not final yet. Bills will be filed in the House and Senate on Thursday.
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