COLUMBIA, SC (WIS) - South Carolina lawmakers are one step closer to a fix that could help shore up the state's pension plans and fill in a $20 billion debt.
In a 99-14 vote on the House floor, representatives voted to move a bill forward that would do several things in an effort to pay off that debt that continues to climb.
Agencies would increasingly pay more toward their workers' benefits -- up to about 18 and a half percent of employee salaries. Employees see the cap of how much they must pay in at 9 percent and with an amendment on the bill that passed Tuesday, when 85 percent of the debt is paid, the contribution rates can lessen then. But that could be in 20 years or more.
The state is also throwing in $160 million to pay off the debt this year. They are also adding some rules to the board of people who oversee the state pension.
"I do feel the retirees have bought into this, and they are educated on this," Rep. Bill Herbkersman. "We've had so many retirees at the meetings. And the first meeting was a free for all, but by the last meeting, the retirees were coming up and were thanking us for the hard work and for the hard decisions. I mean this wasn't an easy decision for everyone. It affects three out of every ten South Carolinians."
One reason lawmakers give for the deficit is underperforming or bad investments. In order to hold the investors responsible, they are introducing term limits on the board that oversees the pension fund.
In a statement released after the chamber's vote, House Speaker Jay Lucas praised action on the bill but stressed there was still more work to be done.
"The passage of today's bill is a giant first step towards honoring our commitments to state retirees and steering our retirement system back on a path to solvency. Correcting the inaccuracies of the past is the only way we can guarantee positive investments for the future," Lucas said. "This legislation seeks to protect every South Carolina taxpayer by stopping the financial hemorrhage before the system's unfunded liabilities spiral beyond repair."
State Treasurer Curtis Loftis, one of the biggest critics of how the state's pension fund is handled, released a statement in the form of several tweets, saying good and honorable people are being "bamboozled by the same acturial mumbo jumbo used to keep the pension swindle alive for the last 16 years."
The Senate, meanwhile, will reconvene on Wednesday to continue debate on their own version of the bill.