Management & Labor

A Government Adrift

One day this June, a group of state agency managers came to Governor Mark Sanford with a pitch. They wanted to raise the projected growth...
by | July 31, 2008

One day this June, a group of state agency managers came to Governor Mark Sanford with a pitch. They wanted to raise the projected growth rate for the for state retirement fund's investments from 7.25 percent to 8 percent. That would free up significantly more money for state spending.

Sanford hated the idea. Given that the system currently has only about 70 percent of the money it needs to pay retirees, he thought investment policies ought to be more conservative, not more daring. And given the turbulent economy, what reason was there to be optimistic about investments anyway?

In many states, there wouldn't have been much more to it. The governor would have prevailed. Mark Sanford, however, has the bad luck to be the governor of South Carolina.

Sanford's objections came out during a gathering of the Budget and Control Board, a group that consists of the governor, the state treasurer, the comptroller general and two legislators. They talked about how cost-of-living adjustments might affect the retirement system and whether South Carolina's projections were rosier than those of comparable states. But in the end, all that really matters is that the Board has five votes, and the governor casts only one of them. Sanford was outvoted 4 to 1.

In South Carolina, this is business as usual. The Budget and Control Board is just one reason why South Carolina's governor arguably has less power than any other in the country. And that has been true for more than a century. As recently as 15 years ago, the governor didn't even have a cabinet or submit a budget. Legislation in 1993 changed that but, even today, the governor can't hire or fire the heads of many agencies without the legislature's permission. This is separation of powers beyond James Madison's wildest dreams.

Now, despite big obstacles, a confluence of factors suggest change is afoot. New reform-minded legislators are entering the General Assembly and some old ones are rethinking their views. Scandals have exposed weaknesses in the present arrangement.

South Carolina also has a champion of restructuring in Sanford himself. Truth be told, though, that's more of a curse than a blessing. Sanford is a combative, uncompromising loner who has few allies within his own Republican majority. He is not the sort of governor to whom even the more reformist members of the legislature would feel completely comfortable delegating new powers. Still, the chances seem good that, before too long, South Carolina government will step out of its 19th-century clothing and move toward the structure that prevails virtually everywhere else in America.

Power of the Pitchfork

South Carolina can thank "Pitchfork" Ben Tillman for its unique and cumbersome form of government. Tillman earned his nickname for suggesting, while a United States senator, that someone stick a pitchfork in President Grover Cleveland. But, before his time in Washington, he was governor of South Carolina. And he was the instigator of the 1895 constitution, still largely in effect.

The primary goal of that constitution was to guarantee that nobody but a white man would ever be elected governor. But the authors, in the throes of racial paranoia, went further. They divided executive power in a whole series of complex ways just to make sure that, if there ever was a black governor, he couldn't do anything. That's why South Carolina has nine separately elected constitutional officers, and why boards and commissions, not the governor, cast the decisive votes when it comes to running the executive agencies.

As the years passed, the governor grew weaker still as state government expanded and became more fragmented. "For every need that needed to be addressed, there was a new agency created to handle that," says Richard Young, a veteran of state government who is now a researcher at the University of South Carolina. "There wasn't any uniform central planning of any of this. It just evolved over time." By 1993, the state had 145 agencies.

State government experts have pointed out virtually from the beginning that the system had huge flaws. Commissions urged reform in 1920, 1945 and 1991, with the 1991 commission declaring that "South Carolina's State government still depends on 'horse and buggy' government structures."

Little was done for one simple reason: The legislature didn't want anything done. Even the most junior of the 170 members had found opportunities to intervene in management decisions. They appointed the boards and commissions that, in turn, chose the heads of agencies. For decades, legislators have defended this system as one of checks and balances -- even if the checks fall heavily against the governor. "If we wanted a king, we could easily have that kind of government," says state Senator John Land, a Democrat who's been in office for 30 years. "It's often been said that a dictatorship is the best form of government if you have a good dictator, but you can't count on that."

Finally, after a series of scandals in which legislators were taped accepting money in exchange for votes, and the governor at the time found himself unable to remove the head of the state Highway Patrol despite obvious malfeasance, some changes were made in 1993. Lawmakers consolidated 76 departments into 13 executive agencies. In 11 cases, the governor was given the authority to hire and fire agency heads.

Legislative Turf

It was those changes of the 1990s that limited the embarrassment following another Highway Patrol scandal this year in which a video captured a trooper using a racial slur and threatening to kill a black suspect. Officials in the agency were aware of the incident, but the trooper kept his job. This time, the governor had some leverage over the head of the Highway Patrol through his boss, the director of the Department of Public Safety, which was created in the 1993 reforms. "I saw that video that morning," Sanford recalls, "and that afternoon we made the decision."

But the decision owed more to luck than to management reform. Sanford didn't have the power to fire the Public Safety head -- he had the power only to decide whether he should be rehired. As it happened, the man was up for a new term, and Sanford could simply choose not to renominate him. When Sanford took that step, the Highway Patrol chief announced his retirement as well. Otherwise, they might still be serving.

The governor has even less control over other departments. In 2006, an audit uncovered tens of millions of dollars of waste and mismanagement in the state Department of Transportation. In most states, the department director would have been unceremoniously fired.

The General Assembly, however, guards the transportation department more closely than it guards any other agency. That dates back to 1935, when Governor Olin Johnston deployed the National Guard to try to remove a group of highway commissioners against the wishes of the legislature and the courts. Today, the chairman of the transportation commission is the only member picked by the governor; the rest are legislative appointees. The director, defiant until the end, had enough allies on the commission to stay on for months.

Or consider the Budget and Control Board, where Governor Sanford lost that battle over retirement investments in June. It effectively serves as the state department of administration, with human resources, information technology, purchasing and state buildings all under its purview. With two of the five members coming from the General Assembly, legislators have significant say not only over the ways crucial laws are made but over how they are executed. "Most students of government would tell you it's an invasion of power by the legislative branch on the executive branch," says Bob Sheheen, a former speaker of the House. "It was probably implemented for that reason."

The dynamics during Sanford's time in office have made that clear. Sanford has been on the losing end of a lot of 3-to-2 Budget and Control Board votes. Comptroller General Richard Eckstrom generally has been a Sanford ally, but the state treasurer and the two legislative representatives have often sided against him.

That seemed to change in November 2006, when Thomas Ravenel, a Republican allied with Sanford, ousted the nine-term state treasurer, Democrat Grady Patterson. Suddenly, the governor had a majority on the five-member panel that runs much of state government. The long-time executive director of the board stepped down and was replaced by Sanford's former chief of staff, Henry White, who helped launch a study of the Budget and Control Board and found that $500 million could be saved over three years through more efficient management.

But the shift in power ended up being short-lived. In July 2007, Ravenel resigned amid charges that he had distributed cocaine. He later pleaded guilty. Legislators, over Sanford's objections, quickly appointed one of their own, state Representative Converse Chellis, to serve as treasurer in Ravenel's place. That put the legislature back in control again. White resigned and the old executive director replaced him -- on a 3-to-2 vote. Sanford's allies argued that Chellis' selection was unconstitutional, but the state supreme court rejected the suit. As Sanford wryly asks: "Who appoints all the judges to the supreme court? The General Assembly."

Tilting at Fiefdoms

Given the weakness of his office, it came as no surprise when Sanford made restructuring one of his first priorities upon taking over in 2003. During the first year, he appointed a Management, Accountability and Performance Commission to study South Carolina government. In a finding that could just as easily have appeared in the first commission report 83 years earlier, the group determined that "state agencies operate as a collection of independent fiefdoms" and that government was "fragmented, unwieldy, and unaccountable."

The proposed cures: Turn some elected officials -- including the secretary of state, superintendent of education and adjutant general (an office that isn't elected in any other state) -- into gubernatorial appointees. Create a department of administration and shift the chief information officer to the governor's office. Consolidate state agencies into cabinet departments under the governor's control.

These proposals have been central parts of Sanford's agenda ever since. But Sanford has had little success, even though the General Assembly is run by his own party. The best example is the Department of Transportation. In the wake of the 2006 scandal, the governor was given the power to choose the head of the department. However, lawmakers left in place the Transportation Commission, dominated by legislative appointees, to oversee the department. They also created a new commission, made up entirely of legislators, to oversee the oversight process. Power is now more fragmented than ever.

At times, some major changes have appeared close to approval. A bill to create a department of administration passed the House unanimously in April, only to die in the Senate. But some say the whole effort was merely a sham. Cindi Ross Scoppe, an editor at The State, the largest newspaper in South Carolina, says legislators like to act as though restructuring is on the table, even if it stands no chance of passing both chambers. "The legislature has become more hostile to the idea of government restructuring every year since Mark Sanford took office," she says, "because he has done so much to antagonize them."

Although Sanford has been the strongest advocate of restructuring, he has also, in a sense, been its greatest enemy. He has clashed repeatedly with his fellow Republicans in the General Assembly over even the smallest issues. He's targeted legislators' pet projects and pushed for spending cuts that virtually no lawmakers were willing to accept. He's continued to press for school vouchers in the absence of legislative support.

The legislature has overridden hundreds of the governor's vetoes during his six years in office. This year, Sanford thought the budget was wasteful, so he vetoed parts of it -- then threatened to sue lawmakers for failing to meet their responsibility to pass a budget that was balanced. "I'm an unabashed conservative," Sanford says, "and sometimes accused of being a libertarian, to which I say, 'I'm guilty, I love liberty.'"

The personal tone of the debate has aggravated the policy disagreements. At one point, Sanford walked to the statehouse with a pair of squealing piglets in his arms, an unsubtle jab at what he called the pork-barrel spending of lawmakers. The pigs left a mess behind, both literally and figuratively.

Conflicts such as these have framed all the discussions of restructuring throughout Sanford's tenure. In effect, legislators now think of reform not in terms of giving more power to the executive, but to Mark Sanford personally. "This governor proves the argument completely that you need a balance," says Senator Land. "You could get a really strange governor elected that could play havoc with our state government. I don't have to say a word. I just say, 'Do you want to turn it over to this guy?'"

In Sanford's view, the personal animosities are a secondary issue. He argues that collegiality wouldn't have stopped legislators from resisting his efforts to streamline state government. He puts it this way: "You can play good boy and say, 'If you give me a couple of crumbs off the table, I'll behave and I won't say a word.' That has not necessarily been our approach because we're looking for changes that are bigger than that."

Waiting for the Moment

There are signs that, despite all the obstacles, change may be on the horizon. One is a new approach by state Senator Vincent Sheheen, the legislature's most aggressive restructuring advocate (and former House speaker Bob Sheheen's nephew). Sheheen proposed legislation this year to sweeten the restructuring deal for legislators by giving committees the responsibility to investigate and oversee -- although not to staff -- the departments in their subject areas. The idea is to create a more robust, better-informed budgeting process, thereby giving legislators important work to do as they surrender some of their power. The bill didn't pass this year, but Sheheen isn't giving up.

The new General Assembly that convenes next year may be more amenable to restructuring. One reason appears to be a shift of opinion among black lawmakers. In a supreme irony, some of the most loyal defenders of Pitchfork Ben's handiwork have been blacks. Unable to win statewide office, they have focused on exerting influence through the legislature, and so, traditionally, they've protected that power.

But state Representative Joe Neal says that African-Americans in the legislature, himself included, were impressed by Sanford's swift response to the Department of Public Safety scandal. More and more, Neal says, the Black Caucus is not reflexively opposed to restructuring.

Still, there is concern among the legislature's 35 black members that even a non-partisan campaign to give the governor more power will enable him to implement his conservative agenda. "If the governor can keep his efforts for restructuring apart from his efforts for vouchers, he may get votes in the Black Caucus," Neal says. "I'm not sure he can do that."

The restructuring forces aren't pinning their hopes just on persuasion. In the June primaries, Libertarian activist Howard Rich, the South Carolina Club for Growth and other like-minded groups collaborated in a campaign to rid the General Assembly of some of its anti-reform Republicans. This campaign won some major victories. The Senate majority whip was defeated. A former Sanford chief of staff ousted a sitting senator. A 28-year-old journalist beat an incumbent representative. Overall, nine incumbent Republican legislators lost in primaries. Were voters really voicing their displeasure with the structure of South Carolina government? "Oh heavens no," The State's Scoppe says. "It's been vouchers."

But in the strange world of South Carolina politics, the same folks who demand vouchers and privatization also tend to be the ones who want to change the structure of government. Chad Walldorf, the head of the South Carolina Club for Growth, speaks just as passionately about the dangers of fragmented governmental control as he does about the need for lower taxes. "It's a basic tenet of the business world or any government," he says, "that you put people in charge and hold them accountable." In his view, the current system makes accountability next to impossible.

The legislature that meets in Columbia next year will be a very different one. In addition to the primary defeats, an unusual number of Republican legislators are retiring -- a quarter or more of the Republican caucus in both the House and the Senate in 2009 is likely to be freshmen. Will they have less reason to be suspicious of Sanford's agenda? At this point, that's far from clear.

In fact, the best guess may be that serious restructuring will have to wait until after 2010, when a new governor is elected. But the assumption is growing that it will eventually take place. Sanford believes it will, although he makes no pretense that overhauling South Carolina government will be easy. "It's been the way it's been since 1895 for a reason," Sanford says. "It's hard to change."

Josh Goodman
Josh Goodman  |  Former Staff Writer
mailbox@governing.com  | 

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