COLUMN: Senate cooperated on ESC reform

The General Assembly recently enacted major reform of the South Carolina Employment Security Commission (ESC). I knew when I filed the legislation more than a year ago that reform moves slowly and requires hard work. I appreciate those who joined me in this decisive step forward.

The problems at the ESC simmered for a decade and then boiled over when the Unemployment Insurance Trust Fund (UI Fund) became insolvent in November 2008. The crisis forced legislators to finally confront issues that we, me included, should have addressed long before.

A Legislative Audit Council (LAC) audit of the ESC uncovered myriad shortcomings--some of agency management and some of legislative oversight. The audit also revealed structural and operational problems that require reform and modernization. I determined in the wake of the LAC report not to look backwards and cast blame but instead to move forward. We have done that.

The new law achieves a complete overhaul of the agency and its mission. The law merges the ESC and the Workforce Investment Act division at the South Carolina Department of Commerce into a new agency called the South Carolina Department of Employment and Workforce (DEW).

The merger addresses an audit finding that the ESC has focused far too much on cutting checks and not nearly enough on getting unemployed South Carolinians into good jobs.

Senator Nikki Setzler spent hours in our committee hearings and on the Senate floor reminding us that getting South Carolinians back to work matters most. Several components of the new law address that issue, and even the name, suggested by Senator Setzler, reflects the reoriented mission of the new agency.

DEW no longer operates under the direction of three commissioners, as did ESC. Governor Sanford will nominate a new executive director for DEW who will take over following confirmation by the Senate. The director serves at-will to the governor until March 30, 2011. Then a new screening committee will qualify three candidates from which the next governor will choose one to serve at-will following advice and consent of the Senate.

Senator Glenn McConnell negotiated this compromise that combines the fact that the governor answers to the entire state with the desire for legislative oversight of the agency. DEW will be far more accountable.

The three sitting commissioners will constitute an appeals panel for disputes between claimants and employers. Senator McConnell ensured, however, that the General Assembly will have the opportunity to elect three new commissioners within five to seven weeks. Both the new commissioners and new executive director must meet job qualifications previously non-existent.

DEW will report more information more often to the General Assembly. Senator Mick Mulvaney devoted much time during our committee meetings to the question of adequate and timely information and the fact that ESC simply had not been producing it.

DEW must produce monthly progress reports during 2010 and 2011. The currently required annual assessment report on the UI Fund will be enhanced to show data in better chronological context. The LAC also will conduct three more review audits of DEW between now and 2015.

The LAC discovered that the ESC had made hundreds of millions of dollars in payments in recent years to people who had been fired for causes such as violence and theft. Senators Chip Campsen and Brad Hutto worked together on the Senate floor to craft a statutory prohibition on benefits to anyone fired for causes including: damage to property of more than fifty dollars; alcohol possession or use; theft of more than fifty dollars; criminal assault or battery; criminal abuse of patient or child in one's care; willful neglect of duty. The immediate savings of these payments will help South Carolina sooner repay its UI Fund debt.

Majority Leader Harvey Peeler and Minority Leader John Land deserve much credit. They made this bill a Senate priority and pushed it to its resolution, especially when certain issues threatened to kill reform.

I finally must thank Governor Sanford who has made ESC reform a priority in each of his last two "State of the State" addresses. His leadership kept ESC reform in the forefront, and his signature of the legislation proves that we can work together on important issues.

Our work remains unfinished as South Carolina needs billions of dollars to repay our federal loan and replenish our UI Fund reserve. We will address those issues in coming weeks, and I fully expect us to continue our work in the productive manner by which we achieved real reform for South Carolina.

Senator Greg Ryberg (R-Aiken) represents District 24 in the South Carolina Senate. He can be reached at gregryberg@scsenate.gov.