Senate rejects governor's tax-swap plan

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The tax swap was backed by Gov. Mark Sanford, who was flying to Bermuda for a family vacation when the Senate voted Thursday afternoon. The Republican governor had lobbied all 46 senators in the last two days to pass his bill, but it was killed by a 28-18 vote, similar to a vote taken last week.

The governor's absence during the debate on his centerpiece legislation left some senators shaking their heads.

"The governor left his responsibilities and went to Bermuda," said Sen. Robert Ford, D-Charleston.

A spokesman for Sanford said there was nothing improper about Sanford's absence.

"The governor, over the last 36 hours, has had personal conversations with nearly every senator," Sanford spokesman Will Folks said. "The legislative process is all about negotiation. There comes a point in that process, however, when you simply have to walk away. The governor is not going to negotiate where his plan is undermined."

The Senate adjourned Thursday evening in frustration, with Democrats and Republicans blaming each other for the lack of a revenue plan to address education and healthcare needs and offering only grim hope of a compromise before the Legislature ends its regular session on June 5.

"Yes, there is a chance," said Sen. Tom Moore, a Clearwater Democrat. "Will it happen? The odds are strongly against it."

Senate Majority Hugh Leatherman said he would work to find a compromise to fund the $171 million Medicaid shortfall in the days remaining.

Also defeated Thursday was a proposal by Sen. David Thomas of Greenville to end property taxes through a two-cent increase in sales tax. The Senate tabled the plan 21-18 after some senators raised questions about its impact.

The Senate passed a budget Wednesday that fell $20 million short of the spending plan passed by the House after weeks of disagreement over how to fund shortfalls in healthcare and education. Senate leaders hoped to craft a revenue plan in separate leguislation Thursday but acrimony spread. Leatherman accused Democrats of obstructing any plan involving the governor's proposal, a charge Moore denied.

"When it's all said and done, if you've got the majority, how can you blame the minority for thwarting the will of everything?" he asked.

The cigarette tax, estimated to raise $171 million a year, would have funded the following, according to Senate Finance Committee Chairman Hugh Leatherman:

. 6,000 nursing home recipients;

. 12,000 people in community long-term care;

. 66,000 seniors in the SilverCard prescription drug program;

. 250,000 others who receive pharmaceutical benefits;

. 49,700 aged, blind and disabled people who receive Medicaid services;

. and 43,000 children in the Children's Health Insurance Program (CHIPS).

Leatherman said that without the increased cigarette tax, those programs would be "gutted."

"If we leave here without funding Medicaid, the blood of the poor and weak will be on the hands of those who stopped it," he said.

With the federal matching funds from the state-federal Medicaid health insurance program, the $171 million would generate a total of $500 million in health care services.

Leatherman added that if the Senate fails to pass the cigarette tax, "it will be criminal and they ought to lock us up."

Sen. Larry Martin, R-Pickens, said senators would not be able to hide behind technical votes for the bill if they fail to pass it.

"If the citizens are not getting the services on July 1, it's not going to matter how you voted on this or that amendment. You didn't deliver," Martin said.

Sen. Jake Knotts, R-Lexington, an opponent of the cigarette tax, pointed out that the Medicaid fraud unit had uncovered $6 million in Medicaid waste, fraud and abuse, and said that illustrated why the Senate should not increase funding for the federal program.

But Sen. Greg Gregory, R-Lancaster, said the numbers illustrate exactly the opposite point.

Gregory noted that a Legislative Audit Council study found just $20 million in duplications, fraud and abuse in the state's $3 billion Medicaid program.

"That's a very small number, less than one percent," Gregory said, suggesting that any business would be happy to have such a small percentage of it's finances in the questionable category.

Lawmakers must agree on a state budget by June 5 or arrange for an extra legislative session.