State pension requirements lead to Darlington budget crunch

Officials in Darlington and many other municipalities are finding it harder and harder to make ends meet while paying into funds required by state law.

DARLINGTON, SC (WBTW) – Officials in Darlington and many other municipalities are finding it harder and harder to make ends meet while paying into funds required by state law.

“The state is requiring municipalities to increase the amount they are contributing for retirement,” said Lisa Chalian-Rock, Darlington Planning Director.

The increase required by lawmakers is one way they hope to offset a growing gap in the amount paid into state pension funds and the amount of debt the system is currently saddled with.

“That, for the city, means $78,000 a year that we have to pay this year to pay an increase that we don’t get funding from the state for,” said Rock.

As recently as last fall, state treasurer Curtis Loftis said the state’s pension program is at least $21 billion in debt.

“We’re just trying to find as many ways as we can to fill that gap,” Rock said.

Unfortunately for many cities and towns across the state, measures like Act 388 place increasing requirements on local budgets to help pay into retirement and pension plans–and limit how much local millage and property taxes can be raised to help offset those costs.

“$78,000 is kind of a lot of money,” Rock explained. “But we’ve worked with difficult budgets before and we’ll try and find some money.”

Rock said that $78,000 includes a $31,000 requirement for the police department’s pension fund–the largest in the budget.

“The police department to reorganize some of their task management to reduce overtime,” said Rock.

She said overtime has come down by 81 percent, which she hopes will save some money along with a three percent raise for the next five years in city water rates.

“Every department is always looking for somewhere that they can become more efficient,” Rock said.

She said the city’s last option would be to raise millage, but even that decision has to meet state requirements.

“We don’t have numbers yet from the state about our millage cap and what would be available to us,” she said.

Legislation to ease these sorts of budget crunches has been slow at the state level, though treasurer Curtis Loftis is on the record saying a tax increase will likely be needed.

The city of Darlington’s final budget will not be due until June.