Confusion swept through the Legislature on Thursday during a special session at which senators were called to vote on changes to a debt refinancing bill that aims to rescue a fiscally crumbling pension system. The newly amended legislation passed by an 8-6 margin.
In August, the Senate voted on an already heavily amended version of the legislation, which has been referred to as the Government Employees’ Retirement System bailout bill. Proposed by Gov. Albert Bryan Jr., the bill creates a special purpose entity charged with the responsibility of selling the rights to as much as $200 million per year in federal alcohol excise tax revenues to avert the collapse of GERS.
But a section of the revised bill before lawmakers on Thursday, which would allow the governor to negotiate and execute amendments to existing agreements with rum companies, put the senate “in a quagmire,” according to Sen. Donna Frett-Gregory.
Several senators said the new version of the bill takes oversight away from the Legislature and doesn’t allow lawmakers the opportunity to question rum companies. Some said the bill was changed so heavily that they were unsure if their power to ratify it would be compromised with the new version under consideration.
“You can’t continue to talk around reality, the reality is that this body said that they wanted to ratify as per law, as per customary practice. And the same bill that was passed by this body was gutted. So, you can look at it however you want,” said Sen. Kurt Vialet. “But the long and short is that it was gutted, and we are in the process of having a vote and agreements that have not been fully vetted. We are in the process of ratifying rum agreements that have not been fully executed.”
Because section 1409 of the new version of the bill states the governor would have the authority to ratify agreements with the rum companies, Sen. Vialet interpreted it as the executive branch looking for a “back door to ratification” of the entire bill. Sen. Marvin Blyden, on the other hand, said “legal counsel came onto the floor this morning and made it clear, crystal clear, that is not why we are here.”
“We are here in a special session and the executive team have brought forth an amendment they want to add to the act. We are here to ask our questions to them and make a decision as to whether we want to move forward or not in order to amend whatever they send forward. I know all 15 senators in here do not want to give up their power, their authority. That’s not what we are here for,” Blyden said.
Sen. Oakland Benta, like many of his colleagues, said he could not see himself moving forward with an affirmative vote on the bill with how it is now structured and worded. “I am not going to be blindfolded and work on something haphazardly,” he said.
Sens. Benta, Vialet, Dwayne DeGraff, Kenneth Gittens, Javan James Sr. and Janelle Sarauw all voted against the newly amended legislation.
Sen. Sarauw called the legislation “predatory lending,” and said the proposed loan is similar to the style of bank lending that led to the 2008 mortgage crisis.
“If we really wanted to save the system, we would find a good tax team, rewrite the excise tax, make it fair … There are ways to solve this, but to put my generation and the generation behind me in more debt is not the solution,” Sarauw said.
Sens. Blyden, Frett-Gregory, Alicia Barnes, Allison DeGazon, Stedmann Hodge Jr., Myron Jackson, Steven Payne Sr. and Athneil Thomas voted in favor of the bill, while Senate President Novelle Francis Jr. was absent.
DeGazon said she tried to look at the bill as though it dealt with her finances, her money.
“Would I refinance my home right now, yes. Would I be concerned about ten years, twelve years from now, yes. But I know that I would take advantage of the opportunity so I could maybe get my home in order, maybe pay off a credit card, maybe bring down my car note so my family and I can be stable for a minute. And in the next two, three years we sit down and reevaluate what we need to do again,” she said.
Now that the new version of the legislation has passed, as well as an additional amendment that senators voted on, Jackson said it is in the hands of the governor.