Gov. Nikki R. Haley's State of the State Message

COLUMBIA, SC – Wednesday, January 16, 2013

Mr. Speaker, Mr. President, Ladies and Gentlemen of the GeneralAssembly, Constitutional Officers, and my fellow South Carolinians:
This and every year, we will continue the tradition that recognizes thecertain truth that everything we have in this state and this nation weowe, first and foremost, to the men and women in uniform who bravelyserve on our behalf.

So now, please join me as we pay tribute to those who gave the last full measure of devotion in the service of their state and country this past year:

Chief David Lee Crenshaw, Pendleton

Sergeant Channing B. Hicks, Greer

Sergeant John D. Meador II, Columbia

1st Lieutenant Ryan D. Rawl, Lexington

Master Cpl. Sandra Sandy Rogers, Aiken

Private First Class Adam C. Ross, Lyman

Sergeant First Class Matthew B. Thomas, Travelers Rest

On behalf of all South Carolinians, to their families, know we will never forget.

We love and respect our men and women in uniform here in South Carolina – few things make me as proud as the level of patriotism that justradiates off our state and her people.

When I make that call to the families who just lost a loved one, Ipromise them that the people of South Carolina will wrap their armsaround them and never let go.

And the citizens of this state have never let them down.

A wonderful example of that is the 4,150 volunteer members of the South Carolina Patriot Guard Riders.

You’ve all seen these selfless men and women – whether you know it or not.

Their mission is two-fold:  to show their sincere respect for our fallen heroes, their families, and their communities, and to shield themourning family and their friends from interruptions created by anyprotestors.

They do it magnificently.

Please join me in extending a warm South Carolina thank you to BruceBallou, the State Captain of the South Carolina Patriot Guard Riders.  You make our state so proud, and may God continue to bless you and yourvolunteers for their service.  

We have another very special guest with us tonight, a hardcore rockstar, Brigadier General Lori Reynolds, the commanding General of one of thegreatest military institutions that’s ever existed: the Marine CorpsRecruit Depot, Parris Island.  If you don’t believe me, tour it yourself – but take my advice, don’t mess with this General.  

The Marine Corps has been at Parris Island since 1915 and has trainedthere for every major conflict of the 20th and 21st centuries.  We areso proud of our Marine Corps, so proud that the most impressive Marinetraining facility in the world is located right here in South Carolina,and so proud that General Lori Reynolds now calls the Palmetto Statehome.

I’d now ask you to indulge me in a brief moment of personal privilege.

When we as a family started this Administration one of the biggestchallenges was moving into a house that was, more than anything, amuseum.

A wonderful, beautiful, historic building but a museum nonetheless.  And so as a mom my biggest challenge was to make that house into a home for all of us.

We were blessed to have a mansion family that welcomed us and understood the games our kids would play by putting wigs on statues, giving eachmember of the security team a nickname, and playing jokes on the staffconstantly.

We love them all.  But there was one person that blessed our lives in a way that no one else could.

He did the same for the Hodges and the Sanford families.

He did the same for many of you.

Chamberlain Branch became a staple of the Residence, not for the job he did but for who he was.

He greeted many of you and other South Carolinians in a way that was Godly and unforgettable.

He made everyone feel special and welcome.

Most importantly, to this mom, he was the person my children couldn’twait to see when they got home and the one who truly turned that houseinto home for us.

Our family was blessed by his unselfish kindness to our children and everyone he came in contact with.

By now you all know that Chamberlain was tragically killed in December and our hearts remain broken.

Chamberlain has three young children – Chyann, Little Chamberlain, andChaniya – who were staples running around that house, and we are blessed to have with us tonight his amazing wife Cherisse.

Please join me and the Hodges and Sanford families in recognizingCherisse, and saying to Chamberlain Branch, one of the kindest, best men we ever knew, that while you will forever be missed you will never beforgotten.

I also have the pleasure of being humbled by two little ones who remind me how cool it is to be their mom every day.

Whether it’s getting them up and out the door every morning for school – sometimes fighting about what to wear or whether to go to school at all –  or them not having a care in the world about me being on tv, theyhave a way of making me remember what truly is important in this life.

They put up with a lot but never lose the smiles on their faces, soplease join me in welcoming Rena, who still loves to dance and Nalin,who still has a passion for the game of basketball.

Of course, our family is clearly missing someone tonight.

Michael is not with us as he has deployed with the South Carolina Army National Guard ADT 49 to Afghanistan.

We miss him terribly but he is doing exactly what he signed up to do –serve his country. He is excited to answer the call, and his only ask to me was to remind our state and country that we are just one ofthousands of families that share the bond of knowing military service.

Michael, Rena, Nalin and I thank you for the many prayers and messagesof support that have been sent to our family.  It has given us strengthand inspiration.  And we look forward to having him and his entire unitback safely with us next year.

Ladies and gentleman, the state of our state is productive – in spite of the challenges that come our way.

The last half-decade or so has not been an easy one for our nation.  Through the financial crisis and the deep recession that followed, wehave watched Washington flounder on both sides of the aisle, bouncingfrom one so-called solution to another.

The result of our federal government’s incompetence has been predictably poor: a stagnant recovery, listless jobs numbers, rising unemployment.

The opposite has been true in South Carolina over the last two years.  31,574 jobs announced. Over $6 billion in new investment.  Unemploymentat a four-year low.

And two 11-win football teams.

Coming into office, I made a promise to the people of South Carolina, a promise to eat, sleep, and breathe jobs in our state.

We have all the tools to be successful.

A beautiful state, a place where any person would want to live, work and raise a family.  A loyal, dedicated workforce with a burning desire tolearn and a work ethic to match.  And one of the lowest unionparticipation rates in the country.

We needed to let the nation, and the world, know that South Carolina was open for business.  Show them the positives of our great state, and the progress that we have made as a state and as a people.

And we have.

In two years, we have announced new jobs in forty-five of South Carolina’s forty-six counties.

We’ve announced more than 6,300 new jobs to rural areas of our state.

We’ve cut taxes on small business – and special thanks to Chairman Brian White and Rep. Tommy Stringer for their fight to make that happen.

We’ve passed tort reform that, for the first time
ever, puts a cap on lawsuit damages.

We’ve fought against the unionization of South Carolina, cherishing thedirect relationship between our companies – who know how to take care of those that take care of them – and their employees.

We’ve, through Lillian Koller and the Department of Social Services, moved more than 14,000 families from welfare to work.

We’ve created an Agribusiness partnership to showcase the largest industry in our state.

We’ve been awarded, for the second consecutive year, a Gold Shovel in recognition of our economic development successes.

We’ve been ranked as the second best state in the nation as a place todo business.  But as Secretary Hitt knows, we aren’t going to stop until we’re first.

We’ve announced $5 billion in foreign investment.

And we’ve seen no less an authority than The Wall Street Journal saythat, “Anyone still thinking the U.S. has lost its manufacturing chopshasn’t been to South Carolina.”

South Carolina is truly becoming the “It” state when it comes toeconomic development and job creation – not just in the United States,but worldwide.

With us tonight are a number of people who are proof positive that whatwe are doing is working, and I’d like to ask you to help me welcomethese wonderful friends of South Carolina.

To those whose names I call, please stand and remain standing.  And please hold your applause until the end.

– Representing 500 jobs in Anderson and Lexington Counties, from Michelin North America, Inc., Richard Kornacki

– Representing 126 jobs in Georgetown and Williamsburg Counties, from Agru America Inc., Vicky Thornton

– Representing 124 jobs in Union County, from Belk, Inc., Dave Penrod

– Representing 100 jobs in Colleton County, from SarlaFlex Incorporated, Krishna Jhunjhunwala

– Representing 1,000 jobs in Lancaster County, from Red Ventures, Mark Brodsky

– Representing 200 jobs in Berkeley County, from Nexans, Cam Dowlat

– Representing 80 jobs in Florence County, from McCall Farms, Inc., Henry Swink

– Representing 750 jobs in Richland County, from WNS North America Inc., Reese McCurdy

– Representing 190 jobs in Chesterfield County, from Schaeffler Group USA Inc., Bruce Warmbold

– Representing 50 jobs in Bamberg County, from Tobul Accumulator, Inc., Jim Tobul
 
– Representing Honda of South Carolina Manufacturing, Inc., BrianNewman, in celebration of the fact that they just produced their 2.5millionth ATV.

– Representing Fujifilm Manufacturing USA, John Ueno, in celebration ofthe 25th anniversary of Fujifilm being in Greenwood, South Carolina.

Please join me in showing our support to these great friends, old andnew, and thanking them for making South Carolina their home.

And as if we didn’t have enough to celebrate last year when Condé Nastnamed Charleston the best tourist destination in America, this yearwe’ve topped ourselves, as our beautiful Lowcountry city was named thenumber one tourist destination in the world.

Representing the Charleston Area Convention and Visitors Bureau tonightis Helen Hill, who along with the hospitality industry, our own peopleat PRT, and most importantly the citizens of Charleston deserves a round of applause.

I’m also of the mind that when any South Carolinian succeeds, it’s agreat day in South Carolina.  And we should all be exceptionally proudof a great friend to this state and a proud Clemson Tiger, Dr. LouisLynn.

In 1985, Dr. Lynn founded ENVIRO AgScience, Inc., and his successes andcontributions have not gone unnoticed.  This past year, the UnitedStates Department of Commerce gave Dr. Lynn the Ron Brown Award as thenation’s Small Business Person of the Year.  Congratulations, Dr. Lynn.

That the companies represented here tonight chose South Carolina to betheir home is a tribute to the kind of state we have right now.

But we can absolutely do more.

And we will do more – because none of us should be satisfied until every person in South Carolina has the opportunity to find work. 

First, we cannot rest on our laurels when it comes to our tax rates.

You’ve long heard me say that South Carolina needs to reduce our taxburden every single year.  Never has that been more important than now,with our citizens opening their paychecks this month and seeing that,low and behold, Washington’s tax hikes on the rich somehow got them too.

 

This year, I propose that we eliminate the six percent tax bracket.

 

This reform cuts taxes for the overwhelming majority of people who payincome tax, and not a single South Carolinian will pay more.

 

Other states have seen the successes we’ve had in South Carolina and are nipping at our heels.  Look around the nation and see all thegovernors, the legislators, the states that are proposing slashing oreven eliminating their income taxes.  We have to keep up.

 

Second, we need to take a serious look at our regulatory environment.

 

If government is costing a business time, then government is costing that business money.

 

And while the legislature convenes annually to look at new legislationand regulations, I know of no joint legislative and executive effortthat comes together to look at removing regulations that stymie theprivate sector and hold our economy back.

 

That changes this year.

 

Tonight I am announcing the formation of a Gubernatorial Task Force,largely to be made up of members of the business community, that willreview regulations and recommend those that can be eliminated.

 

Some changes can and will be made at the agency level – which is why one of the appointments I make will be the Chairman of Commerce’s SmallBusiness Regulatory Committee, Dan Dennis, and why I will be directingby Executive Order all of my agencies to begin this review process.  

 

But some may require legislative action, which is why I am asking you to join me in this effort and inviting Majority Leader Peeler, MinorityLeader Setzler, Majority Leader Bannister, and Minority LeaderRutherford to each make an appointment to the task force.

 

It has always been my belief that the best way to recruit new businesses in our state is to take care of the businesses we already have – andthat with the business community as our biggest cheerleaders, there isnothing we can’t accomplish in the great state of South Carolina.

 

Third, we have to address our crumbling infrastructure.

 

Our roads, our bridges – they simply aren’t up to standard.  More than1,000 of South Carolina’s bridges are either load-restricted orstructurally deficient.

 

First and foremost, it’s a public safety issue.  The citizens of SouthCarolina deserve to drive on roads that aren’t littered with potholesand on bridges they know won’t fall down.

 

It’s a core function of government.  But it’s also an economic development issue.

 

South Carolina has announced our self as the new superstar of American manufacturing.

 

We build things.

 

We build planes.

 

We build cars.

 

We build tires.

 

We build more ATVs than anywhere else in the world.

 

We need roads and bridges that match the quality of the companies that manufacture in our great state.

 

And we will
get them.

 

But I will not – not now, not ever – support raising the gas tax.

 

The answer to our infrastructure problems is not to tax our people more, it’s to spend their money smarter.

 

Why would we raise the gas tax to improve infrastructure when all thegas tax dollars we currently collect don’t go to improving ourinfrastructure?

 

Millions of dollars each year in gas tax revenue are being diverted away from our bridges and our highways.  Let’s change that.

 

And then let’s invest more of the money we already have into this vital area.

 

Every year you hear me talk about the “money tree” that falls duringsession, whereby new dollars appear above and beyond what was availablewhen we balance our budget in December or January.

 

Let’s prioritize that money differently this year.

 

We’ve released an Executive Budget that is balanced, funds the corefunctions of our government, strengthens underfunded needs like mentalhealth and law enforcement AND identifies an estimated $90 million thisyear for road and bridge improvements.

 

Let’s follow that blueprint.  We can make our state safer – and our business climate even more dynamic.

 

With us today is Warden Mike McCall, one of the unsung heroes of SouthCarolina state government.   Warden McCall runs Lee CorrectionalInstitution – one of our most dangerous prisons, housing the worst ofthe worst of our convicts.

 

As a legislator, it was always my belief that giving money tocorrections was giving money to criminals, and that there were better,more noble places our tax dollars should go.

 

Warden McCall will tell you that’s not true.

 

Twice in the past year, the Warden has had the prisoners take control of parts of his prison.  He has seen one of his guards viciously beatenand left for dead in a janitor’s closet.

 

Yet Lee Correctional has no towers, no wands, and few cameras.   I’ve been there.  I’ve seen it.

 

Warden McCall will tell you that if we give money to his facility it’snot going to the prisoners, it’s going to the guards.  And that forthem, it’s a matter of life or death.

 

Join me in thanking Warden Mike McCall – and then join me this budgetyear in helping to keep him, and all our prison guards, safe and secure.

 

Of course, we can’t talk about security in South Carolina withouttalking about the Department of Revenue and the protection of thepersonal data of the people of our state.

 

Plenty has been said and written about the international criminalhacking that took place at DOR – I’m not here to rehash that or to lookbackwards, except to say this: when it comes to data security, the state of South Carolina should have done better in the past and will dobetter in the future.

 

That does not mean that we will be 100 percent protected.  The toughestlesson I have learned is that in today’s world there is no such thing as absolute security.  That is true for conventional terrorism andhomeland security threats, and it is true for cyberterrorism andcybersecurity threats.  It’s a hard reality, but reality nonetheless.

 

What it does mean is that we will do everything we can to make sure that no state in the country has better security measures in place than wedo.

 

Already we have taken a number of steps in that direction at the Department of Revenue.

 

We are encrypting all personal and sensitive data.

 

This month we will have completed implementation of two-factor identification for DOR employees.

 

We are segmenting our networks to make sure that our most sensitive information is protected separately and securely.

 

We have created a Security Council within the Department, a team ofprofessionals that will meet regularly to discuss the state of oursecurity in this changing world and constantly update our processes.

 

And we have changed the organization of the Department so that the Chief Information Security Officer reports directly to Bill Blume, thedirector of the agency.

 

By the end of this process the Department of Revenue’s data will be as secure as any data in the private or public sector.

 

But it’s not just DOR that requires our attention.  In October I askedInspector General Pat Maley to review the IT standards and practicesacross state government.

 

His report made clear the following: while cybersecurity policies werecarried out on a near-daily basis in almost every agency, South Carolina lacks a single entity with the authority necessary to better secure our systems.

 

We must fix that, and fix that this year.

 

I have also directed every single cabinet agency to work with our stateIT department to make sure that twenty-four hours a day, seven days aweek, fifty-two weeks a year, our systems will be watched.

 

These measures are not cost-free, but they are necessary, and I want the thank Chairman Hugh Leatherman and Chairman Brian White for their helpin enabling the state to respond forcefully to this attack.

 

My ask to you tonight is to ensure that it’s not just cabinet agencies,but every agency in state government that is working with our state ITdepartment to provide our citizens the security they deserve.

 

To date, more than 1.1 million of South Carolina’s citizens andbusinesses have signed up for credit protection, either through Experian or through Dun and Bradstreet.

 

They are good, honorable companies who will help keep our informationprotected and at the same time be respectful to the citizens of SouthCarolina who have turned to them in our time of need. 

So to every South Carolinian watching tonight, let me say this: if youhave not signed up yet for protection, if your parents have not signedup for protection, if your friends or your coworkers or your neighborsor your siblings have not signed up for protection, please, please urgethem to do so.

 

It is so important.   Please visit: www.protectmyid.com/scdor and use the activation code SCDOR123.

 

There is no question that what happened at the Department of Revenue was a jolt to all of us.  My pledge to the people of our state is that aswith all crises, all challenges, we will do everything in our power tocome out the other side stronger than before.

 

We’ve come now to the portion of the evening that may feel to some like déjà vu.  Restructuring.

 

Few of us would deny that our government structure is outdated, broken, and does not well serve the citizens of South Carolina.

 

Every year governors as far back as Dick Riley have stood before you and pleaded to bring our government into the modern era.

 

And every year it feels like we end up in the same place, preaching the same changes, facing the same obstacles.

 

This year I want to keep it simple – two critical changes to the way South Carolina is structured.

 

First, our Department of Education.

 

Last year, for the first time ever, the House passed a bill that wouldallow governors to appoint the Superintende
nt of Education.

 

I cannot overstate how important this change is.

 

And all we are asking is that we give the voters the opportunity at the ballot box to make this constitutional change.

 

General Zais supports it.

 

The South Carolina House of Representatives supports it.

 

And I believe that if given the opportunity the people of South Carolina will support it at the ballot box.

 

Let’s give them that opportunity.  They deserve it.

 

And now to the Department of Administration.

 

Each of the last two years, I have made the argument as to why riddingour state of the unaccountable “Big Green Monster” that is the Budgetand Control Board would move South Carolina forward. 

 

Some of you, like Senators Larry Martin and Shane Massey, have made that argument with me.

 

For me to do so again tonight would be redundant.

 

I believe most of you know it is the right thing to do.

 

Instead, I will make this observation: if one came to South Carolinafrom another state or country and saw the way the Department ofAdministration bill was handled last year, he or she would surely beconfused.

 

The Senate unanimously voted in favor of it.  A large majority in the House voted for it.  And still, it didn’t pass.

 

How is that possible, one might wonder.  How did the Senate not eventake a vote on the final day? That’s not the way our system is supposedto work.

 

One might conclude that some of the votes in favor of restructuring were contrived.  One might even think that some wanted to be on the recordin favor of it while at the same time trying desperately to stop it from happening.

 

Well, to that, I will say this.

 

I wish a warm welcome to all the newly elected members of the House andSenate, but I want to extend a special welcome to the new senator fromLexington County, Katrina Shealy.  Senator Shealy represents one lessexcuse for those who don’t want to change the wasteful and inefficientway state government operates.

 

There are no more excuses left.  Let’s pass the Department of Administration this year.

 

Unfortunately, our structure of government isn’t the only place South Carolina lags behind the rest of the country.

 

In recent years, there has become a palpable sense among the people ofour state that something is fundamentally wrong with the way manyelected officials have conducted themselves.

 

In some ways that sense is unfounded.  The vast majority of our electedofficials are honest and honorable people.  But in other ways, thepublic’s unease is fully justified. 

 

For too long, votes weren’t being recorded.

 

Hundreds of would-be challengers were thrown off the electoral ballot while incumbents skated by untouched.

 

The people, by and large, believe that South Carolina government is setup in a way that serves the public officials of our state rather thanthe other way around.

 

We have made some progress over the last years, starting with thepassage of a bill that for the first time ever requires that everysingle vote on the floor of the General Assembly be on-the-record – and I thank you for making that a reality.

 

But we still haven’t done nearly enough.

 

The State Integrity Investigation took a look at every state’s risk for corruption and gave South Carolina an “F”.

 

We got an “F” for our ethics enforcement agencies.

 

We got an “F” for our legislative, executive, and judicial accountability.

 

We got an “F” for our public’s access to information.

 

We got an “F” for our state budget processes.

 

We got an “F” in nine of the fourteen categories they considered.

 

Every single one of us knows that is not good enough, that the people of South Carolina deserve better, and that it is our responsibility – ourobligation – to give it to them.

 

I think we each also know that if the public is going to trust thechanges we make to a system that almost exclusively governs us then weshould not be deciding alone what those changes look like.

 

Instead our ethical standards should be determined NOT by those insidethis Capitol but by those who have no stake in our rules. 

 

That’s why, in October, I created a panel of individuals ofunimpeachable personal and professional credentials to help us navigatethis reform process.

 

The panel includes former prosecutors.

 

It includes former members of our ethics commission.

 

It includes former legislators.

 

It includes members of the press.

 

It includes appointees made from each of your bodies.

 

It includes Democrats and Republicans.

 

Most importantly it is made up of people who have nothing to gain fromtheir participation other than the satisfaction of moving South Carolina forward.

 

Rarely has such a talented and diverse group of people gotten togetherand worked so quickly, so meticulously, and so diligently toward thetask at hand.

 

While every member of the South Carolina Ethics Reform Commissiondeserves our thanks and praise, the co-chairs of the Commission are here with us this evening, and I ask you to join me in recognizing twowonderful statesmen, two former Attorneys General, Travis Medlock andHenry McMaster.

 

They have thrown themselves into this process with an intensity andsense of purpose that gives me great hope for the recommendations theywill deliver to us within the next two weeks.

 

They have been thorough and thoughtful, taking testimony and gatheringresearch from those within the system as well as those outside it.

 

And I have every faith that their recommendations will make South Carolina stronger.

 

Our citizens must have confidence in how we do our jobs.  Thatconfidence will come from adopting the recommendations of thisbipartisan, professional, and unbiased group of experts.  Our citizensdeserve no less, and we should accept no less.

 

Now let’s talk about health. 

 

For all the debate we will have over health care in the cominglegislative session I believe we all agree that we want and need ahealthier South Carolina.

 

And no one can deny that this administration – working with legislatorslike Rep. Murrell Smith and Sen. Thomas Alexander – has made health apriority.

 

We started 2011 with a Medicaid budget out of balance and we brought it under control.

 

We started with one of the lowest rates of insured children in thecountry and now South Carolina is recognized for adopting leading edgestrategies to reach more kids.

 

We started with mental health and addictive disorder programs hobbled by cuts and together we have reinvested in both.

 

We started with a Medicaid program that required little accountability for quality or co
st and we’ve demanded b