S.C. proposal would cut SCANA executive compensation packages after nuclear fiasco
COLUMBIA — One South Carolina lawmaker wants to drastically shrink the compensation packages for outgoing executives at SCANA, following the $9 billion cancellation of two nuclear reactors at V.C. Summer station.
Kirkman Finlay, a Republican from Columbia, introduced legislation that would stop the majority owner of the abandoned power plants in Fairfield County from approving multi-million severance packages for its departing leaders.
The proposed legislation was introduced at a time when two of SCANA’s top executives are set to retire. Chief Executive Kevin Marsh and Vice President of Generation Steve Byrne announced in late October that they would leave the Cayce-based parent of S.C. Electric & Ga s at the end of the year.
Lynn Teague, a lobbyist with the League of Women Voters who is protesting SCE&G’s proposed nuclear rate hikes, wasn’t sure how the bill would work legally, but she thinks it would satisfy one of the public’s biggest frustrations.
“On a whole, it certainly seems to address people’s concerns about fairness,” Teague said. “Why should people profit for doing a bad job?”
In recent months, state lawmakers and average South Carolinians voiced outrage over the executive compensation packages for SCANA and state-run Santee Cooper, the minority owner of the unfinished power plants.
Marsh and Byrne could receive up to $20 million in total severance compensation, according to SCANA’s filings with the Securities and Exchange Commission. The company has not announced their severance packages. Lonnie Carter, Santee Cooper’s former CEO, is collecting roughly $800,000 per year as part of his retirement package this fall.
Finlay’s legislation has yet to be considered by lawmakers. His bill was among 14 proposals introduced by House members this month in response to the collapse of the reactor project, which promised to usher in a new age of nuclear power in the United States.
A half-dozen of the bills, which include proposals to stop SCANA from charging customers for the aborted project, were sent to the House floor this week and should get a vote soon after the new session starts Jan. 9.
If passed by the General Assembly, Finlay’s legislation would tie the severance packages of SCANA’s outgoing leaders to the compensation given to other SCANA employees who lost their jobs following the nuclear project’s cancellation on July 31. Overall, nearly 6,000 jobs, including workers for plant contractors, were lost on that summer Monday.
According to the draft legislation, SCANA’s executives won’t receive their larger payouts unless the company drops its attempts to charge electric customers for the abandoned power plants. SCANA was able to use a 2007 law to collect money ahead of time from customers. Santee Cooper did not.
Finlay, who took part in a special House committee that investigated the nuclear cancellation, did not return two phone calls and a text message seeking comment.
Finlay has been among harshest critics since the project imploded, saying in August: “The ratepayers of South Carolina — us, our children and, if plans are to believed, our grandchildren — will be paying for the colossal mistakes that have been made. ... We have given the utilities more of a blank check than we ever should have.”
It’s unclear how the legislation would affect Marsh’s and Byrne’s compensation, since the two executives would leave SCANA before next year’s legislative session.
In 2016, Marsh, who led SCANA since late 2011, earned, in total, more than $6.1 million for his work. Byrne collected more than $2.5 million.
Over the life of the nuclear project, Marsh and Byrne also received bonuses that were partially tied to the success of the Westinghouse-designed nuclear reactors.
Westinghouse’s bankruptcy filing killed the project plagued by construction delays and cost overruns, and, according to a 2016 audit not released publicly until after the project collapsed, poor design work and purchasing mismanagement.
SCANA has tried to ease concerns with a proposed compromise to roll back electric rates charged by its SCE&G subsidiary. Customers would pay on average 15 percent of their bill toward paying off the abandoned plant rather than 18 percent. The company also is banking on a $2 billion tax break to lower the debt owed on the V.C. Summer project.
The proposal was panned by lawmakers and Gov. Henry McMaster, who want refunds for SCE&G customers after they paid $1.7 billion for the partially completed reactors.
SCANA has said having to pay pack customers and halt future payments for the nuclear work could make the former Fortune 500 company financially unstable.