COLUMBIA -- Gov. Mark Sanford lost another battle over the State Budget and Control Board on Wednesday, as the five-member panel chose former director Frank Fusco to head the agency.
Fusco, who stepped down as executive director in January, replaces Henry White, Sanford's former chief of staff, who resigned Aug. 3.
The Board voted 3-1 to hire Fusco; Sanford was the sole dissenter. Comptroller General Richard Eckstrom, the board's fifth member, abstained, saying he supported another candidate.
"It's a farce to say this is an executive agency," Sanford said, adding lawmakers use the Budget and Control Board to "just warehouse political hacks, in many cases."
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Newly elected state Treasurer Converse Chellis, a former lawmaker, joined the board's two legislative members in supporting Fusco.
Sanford said Fusco's selection means there is little chance of reform at the agency, which oversees billions in state contracts, purchases, land transactions and other day-to-day operations of state government.
Citing a recent examination of the agency, Sanford had hoped to reduce the internal mark-up on information technology and other services the board charges other state agencies, trim employee benefits, and generally reduce state costs.
"Things will be done the way they had been done," Sanford said. "How many dusted-over reports are there in Columbia, South Carolina? It gets talked about but never dealt with."
Fusco said the report, known as the Government Efficiency and Accountability Review, will be his first priority.
However, Fusco's selection limits Sanford's influence in implementing those changes, many of which can be done by the executive director.
"I am very pleased to be able to go back to the board," Fusco said. "My career has been focused on change and improvement."
Fusco, 58, has worked for state government for more than 30 years. He was named executive director of the Budget and Control Board by then-Gov. Jim Hodges, a Democrat, in 2001. Fusco also has worked for the Joint Bond Review Committee and the House Ways and Means Committee.
Fusco's selection was contentious, with Republican Sanford questioning Chellis, also a Republican.
"If (the Board) is truly an executive branch entity, I ask that you defer to us," Sanford said.
Chellis said he interviewed the three candidates -- Fusco; Charleston businessman Chad Walldorf, Sanford's former deputy chief of staff and the governor's candidate for the post; and former lawmaker Mike Easterday, an aide to Lt. Gov. Andre Bauer -- and said Fusco was the most qualified.
"I've looked at the resumes," Chellis said. "I've looked at the expertise. If you put all those names at the top of the paper, only one stands out, and that's Frank Fusco."
Senate Finance Committee chairman Hugh Leatherman, a voting member of the Budget and Control Board, disputed Sanford's claim the governor always has had his choice of executive director for the budget board. The choice always has been left to a majority of the board, the Florence Republican said.
Leatherman also said lawmakers have created a committee to review the Efficiency and Accountability report. "We totally intend to look at each and every one of those" recommendations.
Though Fusco has returned as executive director, he will not regain control over a controversial grants program.
After White refused to issue grants during his tenure, lawmakers changed the law governing the controversial $55 million competitive grants program. Now, a new five-member committee will issue all grants.