The SC Policy Council is reporting activities from the SC State Legislature:
This week the House passed a $32 billion budget – the largest budget in state history. However, they only debated around $10 billion of that spending and merely rubberstamped the acceptance of over $9 billion of federal dollars, without asking what strings are attached to those dollars or how state policy will be affected by the federal government as a result.
While lawmakers had an extra $1.8 billion to spend this year, House budget writers only opted to return $128 million – around 7% of the extra revenue – to the taxpayers. This would be in the form of a non-refundable $100 tax credit, but only for taxpayers whose state tax liability is at least $100 (after credits). Taxpayers who pay less than $100 in state taxes will not receive a tax credit.
Governor McMaster asked the General Assembly to immediately allocate up to $45 million of the state’s surplus dollars to the Department of Health and Environmental Control (DHEC) to help prevent the COVID-19 outbreak in South Carolina. Governor McMaster suggested deducting those funds from the taxpayer rebate instead of from the over $51 million of surplus funds aimed at pork projects or programs (such as $19 million for another convention center in Greenville, and $10 million in “film incentives” for the motion picture industry).
We will be publishing an overview of the House budget next week, but for now a few of the highlights include:
- The data warehouse bill, inserted as a budget proviso. This would create a massive data collecting system that tracks children from preschool through the workforce (and possibly beyond). The warehouse would be a tool for state economic planners to shape South Carolina’s emerging workforce (students). In fact, previous versions of this proposal referred to state public schools as the “workforce delivery system.” This language was passed as individual legislation by the House last year, but the bill stalled in the Senate.
- An extra $100 million for roads, despite a surplus of $500 million from gas-tax-hike revenues currently sitting in the DOT’s Infrastructure Maintenance Trust Fund.
- An additional $71 million for employee benefits – specifically, increased funding for the insolvent state pension, and increased costs for employee health insurance.
- $120 million redirected from debt service to school district building improvements, instructional materials, and career and technology education centers
The Senate’s Santee Cooper “reform” plan
Meanwhile the Senate released its plan for the reformation of Santee Cooper, after rejecting NextEra’s purchase offer, Dominion’s management offer, and Santee Cooper’s own reform plan last week. The Senate reform bill, S.1163, essentially constitutes a complete legislative takeover – the board would be suspended and replaced with an interim board of legislative appointees, and permanent board members going forward would be screened and elected by the General Assembly. The bill also attempts to institute some ratemaking transparency and oversight measures, while reaffirming Santee Cooper’s bond covenants – a concession that until the debt is paid, there is no way to force rates to go down or even to truly regulate the process of setting rates.
In addition to the Santee Cooper “reform” proposal detailed previously, lawmakers filed legislation (S.1160) requiring the Department of Commerce to publish the “clawback” provisions (requirements that the company return its economic development incentives if it does not meet its obligations) in all economic development programs it administers, and requiring a biannual report of all the triggered clawbacks and the progress on obtaining repayments. This policy would institute a much-needed layer of accountability and transparency to the state’s economic incentive approach.
The bill gives various oversight roles to the Public Service Commission, the Office of Regulatory Staff, a temporary legislative oversight committee, and a permanent legislative oversight commission – all of which consist of either legislators or legislative appointees. (Exception: the governor would appoint one member of the temporary oversight committee – a minor concession that is meaningless against a whole committee-full of lawmakers’ appointees.)
In summary, the Senate’s Santee Cooper reform plan is not to work toward selling the state-owned utility in an accountable, transparent manner, or to make Santee Cooper accountable to its taxpayer-owners, but to extend and solidify the legislative monopoly over the utility regulatory system. This system of legislative control over every aspect of utility regulation is entirely responsible for the failed V.C. Summer nuclear project and billions in ratepayer-backed debt driving up Santee Cooper’s rates.
Other Senate activity:
Another Senate committee advanced S.1071, which would create a new supplemental insurance policy for professional and volunteer firefighters diagnosed with cancer. To be eligible, the firefighter must have served with a SC fire department for at least five years, and have been actively serving within the ten years previous to the diagnosis. The plan would be funded from the proceeds of the currently-imposed premium tax on fire insurance companies. A related bill (S.753) would redirect a portion of funding for local fire districts to the “V-SAFE” program, which issues grants for equipment, vehicles and training to volunteer/half-volunteer fire departments.
The full Senate passed a number of bills, including the following:
- S.994 – Paying Lee County transportation officials out of gas-tax funds for attending their meetings (read more). (Awaiting consideration in the House)
- H.3998 – Creating a new tax credit for the construction of low-income housing projects over the next ten years. Credit is equal to the federal low-income housing tax credit. (Awaiting the governor’s signature)
- H.3485 – Imposing a new fee on recipients of the historic building rehabilitation tax credit. Fee goes to a new grant fund for historic preservation, administered by the Department of Archives and History. (Returned to the House with amendments)
- H.5034 – Requiring all Charleston County school board members to run for reelection in November; board members would be elected from single districts instead of county-wide. (Awaiting third reading in the Senate)S.1161 would require all health insurance plans to waive cost-sharing requirements for COVID-19 testing.
S.1156 would make it illegal to transport a pig in South Carolina unless the pig is accompanied by “an official form of identification.” This bill would also ban the importation of all but one pig species (the “Sus scrofa species”) and completely prohibit the possession of live wild hogs.
Finally, H.5390 would exempt smaller higher education construction and improvement projects from the full regulatory approval process. Specifically, research university projects costing $5 million or less would not be considered “permanent improvement projects.” For all other higher education institutions, the threshold would be $2 million.
Taxation and Spending
- S.1127 – Making the tax credit on solar energy systems refundable (you can earn a refund through the credit not just reduce your income tax)
- S.1123 – If a firefighter leaves the department that hired him and trained him for another in the state within two years of starting, the new department must reimburse the other for the cost of training including salary. If they stayed with the original department for more than a year but not two, the new department only has to reimburse 50%
- H.5304 – Income tax deduction for overtime worked in accordance with the Fair Labor Standards Act
- S.1134 – Increasing (from 3 to 5) the membership of the Hartsville Community Center Building Commission which is appointed by the Governor and the local legislative delegation
Criminal Justice
- H.5287 – Adds a definition of anti-Semitism for the State Human Affairs Commission
- S.1136 – Ordering that the state will not comply with federal attempts to regulate firearms that were created and owned in South Carolina, no local or federal official may enforce federal gun laws on firearms made and owned in this state, to be compliant a firearm must have “Made in South Carolina” on it
- H.5317 – Ordering that the state will not comply with federal attempts to regulate firearms that were created and owned in South Carolina, no local or federal official may enforce federal gun laws on firearms made and owned in this state, to be compliant a firearm must have “Made in South Carolina” on it
Elections
- H.5288 – Closing party primary elections, minimum time for party membership is two years, state election commission and county entities will keep list of people registered with parties, lying on the party registration form is considered perjury
- H.5305 – Setting voting precincts in Lancaster County
Regulations
- S.1129 – Changing regulations on the PSA; a director shall not be appointed for more than two consecutive unexpired terms, setting qualifications for board members, PSA and ORS must receive and review public comment on rate changes, the PSA shall submit an integrated resource plan to the PSC instead of the State Energy Office
- H.5308 – If a call center is relocating at least 30% of its business to a foreign country they must notify the director of DLLR or be subject to civil penalties of up to $10,000 a day that they are not in compliance, if the company does move its call center, it is not eligible for state loans or grants for 5 years. State agencies that hire call center must make sure they are in the state.
- H.5309 – A bill regulating ride sharing services stating that a personal vehicle may be registered with the PSC as a charter limo but does not have to be
- H.5307 – Requiring potential teachers fulfill student teaching requirements before being allowed to take the national licensing test
- H.5306 – Makes property that is converted from agricultural use to a structure require “setback lines” unless consent is gained from adjoining property owners to waive the setback line rule
Road Naming Bills
- H.5286 – Road naming bill for fallen officer Allen Lee Jacobs
- H.5300 – Resolution for DOT to name a road after a fallen firefighter
- H.5301 – Resolution for the DOT to name a road after a fallen fire engineer
Resolutions (highlights)
- H.5285 – Declaring March 4 as “Etiquette Day in South Carolina”
- H.5318 – Resolution for Herbkersman being named “Greater Bluffton Republican of the Year”
- H.5310 – Resolution for the “2020 Poultry Festival Distinguished Citizen”
- S.1132 – Resolution to make November 28th “Savannah River Site Day”
Bills filed during 3/3/20 – 3/5/20
Regulations
- H.5334 – If you are born after 1979 you need a boater safety license to operate a boat
- S.1138 – Commercial airmen that participate in interstate commerce and are required by the feds to have licenses and permits, must have those permits on them while flying in South Carolina. With a penalty for noncompliance of a felony with up to 3 years in prison
- S.1137– States that midwives should have access to continuing education, consulting physicians, as well as a plan for moving a birth to a nearby hospital if needed. Regulations promulgating these goals will be created by DHEC
- S.1139 – Regulating drones, makes it illegal to; fly drones while under the influence of alcohol or drugs, to use a drone to interfere with a first responder, to endanger a person or property, fly a drone to violate a restraining order. It also requires that a political subdivision that is applying to ban drones in certain areas hold a public meeting on the issue first.
- S.1140 – Tow companies may only charge storage fees for a vehicle after they have notified the owner that they have the vehicle
- S.1147 – Allowing and creating a form to allow parents to consent and revoke consent at will for “do not resuscitate orders”
- H.5339 – Ordering DHEC to make regulations on the amount of certain contaminants that may be allowed in public water systems
- H.5338 – Creating a “TOD” designation (transfer on death) for titles to certain titled personal property like; boats, vehicles, mobile homes, and out board motors. Deletes a requirement that the DNR must receive a bill of sale to title a boat
- H.5321– Allows dental hygienist assistants to do primary preventative care on a patient without supervision, and use anesthetic under “general” (currently “direct”) supervision of a dentist
Taxation and Spending
- S.1150 – Allowing a Redevelopment Authority to use redevelopment fees to finance and support museums
Elections
- H.5337– Allowing political candidates to use campaign funds for childcare expenses
- S.1146– Setting a date to appoint a large number of people to various boards for April 29th
Government Structure
- H.5335– Creating a committee comprised of legislators to negotiate the Next Era bid
- H.5348– Renaming the “Newborn Screening Advisory Committee” the “Newborn Screening and Rare Disease Council” and dictating some requirements for the board’s membership
Resolutions (highlights)
- H.5320– Resolution for a moratorium on the production of pentachlorophenol
- H.5342 – Resolution for the 2019 national winner of “America’s Best School Bus Inspector”
- H.5344 – Resolution to create “Independent Colleges and Universities Week” April 6 – 10
- H.5333 – Resolution for the Carolinas Associated General Contractors
Bills filed during February 25 – 27, 2020
This week House and Senate committees continued the process of reviewing proposals for state-owned utility Santee Cooper. All three proposals have serious problems, and none of them would eliminate Santee Cooper’s $7 billion in ratepayer-backed debt. The only way to arrive at a real solution for Santee Cooper is to start with a transparent process where decision makers can be held directly accountable. Read more here.
In addition, House and Senate lawmakers considered two bills calling for a convention under Article V of the U.S. Constitution to propose constitutional amendments. The House Judiciary Committee advanced H.3125 out of subcommittee, and a Senate Judiciary Subcommittee heard testimony on S.125 before carrying it over to its next meeting. Regardless of the specifics of each proposal, a constitutional convention is a serious threat to our inalienable rights – as it would literally allow the rewriting of the constitution and Bill of Rights. In addition, many of the desired “reforms” – balanced budget amendment, term limits, etc. – are already enacted at the state level, but have not eliminated debt, excessive spending or government overreach. Finally, the state lawmakers who routinely violate our own laws and state constitution would be in charge of the process of picking the individuals who would rewrite the Constitution.
Meanwhile, a Senate subcommittee advanced S.389, which would close party primaries to participation from anyone but registered party members. This would essentially change the primaries from public functions to private functions, in which case taxpayers should not be forced to cover the costs of those particular elections. The subcommittee also passed S.1083, which would prohibit anyone who voted in the 2020 Democratic primary from voting in the Republican primary in 2024 – a proposal with serious constitutional concerns, as reportedly acknowledged by lawmakers before voting to advance the bill.
The full House amended and passed H.4431, which would amend and standardize the local business license 
tax law. Among other things, this bill would set standard renewal and expiration dates, would base tax on gross income from the previous year, and would allow the Municipal Association to set and revise a standardized business license class schedule.
The full Senate continued debate on the education omnibus bill, after voting to limit debate to 20 minutes per amendment, and prohibit the introduction of any new amendments not already filed. The Senate went on to adopt language requiring the Department of Education to develop a uniform criteria for school districts to use when evaluating district superintendents; creating a SC Reading Panel, tasked with assisting the Department of Education with reading instruction, and reviewing and commenting on the state, district and school reading plans; and creating a development office in the Governor’s School of Science and Mathematics. This bill approaches public education as a “workforce development system” in which schools are less about educating students, and more about supplying businesses with qualified workers.
The new bills lawmakers filed this week included H.5288, another bill to close primaries. As noted previously, voters should not be forced to pay for elections in which they cannot participate, so if the political parties want to limit participation to their own members, they should also assume responsibility for 100% of the costs.
Another bill, S.1129, would institute several “reforms” of Santee Cooper, such as adding additional qualifications for board members and imposing board member term limits. These would not make the board any more accountable to the taxpayer-owners of Santee Cooper, however. The bill would also (among other things) require Santee Cooper to submit its integrated resource plan to the Public Service Commission (without requiring the latter to approve it) and to hold public hearings before changing rates, but would not change how rates could be set.
One particularly concerning bill, H.5308, would require call centers to notify the Department of Labor, Licensing and Regulation (DLLR) before relocating a call center or 30% of its operations to a foreign country, and would impose a fine for failure to notify of $10,000 for every day of the violation. The bill would also prevent state agencies from utilizing non-state-based call centers.
Finally, H.5307 would prevent teacher candidates from taking their teacher examination before they’ve completed their student teaching hours. This is a good example of the governmental micromanagement that permeates the educational system and which poses one of the primary barriers to educational reform.
As always, your State legislators would like to hear from you on what you want them to do. You may contact your legislator at this link.
The above synopsis of legislative activities was first published by The SC Policy Council. The SC Policy Council is a friend of Liberty and limited government, a good watchdog, and The Standard is pleased to present their findings and research toward the ends of Liberty, free enterprise, a more responsible, and a limited, State government. — The Editor
Michael Reed is Editor of The Standard.
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