2006 Top Legislative Items in South Carolina
September 25, 2006

Billboards

Passed: The "South Carolina Landowner and Advertising Protection and Property Valuation Act" (H. 3381) passed the General Assembly, over the veto of the Governor. Under the legislation, local governing bodies must provide just compensation to outdoor advertising sign owners when they require the removal of a sign, except under certain specified situations as outlined in the bill. When both bodies overrode the Governor's veto, this bill drew a great deal of media attention.

The budget debate for fiscal year 2006-2007 was unusual. The House Ways and Means Committee stopped meeting in the middle of budget deliberations when the Governor issued a press release blasting them for "growing government." In response, the Committee split the bill into two parts calling one the "Supplemental Bill." The Senate put the bills back together, and was pleasantly surprised to find during their deliberations, an extra pot of money available.

After over a week of mostly closed-door budget conference committee meetings, the Senate and House adopted a plan. However, the plot thickened when the Governor threatened to call the Legislature in for a special session the week of June 5 to take up his budget vetoes. On the last day of session, in a slick move, the House did not bring the final budget over to the Senate for ratification. They did not ratify the bill until June 7. Taking the five days the Governor is allotted to review and present his vetoes to the body, the Legislature assured themselves the deadline would be June 14, which is exactly when they wanted to come back in for session.

Some noteworthy items include:

• Restored trust funds with $174.3 million in funding;

• Required unspent revenue be deposited into a Contingency Reserve Fund currently projected at $56.1 million;

• Utilized $129.5 million in revenue tax relief (see H.4449 and H.4450):

Reduced the Sales Tax on Food from 5% to 3% … $96.5 million
Two-Day Sales Tax Holiday after Thanksgiving … $18 million
Additional Property Tax Relief to Counties … $15 million

• Fully funded the General Reserve Fund at $167.7 million ($14.2 million increase);

• Fully funded the Capital Reserve Fund at $111.8 million;

• Provided a 3% pay raise to state employees at a cost of $52.2 million;

• Funded the state employee and retiree health insurance program with $30.5 million (no increased premiums to subscribers and no changes in benefits);

• Appropriated $760,000 to increase the Privately Operated Vehicle (POV) mileage reimbursement rate to the IRS level of 44.5¢ per mile.

• Included a proviso providing incentives for use of alternative fuels and fuel efficiency

Some noteworthy K12 public education budgetary items include:

• The Education Finance Act is fully funded ($69.5 million in new funds) to achieve a Base Student Cost of $2,367;

• Initiated a 15 year or 250,000 mile replacement cycle for school buses by appropriating $26 million for bus purchases and $26.8 million for fuel (also note that S.1026 provides $13 million in funding in the current year to address bus fuel and replacement parts);

• $25.6 million is appropriated for early childhood programs, of which $23.6 million will be directed to at-risk four year olds. The proviso directing these funds provides that full-day four-year-old kindergarten will be made available to all at-risk students in specified Plaintiff districts in the Abbeville County School District et al. vs. South Carolina lawsuit, from a combination of public and private providers. The program will be funded by the state at a cost of $3,077 per child. A transportation allowance and start-up grants for new classrooms are also provided. If available funds allow, the program may be expanded to the other Plaintiff districts in the lawsuit. The remaining $2 million is appropriated to expand the 0-4 year old program used by the Georgetown County First Steps program to other areas of the state.

• Fully funded the growth in the National Board Certification program ($6.1 million);

• The assessment program received an additional $2.9 million;

• An additional $5 million is appropriated for instructional materials;

• The Education and Economic Development Act (EEDA), which passed the General Assembly last year, is fully funded at $14.9 million. The EEDA focuses the high school curriculum into sixteen different career clusters. Interest assessments, academic assessments and career development counselors will be made available to assist students in choosing a cluster, and these career clusters will be complemented by programs at the state's colleges and universities, as well as at the Employment Security Commission.

• The Student Health and Fitness Act, passed by the General Assembly last year, is funded at $4.1 million. This Act increases access to physical education classes; provides increased instruction in health, safety and nutrition; and provides for an individual physical fitness assessment for each student.

• The High Schools that Work program received an additional $1.1 million to increase the number of sites from 100 to 140. The goal of this program is to increase the number of students who meet reading, math, and science performance goals and who complete an upgraded academic core with a career focus.

• Adult Education received an additional $1.6 million.

• High School Reading received an additional $500,000. This is an expansion of programs which target the lower grades to ensure that the focus on reading skills is maintained throughout the high school grades after PACT testing.

• The Governor's School for Science and Mathematics and the Governor's School for Arts and Humanities each received $2.5 million in non-recurring funds for capital projects.

• The Educational Television Commission received $1.4 million in non-recurring funds for Education Satellite Services.

Did not pass: after another year of talk about raising South Carolina's 7-cent a pack cigarette tax (the nation's lowest) to help pay for various health-related programs, the cigarette tax will remain the same.

Did not pass: Under this bill, common law marriages would not have been recognized by the state after or on January 1, 2006.

Charter Schools: Passed. A bill creating a statewide charter school district passed. This legislation allows the option of statewide, rather than local, sponsorship by creating the South Carolina Public Charter School District, which is authorized to sponsor and oversee a charter school. This newly created statewide public body, the South Carolina Public Charter School District, must be considered a local education agency and is eligible to receive state and federal funds and grants available for public charter and other schools to the same degree as other local education agencies. The office of the new district is to be housed at the State Department of Education. Signed May 3.

Early Childhood: Passed. The South Carolina Child Development Education Pilot Program, which funded for two years in the Appropriations bill, passed. The program will be available to children from the eight equity law suit districts first. Leftover funds will go to the remaining law suit districts. The program is voluntary, and the Education Oversight Committee is to evaluate the program.

First Steps: Passed. First Steps was reauthorized through July 1, 2013. Signed February 21.

Funding: see Budget section

Uniform School Start Date: Passed. The school year won't start prior to the third Monday in August beginning the 07-08 school year. Reps. Kirsh and Anthony introduced local legislation exempting their local districts from this statewide legislation. After several attempts, their bills ultimately failed, but they represent a movement that is likely to grow once the legislation is enacted. Signed April 8.

Put Parents in Charge Act: Failed. At the beginning of May, PPIC supporters made a strong attempt to amend Rep. Kirsh's tax bill with a voucher plan. Their amendment was defeated 59-52.

Eminent Domain bills S. 1029 (study committee) , S. 1031 (constitutional amendment), and H. 4503 (the main bill) lingered on after the Legislature adjourned on June 2. The Conference Committee met on Wednesday, June 14, the day the Legislature was scheduled to come in for Special Session. House appointees were Reps. Harrison, Edge, and Coleman. Senate appointees were Senators Gregory, Sheheen, and Campsen.

Our major issue was the House's position on H. 4503 that Special Purpose Districts would need approval from the Budget and Control Board before any condemnation action. Senator Sheheen made the motion to go with the Senate version on the budget and control board issue, which passed.

However, that afternoon on the floor, the Legislature did not give free conference powers on H. 4503 and it ultimately failed. S. 1029 and S. 1031 passed.

House members began the session with a new Speaker at the podium, after Speaker Wilkins left last year to serve as U.S. Ambassador to Canada. When a new leader takes over, there is change to be expected in some committee appointments and also in the general tone of the Chamber. Speaker Harrell took office with ease, elevating Rep. Dan Cooper as Chairman of the budget-writing Ways and Means Committee (Harrell's former post), and also keeping the House uncharacteristically quiet during deliberations. He demonstrated strong leadership skills and flexed his muscles with the body's quick override of the Governor's veto of the entire budget.

Passed: Widely known as Jessica's Law, the "Sex Offender Accountability and Protection of Minors Act" requires electronic monitoring of child molesters. A controversial amendment passed, which says those convicted twice if child rape could face the death penalty.

Property Tax Relief: Passed. After nearly a year of debate, H. 4450 (proposed Constitutional Amendment) and H. 4449 (enabling legislation) passed. Both the House and Senate studied a menu of items to address property tax relief. The House passed a sweeping tax swap proposal early in the session that increased the sales tax two cents to offset the loss to local governments. The Senate was more cautious in their approach wrestling with the procedural hurdle of a 2/3 vote needed for changes in the assessment ratio. It was left for a conference committee to adopt the changes that were made.

H. 4450 (Proposed Constitutional Amendment) would create a cap on the increase in value due to countywide reassessment of 15% over any five-year period. The base year for appraised values is property tax year 2007. Certain types of transfers of ownership are exempt from triggering a full reassessment. When property is sold, transferred, or improved otherwise it is assessed at full market value. The time limit for appeals of valuation is also extended.

H. 4449 (Sales Tax Swap) eliminates all school operating taxes on owner occupied homes, with a two-thirds vote required in the House and the Senate to change this provision. The sales tax will be increased by one cent, excluding food and accommodations, effective June 1, 2007. Taxpayers will receive relief from the school operating exemption on their tax bills due in January 2008. Revenues from the additional one cent tax will be placed into a trust fund. The trust fund will be used to (in priority order):

1. Replace the eliminated school operating taxes on owner occupied homes with revenues from the 1¢ general sales tax imposed (these replacement funds will be included in the local maintenance of effort); then

2. Provide $2.5 million total in minimum replacement funding for each county to be distributed among the school districts (these funds, over the replacement amount due to the formula, are not a part of the local maintenance of effort); then if funds are available

3. Roll back county operations taxes on owner occupied homes as far as possible, as remaining funds are available from the new 1¢ general sales tax imposed.

Did not pass: The Workers' Comp bill would have revised the workers' compensation system, which provides disability payments for workers who sustain injuries in the course of their employment. The legislation provides that the burden of proof in a workers' compensation claim is on the employee. H. 4427 passed the House but ended the session in Senate Judiciary.