Friday, Jan. 8, 2021
The first session of the 124th General Assembly will convene at noon on Tuesday, Jan. 12. This will be the first year of a two-year legislative session. Like last year, the pandemic will again curtail numerous in-person meetings and significantly alter the normal legislative process.
Legislative leadership is committed to maintaining a safe workplace and reducing the likelihood of transmission of COVID-19, while ensuring public access to the legislative process. There will be far fewer in-person subcommittee and committee meetings, as most will likely be conducted online. Leadership remains confident that the most pressing issues facing our state will be addressed.
Sine Die adjournment is scheduled for May 13.
Here are the issues likely to be at the top of the agenda:
Legislation to conform our state’s tax code to the federal IRS code will again be required due to changes by Congress. Also on the tax front, legislation was pre-filed in the House that would lower the state’s income tax in a phased-in approach, and another bill would eliminate most sales tax exemptions and reduce the state’s sales tax. These bills were the result of a House tax study committee that met in 2018 and 2019 to provide a fairer and flatter tax structure.
Prior to the pandemic, South Carolina saw record economic growth and tax collections. As the pandemic spread and the economy slowed, budget forecasters significantly reduced expected revenue by over $800 million. However, because the General Assembly adopted a Continuing Resolution in June keeping state agency budgets at FY 19-20 funding levels, state agency budget cuts were not necessary.
Despite the disruptions to the economy, our state continues to experience slow and steady growth of just under 2%. The current estimate for FY 21-22 is $9.609 billion in General Fund revenue, with an estimated $182 million in new recurring revenue. Legislative leaders are cautioning state agencies not to expect much, if any, new recurring revenue. The good news is that our state has a projected surplus of $987 million, of which $675 million is available to appropriate now, to address one-time capital and maintenance needs. This does not include the expected Department of Energy lawsuit settlement of $525 million.
The House Ways and Means subcommittees began hearing state agency budget requests this week and will continue hearings for the next few weeks. They are expected to take up the budget in full committee the third week of February. Full floor debate is expected in the House the second week of March, and then the budget goes to the Senate for their consideration.
Gov. Henry McMaster is expected to release his Executive Budget on Friday, which outlines his recommendations to the General Assembly for his funding priorities for the next fiscal year. It is expected he will ask the General Assembly to appropriate $123 million of the surplus funds to assist small businesses affected by the pandemic.
Once posted, the Executive Budget can be found here.
Individual state agency budget requests can be found here.
The Department of Health and Environmental Control remains the lead agency for South Carolina’s response to the pandemic. The agency board recently announced the selection of Dr. Edward Simmer, MD, for appointment as director of the agency. Dr. Simmer currently serves as Chief Medical Officer for TRICARE Health Plan and retired from the Navy on Dec. 31. Previously, he served as Commanding Officer and CEO at the Naval Health Clinic Oak Harbor in Washington state. The selection is subject to approval by the Governor and advice and consent by the Senate. Information on COVID-19 and the vaccine can be found here.
In 2019, Gov. McMaster and legislative leadership said the 2019 legislative session would produce long-overdue reforms in K-12 education. The House passed its version of education reform in early March of that year. However, after hearing complaints from teachers and others about the legislation, the Senate did not pass their version known as “The South Carolina Career Opportunity and Access for All Act.” Instead, Senate Education Committee Chairman Greg Hembree (R-Horry) wanted to bring more stakeholders to the table and held numerous subcommittee and committee meetings throughout the summer and fall. After numerous changes to the bill, the full Senate Education Committee passed it out of the Education Committee in December 2019. The bill was the first to be debated by the Senate when they returned in January. After six weeks of debate, the full Senate approved the measure and returned it to the House in early March 2020, two weeks prior to the pandemic shutting down the legislative session. Lawmakers never got back to the bill during the abbreviated session that followed. This legislation, and teacher pay increases, are likely to be addressed this session. Expansion of broadband into rural areas will again be a priority.
The fallout from the V.C. Summer nuclear debacle continues to be a major issue at the State House. With ratepayers being forced to pay billions of dollars for the project that has been abandoned and numerous missteps by the state-owned utility ever since, the push to sell Santee Cooper is gaining momentum. Both the House and Senate have formed special committees to address the potential sale of the utility, and Gov. McMaster continues his support of a sale.
The House Santee Cooper Ad Hoc Committee met this past Wednesday and favorably approved H.3194 (Lucas, G.M. Smith, Simrill, Rutherford and others) that would authorize the sale of the assets of the South Carolina Public Service Authority (aka Santee Cooper) and provide reform measures. The bill now goes to the full House Ways and Means Committee on Tuesday. Chairman Hugh Leatherman appointed a six-member Senate Finance subcommittee, known as Santee Cooper Review and Policy (SCRAP), which will meet to debate how to proceed. Senator Leatherman believes Santee Cooper is increasingly not an asset.
The House has previously passed legislation that would ban abortion once a fetal heartbeat is detected but the measure never passed the Senate due to filibusters. Now that the GOP holds 30 of the 46 seats in the Senate, this issue is likely to be debated this year.
Another issue that has been gaining momentum in recent years is the “Compassionate Care Act” that deals with medical marijuana. Law enforcement officials have repeatedly opposed such legislation, but after several years of debate and numerous changes to the bill to appease other opponents this legislation is likely to be on the agenda again this year. Gov. McMaster has indicated he will follow law enforcement’s lead on the bill, suggesting a veto should legislation reach his desk.
Legislation that would eliminate the Certificate of Need (CON) requirements relating to the licensure of health care facilities has been debated for the past several years. While the House has passed such legislation in the past, the issue has never gained momentum in the Senate. Legislation has been pre-filed to both eliminate the CON program and to reform it.
Numerous bills have been pre-filed in both the House and Senate relating to higher education and the technical college system. Legislation that creates the SC Workforce Industry Needs Scholarship (SCWINS) passed the House and received second reading in the Senate last year but failed to receive final passage. That bill, which creates a scholarship for students attending a two-year public technical college majoring in a critical workforce area program is likely to be debated again this year. Other pre-filed legislation that might be considered includes bills that provide exemptions to the state procurement code for higher education institutions; expands definitions of in-state tuition; creates a Board of Regents; abolishes the Education Oversight Committee and the Commission on Higher Education and establishes the Commission for Comprehensive Education.
In the wake of the racial unrest this past summer, the House of Representatives formed the Equitable Justice System and Law Enforcement Reform Committee, which aims to bring substantial reforms to improve our state’s justice system and law enforcement policies. The subcommittees included: Civil Asset Forfeiture Reform, Criminal Statutory Review, Law Enforcement Officer Training, Tactics, Standards and Accountability and Sentencing Reform.
The committee met this past Wednesday and received an update from each subcommittee. All the subcommittees’ recommendations are being drafted into bill form and will be introduced and sent to the Judiciary Committee for debate. Included in the recommendations is a Hate Crimes bill, which closely resembles legislation recently passed in Georgia with additional language added regarding process issues. With the passage of the Georgia law in June, only three states (Arkansas, South Carolina and Wyoming) do not have such a law on the books. Many in the business community, including the SC Chamber of Commerce, are supportive of this measure.
Judicial pay increases have been debated in recent years, and legislation has again been pre-filed to raise the salaries of judges.
Every 10 years following the US Census, the legislature must re-draw House and Senate district lines to ensure each district has a comparable number of citizens. Reapportionment, or redistricting, can be highly political as the new districts can determine which political party has the advantage in elections for the next decade. The Census Bureau is required to send the census data to the states no later than April 1. This information is then used to redraw legislative districts based on population changes. This process will likely consume much of the legislature’s time and attention for the final six weeks of the session.
21 New Members in 2021
As a result of retirements and election losses, there will be 15 new members in the House of Representatives and six new members of the Senate – 21 new members of the General Assembly in total. Click here for a full list of House members and click here for a full list of Senate members.
State of the State Address
Gov. McMaster will deliver his annual State of the State address on Tuesday, Jan. 13, at 7 p.m. McMaster will lay out his legislative and budget priorities at that time to a Joint Session of the General Assembly.
The first session of the 124th General Assembly will convene on Tuesday, Jan. 12.