View from the Dome – May 3, 2019
By Copper Dome Strategies, LLC 

The debate on the potential sale of state-owned utility Santee Cooper again dominated the time on the Senate floor this week. The House spent most of its week in committee meetings. Teachers rallied at the State House on Wednesday for education reform and increased pay. 

TAX 

The SC House Tax Policy Review Committee’s sales tax proposal was introduced on Thursday, read the first time and referred to the Ways and Means Committee.  

The bill, H.4532 (Pope, Clemmons, Daning, Taylor and others), is similar to a plan first proposed by the TRAC Commission a decade ago, to basically eliminate all sales tax exemptions, and begin taxing electricity, food and medicine at 25% of the gross proceeds of sales, which would roughly equate to a sales tax rate of 1.25%. The plan would lower the current state sales tax from 6% to 3%.  

House Ways and Means Tax Subcommittee Chairman Alan Clemmons (R-Myrtle Beach) testified that he plans to hold public hearings around the state this summer and fall on the proposed plan in preparation for debate in the legislature next year. 

For a fuller account oh H.4532 – including how it proposes a tax on services and SCACPA’s response –please read this SCACPA blog postSales Tax Bill Based on TRAC’s Ideas, Including a Tax on Services, is Referred to Ways and Means Committee.” 

SINE DIE ADJOURNMENT  

Sine Die adjournment is scheduled for Thursday, May 9 at 5 p.m. Adjournment sine die means “without assigning a day for a further meeting or hearing.” This Latin term is used to signify the end of our legislative session. 

However, in most recent years, our General Assembly has adopted a Sine Die Resolution that allows them to continue past the mandatory May 9 Sine Die deadline to complete unfinished business. The resolution typically specifies when they can meet and what specifically the legislature can debate during the extra session. The Senate has introduced, but not yet passed, a Sine Die Resolution S.785 (Peeler, Leatherman, Setzler and Massey) that allows the General Assembly to return on May 20 and adjourn May 22. The House has not yet introduced its version, but we expect both bodies will reach an agreement to return before next Thursday’s adjournment. 

BUDGET 

With the Senate approving its version of the state budget H.4000a few weeks ago, the bill was returned as amended to the House along with H.4001, a joint resolution to appropriate funds from the Capital Reserve Fund. The House is expected to amend the bill and return it to the Senate next week, thereby setting up a Conference Committee made up of three House members and three senators to resolve the differences. It is unknown at this time if the Conference Committee could complete its work prior to the end of the legislative session next Thursday. If not, members of both chambers must agree to continue working beyond the mandatory May 9 Sine Die adjournment date, something they have routinely done in previous years. 

The Senate Finance Committee adopted H.4413 (G.M. Smith, Lucas, Simrill, Rutherford and Stavrinakis) a Joint Resolution that gives authority to pay the expenses of state government in the event the 2019-20 fiscal year begins without a state budget having been adopted. The Joint Resolution now goes to the full Senate. 

Information on both versions of the budget can be found here. 

The governor’s Executive Budget can be found here. 

Individual state agency budget requests can be found here.  

EDUCATION REFORM 

Teachers from across the state rallied at the State House on Wednesday for education reform and increased pay. The rally was not without controversy as GovMcMaster, State Superintendent of Education Molly Spearman and House Speaker Jay Lucas (R-Darlington) criticized teachers for the walkout. While all teachers are set to get a 4% pay increase and see a substantial increase in starting teacher salaries this year in the state budget, legislation aimed at education improvements has stalled for the year. The House passed its version of education reform H.3759 (Lucas, Allison, Felder, Pope, Simrill, Rutherford and others) in early March, but the Senate plan on S.419 (Hembree, Malloy, Turner, SetzlerSheheen and Alexander) known as “The South Carolina Career Opportunity and Access for All Act” remains in committee. 

A summary of the companion bills can be found here.  

Senate proposed changes can be found here.  

ENERGY 

The Senate spent the majority of its time on the floor debating Joint Resolution S.678 (Peeler, Climer, Davis and Fanning) that would give the Governor the authority to utilize the Department of Administration to conduct a competitive bidding process for the sale of state owned utility Santee Cooper. On Thursday, by a vote of 42-1 (Grooms), the Senate agreed to adopt a compromise amended version. The new plan calls for the Department of Administration to seek not only bids from qualified offerers to purchase Santee Cooper, but also to seek offers for potential management contracts of the state-owned utility as well as a reform plan for the utility regarding its future. The Joint Resolution was then added to a similar House bill already in the Senate, H.4287 (Lucas, G. M. Smith, Simrill, Rutherford and others), and returned to the House where it can accept the new Senate plan, or insist on its version which would set up a conference committee to resolve the differences. 

HEALTHCARE 

During a meeting of the Senate Medical Affairs Committee, committee Chairman Senator Danny Verdin (R-Laurens) commented on S.366 (Davis, Hutto, McLeod and Kimpson) the “Compassionate Care Act” relating to medical marijuana. Chairman Verdin stated that although the committee had decided not to debate the bill further this year, he expects interested parties to continue working on the bill and he fully expects to take up the bill when the General Assembly reconvenes in January. 

NEW MEMBER 

Republican Stewart Jones was sworn in as the newest member of the House of Representatives, representing the District 14 seat in Greenwood and Laurens Counties. Jones won a special election last week to fill the vacancy created by the resignation of former Rep. Mike Pitts (R-Laurens) for health reasons. 

APPOINTMENT 

The Senate Judiciary Committee gave an unfavorable report of Mr. Charles M. Condon to serve as Chairman of the Board of the State Public Service Commission (aka Santee Cooper) by a vote of 19-4. Condon, a former Charleston solicitor and state attorney general from 1995 to 2003, has been serving as interim chair of the board of the publicly owned utility since November. Condon said he has not decided on if he will withdraw from consideration but noted it is likely he would be voted down by the full Senate. The governor’s office called the vote a setback for transparency and accountability at Santee Cooper. 

Later that afternoon, the full Senate approved Gov. Henry McMaster’s nomination of Mr. Daniel Ellzey of Columbia to be Executive Director of the Department of Employment and Workforce by a vote of 39-0. Ellzey, an attorney, previously practiced labor and employment law and was an executive with Toyota. He succeeds Cheryl Stanton, the state’s prior workforce director, who resigned in December.  

The governor’s nomination of Mr. Stephen F. Morris as Director to the Department on Aging failed to receive confirmation by a vote of 2-41. Morris has been serving as interim director since December and acknowledged morale and personnel issues at the agency and has been previously questioned about his leadership abilities to resolve those issues. GovMcMaster must now nominate another individual to lead the department. 

INTRODUCTIONS OF INTEREST 

HOUSE 

  1. 4532(Pope, Clemmons,Daning, Taylor and others) Sales tax reform proposal. Referred to Committee on Ways and Means.  

SENATE 

No introductions of interest. 

UP NEXT 

The General Assembly will adjourn Sine Die on Thursday, May 9 at 5 p.m.