View from the Dome – Feb. 8, 2019
By Copper Dome Strategies, LLC

Major education reform legislation continued debated in two separate subcommittees in the House and Senate.

The SC House Tax Policy Review Committee heard a “Road Map for Tax Reform” presentation that is supported by the South Carolina Chamber of Commerce.

The Santee Cooper Study Committee reviewed bids submitted by parties interested in purchasing or managing the publicly held utility. The private sector company studying the possibility of selling the Santee Cooper says more than a dozen bidders offered proposals and three of the bids promised to eliminate all of Santee Cooper’s debt.

The General Assembly met in Joint Session to elect judges to a number of seats on the Court of Appeals, Circuit Court and Family Court. View the election results here.

Here are more details on the progress of legislation in these and other areas:

TAX

The SC House Tax Policy Review Committee met Thursday to hear a presentation from Jared Walczak of the Tax Foundation: “South Carolina: A Road Map for Tax Reform.” His presentation, supported by the South Carolina Chamber of Commerce, can be found here.

After the presentation, the committee had a lengthy discussion on how to move forward. Members noted there have been too many efforts in the past that never gained traction and agreed on the need to move a plan forward soon. The committee plans to meet again the week of Feb. 18 and will continue to formulate an income tax plan, which will be followed by a sales tax plan.

This 14-member ad hoc committee was created in 2016 by Speaker of the House Jay Lucas and is responsible for reviewing South Carolina’s tax code and submitting suggestions for reform to the Speaker.

BUDGET

Both House and Senate budget subcommittees continued meetings to hear state agency budget requests. On Tuesday, the Senate Finance Transportation and Regulatory Subcommittee heard requests from the Office of Regulatory Staff (ORS) and the Public Service Commission (PSC). The ORS is not seeking additional state funding but is seeking authorization for additional Personal Services Funding. The PSC is not seeking additional state funding.

House subcommittees are wrapping up their agency hearings and will turn their focus to agency provisos. Provisos are clauses in the state budget that direct the expenditure of funds and hold the force of law for one year. The full Ways and Means Committee will begin debate on the budget the week of February 18-21. The state’s General Fund revenue will include over $1 billion in new revenue from two years of a budget surplus. Budget writers will have an additional $498 million in new recurring revenue and $549 million in one-time revenue.

The governor’s Executive Budget can be found here.

Individual state agency budget requests can be found here.

ENERGY

The Public Service Authority Evaluation and Recommendation Committee, also known as the Santee Cooper Study Committee, met to discuss the recently released report on the bids submitted by parties interested in purchasing Santee Cooper or managing the publicly held utility. The committee, which has been meeting since last summer, had previously hired a private sector company, ICF, to study the possibility of selling the state-owned utility as a result of the fallout of their decision to cease construction on two nuclear reactors they had partnered with SCE&G to operate. According to the company, more than a dozen bidders offered proposals and three of the bids promised to eliminate all of Santee Cooper’s debt. Lawmakers said Wednesday’s meeting provided some clarity, but they would need more information before moving forward. If the special committee decides to sell the utility, the General Assembly would have to approve it. View the full report at here.

Fallout from the decision to cease all construction on two new nuclear reactors being built at the V.C. Summer Nuclear Generating Station in Jenkinsville by SCANA and state-owned utility Santee Cooper remains one of the most costly, complex and politically explosive issues to hit our state in decades.

EDUCATION REFORM

The House Education and Public Works K-12 Subcommittee held its second meeting on H. 3759 (Lucas, Allison, Felder, Pope, Simrill, Rutherford and others) known as “The South Carolina Career Opportunity and Access for All Act.” The bill seeks to tackle the fundamental changes needed to modernize our education system with a primary focus on students and teachers.

The bill’s primary sponsor, House Speaker Jay Lucas (R-Hartsville) said, “The bill lays out the blueprint to update the outdated student funding formula created over 40 years ago; will increase base teacher pay; will get more money and resources into the classroom; will free teachers to teach instead of giving unnecessary tests; will hold chronically failing school districts accountable by providing alternative management solutions; will focus on the overall education and workforce pipeline, and get our students ready for a future in higher education, the technical college system, or the workplace.”

A companion bill was introduced in the Senate by Senate Education Committee Chairman Greg Hembree (R-Horry). Gov. McMaster strongly supports the legislation.

Highlights of the bill include:

  • A 9% pay increase for first year teachers while providing an across the board 9% pay raise for all teachers over the next two years
  • Requiring school districts with fewer than 1,000 students to consolidate with neighboring districts to share resources and save money
  • Dissolving school districts that have four consecutive years of failing scores
  • Eliminating three end-of-year standardized tests in elementary schools
  • Ending remedial classes at technical colleges by requiring students to pass an admission test for technical colleges
  • Regionalizing career centers for high school students, to include making technical colleges the career center
  • Establishes within the Governor’s Office the ‘Zero to Twenty Committee’ to monitor the state education and workforce pipeline to continually determine the education and training levels required by the State’s employers and identify and recommend improvements regarding efficiency and cooperation of agencies and programs throughout the age zero to twenty education and workforce pipeline

The subcommittee heard testimony from a number of groups and individuals, both in favor of the bill and those opposed to parts of the bill. The subcommittee agreed to continue hearing testimony next week and will begin the meeting at 4:45 pm so that teachers and students have an opportunity to express their views. You can view a video of the meeting here.

On Wednesday, the Senate Education Subcommittee on S. 419 (Hembree, Malloy Turner, Setzler, Sheheen and Campsen) held its first meeting on the Senate companion bill to the SC Career Opportunity and Access for All Act. The subcommittee plans to hold four meetings across the state to seek input from interested parties and would like to move the bill to the full Senate Education Committee by the end of March.

HEALTHCARE

The Insurance Subcommittee of the Labor, Commerce and Industry Committee took testimony on H.3760 (Sandifer) a bill that would merge the Patients’ Compensation Fund with the South Carolina Medical Malpractice Joint Underwriting Association. The bill proposes to assess a fee on providers and comprehensive insurance companies to cover the shortfall. The bill was carried over by the subcommittee as amendments are expected to be offered at the next meeting.

HIGHER EDUCATION

The House Education Committee approved H.3639 (Taylor, Allison and Felder) relating to in-state tuition for military personnel and their dependents. The bill expands the categories of individuals covered by these provisions to conform with certain changes in federal law. The bill now goes to the full House for consideration.

The House of Representatives unanimously approved S. 228 (Gambrell) which creates the Tri-County Technical College Enterprise Campus Authority. The bill will receive third and final reading approval today and will be enrolled for ratification.

JUDICIAL/LEGAL

The General Assembly met in Joint Session to elect judges to a number of seats on the Court of Appeals, Circuit Court and Family Court. View the election results here.

S.386 (Malloy, Climer, Goldfinch, Talley, Sabb and Harpootlian) dealing with revisions to the SC Tort Claims Act was debated in a Senate Judiciary Subcommittee again on Thursday. The bill includes the provisions of S.7 related to caps (below) and also deals with related issues to the Tort Claims Act, such as what constitutes bad faith, what is an occurrence, recovery of attorney’s fees, the State Catastrophic Fund and other items. At the Thursday meeting, 16 amendments were adopted. The amended version will be available for review on Monday. The subcommittee intends to meet again next Wednesday and report the bill out to Full Judiciary Committee. There is ongoing research on what this will do to the rates charged by the Insurance Reserve Fund to governmental bodies.

S.7 (Malloy, Climer, Goldfinch, Talley and Harpootlian) dealing with the Tort Claims Act limits has been reported out of the Senate Judiciary Committee and is being held on the Senate Calendar for further debate. This bill proposes to raise the caps on the recovery limits. It would raise the cap on a single person from $300,000 to $1 million and for an occurrence from $600,000 to $2 million. As amended by the Senate Judiciary Committee, it adds an annual increase or decrease based on the CPI. The amendment also changes the effective date to causes of action with a date of loss arising on or after July 1, 2020. There is ongoing research on what this will do to the rates charged by the Insurance Reserve Fund to governmental bodies.

INTRODUCTIONS OF INTEREST

HOUSE

H.3843 (Reps. Bamberg, Cobb-Hunter and Hosey) Enacts the “Magistrates’ Education and Improvement Act” and relating to magistrates’ salaries. Referred to Committee on Judiciary.

H.3845 (Reps. Elliott and Loftis) Joint Resolution to authorize SC Public Charter School District to provide certain funds for three and four-year old children with disabilities. Referred to Committee on Education and Public Works.

H.3848 (Rep. Hart) Exempts property taxes on certain disabled veterans in the year in which the disability occurs. Referred to Committee on Ways and Means.

H.3917 (Reps. Clemmons, W. Newton, W. Cox and Pope) Enacts the “South Carolina Electronic Notary Public Act.” Referred to Committee on Judiciary.

H.3921 (Rep. Norrell) Relating to reporting allegations of sexual harassment and sexual assault for higher education institutions. Referred to Committee on Judiciary.

H.3922 (Rep. Norrell) Relating to disciplinary actions against students for higher education institutions. Referred to Committee on Judiciary.

SENATE

S.486 (Senators Talley and Reese) Enacts the “South Carolina Remote Online Notarization Act.” Referred to the Committee on Family and Veterans’ Services.

S.487 (Senators Talley and Reese) Enacts the “South Carolina Electronic Notary Public Act.” Referred to the Committee on Family and Veterans’ Services.

S.490 (Senators Turner, Corbin, Bennett and Shealy) Enacts the “Transparency in Private Attorney Contracts Act” relating to contingency fee contracts. Referred to the Committee on Judiciary.

S.494 (Senator Fanning) Exempts substance abuse treatment facilities from the Certificate of Need process in certain circumstances. Referred to the Committee on Medical Affairs.

APPOINTMENTS

The Senate Family & Veterans’ Services Committee confirmed the appointment of Adjutant General Major General Roy Van McCarty. A 1982 graduate of The Citadel, Maj. Gen. McCarty’s military career spans more than 36 years. In his current capacity, he oversees the administrative activities and daily operations of the South Carolina Military Department, which encompasses the South Carolina Army and Air National Guard, the Emergency Management Division, the State Guard and the Youth ChalleNGe Academy. If confirmed, he will become the first Adjutant General appointed by a governor since the constitutional amendment giving him that authority was approved by South Carolina voters in 2014. To read more about his appointment go here. His appointment now goes to the full Senate.

The Senate Medical Affairs Committee confirmed the appointment of Mr. Richard K. (Rick) Toomey as Director of the South Carolina Department of Health and Environmental Control (DHEC). Toomey served as president and CEO of Beaufort Memorial Hospital from November 2007 to September 2016. He currently serves on the Beaufort Historical Foundation’s Finance Committee and is a past chair of both the North Carolina and South Carolina Hospital Association Boards. The DHEC director is selected by the board to serve a four-year term. His appointment now goes to the full Senate.

UP NEXT

The House Education and Public Works K-12 Subcommittee will hold a public hearing Tuesday afternoon to hear public comments on the K-12 reform plan.