View from the Dome – March 15, 2019
By Copper Dome Strategies, LLC

There were no meetings scheduled in the House this week as they debated and passed the state budget. The Senate continued meetings on the state budget, education reform and medical marijuana. State leaders announced a plan to move the Carolina Panthers headquarters to South Carolina.

TAX

On Tuesday, the Senate Finance Committee approved H.3985 (Reps. Lucas, G. M. Smith and Stavrinakis) the annual tax conformity legislation. The bill updates the reference to the Internal Revenue Code to state income tax laws and provides that if the IRS Code sections adopted by the state are extended, then these sections are also extended for South Carolina income tax purposes. On Thursday, the full Senate gave second reading approval to the bill by a vote of 39-0. After a third and final reading vote next week, the bill will go to the governor.

BUDGET

The House of Representatives gave final approval to the FY 2019-20 state budget H.4000 on Wednesday after starting debate on Monday, returning Tuesday morning and finishing debate at 1 a.m. Wednesday.

Ways and Means Committee Chairman Murrell Smith (R-Sumter) said the top priorities were attracting and retaining teachers, funding higher education and freezing tuition, protecting taxpayers and keeping debt low and focusing on funding the core functions of government. He stated that House leadership had been working in partnership with the governor’s office on the spending priorities.

In addition to increased revenue for K-12, the proposed budget adds $44 million to fund public higher education institutions and included a proviso requiring colleges to certify to the Commission on Higher Education they have not raised tuition in order to receive the funding. The plan, supported by Gov. Henry McMaster, is an attempt to control tuition increases. South Carolina’s student loan debt has quadrupled since 2008, a faster increase than any other state in the nation according to a recent report.

The budget also includes $3 billion in tax relief that includes individual income tax cuts, small business tax cuts, corporate income tax cuts, food tax elimination and property tax relief.

The $8.7 billion General Fund budget also includes:

  • $159 million for a 4% teacher pay increase
  • $41 million for a 2% state employee pay increase
  • $85 million for a Rural School District and Economic Development Closing Fund
  • $49.5 million for the state Medicaid maintenance of effort and annualization
  • $49.7 million to cover 100% of the state employee health and dental insurance increases
  • $40 million for new voting machines
  • $11.2 million for judicial salary increases
  • $1 million for pay increases for SC DJJ officers

For the technical colleges:

  • $6 million base recurring funding
  • $51 million Lottery Tuition Assistance
  • $17 million SC Workforce Industry Needs Scholarships (SC WINS)
  • $11 million Workforce Scholarships and Grants
  • $9.2 million ReadySC
  • $12.5 million high-demand job skills training equipment
  • $4.1 million technology funding

Total state spending this year is $29.4 billion, which includes $8.7 billion in general funds, $11.9 billion in “other funds” and $8.8 billion in federal funds. Senate Finance budget subcommittees are wrapping up their work on the state agency budget requests as they await their turn to debate the budget in full committee and floor debate. Budget writers have an additional $498 million in new recurring revenue and $479 million in one-time revenue.

To view the budget briefing outlining highlights presented to House members, go here.

Budget spreadsheets from each subcommittee can be found here.

House Ways and Means Committee Budget Provisos can be found here.

The governor’s Executive Budget can be found here.

Individual state agency budget requests can be found here.

EDUCATION REFORM

After holding a public hearing on Monday, the Senate education subcommittee held two more meetings this week on S.419 known as “The South Carolina Career Opportunity and Access for All Act.” The education reform initiative is the Senate’s version of H. 3759 (Lucas, Allison, Felder, Pope, Simrill, Rutherford and others) that passed the House last week. The subcommittee, chaired by Senate Education Committee Chairman Greg Hembree (R-Horry), is going through the bill section by section and discussing amendments after receiving feedback from the public hearings and interested stakeholders. This week’s meetings primarily focused on the sections of the bill dealing with teachers. Another public hearing is scheduled for Monday in Gaffney. The subcommittee plans to move the bill to the full Senate Education Committee by the end of March.

A summary of the companion bills can be found here.

HEALTHCARE

On Wednesday, a Senate Medical Affairs Subcommittee again debated S.366 (Senators Davis, Hutto, McLeod and Kimpson) the “Compassionate Care Act” relating to medical marijuana. Subcommittee Chairman Senator Tom Davis (R-Beaufort) had previously assigned members of the subcommittee to begin researching various sections of the bill and the potential impacts of the legislation on the business community, the medical community, the patient community, etc. After hearing various reports, the subcommittee did not take any action on the bill and will continue meeting. The state’s top two law enforcement officials, Attorney General Alan Wilson and SLED Chief Mark Keels, are in opposition of the proposed legislation along with the South Carolina Sheriff’s Association. The South Carolina Medical Association also opposes sections of the bill that force physicians to be the access point for marijuana in South Carolina. They are calling for lowering marijuana from a Schedule I to a Schedule II drug so that more comprehensive research can be conducted. This issue has been discussed in previous legislative sessions and will surely generate considerable debate 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.

HIGHER EDUCATION

The Senate Education Committee approved on Wednesday, as amended, H.3576 (White, Cobb-Hunter and Garvin) the “SC Workforce Industry Needs Scholarship (SC WINS).” The bill establishes the SC WINS scholarship for students who are attending a two-year public technical college, majoring in a critical workforce area program, as defined and recommended by the State Board for Technical and Comprehensive Education and ratified by the South Carolina Coordinating Council for Workforce Development, and who are receiving a Lottery Tuition Assistance Program Scholarship (LTAP) for the current school year. During discussion, the critical areas included advanced manufacturing, healthcare, information technology and transportation logistics and distribution. The bill was amended to include provisions for need-based students as well. The bill now goes to the full Senate for consideration.

PROFESSIONAL FOOTBALL

Gov. McMaster and legislative leaders held a press conference Wednesday to announce the filing of legislation aimed at bringing the Carolina Panthers professional football team’s headquarters and training facilities to South Carolina. McMaster said they have been working with the team’s ownership on the potential move and will expedite the legislation in order to help facilitate it. The legislation, H.4243, would make the team eligible for specific tax incentives and infrastructure improvements. If successful, the team would move 150 employees and an estimated $190 million payroll into either York or Lancaster counties.

ENERGY

The newly formed Senate Select Committee on Santee Cooper met again on Wednesday and heard a presentation from the SC Public Service Authority, also known as Santee Cooper. Leadership gave an overview and general remarks regarding the publicly-owned utility. The committee is committed to their effort to determine if the sale of Santee Cooper is in the best interest of ratepayers and the state. They have scheduled another hearing for next Tuesday.

INTRODUCTIONS OF INTEREST

HOUSE

H.4243 (Reps. Simrill, Lucas, Pope, G. M. Smith, Rutherford, and others) relating to job tax credits for a professional sports team. Referred to Committee on Ways and Means.

SENATE

S.636 (Senators Hutto, Rankin, Sabb, Young and Talley) relating to workers’ compensation hearings and medical records and opinions as evidence. Referred to the Committee on Judiciary.

S.638 (Senators Gambrell and Alexander) Enacts the “South Carolina Small Wireless Facilities Deployment Act” relating to local governments and control over rights of way. Referred to the Committee on Judiciary.

S.639 (Senator Malloy) relating to minimum sentences for criminal offenses. Referred to the Committee on Judiciary.

S.641 (Senator Grooms) Requires an office of public policy and events for maintaining records of lectures and events at colleges and institutions of higher learning. Referred to the Committee on Education.

S.642 (Senators Campbell and Leatherman) Relating to compensation and payments in workers’ compensation. Referred to the Committee on Judiciary.

S.650 (Senators Turner, Grooms, Shealy and Talley) Provides for a Workforce Diploma Program through the State Board for Technical and Comprehensive Education. Referred to the Committee on Education.

S.655 (Senators Peeler, Malloy, Climer, Fanning, Gregory and Leatherman) relating to job tax credits for a professional sports team. Referred to the Committee on Finance.

S.657 (Gambrell) Joint Resolution to require an electrical utility to make net metering available to customer-generators on a first-come, first served basis. Referred to committee on Judiciary.

S.660 (Campbell) Relating to definitions in the “Utility Facility Siting and Environmental Protection Act.” Referred to committee on Judiciary.

UP NEXT

The Senate Education Committee will hold a Public Hearing on S.419 the “South Carolina Career Opportunity and Access for All Act” at 6 p.m. at the Gaffney High School Auditorium.