Weekly Legislative Update: May 7 – May 9, 2019

What they did:

Lawmakers adjourned sine die this week, ending the 2019 legislative session – except for at least one special session later this month. Lawmakers have still not passed the budget, despite five months to do so and a process laid out in state law designed to make passing a budget both transparent and efficient. Lawmakers routinely ignore this law, preferring to send the appropriations bill through a plethora of subcommittees in both the House and the Senate instead of the joint open hearings the law requires. This year the budget only made it to conference committee before the end of session.

This week the House amended the budget back to the original House version with a few additional amendments – including a proviso requiring the Department of Administration to solicit bids for the sale and for the management of Santee Cooper, a new program to fund rural broadband infrastructure (originally a separate bill that passed the House but not the Senate), and a sales tax exemption for urinary catheters. The budget is now in conference committee, where three lawmakers from each chamber will resolve the differences between the House and Senate versions.

The special session will be May 20-22. Lawmakers will be limited to only a handful of topics by the sine die resolution, including the budget, any bills in conference committee, local legislation, legislation regarding Santee Cooper, and S.1, a bill undercutting some of the Governor’s interim appointment power. The Senate passed this bill back in January, but the bill stalled in the House. In response, the Senate added the bill’s language to numerous unrelated bills before returning them to the House (despite the Constitutional prohibition on multiple subject bills). As a result, the House added S.1 to the list of matters that lawmakers can consider in special session.

Perhaps most notably, the Panthers tax incentive legislation passed the Senate and went to conference committee (the House insisted on its own version) – after the Senate skipped the roll call vote on the bill’s second reading. Not only is this illegal, as the law specifically requires a roll call vote on second reading, but all the significant Senate amendments were adopted prior to second reading – the reason a roll call vote is so important at that stage of the process.

In addition to giving the team eligibility for jobs tax credits without requiring them to actually create jobs, the Senate’s bill would significantly increase the jobs tax credit for low-income counties (from $8,000 to $25,000 per new job for Tier IV counties, and from $4,000 to $20,250 per new job for Tier III counties).

 

What they said:

Kicking off the week’s debate on the Panthers’ incentive bill, Sen. Dick Harpootlian said:

“This is our opportunity – today – to make an important choice about the proper role of government. Do we believe our role is creating conditions of economic success – an even playing field, where all businesses succeed or fail on their own merits, or is our role to pick winners and losers – to put the considerable weight of the state and the public’s money behind one market participant?”

While the Panthers’ incentive bill is an extremely ill-advised economic development deal (for instance, redefining “new jobs” since the relocation is unlikely to create additional South Carolina jobs), the real issue isn’t how poorly crafted it is.

The issue is that the greatest level of prosperity comes when government gets out of the way of the free market. It is not government’s job to ensure prosperity or create jobs, and government’s attempts to do so often result in less prosperity for many individuals. Economic development deals like this one are not free: The cost is borne by the rest of the market – small businesses all over the state which do not enjoy the taxpayer-funded handouts corporations often get simply in exchange for locating in South Carolina.

 

What they filed:

Even in the last week of session, lawmakers continued filing new bills. S.841 would tighten existing gun control laws and expand the penalties for violation. For instance, current law prohibits the sale of handguns to certain individuals, such as minors and drug addicts and alcoholics. This bill would expand that prohibition to all firearms, not just handguns.

S.839 would hand public works duties in the city of Spartanburg over to the Spartanburg Sanitary Sewer District Commission, and S.838 would prohibit the flying of drones below a certain altitude over and around Lake Bowen. S.828 would allow group insurance plans to cover certain deformities and dysfunctional conditions, and two bills (S.833 and H.4598) would place certain redevelopments beyond the control of local governments or planning boards.

H.4576 is a House companion to the Senate higher education funding bill, which would tie higher education funding to general fund growth, send more funding to scholarships, and create “enterprise divisions” – unaccountable mini-governments within colleges and universities which are shielded from state accountability. Read our analysis of the Senate bill here. Along those same lines, H.4580 is a Constitutional amendment which would prohibit lottery funds from being used for anything besides higher education tuition assistance and scholarships.

H.4593 would require municipalities that offer water and sewer service outside the municipal boundaries to charge the same price to both municipal and non-municipal customers, and would prohibit municipalities from requiring non-municipal customers to agree to annexation as a condition of service.

Finally, H.4594 would prohibit lawmakers’ family members from being elected to judicial office.

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