UPDATE: Surplus, Capital Reserve, Sine Die, Uber

state house dome

SESSION IS OVER … ALMOST

The third week in June ended on a tragic note in the General Assembly, and attention has rightly been away from legislative business. In the interests of keeping tabs on the legislature, however, here’s a summary of the main business at present.

Supplemental appropriations bill 

The House passed a supplemental appropriations bill on Wednesday determining what to do with a surplus of $400 million divided between recurring and non-recurring revenue. Some of the $415 million was pre-committed to education, but lawmakers have discretion over roughly $300 million of the surplus.

Some notable expenditures in the House supplemental appropriations bill include:

  • $145.8 million to county transportation committees, or CTCs, for the repair and maintenance of state owned secondary roads.
  • $23.5 million for a state employee one-time bonus ($800 for every employee employed for more than 6 months and earning less than $100,000).
  • $70 million for “economic development infrastructure” – i.e. to build an interchange for Volvo.
  • $16.5 million for debt service on economic development bonds (paying down some bond debt will free up more bonding capacity to finance projects such as the Volvo incentives package).

The Senate Finance Committee approved a different version of the bill Wednesday, which the full Senate approved on Thursday. The Senate version of the legislation increases the share of the surplus going to CTCs to $216 million. The Senate achieved this increase by cutting other proposed expenditures, including child support enforcement at the Department of Social Services, medical assistance payment case services at the Department of Health and Human Services, appropriations to the homestead exemption fund, and indigent defense.

The bill will be debated over the next several days in a conference committee alongside other budget bills.

On road funding, bear in mind: putting more money into the same unaccountable and wasteful transportation governance system without reform is unlikely to yield any significant or lasting improvements to South Carolina roads.

Capital Reserve Fund 

An amended version of the capital reserve fund passed the House on Wednesday. The most recent version of the legislation passed by the House appropriated $127 million, in contrast to the $84 million appropriated by the most recent Senate version of the bill.

Each version of the legislation appropriates a large amount of funds to higher education, but the House version focuses on this area to a greater degree than the Senate. The House legislation restores financing to a number of higher education projects for which the Senate only appropriated $1, including:

  • $25 million for a proposed children’s hospital at the Medical University of South Carolina. (A private donor recently gifted the same amount to MUSC for the same purpose, but that apparently doesn’t alter the university’s need for this appropriation.)
  • $2.5 million for repurposing of the Stern Center at the University of Charleston.
  • $3.5 million for renovations of the old law school at the University of South Carolina (USC) Columbia.
  • $5 million for a business and behavioral sciences building at Clemson University.
  • $5 million for the South Caroliniana Library at USC Columbia.

Despite the constant claims of poverty by state institutions of higher education, South Carolina’s principal state universities are doing just fine financially. Nor does increasing university funding seem to improve educational outcomes. In any case, many lawmakers seem determined to give the universities all or most of what their lobbyists ask for.

With different versions having passed both chambers, the CRF bill is now in conference committee.

Amending sine die

Also on Wednesday, the House passed a new sine die resolution which would permit the General Assembly to debate H.3579 during the additional session days. The House and Senate were already operating under a separate sine die resolution that restricted the matters lawmakers could debate.

The Senate adjourned Thursday under the terms of the original sine die resolution, with Senate leaders expressing little interest in considering the House resolution or debating the gas tax prior to final passage of all budget bills. However, there is no guarantee senators won’t return to this resolution or the gas tax when they return to approve conference committee reports on the multiple appropriations bills and others. Leaders in the Senate alluded to a return to Columbia next week, assuming all goes according to plan in conference committee.

It would be irresponsible of the legislature to extend session even further – increasing the taxpayer cost of the already too-lengthy session – to debate what is sure to be the largest tax increase in state history. Since the Senate has already voted put the gas tax bill on special order, the bill will be among the first debates the chamber takes up in 2016. That should settle it until next year.

Uber bill’ conference report adopted

The House approved the conference version of the Uber legislation by a vote of 96 to 2, and the Senate approved the conference report by a vote of 39 to 0.

The most recent version of the Uber legislation (the conference report) has been made available on the State House website; it combines almost all the negative provisions from the bill’s previous versions.

In general, the bill is a sad missed opportunity. Rather than deregulating the entire passenger carrying motor vehicle industry (including ride-sharing companies and their competitors, traditional taxis) legislators have opted to impose numerous burdensome regulations on ride-sharing companies, too, leaving them just slightly less regulated than taxis. The conference report on the Uber legislation continues this approach.

More detailed analysis by the Policy Council on the ridesharing issue and its appropriate policy solution can be found here.

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