Fine and Fee Increases: You’re Next
For more than two decades, no general tax increases have been enacted in South Carolina, a fact often cited by legislators seeking to burnish their “friend of the taxpayer” credentials.
But if it’s true the General Assembly hasn’t passed a general tax increase in some time, every year they’ve tacked on myriad fees, assessments and fines that take money out of your pocketbook and help grow government. Because fine and fee increases affect only certain taxpayers, the legislature can get away with claiming they’re not raising “general” taxes. But the impact of these stealth taxes is far more widespread than many people think, not least because increased business costs are inevitably passed on to consumers. In fact, such hidden taxes constitute $7 billion of the state’s $21 billion budget. Also of note is that in a year that saw a General Fund budget cut, the Other Funds category of the budget (made up of fines and fees) increased by $147 million.
One reason fine and fee revenue is surging is because agencies are able to increase their own fines and fees without specific legislative authorization. While proposed fines/fees must appear on committee hearing agendas, they automatically become law within 60 days if no action is taken. Another problem, as reported in The Nerve, is that the General Assembly essentially exercises “no oversight” over agency fine and fee revenue.
The good news is that a joint resolution by Senator Tom Davis would implement a six-month moratorium on fine and fee increases introduced either as budget provisos or as administrative agency regulations. A related bill, introduced by Senate President Pro Tempore Glenn McConnell and Senator Mike Rose, would make the policy permanent. The bad news is that while such proposals might bring about more transparency (remember the lack of recorded votes), they won’t prevent fine and fee increases altogether. In 2009, legislators introduced 108 proposals to raise fines and fees – 96 as standalone bills and 12 as budget provisos. Thus even if Davis’ bill passes the House (it has already passed the Senate), South Carolinians could still be facing several new fee increases for 2010.
Here’s who is next up as a potential target:
Almost anyone who generates trash – Under H 3517, landfills would be responsible for assessing a $5/ton charge to waste disposers, a cost that will be passed on to anyone who uses trash pickup. This measure should be considered in light of recent Department of Health and Environmental Control (DHEC) regulations reducing annual landfill capacity from 42 million tons to 10.8 million tons – a policy that will drive up prices even further.
People who live in school districts (i.e., everyone) – Talk about a good idea combined with a terrible idea. This proposal (H 3230) would create the commonsense requirement that school districts must check the state child abuse registry before hiring someone. Then, the bill takes a turn for the inane by allowing the Department of Social Services to charge an unspecified fee to school districts for doing so. Why should taxpayers pay twice for the same service? See also S 935, S 953, S 978.
Homeowners who live in subdivisions – Under S 30 the state would for the first time regulate homeowners’ associations, implementing an annual registration fee of $10 per lot for each association. The bill also slaps a $100 registration fee on anyone who wants to act on behalf of a given association.
Electronics users (again, everyone) – This bill imposes a $5,000 registration fee on manufacturers of electronics (read: consumers who buy electronics; read: everyone) so as to fund a “comprehensive” electronics recycling program. The proposal also gives DHEC broad latitude to create yearly renewal fees for these businesses, “in amounts to fully cover but not to exceed expenses incurred for the administration of the article, including the cost of any education or outreach.” Once again, these costs will be passed on to consumers.
Seniors and the disabled – This bill would require in-home care providers to be licensed, leaving DHEC free to determine what it will charge to process applications. Adult care companies – not including hospice care or nurses, who are already subject to other forms of regulation – will thus bear the brunt of these costs, which will then be passed on to consumers. In-home care is defined as helping individuals with activities like eating, walking and bathing. So why not simply require a criminal background check, and perhaps basic first aid training, instead of licensure?
Consumers (of alcohol) – H 4327 is a textbook case in government greed. First, make it illegal to sell alcohol on Sundays. Then issue a special license, subject to a $400 biennial permit fee, to sell alcohol on Sundays.
Consumers (of water) – This fee is for your own good, so says this Senate resolution that would increase well application fees “to ensure the protection of the health of private well users.” The measure fails to specify what the new fee will be, apparently leaving that decision to DHEC.
Pet owners – S 913 would double the fee charged to inoculate pets against rabies. The vaccination is mandatory.
Obese state employees – S 109 would charge obese state workers an additional $25 per month for their health insurance. This past August, smokers also got hit with a $40 monthly health insurance surcharge. (30 percent of South Carolinians are said to be obese while just over 20 percent of adults in the state are smokers.)
Tourists – When is a tax increase not a tax increase? Apparently, when the General Assembly says so. So while one would normally consider a 1 percent sales tax increase on accommodations (in Horry County) to be a tax increase, the legislature calls it a “fee” in this legislation (S 483) that passed in 2009. Beaufort County residents, you’re next
Golfers – S 930 would impose a $5 fee every five years to obtain a golf cart permit. The proposal seems to require a separate permit for each golf cart, as opposed to one permit for owners of multiple carts. But it’s unclear whether golf courses are exempt.
Homebuyers – Last session, the General Assembly permitted school districts in Dorchester County to assess impact fees on new homeowners (S 235). Similar bills have been introduced for Beaufort and Jasper counties. The governor allowed the bill to become law without his signature.
Repo Men – This bill seeks to regulate the “collateral recovery” business by requiring repo men to be of “good moral character,” as validated by state licensure. In turn, S 1073 authorizes the Department of Consumer Affairs to charge examination and biennial license fees of up to $100.