Weekly Legislative Update. March 26 – 28, 2019

What they did

This week, the House passed legislation to give taxpayer-backed incentives to the Carolina Panthers. The bill would add special definitions of key terms (like “new job” and “full time”) to the job development tax credit law – specifically so the professional football team can qualify for the tax credit. (SCPC analysis). The companion bill is on the Senate floor calendar, but has not yet been debated.

The House also passed H.4260, a utility regulatory bill which was filed only last week and fast-tracked through committee. This massive bill would increase the power of the legislatively controlled Public Utility Review Committee (PURC) which nominates and oversees utility regulators; increase the power of the Public Service Commission (PSC); make utility executives personally liable for all utility submissions to the PSC; and make a false or incomplete report to the PSC a felony offense. While the bill also contains conflict of interest provisions and whistleblower protections (with a loophole) for utility employees, the bill further exacerbates the root problem of unaccountable legislative control over the utility industry.

On Wednesday, the House amended and passed H.3307 (a bill creating a database for property seized by law enforcement) to ban the practice of civil asset forfeitures entirely. However, on Thursday, they reconsidered the vote to pass the bill and placed it back on the floor calendar.

H.3620 passed the House Ways and Means Committee, and would allow state employees who have been retired for a year to return to work and draw both pension and salary. A similar program in the past contributed largely to the $81.9 billion pension deficit.

Meanwhile, the Senate passed S.530, a massive bill amending the state procurement code; S.185, which extends the sunset date on an income tax credit for accredited investors who invest in start-ups; and H.4157, which amends the procurement process for the purchase of new voting machines. This resolution would extend the deadline for bid submission by a month, have the Election Commission screen the bids, and allow the State Fiscal Accountability Authority to award the contract. The resolution would impose ethics requirements to guard against conflicts of interest, and would suspend parts of the procurement code for this particular situation. The resolution did not receive a committee hearing.

Finally, the Senate also debated S.203, which is currently on special order (or priority debate status). This bill would consolidate smaller school districts in low-income counties. The bill has been amended, but not passed. ‘

The Senate Judiciary Committee passed S.276 on Wednesday. Under this bill, anyone who threatens violence “by use of a dangerous weapon” in any “public gathering place” could be arrested and forced to get a mental health evaluation as a condition of bond. If the individual does not pass the evaluation, the solicitor could refer him to a mental health court or he could be required to get counseling. The committee amended the bill to include language that could include internet threats. This bill contains serious due process concerns.

What they said

Discussing the Carolina Panthers incentive bill, Rep. Gary Simrill said:

“I can tell you the cost-benefit analysis is positive.”

Not all lawmakers have seen this report, which is not available to the public – yet a bill subsidizing the team to the tune of $120 million in tax breaks passed the House this week. It is unclear if the analysis would be made public once the deal is finalized. Any deal backed by public money should be completely transparent to its investors – the taxpayers of South Carolina.

What they filed

This week, lawmakers filed several concerning bills. H.4333 would increase maximum campaign contributions in the state to twice the federal level. Under current law, lawmakers can spend campaign funds on “any ordinary expenses incurred in connection with an individual’s duties as a holder of elective office” – a loophole that can be used to justify nearly anything.

S.712 is a special law that would ratify a 2001 transfer of service territory from the Belton-Honea Path Water Authority to the Broadway Water and Sewerage District. Under state law, special purpose districts must be enlarged or altered by the local county council, but as this has not been done, S.712 is an attempt to ratify the territory transfer by special legislative act. This is a flagrant – and unnecessary – violation of the constitutional prohibition of special laws.

H.4334 would lower the income tax, instituting a flat tax rate of 4.5% by 2025 – but it would also institute an estate tax (or a “death tax”). S.720 is a tax favor and would exclude internet streaming services from sales tax. And H.4332 (a companion to the Senate version) would allow economic development bond debt for freight projects, and would – for certain projects – lift the requirement that the company actually has to create jobs (SCPC analysis). Economic development bonds are general obligation – which means they are ultimately backed by taxpayers’ personal property. It should be noted, however, that this bill would not issue the bonds itself.

To view the full list of newly filed bills, click here.

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