After holding a hearing and voting to remove the State Treasurer from office, the Senate passed its version of the state budget this week, as the House worked through bills on its calendar. Just six legislative days remain before adjournment for the year.
Yesterday, the Senate Agriculture and Natural Resources Committee confirmed the governor’s appointment of Dr. Paige Mackey to the State Board of Veterinary Medical Examiners, representing the Second Congressional District. The appointment now goes to the full Senate for confirmation.
On Wednesday, a House Agriculture Subcommittee adopted H. 3223 (Rep. Bailey), providing for requirements concerning the use of telehealth for veterinarians. The bill is expected to go before the full committee for consideration next week.
This week, the Senate adopted the FY24-25 General Appropriations Act H. 4025 and the Capital Reserve Fund H. 4026. Senate Finance Committee Chairman Harvey Peeler (R-Gaffney) called the plan “a good budget that funds the core functions of government.” For the first time in years, the budget will not include earmarks in order to focus on members’ top priority – tax reform.
Earmarks are one-time payments given to non-profits or local governments, which can include a number of services as well as road repairs, first responder equipment upgrades or capital improvements to local facilities. Last year’s budget allocated more than $430 million in earmarks, with the biggest portion dedicated to tourism, recreation and sports. The Senate did, however, approve an increase in their “in-district expense” allocation, raising it from $1000 to $2500 monthly, basically giving every legislator an $18,000 annual pay raise.
Items in the Senate-passed version that were also in the House version include:
- $1 billion for tax relief, including over $800 million for homestead exemption and $290 million to continue cutting the state’s personal income tax, dropping the rate from 6.2% to 6%;
- $112 million to raise starting teacher minimum salaries by $1,500 to $48,500;
- $150 million for the neurological health center at USC;
- $90 million for technical college scholarships for critical needs jobs through the SC Workforce Industry Needs Scholarship Program (SCWINS);
- $60.4 million to maintain health services covered by Medicaid; and
- $66 million for a minimum 2% state employee pay increase.
In response to Hurricane Helene:
- $25 million to the Department of Transportation for unreimbursed costs related to Hurricane Helene;
- $10 million to the Office of Resilience to replenish the Disaster Relief and Resilience Reserve Fund; and
- $222 million to match federal FEMA funds.
The $14 billion general fund budget includes $666 million in “new” recurring revenue and an estimated one-time budget surplus of about $1.25 billion. The budget will now return to the House for concurrence in the Senate amendments. Typically, the House non-concurs, and the differences between the two versions will be worked out by a Conference Committee. Normally, that process stretches beyond the session adjournment date.
The Senate budget spreadsheet can be found here.
Individual state agency budget requests can be found here.
Yesterday, a subcommittee of the House Labor, Commerce and Industry Committee adopted S. 51 (Senators Davis, Grooms and others), a Joint Resolution to encourage Santee Cooper to issue a Request for Proposal to solicit proposals on utilizing assets associated with V.C. Summer Units 2 and 3. The resolution now goes to the full committee for consideration.
On Wednesday, a Subcommittee of the House Ways and Means Committee took testimony, but did not take any action, on three bills dealing with sports wagering and gaming. H. 4176 (Reps. Murphy, Brewer and others) would authorize casino gaming, H. 3625 (Reps. Murphy, Rutherford, Herbkersman and others) enacts the “South Carolina Sports Wagering Act”, and H. 4129 (Reps. Brewer, Guffey, M. M. Smith and others) relates to games of skill. It remains unclear when the subcommittee plans to meet again.
This week, the House adopted H. 3752 (Rep. Gilliam), enacting the “Social Work Interstate Compact Act.” The bill aims to facilitate the interstate practice of regulated social workers with the goal of improving public access to competent social work services. The compact seeks to preserve the regulatory authority of states to protect public health and safety through the current system of state licensure. The bill now goes to the Senate for consideration.
On Wednesday, the House Education Committee adopted H. 3632 (Reps. Erickson and Spann-Wilder), clarifying that LIFE and Palmetto Fellows Scholarship stipends apply to accounting majors who completed coursework in economics and business statistics as freshmen in the 2024-2025 school year. The bill now goes to the full House for consideration.
On Tuesday, the House Labor, Commerce and Industry Committee adopted S. 307 (Senator Climer), which provides guidelines for peer-to-peer car-sharing programs and outlines insurance and liability procedures. The committee also adopted H. 4135 (Rep. M. M. Smith), which regulates vision care plans. Both bills now go to the full House for consideration.
On Wednesday, a Senate Judiciary Subcommittee adopted H. 4160 (Reps. W. Newton, G. M. Smith, Jordan and others) regarding judicial seats. The bill would turn ten of the sixteen at-large seats into resident seats based on population, caseload, fair representation and location. The bill now goes to the full committee for consideration.
The Senate voted late on Monday evening to remove State Treasurer Curtis Loftis from office for his role in the $1.8 billion accounting error that resulted from switching to a new accounting system. The Senate used an obscure constitutional measure, not used in 150 years, to call the vote to remove a state constitutional official from office.
During the nearly ten-hour “political hearing”, Senators Larry Grooms (R-Berkeley) and Stephen Goldfinch (R-Georgetown) laid out the case for Loftis’ dismissal, saying his removal is warranted due to “willful neglect of duty.” They claimed Loftis had known about the accounting error for years but failed to correct the mistake or notify the General Assembly. Loftis, along with his legal team, argued that South Carolina’s accounting problems, which involved almost no actual money, stemmed from the changeover from the state’s legacy accounting system to a new one, and placed much of the blame on the State Comptroller General for the error. Comptroller General Richard Eckstrom resigned from office in 2023 as a result. Loftis did acknowledge his actions may have fallen short at times and promised to do a better job. His team highlighted numerous accomplishments since becoming treasurer in 2011.
However, despite the vote, in order for Loftis to be removed from office, the House of Representatives must also approve his removal by a two-thirds vote of that chamber. At this stage it appears the House may not be willing to go along. Governor Henry McMaster is opposed to the idea and said the state needs to move on and work together.
On Tuesday, the House Labor, Commerce and Industry Committee adopted S. 176 (Senator Climer) regarding regulations for Certified Public Accountants (CPA) and Public Accountants. The bill modernizes the CPA Practice Act, removes barriers to mobility and extends the time to pass the exam to 36 months. The bill now goes to the full House for consideration.
The House Ways and Means Committee met on Tuesday morning to receive expert testimony on H. 4216, which lowers the state’s income tax rate. The state’s top economist, Frank Rainwater, gave an overview and perspective of the state taxes, along with a comparison to neighboring states. He noted that of the 2.8 million tax filers in South Carolina, 44% of state filers pay no state income taxes at all – 10% of state filers pay 65% of the tax liability – and the top 1% of earners pay 24% of all state income taxes collected.
H. 4216 has been criticized by many because, even though it lowers the top income tax rate from 6.2% to 3.99%, it will cause most tax filers to pay more due to the elimination of many exemptions. Because of this, Rainwater was asked by the committee to provide three other options they might consider:
(A) Maintains a flat tax of 3.99% but changes the deductions and the phase-in – $307 million cost;
(B) 4.74% rate – with increased deductions from $6,000 to $19,000– 25% of filers would see a decrease – Zero liability increases – $282 million cost;
(C) Not a flat tax, but instead maintain a two-tiered tax system. 1.99% up to $35,000 in income and 5.49% above. $15,000 starting deductions – $290 million cost.
The committee is likely to meet again next week.
On Wednesday, a House Ways and Means Subcommittee adopted H. 3858 (Reps. Brewer, Pedalino, Lowe and others) relating to property taxes on boats. The bill now goes to the full committee for consideration.
This week, the House adopted H. 3800, which provides sales tax exemptions for durable medical equipment. The bill now goes to the Senate for consideration.
On Tuesday, the Senate Labor, Commerce and Industry Committee advanced two bills aimed at setting parameters for social media companies for child safety. The committee adopted a strike and insert amendment to H. 3431 (Reps. W. Newton, Wooten, Pope, Pedalino and McCravy), providing that social media companies may not permit certain minors to be account holders and must restrict social media access to minors during certain hours. The bill was amended to exclude cable-operated streaming services like Netflix, Peacock, Paramount Plus, etc. The committee also adopted S. 268 (Senator Bennett), which includes the same strike and insert amendment. Both bills now go to the full Senate for consideration.
On Wednesday, a Senate Judiciary Subcommittee adopted H. 3571 (Rep. Hiott), which concerns notification of excavations and the 811 system. A compromise amendment is being drafted for the full committee.
All bills introduced this week can be found here:
Just two weeks remain in the legislative session.
