SOUTH CAROLINA GENERAL ASSEMBLY-LPITS 1996 Post Session Report

Readers of the 1996 Post Session Report should be aware that this publication targets only a segment of the legislation passed by the General Assembly this year. Major pieces of legislation are summarized here in a format which is intended to be more accessible and expansive than a simple reading of the acts and joint resolutions as they are drafted. However, the report is simply a guide to, not a substitute for, the full text of the legislation summarized in the following pages.

The research staffs for the standing committees of the House of Representatives select and compose the bill summaries found in this report. It is their skill and dedication which makes this resource available.

OVERVIEW OF THE 1996 SESSION/
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The 1996 legislative year began with a renewed thrust to attract new businesses to South Carolina and promote expansion among businesses already located in the state. The first major piece of legislation adopted this year, the Economic Development Industrial Cluster Act ( H. 4397 ), expanded 1995's Enterprise Zone Act. The Cluster Act builds upon the economic development tax incentives included in the 1995 legislation by providing economic development incentives in regions not specified in the Enterprise Zone Act. These incentives are designed to induce the creation of "industrial clusters" in South Carolina. An industrial cluster is a concentration of an economic sector in a certain area which can expand the State's economy through business interaction.

Legislators also adopted the SC Rural Development Act ( H. 4706 ) to encourage economic development in South Carolina, particularly in rural areas. The act expands tax breaks and provides other incentives (including lowering the minimum rates that businesses pay for fee-in-lieu-of taxes, increasing the number of years that these lower rates may be negotiated, and increasing jobs tax credits) to new and expanding South Carolina businesses, especially those businesses which bring additional jobs to rural and less-developed areas.

In addition to the Industrial Cluster and Rural Development Acts, the state's business community will feel the effect of several other measures passed this year. H. 3838, for instance, brings such significant changes for workers' compensation as the elimination of an employer's ability to opt out of providing workers' compensation coverage for employees. The General Assembly also responded to federally engineered changes to the corporate world by adopting H. 4790 to facilitate interstate banking and H. 4694 to ensure that basic local phone services will be universally available and affordable in the rapidly changing telecommunications market.

Homeowners will continue to enjoy the property tax relief initiated last year. The General Assembly allocated $104 million to maintain the $100,000 homestead exemption from school operating expenses, bringing the total annual commitment from the State to $213.7 million. As last year, these funds will be distributed to school taxing districts to replace revenue lost due to the exemption. A Senate proposal to distribute the Property Tax Relief Fund on a per capita basis was eliminated in the budget conference committee. Because of continuing growth in school operating taxes at the local level, the General Assembly set 1995 millage as the base for determining the amount school taxing districts receive from the Property Tax Relief Fund.

During the 1996 session, the General Assembly considered providing further tax relief in the form of specific limitations on local governments' taxing authority ( H. 3901 ). Both House and Senate offered proposals that would expressly prohibit local governments imposing any new taxes, unless the tax was specifically authorized by the General Assembly, and that would have restricted local governments' authority to impose any authorized new taxes or to increase existing taxes. The proposed restrictions on local government's authority to increase existing taxes included allowing increases for only specified circumstances or only in amounts not greater than the average percentage increase in the Consumer Price Index for the southeast, unless a greater increase is approved by supermajority vote of the governing body or by a majority of the voters in a referendum. Any authorized new taxes could be imposed only upon a supermajority vote of the local governing body. The House and Senate differed over which local governments would be affected and over whether to impose the tax caps on local governments without the voters' approval in a local referendum. The Senate proposal also would have required a statewide referendum on the question of increasing the state sales tax to six percent, with the increase used to finance specific tax relief programs, such as an expansion of the homestead exemption for owner-occupied residential property and elimination of income taxes for senior citizens and an income tax credit for other South Carolinians. In the end, a compromise was not adopted by both bodies before adjournment on June 13.

While school operating costs comprise the heart of the 1995 property tax relief initiative, the issue of how best to fund much needed renovation and expansion of school facilities took center stage as the General Assembly determined how to disburse revenues expected from last year's extension of operations at the Barnwell Low-Level Radioactive Waste Facility. While the General Assembly earmarked 70% of the funds for school facilities, a formula for distribution was not established until passage of this year's Public School Facilities Assistance Act ( S. 1117). This act allocates funds to districts according to the following formula: 35% according to Education Finance Act formulas, 35% based on the number of weighted pupil units in each district, 15% on a needs basis, and 15% based upon districts' past capital improvement efforts. The remaining 30% of the Barnwell revenue is earmarked for higher education tuition assistance. Half of these funds will be used to expand the merit-based Palmetto Fellows Scholarship program and the other half will be used to create a need-based tuition assistance program.

Beginning in the current school year, the state is providing over $14 million dollars for full-day kindergarten classes for more than 16,000 at-risk students. Funds are disbursed to each district according to the number of its free and reduced-price lunch students. In keeping with Education Finance Act formulas, school districts must fund 30% of the program. Participation is optional for both school districts and parents.

While public education saw expansion during the 1996 session, lawmakers also emphasized ways in which schools might make better use of existing resources. For instance, the Public School Accountability Act ( H. 4957) was proposed in the House to establish statewide benchmarks for academic excellence while affording school districts greater local freedom to meet new requirements in innovative ways. Falling short of statewide standards could have jeopardized certain funding as well as the jobs of teachers and administrators. However, the task of formulating benchmarks which would be sufficiently strict and fair proved to be complex enough for H. 4957 to be set aside for the remainder of the 111th General Assembly. Interest in school reform also prompted passage of the Charter Schools Act ( H. 4443 ) which allows for the creation of locally controlled public charter schools which are exempt from most statewide regulation, authorized to employ noncertified instructors, fiscally autonomous, and designed to pursue specialized missions.

When addressing higher learning, lawmakers placed the same premium on efficiency and innovation by passing the Higher Education Quality and Accountability Act ( H. 1195 ). This act defines and clarifies the missions for each type of institution of higher learning and enhances the powers of the Commission on Higher Education to ensure that these missions are strictly and successfully pursued without unnecessary duplication of services. To guarantee overall quality, the Commission will reduce or expand an institution's funding according to whether certain performance indicators are met. The Commission is also empowered to reduce, expand, consolidate or close an institution of higher learning, with oversight from the General Assembly.

When legislators turned their attention to crime and punishment in 1996, they tended to focus attention on measures which better equip citizens against criminals. With the passage of the Law Abiding Citizens Self-Defense Act ( H. 3730 ), South Carolinians no longer have to justify their need to carry a concealed weapon in order to obtain a permit. By adopting S. 1286 , the General Assembly provides private citizens with access to information about sex offenders compiled in a statewide registry which, until now, has been a resource available to law enforcement, alone. Legislators also approved an opportunity for voters to decide through a referendum at the upcoming general election whether to amend the State Constitution so as to add a "Victim's Bill of Rights" providing certain protection and privileges for crime victims during proceedings which involve their assailants ( S. 1050 ).

The General Assembly revisited the issue of auto insurance reform, passing H. 4490 to repeal the current legal mandate to write physical damage coverage (i.e. collision, comprehensive, fire, theft) for those who qualify for the safe driver discount. Drivers who obtain physical damage coverage in the Reinsurance Facility will now pay self-sustaining rates, thereby ending a pattern of unfair subsidies in the area of physical damage, which allowed, for instance, the driver of a Chevrolet to absorb part of the risk-rate of another driver's BMW. Also of interest to South Carolina's drivers was an initiative to raise the state's speed limits in response to Congress's repeal of federally-imposed limits. The proposed hikes in maximum speeds ( S. 378 ) failed, however, to acquire necessary support before the session's end.

Lawmakers took preliminary steps towards erecting a privately-funded African-American History Monument on the State House grounds ( H. 3515 ). A nine member commission is established to coordinate fundraising and select a design and location. Pending approval by the General Assembly, the monument will be erected after State House renovations are completed.

Environmental issues often took center stage during the course of the session. One bill which prompted particularly spirited debate was H. 3446 , which subjects large hog farms to stricter environmental controls. Using the controls established under H. 3446 , the Department of Health and Environmental Control must promulgate regulations for hog farms. Also enacted this year, the Environmental Audit and Disclosure Immunity Act ( H. 3624 ) is designed to increase voluntary compliance with environmental laws by allowing companies to conduct confidential environmental compliance self-audits and providing certain protection from penalties for those who voluntarily disclose violations of environmental laws so long as progress is being made towards remedying the problem.

Several measures enacted in 1996 will impact the quality of health care for South Carolinians. The General Assembly authorized the Medical University of South Carolina to lease its hospital facilities to Columbia/HCA, one of the nation's largest private health care providers. With passage of S. 1043 , the General Assembly requires all health insurers who offer hospitalization coverage for childbirth to cover hospital stays for mothers and newborns for up to two days following a vaginal birth and up to three days following a Caesarean section. H. 4649 establishes a statewide Cancer Registry to compile statistics on cancer cases which will be used to enhance awareness, prevention, and treatment of the disease statewide.

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Last Updated: September 21, 2001 at 9:18 AM