SC Legislative Update

By Ben Homeyer

The Senate unanimously passed its version of the income tax bill. S1087 would enact the Comprehensive Tax Cut Act of 2022. The act lowers the top marginal individual income tax 6 and 7 percent rates to 5.7 percent in tax year 2022 and allows taxpayers to claim a full deduction of military retirement income. Further, the act increases the manufacturing value exemption for property taxes to 42.8571 percent of the value, which equates to lowering the 10.5 percent manufacturing assessment ratio to 6 percent. (That is the part that is good for us) The act also eliminates the reimbursement cap for this exemption and the phase-in of the current manufacturing property tax exemption. It also allows that local governments will be reimbursed for the exemption (That will cost about $100 million.) Lastly, it appropriates one billion dollars from the Contingency Reserve Fund to the Taxpayer Rebate Fund, which may be used to provide a rebate to taxpayers in a manner prescribed by the General Assembly. The House has a big problem with the last part.  The House version which is backed by the Governor would lower rates to 6.5% and reduce the bottom brackets creating just three brackets instead of seven total.  It costs far less than the senate version and will be a hotly contested issue going in to April

Workforce development groups had a huge meeting with the House to discuss how to get more folks in the job market.  The SC Education and Workforce Development Pipeline development piece shows for the first time a very coordinated effort amongst multiple agencies from k-12 to higher ed to the department of commerce who will serve as the umbrella group to get more workers where they are needed.  

The Senate sent the House S248 “South Carolina Hands-Free Act” would make it unlawful to use cell phones, portable computers, GPS receivers, electronic games, or similar stand-alone electronic devices while driving. It also creates a moving violation to be known as unlawful distracted driving. Second or subsequent offenses would carry a mandatory $200 fine, as well as a two-point violation penalty against offenders’ driver licenses. A final feature directs the SC Department of Transportation to notify motorists of this hands-free requirement at certain points along South Carolina’s interstate highways. Nothing in this bill would prevent hands-free operations such as voice commands, dictation, podcast or music listening, or receiving or placing calls so long as no part of the drivers’ body touches the device. For the first 90 days it is effect, law enforcement could only write warning tickets for violations.

Budget 

The full House adopted the almost unchanged the Ways and Committee Budget, which allocates over $500 million to the SCDOT – along with ARPA allocations totaling $453 million – the SCDOT could see over $1 billion investment this year. 

In addition to these recurring dollars, one-time boosts are provided for rural interstates ($176.5 million), resiliency studies ($5 million), and CTCs ($250 million).

The Be Pro Be Proud had $642,000 approved again in non-recurring dollars to continue the program.  Matching dollars are still coming in from the private sector.  

Dollars are also being put into programs to ramp up CDL training programs and job development.  As well as to create a new division at the DMV to deal with motor carrier services.  

The budget now goes to the Senate where they will have their first shot at making changes.