Tag: SC Senate

Tort Reform Fails in Current SC Senate Legislative Session

The South Carolina Senate failed to advance tort reform legislation this year despite considerable lobbying by small business groups.
Called the South Carolina Justice Act, the bill would have changed the state tort reform law to a position where a defendant in a tort action would be financially liable only for their percentage of fault. The current law can leave one defendant on the hook to pay all awarded damages regardless of their percentage of fault.
At the time of its introduction into the Senate last year, Tom Mullikan, President and General Counsel for the South Carolina Coalition for Lawsuit Reform, said, “Without this legislation, South Carolina may lose economic development projects to neighboring states like Georgia and North Carolina where liability laws are more balanced.”

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SC Senate Passes Medical Marijuana Bill

The SC Senate passed the crucial second reading, by a 28-15 vote, of a bill to approve the sale of medical marijuana in the state. The bill was debated over the last three days of Senate meetings and appears destined to pass what is normally a pro forma third reading today.
The bill will then move to the House where a similar bill was defeated by a parliamentary maneuver two years ago. Changes were made to this bill which eliminated the provisions that led to the killing of the bill in the House two years ago without any debate. Several House members have told Grand Strand Daily that they expect the bill to go through the normal debate process in the House this go around.
South Carolina is one of 12 states in the nation which do not allow the sale of marijuana products for medical purposes (38 states do). It is also one of only four states in the nation in which marijuana still maintains a “fully illegal” status.
Sources told GSD that the sale of medical marijuana in the state is opposed by SLED and the SC Sheriffs Association, ostensibly because of difficulties with regulation of its sale. One could argue, even though it is illegal, sale of marijuana in the state is not regulated now.
click on headline above to read more

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SC Joint Pension Committee Fails Review Test

The South Carolina Joint Committee on Pension Review failed miserably in its task to recommend solutions to the state’s failing public employee retirement system.

Made up of a mixture of Democrats and Republicans from the SC House and Senate, the committee’s basic recommendations were to throw more money at a failing model and to silence the one statewide elected official who has been calling for changes in the system over the past six years.

The state’s public employee retirement fund has been one of the worst, if not the worst, performing public pension funds in the country. It is known for two things – extremely low rates of return on investment combined with extremely high fees paid to the institutions doing the investing.

The public retirement system is currently plagued with an estimated $25 billion shortfall on future liabilities.

The committee’s solution to closing the shortfall is to throw more money into the pot. Employee contributions will rise slightly from the current 8.66% of earnings to a cap of 9% of salary.

However, the employer contributions, those contributions paid by tax dollars from public agencies participating in the system, will rise from the current 11.56% of earnings to 13.56% beginning next fiscal year and rising each year until it reaches 18.56% in 2023. That is a 60.5% increase in tax dollars over the next six years.

As egregious as that rise of public spending is, even worse is the recommendation to remove SC Treasurer Curtis Loftis as Custodian of the pension funds and as a member of the SC Retirement System Investment Commission.

Loftis is the only public official who has routinely criticized the mismanagement of the retirement system by the Public Employee Benefit Authority and the SCRSIC as well as the high salaries and bonuses paid to SCRSIC staffers and their often cozy relationship with risky hedge fund investment managers.

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South Carolina’s Public Pension Problems

Six years after SC Treasurer Curtis Loftis began complaining about the poor performance of public pension investments under the SC Retirement Systems Investment Commission, legislators in Columbia have finally heard the message.

Fixing a seriously underfunded pension system has become a priority for this legislative year, The problem is you don’t fix an approximately $25 billion shortfall overnight.

When Loftis assumed the office of SC Treasurer, he became a statutory member of the investment commission. As a statutory member of the South Carolina Retirement System Investment Commission, Loftis criticized the high fees, low performance and lack of transparency associated with South Carolina’s public pension funds.

Almost immediately, the ‘good ole boy’ system in Columbia struck back. Loftis was subjected to allegations in 2011 that he and Mallory Factor were partners in what was called a “pay to play” scheme involving state retirement funds.

Despite the best efforts of members of the SC Retirement System Investment Commission, Gov. Nikki Haley, then state senator Greg Ryberg and others, Loftis was cleared of all allegations by SLED and the SC Attorney General’s office.

A couple of years later, Loftis was censured by the same SCRSIC he serves on for “false, deceitful and misleading rhetoric.”

At the time, Loftis said the commission members didn’t like him looking under rocks and asking questions about investments made by commission staff.

Things changed last spring when the CEO of the investment commission, Michael Hitchcock, told members of a Senate committee that the returns of the state pension fund have “underperformed” in recent years. He said the approximately $16 billion shortfall in the pension fund accounts has been aggravated in recent years by the gap between the assumed rate of return set by lawmakers (7.5%) and the actual rate of return (1.6%).

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No Renewal Yet on Tourism Tax

The decision on whether Myrtle Beach will be able to reimpose its tourism tax remains in question at this time.

The SC House adjourned debate on a bill (S1122) that would provide a means to reimpose the tourism tax if the bill passes.

Debate on the bill is now scheduled for Tuesday May 31, 2016.

The original bill passed the SC Senate unanimously, but the House amended the bill to eliminate a provision that would allow Myrtle Beach City Council to reimpose the tax by a supermajority vote of at least two-thirds of its members.

If the bill passes in its current, amended form, the tourism tax would have to pass a referendum of city voters in order to be reimposed.

Eighty percent of the revenue raised from the tax goes to the Myrtle Beach Area Chamber of Commerce for marketing the Myrtle Beach tourism attractions out of area.

Since being approved in 2009, the city has transferred in excess of $120 million to the Chamber. This has allowed the private tourism corporations to reduce their marketing budgets by as much as 95%.

Such a transfer of wealth from a public tax to benefit private businesses should be subject to approval by a voter referendum. Actually, it shouldn’t happen at all, especially in an area that prides itself on being so free market capitalist and conservative Republican.

It’s obvious the conservative politicians and their capitalist buddies don’t have a problem imposing taxes and spending the resulting revenue, just so long as it doesn’t come from their pockets.

The bill still has a couple of hurdles. It must pass two more readings in the House. If it passes there in its amended form, a compromise will have to be worked out with the Senate on whether or not to only allow reimposition of the tax after a favorable referendum of the voters.

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Myrtle Beach Tourism Tax Renewal Hits Bump

The effort to renew state legislation that allows the Myrtle Beach tourism tax hit a bump this week in the SC House Ways and Means Committee.

The bill, S1122, originally introduced in the SC Senate in February 2016 by local senators Greg Hembree, Ray Cleary and Luke Rankin breezed through the Senate without a single no vote.

The SC House reported the bill out of the Ways and Means Committee with an important amendment that could have an interesting overall impact on whether the current one-cent local sales tax for tourism promotion gets renewed.

The Ways and Means Committee struck the provision that the tourism tax could be renewed (reimposed) by “an ordinance adopted by a supermajority of the municipal council which must be at least two-thirds of the members of the municipal council.”

The only provision remaining in the bill for reimposition of the tax is the “approval of a majority of qualified electors voting in a referendum held pursuant to this section called by a majority of the members of the municipal council.”

Myrtle Beach City Council imposed the tax on the general public in 2009 with a supermajority vote of council. The tax was never put before the voters in a referendum, allegedly for fear it would not pass.

If the amended bill successfully passes vote of the full House, it will be interesting to see if the elimination of the supermajority option to renew the bill withstands conference committee.

When it was first passed through an ordinance approved by a supermajority vote of Myrtle Beach City Council in 2009, the local option tourism development fee became the first and only local option sales tax (that’s what it is) to be enacted in the history of the state without a referendum vote of approval.

The result of the tax is the Myrtle Beach Area Chamber of Commerce receives over $20 million public tax dollars each year to spend on out of area tourism advertising.

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Important Week for Political Junkies

One of the most important weeks of the year for political junkies in the area is upon us.

On Tuesday, they should get a reasonable idea of how long the Republican Party can hold off the nomination of Donald Trump for president with another round of ‘Super Tuesday’ primaries in five important states.

For locals, however, Wednesday is even more important as filing opens at noon for a number of local offices and all seats in the SC General Assembly.

And the dynamics involved in this year’s political races make them even more interesting for those who follow politics.

Five countywide statutory offices are up for election – Auditor, Clerk of Court, Coroner, Sheriff and Treasurer. Normally these races bring little excitement, but this year two will be open seats and two more are expected to be contested.

Clerk of Court Melanie Huggins Ward and Treasurer Roddy Dickinson have announced they are retiring leaving their seats up for grabs in the primaries and general election.

Two others, Auditor Lois Eargle and Sheriff Philip Thompson are reported to have opposition this year for the first time in a number of years. Only Coroner Robert Edge appears not to have any opposition as filing opens.

Horry County Council will have five seats, Districts 3,4,6,9 and 10 up for election, as well as a special election to fill the unexpired term of retired member James Frazier in District 7.

To make it more interesting, council member Jody Prince is retiring, leaving his District 10 seat open and council members Jimmy Washington in District 3 and Cam Crawford in District 6 will be running for election for the second time in two years as both were elected to office in special election in 2015.

We are hearing reports of possible contested elections in Districts 3 and 9 at this time with District 10 having a number of possible candidates for the open seat. The District 7 seat is expected to have contests in both party primaries as well as the general election.

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SC Senate Committee Approves Gas Tax Hike

The SC Senate Finance Committee voted 14-8 this week to approve a 12 cents per gallon gas tax hike for next year’s budget.

This move was part of an overall vote to replace a SC House road repair plan, approved last year, with one written by the Senate. The House plan approved a 10 cents per gallon gas tax increase.

The Senate plan includes more revenue raising proposals including an increase in driver’s license fees, an increase to a maximum cap of $600 sales tax on a vehicle, up from the current $300. Also included were additional fees on hybrid and electrical vehicles.

The House plan provided for a small cut of state income tax while the Senate plan provides for no tax cuts.

If the Senate plan gains approval from the full Senate, it will have to go back to the House for approval. However, several senators have already placed the plan on the contested calendar meaning the full Senate will have to vote to bring the bill before the full body.

Additionally, if Gov. Nikki Haley sticks to her word, she will veto the plan, if it ultimately passes both houses, because no offsetting tax cuts are included.

It is interesting to note, Senate proponents of the plan are already broadcasting how much of the tax will be paid by non-SC residents. The current estimate is 30%.

This is always an interesting argument that proponents of tax hikes always use to make the tax more palatable for their non-thinking constituents. Tell them how much will be paid by tourists or other outside groups.

What is never mentioned is South Carolina residents will be paying 100% of the tax year around. What percentage of gross revenues may come from tourists or others traveling through the state is really not a consideration for the South Carolina citizens who will be paying the increased tax all the time.

This debate will only become more interesting as the legislative year progresses.

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Gasoline Taxes and Roads on Tap in Columbia

An increase in the gasoline tax is part of the SC General Assembly debate on road funding and tax considerations this week.

This debate will potentially be the one that affects taxpayers the most in the coming years.

One thing I believe you can count on is that before this debate is finished and by the time next year’s budget kicks in, gasoline taxes in the state will have been increased.

South Carolina’s current 16.75 cents per gallon tax on gasoline is one of the lowest in the nation. Last year, the SC House passed a proposal to increase that tax by 10 cents per gallon.

The SC Senate Finance Committee is currently considering a proposal to increase the gasoline tax by 12 cents per gallon.

When both Houses of the legislature are considering a tax increase, it’s a pretty good bet one will be forthcoming.

Additionally, with gasoline prices as low as they’ve been in 10 years, this is the perfect time to raise gasoline taxes because consumers have been accustomed to paying much more than the $1.60 or so per gallon currently charged at the pumps.

Along with the gasoline tax debate are proposals to reduce the state’s income tax.

This ploy was introduced by Gov. Nikki Haley last year and the legislature has picked up on it.

If you can get the taxpayers concentrating on how much they could save in reduced income taxes, maybe they won’t notice, or at least oppose, a gas tax increase.

Haley’s proposal last year even went so far as to call the increased gas tax combined with the reduced income tax “revenue neutral.”

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General Assembly Failing Citizens Again

SC House Confederate Flag Debate Today

The SC House of Representatives will begin today what should be the final debate on removal of the Confederate flag from statehouse grounds.

After a bill to remove the flag raced through the SC Senate in the last two days, garnering only three No votes, momentum is on the side of removing the flag.

But, the House may not be as easy even though the bill received first reading approval yesterday.

A total of 26 amendments to the bill are already filed with the possibility of more coming.

Some of the amendments deal with flags to replace the current one when it comes down.

Some are in the realm of the absurd – just like South Carolina politics most of the time.

One, I am told, calls for the American flag to be flown upside down when the Confederate flag is removed. This may not be as ridiculous as it first sounds.

Flying the American flag upside down is an international signal of distress. That seems very appropriate in an area near the statehouse.

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