Friday Report Issue 7-19 - February 22, 2019

State Budget and Capital Reserve Fund — H. 4000 & H. 4001

The House Ways and Means Committee approved the budget bill (H. 4000) and the Capital Reserve Fund bill (H. 4001), and they now go to the floor for debate. The Local Government Fund was funded at a base level of $222,619,411 with an additional $11,121,265, for a total of $233,740,67. This represents an increase of more than $2 million above what SCAC’s policy position would require. Please thank the members of the House Ways and Means Committee and ask your House members to support the Local Government Fund as approved in H. 4000.

Here are some provisos of interest in the budget bill:

Proviso 1.86 — School Resource Officers (SROs). This proviso allows the State Department of Education to use funds appropriated for the School Safety Program to hire school resource officers for school districts that are unable to.

Proviso 1a.ssp — Funding Criteria for SROs. In conjunction with Proviso 1.86, this proviso sets the criteria for determining which school districts are eligible to apply for funding from the Department of Education for school resource officers.

Proviso 27.1 — Aid to County Libraries. Under this proviso, library funding was increased from the per capita level of $1.75 to $2.00, with a minimum grant of $100,000 per county.  SCAC’s policy position supports funding at the per capita level of $2.25 with a minimum grant of $100,000 per county.

Proviso 33.22 — Rural Health Initiative. This proviso authorizes the Department of Health and Human Services to use appropriated funds to incentivize the development of primary care access in rural and underserved areas by leveraging federal funds that are available. The Department will also use teaching hospitals, such as MUSC, to ensure rural physician coverage in counties with a demonstrated lack of adequate health care access.

Proviso 50.fri — Rural Infrastructure. This proviso authorizes the Department of Commerce to use the Rural School District and Economic Development Closing Fund for economic development, water and sewer infrastructure, and school building infrastructure. The economic development projects must create a minimum of 50 jobs located within the 28 school districts with the lowest Index of Taxpaying Ability (ITA). Proviso 112.1 adds $85 million to this fund.

Proviso 100.21 — Natural Disaster Funding. This proviso authorizes the carry forward funds for Hurricane Irma recovery and the 2014 Ice Storm FEMA match to be used for Hurricane Florence cleanup expenses.

Proviso 118.nr — Hurricane Florence Funding. This proviso authorizes $22 million in nonrecurring funds for FEMA match for Hurricane Florence cleanup expenses.

Proviso 117.112 — State Pay Increase. This proviso provides a 2 percent pay raise for state employees, unless they work for a four-year or technical college and make $100,000 or more.

Proviso 117.142 — Opioid Treatment. This proviso authorizes the Department of Health and Human Services to provide up to $500,000 to a county with a disproportionately high number of opioid-related overdoses and deaths for the development of a local continuum of substance and behavioral health service coordination within the target county.

Proviso 117.mmc — Magistrate Salary. This proviso decouples magistrate’s and master-in equity’s salary from the circuit judge’s salary.

Proviso 117.vsf — Voting Machines Funding. This proviso transfers the funds for the purchase of a new voting machine system and for refurbishment of the current voting system from the State Election Commission to the Department of Administration.

Proviso 118.TR — Income. In the event the winner of the October 24, 2018, Mega Millions contest redeems their ticket, the $61 million that comes to the state will be used to give a one-time income tax rebate in an amount of up to $50 per taxpayer.

Tort Claims Act Changes — S. 7 & S. 386

S. 7 raises the existing caps on damages found in the Tort Claims Act (TCA) from $300,000 to $1 million per individual, from $600,000 to $2 million per occurrence, and indexes both increases to the Consumer Price Index (CPI). If this bill were to pass, it would codify a 333 percent increase in the existing caps. The current fiscal impact statement on the bill predicts a $40 million increase in premiums charged by the Insurance Reserve Fund. The actual fiscal impact will be much higher when all entities not insured by the IRF are taken into account. County budgets that are already pushed to the limits will be further strained by such a change.

S. 386, a companion bill to S. 7, was taken up, amended, and passed by the Senate Judiciary Committee. S. 386 would allow multiple occurrences to arise out of a single event. This could lead to potential “stacking” of the caps when an injured party argues that multiple occurrences caused the event that caused their injury. If this passes, county liability will essentially be unlimited, be impossible to insure against, and will place an unlimited financial burden on your taxpayers. S. 386 also allows for third party claimants to bring a bad faith claim against an insurer. S. 386 further amends the exceptions section by removing one exception and creating new standards for other exceptions.

S. 386 further expands the caps formerly limited to only 1983 civil rights actions to all tort claim actions where there are more than one claimant from a single occurrence. It increases these caps paid from the State Fiscal Accountability Authority (SFAA) from $1 million to $2 million, subject to a maximum of $20 million in one fiscal year. All of these payments will be made from the State’s Catastrophic Fund, which this bill creates. The State’s Catastrophic Fund allows the SFAA to collect assessments from all of the government entities covered under the liability limits. The SFAA is allowed to promulgate regulations in this section to impose the assessments and if a governmental entity fails to pay the assessment, then the State Treasurer is authorized to deduct the assessment from state funds that would otherwise be owed to the local government. By July 1, 2020, the State’s Catastrophic Fund will collect enough assessments to fund the State’s Catastrophic Fund at $3 million. Thereafter, $1 million will be collected every year for the Fund. Beginning June 30, 2039, and every year thereafter, any unspent money over $20 million in the State’s Catastrophic Fund goes back to the governmental entities that funded the Fund through assessments. Starting in 2040, however, the Revenue and Fiscal Affairs Office will adjust the maximum amount of the Fund to inflation so that it will increase yearly. Entities covered by the TCA will have to pay assessments to meet this new total every year.

S. 7 is on the contested Senate Calendar and it is imperative that you contact your Senate delegation. Please let them know about the severe negative impact this bill would have on your county and ask that they help keep the bill on the contested calendar until a successful resolution can be reached.

S. 386 is on the contested Senate Calendar. Please ask your members to oppose S. 386 and to oppose any vote to set this bill for priority status. Unlike S. 7, SCAC staff sees no potential compromise on S. 386 so the bill must be defeated as its fiscal impact will far exceed that of S. 7.

Other Legislative Action this Week

Tobacco Preemption — H. 3274. H. 3274 prohibits political subdivisions from enacting any laws, ordinances, or rules pertaining to the ingredients, flavors, or licensing of cigarettes, electronic cigarettes, tobacco products, or alternative nicotine products after January 1, 2019. Any ordinances adopted prior to January 1, 2019, are exempt from the preemption. SCAC has a policy position opposing this type of preemption. The bill is pending third reading on the contested House calendar. Please contact your House members and ask that they oppose H. 3274.

Administrative Jail Sanctions — H. 3322. This bill provides for comprehensive sentencing reform. Sections 7 and 8 of the bill would create an “administrative” jail sanction to be imposed on probationers and parolees who violate the terms of their supervised program. Instead of going before a judge for a revocation hearing when a violation of probation occurs, probation agents would have the discretion to impose these jail sanctions for a term of up to three days for the first violation and up to 10 days for a second violation. These sanctions would be served in county jails and on weekends, which are when county jails are at maximum capacity. This effectively shifts the financial burden from state prisons to the counties. The bill is silent on whether the counties will bear the costs of medical expenses incurred by these probationers and parolees. Presumably, county jails will have to maintain records and monitor these weekend jail visits. The fiscal impact on counties is estimated to be over $3 million; this figure does not include the costs of record keeping and healthcare for these weekend visits.

A House Judicial subcommittee took testimony this week and will do the same next week. Amendments are expected to be offered. The subcommittee members are Representatives Chris Murphy (chair), Justin Bamberg, Jay Jordan, Cezar McKnight, and Eddie Tallon. Please contact the subcommittee members to express your concern with the impact Sections 7 and 8 of the bill will have on our county jails.

Mental Health Transport — S. 303. This bill requires that anyone who is believed to have a mental illness and requires immediate care be transported to a treatment facility only by a state or local law enforcement officer that is part of a therapeutic transport unit and has undergone mental health and crisis intervention training. It also allows the treating physician of the patient to notify family or friends of the patient that they can transport the person as long as they sign a statement that they assume the responsibility and liability for the transport. The bill was amended to establish a Therapeutic Transport Fund within the Department of Mental Health (DMH). State and local law enforcement agencies may apply to DMH for funds to establish their own therapeutic transport unit and pay for intervention crisis training. A law enforcement agency is not required to establish a therapeutic transport unit until it receives full funding for the unit.  After amending the bill, a Senate Medical Affairs subcommittee carried the bill over for additional research.

Penalty for Failing to Register Motor Vehicles — H. 3916. This bill, an SCAC policy position, increases the penalty for failing to register a motor vehicle from $100 to $500. The current registration fee creates a disincentive to register because of a new $250 registration fee to register a vehicle when you move into the state. Increasing the penalty will remove that disincentive to register and help defray costs incurred by the county in enforcing this requirement. H. 3916 received a favorable report from the House Judiciary Committee. Please contact your House member and ask that they cosponsor the bill and support its passage.

Income Tax Liens — S. 160. This bill authorizes the Department of Revenue (DOR) to implement an internet accessible tax lien system to be used in lieu of the current filing requirements with the county clerk of court or register of deeds. SCAC’s policy position supports this legislation. S. 160 was amended in the Senate to make certain that the new tax lien filing system is internet based and available to the public. The amendment also requires counties to post a notice where liens are filed that provides instructions on how to access the DOR’s tax lien database. The bill received third reading in the Senate and was sent to the House.

Flat Recording Fees — H. 3243. Most documents recorded with the Register of Deeds (ROD) are subject to a fee schedule based on page count. This legislation would change the fee schedule to a flat fee based on the type of document. By eliminating page counting, this change will result in increased efficiency in ROD offices. A House Judicial subcommittee adopted an amendment reflecting a compromise reached with the timeshare industry; recording fees for timeshare deeds would be $10 as opposed to $25. The bill is not expected to create a negative fiscal impact on county government. H. 3243 received a favorable report, as amended, by the subcommittee and will be on the full Judiciary Committee’s next agenda. 

Telecommunications Devices in Jail — S. 156. This bill prohibits the introduction or possession of a telecommunication device, such as a cell phone, in a jail or prison facility unless authorized by the facility. This offense would be a misdemeanor with a mandatory sentence of no more than three years. The Senate Corrections and Penology Committee gave the bill a favorable report.

Sunday Alcohol Sales — H. 3082. This bill authorizes by referendum Sunday alcohol sales by liquor stores in the same 10 counties that have already authorized Sunday alcohol sales. Currently, liquor stores cannot sell alcohol on Sundays. The House Judiciary Committee adjourned debate on this bill.

Veterans’ Affairs Officers — H. 3438. Current law requires a county veterans’ affairs officer (VAO) to be a veteran but also provides an exception for a nonveteran candidate to fill this position if a nonveteran is more qualified than a veteran candidate. This bill, among other things, would remove the exception for qualified nonveteran candidates. The House 3M Committee amended the bill maintain the exception of allowing a nonveteran to fill this position and gave the bill a favorable report.

Coroner Continuing Education — H. 3726. This bill requires coroners and medical examiners to complete continuing education on identifying deaths caused by opiates. The House Medical, Military, Public and Municipal Affairs Committee gave the bill a favorable report.

Golf Cart Rentals — H. 3952. This bill allows counties to adopt an ordinance to regulate a person or entity offering golf carts for rental or lease. The ordinance is limited to the use of safety devices and geographic area, distance, identification of the vehicles, and specific public roadways on which the carts may operate. A House Education and Public Works subcommittee amended the bill to include only golf carts rented or leased for less than nine months and gave the bill a favorable report. It will be on the next full committee’s agenda.

Utility Relocation — H. 3799. This bill provides circumstances under which a public entity undertaking a transportation improvement project must bear the costs related to relocating water and sewer lines. H. 3799 requires the entity undertaking the project to pay 100 percent of the costs of relocating any water and sewer lines that are within the right-of-way and owned by a public utility that has 10,000 or fewer taps or connections and serves a population of 30,000 or less. The entity undertaking the project must pay 100 percent of the costs, up to 4 percent of the total project costs, of relocating water and sewer lines within the right-of-way and owned by a public utility with more than 10,000 taps or connections or that serves a population of more than 30,000. The bill applies to all transportation improvement projects for which no more than 25 percent of preliminary engineering funds have been spent. A House Education and Public Works subcommittee adjourned debate on H. 3799 for the interested parties to work out a compromise regarding a potential sunset provision and potentially moving the 25 percent to 30 percent.

Statewide 911 System — H. 3586. This bill charges the Revenue and Fiscal Affairs office with creating, updating, and implementing a statewide 911 system. The system must be developed and updated with recommendations from a South Carolina 911 Advisory Committee. A House LCI subcommittee adopted an amendment proposed by SCAC to include adding a county administrator recommended by SCAC to the Advisory Committee and gave H. 3586 a favorable report. The bill will be on the next full committee’s agenda.

School District Consolidation — S. 203. This bill would require school districts within a county that do not meet certain benchmarks, such as accreditation and low risk assessment, to consolidate. A Senate Education subcommittee amended the bill so that after August 1, 2022, school districts in Tier IV counties with an average daily membership of less than 1,500 must consolidate, and gave the bill a favorable report.

Newly-Introduced Legislation

View/Download Full Text for Newly-Introduced Legislation

Note: If you would like to offer comments to the SCAC staff, please call us toll-free at 1-800-922-6081, fax to (803) 252-0379, or send an email. You can also go to www.scstatehouse.gov and click on "Legislation," then "Introduced Legislation."

Senate Bills

S. 530 — Updates the “South Carolina Consolidated Procurement Code.”

S. 534 — Provides for additional qualifications for sheriffs and candidates to serve as sheriff.

S. 545 — Repeals Section 12-39-70, relating to classifications for purposes of appraising and assessing personal property of businesses under the jurisdiction of the county auditor.

S. 547 — Provides that the service limitation does not apply to a retired member of the South Carolina Police Officers Retirement System under certain circumstances.

S. 549 — Enacts the “Workforce Opportunity Act.”

House Bills

H. 3999 — Enacts the “South Carolina Constitutional Carry Act.”

H. 4003 — Enacts the “Military Priority Registration Act.”

H. 4012 — Amends sections relating to the Soil and Water Conservation Districts, to include sections relating to elections for those districts.

H. 4044 — Requires the SEC to amend the voter registration application to allow registrants to disclose their political party.

H. 4046 — Eliminates the requirement that a county committee must publish certain notices regarding county conventions in a newspaper.

H. 4047 — Prohibits fusion candidacy.

H. 4051 — Requires a railroad company to provide at least 72 hours notice to a county before the company commences repairs on a public railroad crossing.

Ratifications

The following bills have been passed by both chambers and are now before the Governor for signature or veto:

(R. 5) H. 3630. Delays the real property tax penalty schedule by three months on property owned by individuals affected by the government shutdown.