Friday Report - September 11, 2020

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Revenue, Finance, and Economic Development

The Senate Finance and House Ways and Means Committees met this week to position funding proposals and legislation to be debated by the full Senate and House when they return next week for Sine Die session. The items of interest to county governments are discussed below.


1. Senate Finance Committee Action

On Tuesday, the Senate Finance Committee met virtually to discuss Phase II CARES Act authorizations, the state’s budget, and to take up legislation regarding business licenses. 

The Finance Committee voted to authorize an additional $100 million to state and local governments in Phase II of the CARES Act authorizations. They then passed an amendment to H. 5201, the Appropriations Bill. As amended, H. 5201 continues funding state government at the level of amounts provided for in the earlier Continuing Resolution (Act 135 of 2020, H. 3411) until June 30, 2021. While the majority of the state will continue to operate at the levels of funding from the previous fiscal year, the Senate plan would appropriate $11,687,035 to the Local Government Fund. This is full funding of the Local Government Fund. Please thank your Senators for supporting this budget plan for the remainder of FY 20-21 and ask that they continue to support it on the floor.

The Senate budget plan would also make the following relevant one-time appropriations:

$70,000,000 - Department of Administration: COVID-19 Response Reserve Account

$4,159,050 - State Election Commission: Poll Worker Stipend. The State Election Commission would distribute these funds within 10 days of the effective date of the Act to county election commissions to fund the one-time, supplemental $175 stipend for each poll manager or clerk serving for the November 2020 General Election. The Revenue and Fiscal Affairs Office would determine the amount to be provided to each county election office. After accounting for the additional stipend, a county election commission may use any surplus to purchase PPE, cover costs associated with absentee voting, and towards safety of statewide elections. Any unexpended funds must be returned to the State Election Commission.

$20,000,000 - Statewide Employee Benefits: State Employee COVID-19 Hazard Pay Bonus. To qualify for the bonus, a state employee must have:

a) been in a direct line position that provided direct services to the public or customers during the pandemic;

b) physically reported to the workplace all or most of the working days during the pandemic between March 19, 2020, until the start of Phase 2 of the Re-Entry Plan for State employees on July 6, 2020;

c) continuous state service from March 1, 2020 through September 1, 2020; 

d) been an active employee as of September 1, 2020 and on the date of distribution of the bonus; and 

e) an annual salary of $50,000 or less as of September 1, 2020.

$17,888,242 - Department of Mental Health: Veterans Nursing Home Construction

In addition, the budget plan would extend the provisos contained with Act 135 of 2020 and also include the following relevant provisos:

Furloughed Employee Retirement: Participating employers in the SCRS or PORS that are not state agencies implementing furlough programs on or after March 1, 2020, may make any employee and employer contributions necessary to ensure that a furloughed employee’s retirement benefits were not interrupted as a result of the furlough.

PEBA COVID-19 Return to Work Extension: for FY 20-21, the earnings limitation imposed pursuant to Section 9-1-1790 and Section 9-11-90 does not apply to retired members of the SCRS or PORS who return to covered employment to participate in the state’s public health preparedness and response to COVID-19.

PEBA State Health Plan: Employer and subscriber premiums for Plan Year 2021 shall remain the same as in Plan Year 2020.Copayments for participants shall remain the same in Plan Year 2021 as in Plan Year 2020.

First Responder COVID-19 PTSD Treatment:

·     $250,000 to the Department of Labor, Licensing and Regulation, State Fire Marshal’s Office for first responder PTSD treatment. LLR would distribute the funds to the SC Firefighter Assistance Support Team to reimburse firefighters and emergency medical technicians who incur mental injury as a result of a critical incident during the scope of employment for actual out-of-pocket expenses not covered through workers’ compensation claims and or insurance.

·     $250,000 to SLED for first responder PTSD treatment. The funds would disburse through the SC Law Enforcement Assistance Program to reimburse law enforcement officers who incur mental injury as a result of a critical incident during the scope of employment for actual out-of-pocket expenses not covered through workers’ compensation claims and/or insurance.

Office of Regulatory Staff: Establish the Office of Broadband as a program within the agency to receive federal and state funds, provide grant oversight, and broadband mapping and planning.

One-Percent (1%) Increase to Employer Contribution to SCRS and PORS: Remains suspended for all of FY 20-21. 

Any provisions contained in Act 91 of 2019 (the Appropriations Act) or Act 135 of 2020 (the Continuing Resolution) that are in conflict with the Senate budget amendment would be suspended. 


2. House Ways and Means Committee Action

The House Ways and Means Committee met Friday to discuss the authorization and expenditure of the remaining $668 million in CARES Act funds and legislative items discussed below. Based on some additional funds that became available, they did a strike and insert amendment to S. 426 to send $450 million of the residual aid dollars to the state’s unemployment trust fund. An overview of the pertinent portions of the remaining funds for Phase II of the Corona Virus Relief Fund is as follows: 

 ·     DHEC – Statewide COVID-19 Testing and Monitoring: $73,022,613

·     MUSC – Statewide COVID-19: $20,150,000

·     State & Local Government, Independent College and University Expenditures (July 1 – December 30, 2020): $130,000,000

·     Non-profit Relief Programs – Grants: $25,000,000

·     Small and Minority Business Relief Grants: $50,000,000

S. 426 received a favorable report as amended. Please ask your House members to support full reimbursement for counties from the CARES Act funds and full funding for the Local Government Fund.


3. Other Bills of Interest

Business License Tax Reform – H. 4431. As passed by the House, this bill represents a compromise among all stakeholders to amend the business license tax by standardizing due dates, collection methods, appeals processes, and implementation of business license taxes. The bill also approves a payment portal to be administered by the SC Revenue and Fiscal Affairs Office (RFA). This will make it easier for taxpayers to pay their business license tax as well as streamlining collection for taxing jurisdictions. H. 4431 also provides a standardized business license class schedule to be adopted by taxing jurisdictions by December 31 of every odd year. This schedule is to be recommended by the Municipal Association and approved by the RFA. Taxing jurisdictions will still be able to adopt some sub-classifications. This bill is a standardization effort, which SCAC supports. The Senate Finance Committee adopted an amendment to make technical corrections and to make a concession to the press association and gave the bill a favorable report as amended.

Property Assessment — S. 545. This bill originally required the Department of Revenue to follow certain North American classification system manual provisions. It also repealed a provision relating to the appraisal and assessment of personal property of businesses under the jurisdiction of the county auditor, which SCAC opposes. The Senate adopted a compromise amendment at the request of SCAC to create a form, with input from all interested parties, that would be consistent with the state form that the Department of Revenue utilizes. Currently, the form utilized by each county varies. This agreement preserves the auditor’s authority to assess this property, an SCAC policy position. S. 545 was given a favorable report by the Ways & Means Committee and will head to the floor.

Nursing Home Resident 4 Percent Assessment – S. 207. S. 207 allows a person who is receiving the 4 percent owner-occupied assessment ratio and becomes a patient of a nursing home or community residential care facility to retain the 4 percent assessment ratio while they are a patient of the facility. The person must intend on returning to their home and may not rent the home out for more than 72 days in any calendar year. The Ways and Committee gave this bill a favorable report.

Accommodations and Hospitality Tax – S. 217. This bill originally allowed local governments to use state accommodations taxes, local hospitality taxes, and local accommodations taxes for the control and repair of flooding and drainage at tourism-related lands or areas. This bill includes all local governments. The Ways & Means Committee amended the bill to only allow the use of hospitality taxes for flooding issues and gave the bill a favorable report as amended.

Legislative Session: