Wednesday, February 27, 2013

From the House

Bluffton Today

The budget process so far has been good to Beaufort County. During the accountability portion of the budget, we put together a full court press involving the entire delegation for the benefit of USCB funding parity. At this point, we have $1.2 million going toward bringing our local university branch up to parity with the other branches around the state. While this is far from true parity, it is a good faith start on what may be a multi-year project.

My sincerest thanks go to Dr. Jane Upshaw, Chancellor of USCB and Dr. Lynn McGee, Vice Chancellor, for their tireless efforts in this worthy cause. We also had good work from my delegation colleagues, Rep. Shannon Erickson, Rep. Andy Patrick, and Rep. Weston Newton. We are also grateful to my friend, Rep. Chip Limehouse, Chairman of the Higher Education Subcommittee of Ways and Means for his help in the current appropriation and his commitment to aid in future efforts to bring parity, not only to USCB, but to all the branches of USC. This is another example of the increasing level of influence the Beaufort/Jasper Delegation brings to the General Assembly.

Over the years, readers of this column have heard much about the great work done by my friend, Al Stokes, and his colleagues at the Waddell Mariculture Center at the end of Sawmill Creek Road in Greater Bluffton. Somehow, they have managed to do cutting edge science in the environmental area, as well as maintain and expand a very successful game fish stocking program in support of the local sportfishing industry, all the while keeping the facility going with baling wire and duct tape. This year, the House budget has close to a million dollars for Waddell to do long-overdue repairs and renovation to the facility.

Due to redistricting, the Waddell Center is no longer in District 118. However, it is now in District 120, which is represented by my good friend and fellow Waddell supporter, Rep. Weston Newton. Having been a strong water quality advocate for 13 years on Beaufort County Council, Weston certainly “gets it” when it comes to the huge contribution that Al Stokes and friends have made to the local economy, as well as the local ecology.

Also, we continue getting much comment on the proposal to repair the obviously unfair treatment of the 6 percent property owners with a sales tax swap, as was the original plan for the now much-maligned Act 388. The two features of the proposal that are most important are the fact that it is done by referendum, and that the extra penny of sales tax is a tax swap, not a new tax. We are replacing the unfair and job killing part of Act 388 with a sales tax for school operations. We will likely raise more dollars for the schools because of the visitor portion of the sales tax, and we remove a serious flaw in our revenue regime.

The obvious question is why doesn’t the delegation simply fix Act 388 instead of going through all this extra effort. Believe me, we have tried to do exactly that with very little support. In areas where real estate is not a significant portion of the economy, Act 388 is popular with homeowners for obvious reasons. They also don’t experience the unfairness of investment and our-of-state property owners being stuck with paying for something from which they receive little benefit. Thus, the proposal is an opt-in fix for those areas of the state where the fix is appropriate. Again, this is far from perfect, but simply less egregious than the current law.

Thursday, February 21, 2013

From the House

Bluffton Today

Last Friday, the Old Town Merchant’s put on their Winter Art Walk. Not surprisingly, it was a big hit, not only with Bluffton, Sun City and Hilton Head folks, but there was a large contingent of visitors from all over. The word is spreading about our not-so-little town.

The two proposals I floated in the last few weeks are creating quite a stir. The user fee proposal for roads and bridges is an idea whose time has come. Not only has my mail been running strongly in favor, but editorial boards across the region are beating the drum for this and other similar common sense measures. As we have been building infrastructure in Iraq and Afghanistan, ours is crumbling. Most people seem to get the fundamental difference between profligate spending and necessary investment in the critical needs of our country.

As to my proposal to address the obvious unfairness of the Act 388 placement of the burden of school taxes on businesses and non-resident homeowners, we have gotten a ton of mail in favor of not only the basic idea but also the opt-in feature as well. Nobody likes taxation, but unfair taxation tends to also undermine the faith we must have in our system to get voluntary payment compliance across the board. I believe we are crafting a bill that will address our school needs fairly and spread the burden across the widest possible spectrum of taxpayers. I am cognizant that sales tax is regressive and hits those at the lower end of the economic scale disproportionately, but that is offset by the fact that much of the sales tax is paid by visitors. No system is perfect, but on balance, this is pretty good.

At the risk of speaking a little too much “inside baseball” about how the legislative system works, I want to relate a bit about “provisos” and the Provisos Subcommittee. Provisos are essential spending or directive measures that unless renewed, have a life of one fiscal year. They are useful for, among other things, spending nonrecurring dollars and temporarily mending funding oversights until a more comprehensive solution is created. Your legislator is chairman of the Provisos Subcommittee of Ways and Means. This is important even beyond the particulars of actual provisos, in that all the other subcommittee chairman are also on this subcommittee. This forum tends to look over the spending themes of the committee as a whole and looks out for the state, but allows the chairman some discretion.

One of the matters taken up last week in Provisos Subcommittee had to do with the funding parity of all the USC branches, including our USCB. We have agreed to treat each branch equally, which is a good start and will have the effect of making whole our local university, at least partially. My goal is to define parity not as “per branch” but as “per student” which is fair. If all the branches receive the same dollars and USCB has twice as many students as another branch, we are still not at parity, as far as I am concerned.

Also, we passed a measure in Provisos allowing Beaufort County and Sumter County to form their own economic alliance. With the withdrawal of Jasper County from our former economic alliance, we needed another county with whom to partner. Beaufort and Sumter have a lot in common, especially our military base status, and we needed to get this done to keep our economic development efforts on track. This was a delegation priority and we have every expectation this proviso will stand up in the senate with the help of Senators Tom Davis and Chip Campsen.

Wednesday, February 13, 2013

From the House

Bluffton Today

First, I want to congratulate my friend Tabor Vaux on his election to the District 9 seat on Beaufort County Council. Tabor and his team put together an excellent campaign and we are confident he will distinguish himself, as did his predecessor, my House colleague Rep. Weston Newton. Bluffton was fortunate to have two qualified and motivated candidates in Tabor Vaux and Mark Lawson. Both candidates ran spirited campaigns and we were pleased at the generally high level of the contest.

Also, my friends Larry and Tina Toomer, and the Bluffton Oyster Company were recognized at the Hilton Head Island/Bluffton Chamber Ball, as the Bluffton Regional Business Council Member of the Year. It is impossible to imagine Bluffton without the contribution of these two hard-working folks. They represent an ideal of a true South Carolina entrepreneurial family.

With reference to my road and bridge funding proposal floated last week, we got a ton of calls and emails. Some were less than favorable and usually began with “in this economy.” The reason I bring this forward now is precisely because this economy is on a definite upswing, according to our economists and our tax receipts, and now is the time to invest in the very things that will power our economy to the next level, or at the least, will prevent it from being further constrained by infrastructural deficits.

Most folks wanted to hear more details and a more fully articulated rationale for the proposal. My task at this point is to see if there is sufficient interest to warrant rolling out a developed initiative. I also needed to hear your voice on how we should proceed, if indeed we should move in this direction. There was one theme that seemed to run through the more thoughtful responses, such as from Sun City community leader Karen Heitman, who advised that any proposal should stand on its merits and not be subject to political machination. As with most of Karen’s advice over the years, I absolutely agree.

Please continue to think about how we can mend our roads and bridges and let me hear from you.

At the risk of going to the well too often, there is another matter under feverish consideration right now, and I need to place it before you. It has to do with Act 388, which, as you may recall, replaces part of our school operation costs with a penny sales tax, while lowering the property tax for homeowners in the state, except those with second homes or business properties. The arrangement is patently unfair and that unfairness is compounded as it moves through the economy.
The original rationale for Act 388 was to create a dedicated revenue stream for schools and lower taxes across the board, but the legislative sausage-making ended up with a single penny sales tax and a class of disadvantaged taxpayers. Since our local economy has a huge real estate component, and the disadvantaged taxpayer group makes up a significant portion of our local real estate customers, Act 388 needs to reflect the original intent and add another penny to our sales tax. At least that is part of the current thinking.

My friend, County Councilman Jerry Stewart, along with leaders of the local real estate contingent, is working hard to come up with a way to fairly fund our schools without unfairly taxing a portion of our citizens. We need to again hear your thoughts on this. Our need for revenue requires we have taxes, but unfair taxes are an unstable and toxic ingredient in the mix. What say you?

Wednesday, February 6, 2013

From the House

Bluffton Today

Those of you who follow this column with any degree of regularity know it is an interactive tool that I use fairly often to gauge your support for various ideas that come down the political pike. Today is one of those times when I need your help. I need your opinions, your thinking, and your creativity to address a problem we, as a state, have ignored for so long it has become a critical issue that threatens to constrict our economy and reduce our competitiveness in bringing vital new jobs to our state.

I am talking, of course, about the sad state of our transportation infrastructure, our potholed roads and our hundreds of load-limited and failing bridges. You see the problem from our Interstate Highway system, all the way to the cracking and eroded streets around AllJoy Landing.

We like to talk about how we are a business friendly state. We are working to get our tax rates more competitive; our regulatory regime more rational and effective, and our right-to-work status is a big deal to a lot of companies. However, all these good efforts are for naught if we continue to ignore our crumbling roads. Even the South Carolina Business Roundtable, representing a cross-section of our states economic drivers and led by the SC Chamber of Commerce, has issued a recent paper urging the General Assembly to address this issue. They propose a very modest program clustered around the I-26 corridor, and involving statewide bridge assessment and pavement renewal to be done in the short term. The cost estimate is $6 BILLION. The SCDOT Transportation Infrastructure Taskforce, chaired by Sun City resident and local highway commissioner Craig Forrest, has estimates going out twenty years that are close to $30 billion.

So what are we doing? The governor recently spoke to the issue in her state of the state address and suggested we shuffle around our fiscal obligations and redirect $77 million to roads and bridges. The Speaker has urged that we direct $100 million of new revenue to roads and bridges. Now, $177 million is a lot of money, but not in the context of a generation of neglect to the most essential feature of our economic viability. Is this the “bold, forward-thinking, and bipartisan leadership… that will ensure this critical priority is adequately addressed this year” called for by the SC Business Roundtable? Probably not.

I suggest we take a page from recent Beaufort County history and expand it to the state level. In 2002, our county was faced with $350 million of transportation deficits: afternoon gridlock, failing bridges, and the real possibility of a failed evacuation when the inevitable storm arrives. Facing the facts on the ground, County Council, then led by my colleague Rep. Weston Newton, with vigorous delegation support, passed a penny sales tax for transportation, raised over $150 million, which was leveraged and supplemented with federal dollars to erase the deficit in a matter of years. We voluntarily, via referendum, taxed ourselves to take care of a critical problem.

Could we not voluntarily, via referendum, tax ourselves, perhaps with a fuel tax surcharge geared to an agreed upon plan and timeline? If we could raise a portion of our need, we could leverage and supplement with federal matches to address our road and bridge issue in as little as five years, immediately creating thousands of jobs and opening the doors for thousands more as we become truly the business friendly state we claim we want to be.

If this idea makes sense to you, let me hear from you, along with your reasons and your suggestions. If you think we should do something else, or nothing at all, let me hear from you, along with your thinking. Your judgment will determine whether this ends here or becomes an agenda item at Ways and Means. Think it over and have your say.