Indicates Matter Stricken
Indicates New Matter
The Senate assembled at 11:00 A.M., the hour to which it stood adjourned and was called to order by the PRESIDENT.
A quorum being present the proceedings were opened with a devotion by the Chaplain as follows:
Beloved, hear the words of the Prophet Isaiah, Chapter 6 (v.1) (NRSV):
"In the year that King Uzziah died,
I saw the Lord sitting on a throne,
high and lofty; and the hem of His
robe filled the temple... And one
seraph called to another and said:
'Holy, holy, holy is the Lord of hosts;
the whole earth is full of His glory'."
Let us pray.
Our Father, lest we become caught up and confused in our dismal concern for our daily cares and exhausting concerns of our job as Senators, give us a perspective on this hectic hustle!
As we begin our day, help us to hear the words of the angelic beings, called "seraphs" reminding each other in the words:
"Holy, holy, holy is the Lord of hosts;
the whole earth is full of His glory"
when just the hem of His robe "filled the temple."
Amen.
Senator GIESE made the point that a quorum was not present. It was ascertained that a quorum was not present.
Senator GIESE moved that a call of the Senate be made. The following Senators answered the call:
Alexander Cork Courson Courtney Drummond Elliott Ford Giese Glover Hayes Jackson Land Lander Leventis Martin Matthews McConnell McGill Mescher Moore O'Dell Passailaigue Patterson Peeler Rankin Reese Richter Rose Russell Ryberg Saleeby Setzler Short Smith, G. Smith, J.V. Stilwell Thomas Waldrep Washington Wilson
A quorum being present, the Senate resumed.
Senators BRYAN and LEATHERMAN recorded their presence subsequent to the Call of the Senate.
The PRESIDENT called for Petitions, Memorials, Presentments of Grand Juries and such like papers.
Columbia, S.C., March 15, 1995
Mr. President and Senators:
The House respectfully informs your Honorable Body that it has overridden the veto by the Governor on R. 14, H. 3218 by a vote of 3 to 0:
(R14) H. 3218 -- Rep. Askins: AN ACT TO AUTHORIZE THE FORMER BOARD OF DIRECTORS OF A DISSOLVED NONPROFIT CORPORATION OR ELEEMOSYNARY ORGANIZATION LOCATED IN FLORENCE COUNTY TO DISTRIBUTE THE REMAINING ASSETS OF THE ORGANIZATION; AND TO DELAY THE EFFECTIVE DATE BY TWO YEARS FOR CERTAIN PROVISIONS OF THIS ACT.
Very respectfully,
Speaker of the House
Received as information.
(R14) H. 3218 -- Rep. Askins: AN ACT TO AUTHORIZE THE FORMER BOARD OF DIRECTORS OF A DISSOLVED NONPROFIT CORPORATION OR ELEEMOSYNARY ORGANIZATION LOCATED IN FLORENCE COUNTY TO DISTRIBUTE THE REMAINING ASSETS OF THE ORGANIZATION; AND TO DELAY THE EFFECTIVE DATE BY TWO YEARS FOR CERTAIN PROVISIONS OF THIS ACT.
The veto of the Governor was taken up for immediate consideration.
Senator McGILL moved that the veto of the Governor be overridden.
The question was put: Shall the Act become law, the veto of the Governor to the contrary notwithstanding?
The "ayes" and "nays" were demanded and taken, resulting as follows:
AYES
Alexander Cork Courson Courtney Drummond Elliott Ford Giese Glover Hayes Jackson Land Lander Leventis Martin Matthews McConnell McGill Mescher Moore O'Dell Passailaigue Patterson Peeler Rankin Reese Richter Rose Russell Ryberg Saleeby Setzler Short Smith, G. Smith, J.V. Stilwell Thomas Waldrep Washington Wilson
NAYS
TOTAL--0
The necessary two-thirds vote having been received, the veto by the Governor was overridden, and a message was sent to the House accordingly.
The following was received and referred to the appropriate committee for consideration:
Document No. 1853
Promulgated by Commission on Higher Education
Licensing Nonpublic Postsecondary Institutions
Received by Lt. Governor March 8, 1995
Referred to Senate Committee on Education
120 day review expiration date February 12, 1996
Senator McCONNELL introduced Dr. Bart Barone of Charleston, S.C., Doctor of the Day.
On motion of Senator PEELER, at 11:20 A.M., Senator LEATHERMAN was granted a leave of absence until 12:15 P.M.
On motion of Senator MOORE, at 11:00 A.M., Senator HOLLAND was granted a leave of absence for today.
Columbia, S.C., March 15, 1995
Mr. President and Senators:
The House respectfully informs your Honorable Body that it concurs in the amendments proposed by the Senate to:
H. 3205 -- Reps. Stuart, Riser and Koon: A BILL TO PROVIDE THAT BEGINNING WITH THE 1996 ELECTION, MEMBERS OF THE BOARD OF TRUSTEES OF LEXINGTON COUNTY SCHOOL DISTRICT 1 MUST BE RESIDENTS OF SEVEN DEFINED ELECTION DISTRICTS AND ELECTED FROM THE SCHOOL DISTRICT AT LARGE, TO PROVIDE FOR A SPECIAL ELECTION IN 1995 FOR THE PURPOSE OF ELECTING CERTAIN MEMBERS OF THE BOARD TO SERVE UNTIL 1996, TO PROVIDE FOR THE MANNER IN WHICH AND PROCEDURES UNDER WHICH THESE ELECTIONS SHALL BE CONDUCTED, AND TO REPEAL ACT 217 OF 1993 RELATING TO THE ELECTION OF SPECIFIED MEMBERS OF THE BOARD.
and has ordered the Bill Enrolled for Ratification.
Very respectfully,
Speaker of the House
Received as information.
The following were introduced:
S. 642 -- Senator Thomas: A BILL TO AMEND SECTION 56-9-60, AS AMENDED, CODE OF LAWS OF SOUTH CAROLINA, 1976, RELATING TO THE MOTOR VEHICLE FINANCIAL RESPONSIBILITY ACT, SELF-INSURERS, AND DETERMINATION OF FINANCIAL RESPONSIBILITY, SO AS TO DELETE CERTAIN PROVISIONS, AND PROVIDE, AMONG OTHER THINGS, THAT A COPY OF THE APPLICANT'S LATEST FINANCIAL STATEMENT PREPARED BY A CERTIFIED PUBLIC ACCOUNTANT LICENSED TO DO BUSINESS IN SOUTH CAROLINA INDICATING THAT THE APPLICANT HAS A POSITIVE NET WORTH MUST BE SUBMITTED FOR A DETERMINATION OF FINANCIAL RESPONSIBILITY, AND THAT AN APPLICANT MAY BE REQUIRED TO DEPOSIT IN A SEGREGATED SELF-INSURED CLAIMS ACCOUNT THE SUM OF THREE THOUSAND DOLLARS FOR EACH VEHICLE TO BE COVERED BY THE SELF-INSURER'S CERTIFICATE.
Read the first time and referred to the Committee on Banking and Insurance.
S. 643 -- Senator Thomas: A BILL TO AMEND SECTION 38-77-160, AS AMENDED, CODE OF LAWS OF SOUTH CAROLINA, 1976, RELATING TO THE AUTOMOBILE INSURANCE LAW, ADDITIONAL UNINSURED MOTORIST COVERAGE, AND UNDERINSURED MOTORIST COVERAGE, SO AS TO DELETE CERTAIN PROVISIONS, INCLUDING THE PROVISION THAT IF AN INSURED OR NAMED INSURED IS PROTECTED BY UNINSURED OR UNDERINSURED MOTORIST COVERAGE IN EXCESS OF THE BASIC LIMITS, THE POLICY SHALL PROVIDE THAT THE INSURED OR NAMED INSURED IS PROTECTED ONLY TO THE EXTENT OF THE COVERAGE HE HAS ON THE VEHICLE INVOLVED IN AN ACCIDENT; AND TO AMEND THE 1976 CODE BY ADDING SECTION 38-77-162 SO AS TO DEFINE "CLASS I INSURED" AND "CLASS II INSURED" AND PROVIDE, AMONG OTHER THINGS, THAT CLASS I INSUREDS MAY STACK UNINSURED OR UNDERINSURED MOTORIST COVERAGE UP TO THE LIMITS ON THE VEHICLE INVOLVED IN AN ACCIDENT AND THAT CLASS II INSUREDS MAY NOT STACK UNINSURED OR UNDERINSURED MOTORIST COVERAGE AND MAY COLLECT ONLY SUCH COVERAGE ON THE VEHICLE THEY ARE OCCUPYING AND ONE ENDORSEMENT FROM ANY OF THE INSURED'S PERSONAL POLICIES.
Read the first time and referred to the Committee on Banking and Insurance.
S. 644 -- Senator Leventis: A BILL TO AMEND SECTION 12-36-2120, AS AMENDED, CODE OF LAWS OF SOUTH CAROLINA, 1976, RELATING TO SALES TAX EXEMPTIONS, SO AS TO EXTEND THE EXEMPTION ALLOWED MANUFACTURING MACHINERY TO MACHINERY USED FOR RECYCLING AND TO DEFINE "RECYCLING".
Read the first time and referred to the Committee on Finance.
S. 645 -- Senators Drummond and J. Verne Smith: A BILL TO AMEND THE CODE OF LAWS OF SOUTH CAROLINA, 1976, BY ADDING SECTIONS 9-1-1970, 9-8-240, 9-9-240, AND 9-11-350 SO AS TO CONFORM THE COMPENSATION OF MEMBERS OF THE SOUTH CAROLINA RETIREMENT SYSTEM, RETIREMENT SYSTEM FOR JUDGES AND SOLICITORS, GENERAL ASSEMBLY RETIREMENT SYSTEM, AND THE SOUTH CAROLINA POLICE OFFICERS RETIREMENT SYSTEM TAKEN INTO ACCOUNT FOR PURPOSES OF CALCULATING BENEFITS TO THE PROVISIONS OF THE INTERNAL REVENUE CODE OF 1986 AND TO PROVIDE EXCEPTIONS.
Read the first time and referred to the Committee on Finance.
S. 646 -- Senators Land and Drummond: A BILL TO AMEND SECTION 56-5-90, AS AMENDED, CODE OF LAWS OF SOUTH CAROLINA, 1976, RELATING TO DRIVING LIMITATIONS FOR INTRASTATE MOTOR CARRIER DRIVERS, SO AS TO SUBSTITUTE "MOTOR CARRIERS" FOR "COMMON CARRIERS" IN CERTAIN REFERENCES CONTAINED IN THIS SECTION.
Read the first time and referred to the Committee on Transportation.
S. 647 -- Senators Washington, Ford, McConnell, Passailaigue, Richter, Rose and Greg Smith: A CONCURRENT RESOLUTION TO EXTEND CONGRATULATIONS AND BEST WISHES OF THE MEMBERS OF THE GENERAL ASSEMBLY OF THE STATE OF SOUTH CAROLINA TO WILLIAM J. KNOWLES OF CHARLESTON COUNTY FOR HIS OUTSTANDING AND DEDICATED SERVICE TO THE SOUTH CAROLINA DEPARTMENT OF SOCIAL SERVICES ON THE OCCASION OF HIS RETIREMENT.
The Concurrent Resolution was adopted, ordered sent to the House.
S. 648 -- Senator J. Verne Smith: A SENATE RESOLUTION TO OFFER BEST WISHES AND HEARTFELT CONGRATULATIONS TO MR. BLAKELY KIM PLUMLEY FOR BEING SELECTED AS ONE OF THE SIX BEST SENATORS DURING THE 25TH ANNUAL MODEL UNITED STATES SENATE CONFERENCE.
The Senate Resolution was adopted.
H. 3804 -- Reps. Tucker and Tripp: A CONCURRENT RESOLUTION EXPRESSING THE SORROW OF THE MEMBERS OF THE GENERAL ASSEMBLY AT THE DEATH OF DONALD GUY LEE OF PIEDMONT, AND EXTENDING SYMPATHY TO HIS FAMILY AND MANY FRIENDS.
The Concurrent Resolution was adopted, ordered returned to the House.
H. 3805 -- Reps. Cave and Rhoad: A CONCURRENT RESOLUTION CONGRATULATING THE WILLISTON-ELKO BLUE DEVILS BOYS BASKETBALL TEAM OF BARNWELL COUNTY ON WINNING THE 1995 STATE CLASS A BASKETBALL CHAMPIONSHIP.
The Concurrent Resolution was adopted, ordered returned to the House.
H. 3823 -- Rep. Stuart: A CONCURRENT RESOLUTION TO RECOGNIZE THE HORSENECK COMMUNITY IN LEXINGTON COUNTY ON SUNDAY, MARCH 19, 1995, UPON THE OCCASION OF ITS DEDICATION AND OPEN HOUSE OF THE HORSENECK COMMUNITY CENTER AND TO COMMEND THE MANY CITIZENS AND GROUPS THAT JOINED TOGETHER TO MAKE THIS PROJECT A REALITY.
Whereas, the Horseneck Community Center in Lexington County is opening its doors Sunday, March 19, 1995, after many months of labor on the part of the citizens of the community, Lexington County officials, and the Lexington County Recreation Commission; and
Whereas, this center is the result of a labor of love from a community filled with spirit and a sense of cooperation; and
Whereas, Lexington County officials, citizens, and the Lexington County Recreation Commission are to be commended for the many hours of labor necessary for the culmination of this community project and for the dedication and tradition of volunteerism that made this project a reality for the Horseneck Community. Now, therefore,
Be it resolved by the House of Representatives, the Senate concurring:
That the members of the General Assembly, by this resolution, recognize the Horseneck Community on Sunday, March 19, 1995, upon the occasion of its dedication and open house of the Horseneck Community Center and express deep appreciation to the many citizens, Lexington County officials, and the Lexington County Recreation Commission for their combined efforts in making this project a reality.
Be it further resolved that a copy of this resolution be presented to the Horseneck Community Center.
Referred to the Committee on Invitations.
H. 3363 -- Ways and Means Committee: A JOINT RESOLUTION TO APPROPRIATE MONIES FROM THE CAPITAL RESERVE FUND FOR FISCAL YEAR 1994-95.
Read the first time and referred to the Committee on Finance.
H. 3666 -- Education and Public Works Committee: A BILL TO AMEND TITLE 4, CODE OF LAWS OF SOUTH CAROLINA, 1976, BY ADDING CHAPTER 37 SO AS TO AUTHORIZE COUNTIES TO ESTABLISH OPTIONAL METHODS FOR THE FINANCING OF TRANSPORTATION FACILITIES INCLUDING THE ACQUISITION, CONSTRUCTION, EQUIPMENT, AND OPERATION OF HIGHWAYS, ROADS, STREETS, BRIDGES, AND OTHER TRANSPORTATION-RELATED PROJECTS EITHER ALONE, IN PARTNERSHIP WITH THE SOUTH CAROLINA DEPARTMENT OF TRANSPORTATION, OR JOINTLY-OPERATED PROJECTS OF THE COUNTY AND OTHER GOVERNMENTAL ENTITIES, AND AMEND SECTION 57-5-1330, RELATING TO THE POWERS OF THE DEPARTMENT OF TRANSPORTATION, SO AS TO PROVIDE THAT THE DEPARTMENT MAY NOT DESIGNATE AS A TURNPIKE FACILITY ANY HIGHWAY, ROAD, BRIDGE, OR OTHER TRANSPORTATION FACILITY FUNDED IN WHOLE OR IN PART BY A LOCAL OPTION SALES AND USE TAX AS PROVIDED IN CHAPTER 37 OF TITLE 4.
The Bill was read the first time.
Senator RANKIN asked unanimous consent that the Bill be placed on the Calendar without reference.
Senator McCONNELL objected.
Senator RANKIN moved to refer the Bill to the Committee on Transportation.
Senator PASSAILAIGUE spoke on the motion.
The question was presented to the Senate.
A voice vote was ordered.
Senator PASSAILAIGUE moved to refer the Bill to the Committee on Finance.
Senator RANKIN raised a Point of Order that the motion made by Senator PASSAILAIGUE was out of order inasmuch as the pending motion before the body was the motion to refer H. 3666 to the Committee on Transportation and, further, stated that the motion came too late.
The PRESIDENT sustained the Point of Order.
The question then was the motion to refer the Bill to the Committee on Transportation.
Senator PASSAILAIGUE requested a division vote of the Senate.
A division vote was taken, resulting in a vote of 17-4.
The Bill was referred to the Committee on Transportation.
Senator PASSAILAIGUE, with unanimous consent, was granted leave to speak on the Bill.
Senator DRUMMOND, with unanimous consent, was granted leave to speak on the Bill.
H. 3690 -- Ways and Means Committee: A JOINT RESOLUTION TO MAKE SUPPLEMENTAL APPROPRIATIONS FROM FISCAL YEAR 1994-95 SURPLUS GENERAL FUND REVENUES.
Read the first time and referred to the Committee on Finance.
H. 3728 -- Reps. Hallman, Fulmer, Seithel, Whatley, Harrell, Hutson, S. Whipper and Limehouse: A BILL TO PROVIDE THAT THE CHARLESTON COUNTY BOARD OF ASSESSMENT CONTROL IS ABOLISHED AND ITS POWERS AND DUTIES DEVOLVED UPON THE CHARLESTON COUNTY COUNCIL.
Read the first time and ordered placed on the local and uncontested Calendar without reference.
H. 3734 -- Rep. Askins: A BILL TO AMEND ACT 250 OF 1991, RELATING TO THE ELECTION OF TRUSTEES IN FLORENCE COUNTY SCHOOL DISTRICT 5 AND THE SINGLE-MEMBER DISTRICTS FROM WHICH CERTAIN TRUSTEES ARE ELECTED, SO AS TO REVISE THE DESCRIPTION OF THESE DISTRICTS.
Read the first time and ordered placed on the local and uncontested Calendar without reference.
Senator LAND from the Committee on Transportation submitted a favorable with amendment report on:
S. 67 -- Senators McConnell, Rose, Reese and Courson: A BILL TO AMEND CHAPTER 3, TITLE 56, CODE OF LAWS OF SOUTH CAROLINA, 1976, RELATING TO MOTOR VEHICLE REGISTRATION AND LICENSING, BY ADDING ARTICLE 57 SO AS TO PROVIDE FOR THE ISSUANCE OF SPECIAL LICENSE PLATES FOR MEMBERS OF THE MARINE CORPS LEAGUE.
Ordered for consideration tomorrow.
Senator LAND from the Committee on Transportation submitted a favorable with amendment report on:
S. 154 -- Senators McConnell, Rose, Courson, Reese and Elliott: A BILL TO AMEND SECTION 56-3-3310, AS AMENDED, CODE OF LAWS OF SOUTH CAROLINA, 1976, RELATING TO THE ISSUANCE OF A SPECIAL MOTOR VEHICLE LICENSE PLATE FOR A RECIPIENT OF THE PURPLE HEART, SO AS TO PROVIDE THAT AFTER THE INITIAL FEE FOR ISSUANCE IS PAID, THE PLATE MAY BE RENEWED BY A STICKER, THE CHARGE FOR WHICH MUST BE THE RENEWAL FEE CHARGED FOR A REGULAR PLATE.
Ordered for consideration tomorrow.
Senator THOMAS from the Committee on Corrections and Penology submitted a favorable with amendment report on:
S. 179 -- Senator Rose: A BILL TO AMEND THE CODE OF LAWS OF SOUTH CAROLINA, 1976, BY ADDING ARTICLE 13 TO CHAPTER 3, TITLE 24 SO AS TO PROVIDE FOR THE PRIVATE CORRECTIONS FACILITIES, PROGRAMS, AND SERVICES ACT ALLOWING A UNIT OF GOVERNMENT TO CONTRACT WITH THE PRIVATE SECTOR TO PERFORM SERVICES CURRENTLY PERFORMED BY A CORRECTIONS AGENCY OR DEPARTMENT.
Ordered for consideration tomorrow.
Senator SETZLER from the Committee on Education submitted a favorable with amendment report on:
S. 184 -- Senator Rose: A BILL TO AMEND SECTION 59-5-65, AS AMENDED, CODE OF LAWS OF SOUTH CAROLINA, 1976, RELATING TO POWERS AND RESPONSIBILITIES OF THE STATE BOARD OF EDUCATION, SO AS TO REQUIRE THE BOARD BY REGULATION TO PRESCRIBE THE USE OF PHONICS IN TEACHING READING AND TO PROVIDE IN-SERVICE TRAINING IN PHONICS.
Ordered for consideration tomorrow.
Senator LAND from the Committee on Transportation submitted a favorable with amendment report on:
S. 378 -- Senator Setzler: A BILL TO AMEND THE CODE OF LAWS OF SOUTH CAROLINA, 1976, BY ADDING ARTICLE 60 TO CHAPTER 3, TITLE 56, SO AS TO PROVIDE SPECIAL LICENSE PLATES FOR MEMBERS OF THE SHRINERS.
Ordered for consideration tomorrow.
Senator DRUMMOND from the Committee on Fish, Game and Forestry submitted a favorable with amendment report on:
S. 428 -- Senators McGill, Land and Greg Smith: A BILL TO AMEND SECTION 50-11-120, CODE OF LAWS OF SOUTH CAROLINA, 1976, RELATING TO THE HUNTING SEASON FOR SMALL GAME, SO AS TO EXTEND THE RACCOON HUNTING SEASON IN GAME ZONE NINE.
Ordered for consideration tomorrow.
Senator SETZLER from the Committee on Education submitted a favorable with amendment report on:
S. 482 -- Senator Reese: A BILL TO AMEND THE CODE OF LAWS OF SOUTH CAROLINA, 1976, BY ADDING SECTION 59-23-210 SO AS TO PROVIDE THAT ANY STUDENT WHO CARRIES ON HIS PERSON, IN A BOOK BAG, OR PLACES IN A LOCKER OR DESK A FIREARM, OR ANY OTHER TYPE OF WEAPON, DEVICE, OR OBJECT WHICH MAY BE USED TO INFLICT BODILY INJURY OR DEATH WHILE ON ANY ELEMENTARY OR SECONDARY SCHOOL PROPERTY MUST BE EXPELLED FROM SCHOOL PURSUANT TO THE PROCEDURE ESTABLISHED BY THE SCHOOL DISTRICT FOR EXPULSIONS.
Ordered for consideration tomorrow.
Senator LAND from the Committee on Transportation submitted a favorable with amendment report on:
S. 509 -- Senator Reese: A BILL TO AMEND SECTION 56-3-2150, AS AMENDED, AND SECTION 56-3-2170, CODE OF LAWS OF SOUTH CAROLINA, 1976, RELATING TO THE ISSUANCE OF SPECIAL LICENSE PLATES TO MEMBERS OF MUNICIPAL AND COUNTY COUNCILS, SO AS TO PROVIDE A SPECIAL LICENSE PLATE FOR A MAYOR.
Ordered for consideration tomorrow.
Senator LAND from the Committee on Transportation submitted a favorable with amendment report on:
S. 524 -- Senator Leventis: A BILL TO AMEND CHAPTER 3, TITLE 56, CODE OF LAWS OF SOUTH CAROLINA, 1976, RELATING TO MOTOR VEHICLE REGISTRATION AND LICENSING, BY ADDING ARTICLE 62 SO AS TO PROVIDE FOR THE ISSUANCE OF SPECIAL LICENSE PLATES FOR MEMBERS OF THE UNITED STATES COAST GUARD AUXILIARY.
Ordered for consideration tomorrow.
Senator DRUMMOND from the Committee on Fish, Game and Forestry submitted a favorable report on:
S. 542 -- Senators McConnell and Passailaigue: A BILL TO RELOCATE THE FOLLY BEACH PUBLIC OYSTER GROUND.
Ordered for consideration tomorrow.
Senator LAND from the Committee on Transportation submitted a favorable report on:
S. 547 -- Senator Peeler: A BILL TO AMEND THE CODE OF LAWS OF SOUTH CAROLINA, 1976, BY ADDING ARTICLE 5 TO CHAPTER 15, TITLE 56 SO AS TO PROVIDE REQUIREMENTS FOR WHOLESALE MOTOR VEHICLE AUCTIONS AND FOR WHOLESALE MOTOR VEHICLE AUCTION LICENSE PLATES.
Ordered for consideration tomorrow.
Senator DRUMMOND from the Committee on Fish, Game and Forestry submitted a favorable report on:
S. 564 -- Senator Holland: A BILL TO AMEND THE CODE OF LAWS OF SOUTH CAROLINA, 1976, BY ADDING CHAPTER 36 TO TITLE 48 SO AS TO PROVIDE FOR THE FOREST BEST MANAGEMENT PRACTICES ACT BY DEFINING TERMS AND SETTING FORTH REQUIREMENTS FOR THE COMMISSION OF FORESTRY.
Ordered for consideration tomorrow.
Senator DRUMMOND from the Committee on Fish, Game and Forestry submitted a favorable report on:
S. 596 -- Senator Greg Smith: A BILL TO AMEND SECTION 50-18-20, CODE OF LAWS OF SOUTH CAROLINA, 1976, RELATING TO THE PRODUCTION AND SALE OF HYBRID STRIPED BASS, SO AS TO FURTHER DEFINE THE PROCESS FOR PERMIT RENEWAL.
Ordered for consideration tomorrow.
Senator DRUMMOND from the Committee on Fish, Game and Forestry submitted a favorable report on:
H. 3199 -- Rep. Koon: A JOINT RESOLUTION TO CREATE THE SOUTH CAROLINA COMMISSION ON SPORTING DOGS AND FIELD TRIALS TO ASSESS THE IMPACT ON THE STATE FOR DEVELOPING FIELD TRIAL FACILITIES AND TO DEVELOP A PLAN FOR THE FACILITIES; TO PROVIDE FOR THE MEMBERS OF THE COMMISSION AND AN ADVISORY COMMITTEE; TO AUTHORIZE CONSULTATION WITH PUBLIC AND PRIVATE AGENCIES AND ORGANIZATIONS; AND TO PROVIDE REPORTING REQUIREMENTS AND FOR TERMINATION OF THE COMMISSION JANUARY 1, 1997.
Ordered for consideration tomorrow.
Senator SETZLER from the Committee on Education submitted a favorable report on:
H. 3214 -- Rep. D. Smith: A BILL TO AMEND SECTION 59-47-70, CODE OF LAWS OF SOUTH CAROLINA, 1976, RELATING TO THOSE PERSONS WHO ARE ELIGIBLE FOR SERVICES AT THE SCHOOL FOR THE DEAF AND BLIND, SO AS TO INCLUDE HARD OF HEARING AND VISUALLY IMPAIRED PERSONS.
Ordered for consideration tomorrow.
Senator LEVENTIS from the Committee on Agriculture and Natural Resources submitted a favorable report on:
H. 3452 -- Reps. Riser, Hines, Inabinett, Rhoad and Witherspoon: A BILL TO AMEND SECTION 47-4-10, CODE OF LAWS OF SOUTH CAROLINA, 1976, RELATING TO THE LIVESTOCK-POULTRY HEALTH COMMISSION, SO AS TO REVISE THE PROVISIONS EXECUTED BY THE COMMISSION; TO AMEND SECTION 47-4-20, RELATING TO DEFINITIONS PERTAINING TO THE COMMISSION, SO AS TO REVISE THE DEFINITION OF "PUBLIC LIVESTOCK MARKET"; TO AMEND SECTION 47-4-50, RELATING TO DISEASES IMPACTING THE LIVESTOCK-POULTRY INDUSTRY, SO AS TO CLARIFY A REFERENCE TO FEDERAL REGULATIONS; TO AMEND SECTION 47-4-60, RELATING TO REQUIREMENTS FOR CERTIFICATES OF VETERINARY INSPECTION, SO AS TO CORRECT PUNCTUATION; TO AMEND SECTION 47-4-110, RELATING TO COMMISSION EMPLOYEES, SO AS TO REVISE THE MAXIMUM NUMBER OF LIVESTOCK LAW ENFORCEMENT OFFICERS; TO AMEND SECTION 47-4-130, RELATING TO PENALTIES FOR VIOLATIONS, SO AS TO INCREASE THE FINE; TO AMEND SECTION 47-11-140, AS AMENDED, RELATING TO VETERINARIANS SERVING AUCTION SALES AT PUBLIC LIVESTOCK MARKETS, SO AS TO REVISE THE REQUIREMENTS FOR PROVISION OF SERVICE BY VETERINARIANS; AND TO AMEND SECTION 47-13-30, AS AMENDED, RELATING TO PENALTIES FOR VIOLATIONS, SO AS TO CORRECT A REFERENCE IN THE 1976 CODE.
Ordered for consideration tomorrow.
Senator LEVENTIS from the Committee on Agriculture and Natural Resources submitted a favorable report on:
H. 3453 -- Reps. Riser, Hines, Inabinett, Rhoad and Witherspoon: A BILL TO AMEND SECTION 46-9-90, AS AMENDED, CODE OF LAWS OF SOUTH CAROLINA, 1976, RELATING TO PENALTIES PERTAINING TO THE STATE CROP PEST COMMISSION, SO AS TO REVISE THE PENALTIES AND THE PROVISIONS TO WHICH THEY APPLY; AND TO AMEND SECTION 46-13-80, RELATING TO LICENSES UNDER THE PESTICIDE CONTROL ACT, SO AS TO REVISE THE RENEWAL DATE.
Ordered for consideration tomorrow.
Senator COURSON from the Committee on Invitations polled out H. 3645 favorable:
H. 3645 -- Rep. J. Harris: A CONCURRENT RESOLUTION TO INVITE THE WINNERS OF THE 1995 SOUTH CAROLINA FOLK HERITAGE AWARDS AND THE MEMBERS OF THE 1995 SOUTH CAROLINA FOLK HERITAGE AWARDS ADVISORY COMMITTEE TO ATTEND A JOINT SESSION OF THE HOUSE OF REPRESENTATIVES AND THE SENATE IN THE HALL OF THE HOUSE OF REPRESENTATIVES ON WEDNESDAY, APRIL 19, 1995, AT 12:00 NOON, AND TO RECOGNIZE AND COMMEND THE 1995 SOUTH CAROLINA FOLK HERITAGE AWARD WINNERS FOR THEIR OUTSTANDING CONTRIBUTIONS TO FOLK ART IN SOUTH CAROLINA.
AYES
Courson Peeler Wilson Patterson Russell Passailaigue Rose
NAYS
TOTAL--0
NOT VOTING
Matthews Thomas O'Dell
Ordered for consideration tomorrow.
Senator COURSON from the Committee on Invitations submitted a favorable report on:
An invitation from Columbia Prayer Committee to attend a reception and address by Dr. William Lane Craig in the Lieutenant Governor's Board Room, State House on Thursday, March 23, 1995, from 8:00 until 9:00 A.M.
AYES
Courson Peeler Wilson Patterson Stilwell Russell Passailaigue
NAYS
TOTAL--0
NOT VOTING
Matthews Thomas O'Dell
Senator COURSON from the Committee on Invitations submitted a favorable report on:
An invitation from the Society of the Plastics Industry, Inc./Am. Plastics Council to attend a reception at Stadium Place on Tuesday, March 28, 1995, from 6:00 until 8:00 P.M.
AYES
Courson Peeler Wilson Patterson Stilwell Russell Passailaigue
NAYS
TOTAL--0
NOT VOTING
Matthews Thomas O'Dell
Senator COURSON from the Committee on Invitations submitted a favorable report on:
An invitation from S.C. State Prayer Breakfast to attend a breakfast at the Embassy Suites Hotel on Wednesday, March 29, 1995, at 7:30 A.M.
AYES
Courson Peeler Wilson Patterson Stilwell Russell Passailaigue
NAYS
TOTAL--0
NOT VOTING
Matthews Thomas O'Dell
Senator COURSON from the Committee on Invitations submitted a favorable report on:
An invitation from Young Bankers Division of the S.C. Bankers Assn. to attend an oyster roast at Sterling Garden Center (320 Senate St.) on Wednesday, March 29, 1995, from 6:00 until 8:00 P.M.
AYES
Courson Peeler Wilson Patterson Stilwell Russell Passailaigue
NAYS
TOTAL--0
NOT VOTING
Matthews Thomas O'Dell
CONCURRENCE
S. 638 -- Senators McConnell, Saleeby, Moore and Russell: A CONCURRENT RESOLUTION TO FIX 12:30 P.M. ON TUESDAY, MARCH 21, 1995, AS THE TIME FOR ELECTING A SUCCESSOR TO A CERTAIN ASSOCIATE JUSTICE OF THE SUPREME COURT WHOSE UNEXPIRED TERM EXPIRES JULY 31, 2000; TO ELECT A SUCCESSOR TO A CERTAIN JUDGE OF THE COURT OF APPEALS, SEAT 3, WHOSE UNEXPIRED TERM EXPIRES JUNE 30, 1995; TO ELECT A SUCCESSOR TO A CERTAIN JUDGE OF THE TWELFTH JUDICIAL CIRCUIT WHOSE UNEXPIRED TERM EXPIRES JUNE 30, 2000; TO ELECT A SUCCESSOR TO A CERTAIN JUDGE OF THE ADMINISTRATIVE LAW JUDGE DIVISION, SEAT 5, WHOSE UNEXPIRED TERM EXPIRES JUNE 30, 1998; TO ELECT A SUCCESSOR TO A CERTAIN JUDGE OF THE COURT OF APPEALS, SEAT 3, WHOSE TERM EXPIRES JUNE 30, 1995; TO ELECT A SUCCESSOR TO A CERTAIN JUDGE OF THE COURT OF APPEALS, SEAT 4, WHOSE TERM EXPIRES JUNE 30, 1995; TO ELECT A SUCCESSOR TO A CERTAIN JUDGE OF THE FIFTH JUDICIAL CIRCUIT WHOSE TERM EXPIRES JUNE 30, 1995; TO ELECT A SUCCESSOR TO A CERTAIN JUDGE OF THE SEVENTH JUDICIAL CIRCUIT WHOSE TERM EXPIRES JUNE 30, 1995; TO ELECT A SUCCESSOR TO A CERTAIN JUDGE OF THE NINTH JUDICIAL CIRCUIT WHOSE TERM EXPIRES JUNE 30, 1995; TO ELECT A SUCCESSOR TO A CERTAIN JUDGE OF THE TENTH JUDICIAL CIRCUIT WHOSE TERM EXPIRES JUNE 30, 1995; AND TO ELECT A SUCCESSOR TO A CERTAIN JUDGE OF THE ADMINISTRATIVE LAW JUDGE DIVISION, SEAT 3, WHOSE TERM EXPIRES JUNE 30, 1995.
The House returned the Resolution with amendments.
On motion of Senator McCONNELL, the Senate concurred in the House amendments and a message was sent to the House accordingly.
S. 445 -- Senators O'Dell and Waldrep: A CONCURRENT RESOLUTION TO REQUEST THE DEPARTMENT OF TRANSPORTATION TO NAME THE SECTION OF HIGHWAY 76-178 FROM BELTON TO HONEA PATH IN ANDERSON COUNTY IN HONOR OF ERNEST A. BURRISS.
Returned with concurrence.
Received as information.
THE SENATE PROCEEDED TO A CALL OF THE UNCONTESTED LOCAL AND STATEWIDE CALENDAR.
H. 3534 -- Reps. Wilkins, Tripp, Knotts, Whatley, Harrell, Wofford, A. Young, Hutson, Sandifer, Walker, Littlejohn, Herdklotz, Jaskwhich, Meacham, Fleming, Cain, Kelley, Simrill, Law, Mason, Jennings, Kennedy, Cato, Rice, Klauber, Stuart, Gamble, J. Young, Cotty, Shissias, Haskins, Harrison, Riser, Huff, Robinson, Marchbanks, H. Brown, Witherspoon, Baxley, Lanford, Waldrop and Easterday: A BILL TO AMEND TITLE 12, CODE OF LAWS OF SOUTH CAROLINA, 1976, RELATING TO TAXATION, BY ADDING CHAPTER 10 ENACTING THE ENTERPRISE ZONE ACT OF 1995 SO AS TO PROVIDE FOR THE ESTABLISHMENT OF ENTERPRISE ZONES IN WHICH VARIOUS TAX INCENTIVES MAY APPLY FOR BUSINESSES, TO PROVIDE THE CRITERIA FOR AREAS TO QUALIFY AS ENTERPRISE ZONES, TO PROVIDE THAT BUSINESSES QUALIFY FOR ENTERPRISE ZONE INCENTIVES BY MEANS OF ENTERING INTO A REVITALIZATION AGREEMENT WITH THE COORDINATING COUNCIL FOR ECONOMIC DEVELOPMENT, TO PROVIDE INCENTIVES, DEPENDING ON ELIGIBILITY, THAT INCLUDE THE MAXIMUM CREDIT ALLOWED UNDER THE TARGETED JOBS TAX CREDIT AND AN ADDITIONAL CREDIT FOR EMPLOYEES FORMERLY RECEIVING AFDC, FEE IN LIEU OF TAXES FOR PROPERTY TAXES, RETAINING AN AMOUNT OF EMPLOYEE WAGES NOT TO EXCEED FIVE PERCENT FOR FIFTEEN YEARS FOR DEVELOPMENT EXPENSES AND ALLOWING INDIVIDUAL INCOME TAX CREDITS FOR EMPLOYEES AND WITHHOLDING TAX CREDITS FOR EMPLOYERS AND EMPLOYEES EQUAL TO THE RETAINED AMOUNT, AND TO PROVIDE THE CRITERIA FOR SELECTING OF QUALIFYING BUSINESSES AND PROJECTS.
The Senate proceeded to a consideration of the Bill. The question being the third reading of the Bill.
Senator LEATHERMAN proposed the following Amendment No. 1 (JIC\5642HTC.95), which was adopted:
Amend the amendment offered by Senator Passailaigue, dated March 14, 1995, Doc. No. (JIC\5625HTC.95), designated Amendment Number 1, as and if amended, page 3, subsection (A) of Section 12-10-80 by adding at the end of subsection (A):
/No employer may withhold an amount that results in any employee ever receiving a smaller amount of wages on either a weekly or on an annual basis than the employee would otherwise receive in the absence of this chapter./
Amend title to conform.
Senator PASSAILAIGUE explained the amendment.
Senator PASSAILAIGUE proposed the following Amendment No. 2 (JIC\5625HTC.95), which was adopted:
Amend the bill, as and if amended, by striking all after the enacting words and inserting:
/SECTION 1. Title 12 of the 1976 Code is amended by adding:
Section 12-10-10. This chapter may be cited as the Enterprise Zone Act of 1995.
Section 12-10-20. The General Assembly finds:
(1) that the economic well-being of the citizens of the State will be enhanced by the increased development and growth of industry within the State, and that it is in the best interest of the State to induce the location or expansion of manufacturing, processing, distribution, warehousing, research and development, corporate offices, and certain tourism facilities within the State in order to promote the public purpose of creating new jobs within the State;
(2) that the inducement provided in this chapter will encourage the creation of jobs which would not otherwise exist and will create sources of tax revenues for the State and its political subdivisions;
(3) the powers to be granted to the Advisory Coordinating Council for Economic Development by this chapter and the purposes to be accomplished are proper governmental and public purposes and that the inducement of the location or expansion of manufacturing, processing, distribution, warehousing, research and development, corporate offices, and certain tourism facilities within the State is of paramount importance.
Section 12-10-30. As used in this chapter:
(1) 'Council' means the Advisory Coordinating Council for Economic Development.
(2) 'Department' means the South Carolina Department of Revenue and Taxation.
(3) 'Employee' means an employee of the qualifying business who works full-time within the enterprise zone.
(4) 'Manufacturing' means engagement primarily in an activity or activities listed under the Standard Industrial Classification (SIC) Codes 20 through 39 as published in the Office of Management and Budget's Standard Industrial Classification Manual.
(5) 'Qualifying business' means an employer that meets the requirements of Section 12-10-50 and other applicable requirements of this chapter and, where required under Section 12-10-50, enters into a revitalization agreement with the council to undertake a project under the provisions of this chapter.
(6) 'Project' means an investment for one or more purposes in Section 12-10-80(B) needed for a qualifying business to locate, remain, or expand in an enterprise zone and otherwise fulfill the requirements of this chapter.
(7) 'Withholding' means employee withholding under Chapter 9 of this title.
Section 12-10-40. Annually, by December thirty-first, using the most current data available, the State Budget and Control Board shall designate the enterprise zones within this State as provided in this section. Each enterprise zone must be located in this State and meet one of the following criteria:
(1) consist of a census tract in which either the median household income is eighty percent or less of the state average, or at least twenty percent of households are below the poverty level according to the most recent United States census;
(2) consist of a county classified as less developed pursuant to Section 12-7-1220;
(3) be located in a federal military base or installation which was closed, or designated to be closed, or in a federal facility in which the permanent employment was reduced by three thousand or more jobs after December 31, 1990;
(4) consist of a census tract with at least one hundred manufacturing jobs, at least fifty percent of which are textile and apparel jobs;
(5) consist of a census tract where a manufacturing facility has closed or experienced permanent layoffs and notified the Employment Security Commission under the federal Worker Adjustment and Retaining Notification (WARN) Act of 1988. The enterprise zone designation applies only for five years after the date of closure or layoff, and the number of jobs permanently lost must equal twenty-five percent or more of the total manufacturing workforce in the tract at the time the layoff occurred. The job loss shall have occurred no more than five years prior to the effective date of this chapter, except in any census tract where a catastrophic loss of one thousand or more jobs from a single employer has occurred since 1980 and fewer than half the job losses have been replaced. Any such tract will remain an enterprise zone until at least half the catastrophic job losses have been replaced. Where a municipality in which the catastrophic job loss occurred is split by census tracts, each tract containing any part of the municipality meets the catastrophic job loss criteria; or
(6) consist of a census tract, any part of which is within twenty miles of a federal facility that has reduced its permanent civilian employment by three thousand or more jobs after December 31, 1990, for ten years after the effective date of this chapter.
Section 12-10-50. To qualify for the benefits provided in this chapter, a business must be located within an enterprise zone and satisfy the following criteria:
(1) the business in the enterprise zone must be primarily engaged in a business of the type identified in Section 12-7-1220;
(2) the business in the enterprise zone shall provide a benefits package to full-time employees which includes health care;
(3) the qualifying business shall enter into a revitalization agreement which is approved by the council, except that no revitalization agreement is required for a qualifying business with respect to Sections 12-10-70(2), 12-10-70(3), and 12-10-80(D); and
(4) the council shall determine that the available incentives are appropriate for the project, and the council shall certify to the department that the total benefits of the project exceed the costs to the public, and that the qualifying business otherwise fulfills the requirements of this chapter. No provision of this chapter must be construed to allow the council to negotiate a fee-in-lieu of property taxes agreement or approve job training or retraining.
Section 12-10-60. The council may enter into a revitalization agreement with each qualifying business with respect to the project. The terms and provisions of each revitalization agreement must be determined by negotiations between the council and the qualifying business. The revitalization agreement must set a date by which the qualifying business shall have completed the project. Within three months of the completion date, the qualifying business shall document the actual costs of the project in a manner acceptable to the council.
Section 12-10-70. Qualifying businesses are entitled to the following benefits in addition to all others provided by law:
(1) If at least fifty-one percent of the full-time employees hired for the project either reside in an enterprise zone at the time of employment, have a household income that is eighty percent or less of the median household income for the county prior to employment, or have been a recipient of Aid to Families with Dependent Children (AFDC) payments within the past twelve months, the qualifying business is entitled to the jobs tax credit for the period and in the amount provided in Section 12-7-1220(B); in addition, a qualifying business is entitled to an additional five hundred dollars a year tax credit in the third, fourth, and fifth year of any AFDC recipient's continued employment with the qualifying business, based on the status of the employee at the time of beginning employment. A new job is not considered a new job for the purpose of this credit if it replaces the same job that was part of a reduction in force in the preceding twelve months.
(2) The qualifying business is eligible for the benefits provided in Section 4-29-67 if it meets one-half of the quantitative requirements of that section.
(3) The business is eligible to use the special source revenue bonds authorized under Sections 4-29-68 and 4-1-175.
Section 12-10-80. (A) Upon certification by the council to the department of the council's determination that a business is a qualifying business, a qualifying business may collect a job development fee by retaining an amount of employee withholding permitted by subsection (C) or (D), but not both, for the purposes permitted by subsection (B) or (D), respectively. The amount withheld must be maintained in an escrow account with a bank which is insured by the Federal Deposit Insurance Corporation. To the extent the money is not used as permitted by subsection (B) or (D), it must be treated as misappropriated employee withholding. Employee withholding may not be retained before the entry of the qualifying business into a revitalization agreement. If a qualifying business retains employee withholding under this section, it shall make its payroll books and records available for inspection by the council and the department at the times the council and the department request. Each qualifying business retaining employee withholding under this section shall file with the council and the department the information and documentation respecting the retention and use of the employee withholding according to the revitalization agreement. Each qualifying business which retains in excess of ten thousand dollars in any calendar year shall furnish an audited report prepared by an independent certified public accountant which itemizes the sources and uses of the funds. The audited report must be filed with the council and the department no later than April fifteenth following the calendar year of the retention. Each qualifying business retaining employee withholding under this section is allowed a credit against the withholding tax liability provided in Chapter 9 of this title otherwise owed to the State, the credit not to exceed the lesser of the amount of such tax or the aggregate amount of employee withholding retained.
(B) A qualifying business may collect a job development fee under the revitalization agreement for a period not to exceed fifteen years. A qualifying business must create at least ten new, full-time jobs at the South Carolina facility described in the revitalization agreement. Capital expenditures from the escrow account must be expended at the above-described facility or for utility or transportation improvements that serve this facility. The qualifying business may expend funds from the escrow account if (a) the expenditures are incurred during the term of the revitalization agreement, (b) the expenditures from the escrow account are authorized by the revitalization agreement, (c) the expenditures are approved in writing by the council and the department prior to expenditure, and (d) the expenditures are for any of the following purposes:
(1) training costs and facilities;
(2) acquiring and improving real estate whether acquired by lease, purchase, installment payment, or otherwise, the escrow account can be spent only for capital improvements made after entering a revitalization agreement;
(3) improvements to both public and private utility systems including water, sewer, electricity, natural gas, and telecommunications;
(4) fixed transportation facilities including highway, rail, water, and air; and
(5) construction or improvements of any real property and fixtures constructed or improved primarily for the purpose of complying with local, state, or federal environmental laws or regulations.
(C) The total amount retained from employee withholding by the qualifying business may not exceed the sum of the following amounts:
(1) two percent of the gross wages of each new employee who earns six dollars or more an hour but less than eight dollars an hour;
(2) three percent of the gross wages of each new employee who earns eight dollars or more an hour but less than ten dollars an hour;
(3) four percent of the gross wages of each new employee who earns ten dollars or more an hour but less than fifteen dollars an hour; and
(4) five percent of the gross wages of each new employee who earns fifteen dollars or more an hour.
The hourly gross wage figures set forth in this section must be adjusted annually by an inflation factor determined by the State Budget and Control Board.
(D) Subject to the conditions in this section, any qualifying business in an enterprise zone may negotiate with the council to retain from employee withholding an amount equal to five hundred dollars a year for each production employee being retrained, where this retraining is necessary for the qualifying business to remain competitive or to introduce new technologies. This retraining must be approved by and performed by the technical college under the jurisdiction of the State Board for Technical and Comprehensive Education serving the designated enterprise zone. In addition to the yearly limits, the amount retained from employee withholding may not exceed two thousand dollars over five years for each production employee being retrained. Additionally, the qualifying business must match on a dollar-for-dollar basis the amount retained from employee withholding. The total amount retained from withholding and all of the qualifying business' matching funds must be paid to the technical college that provides the training to defray the cost of the training program. Any training cost in excess of the job development fees and matching funds is the responsibility of the qualifying business based on negotiations with the technical college.
(E) Each qualified business which has retained employee withholding under this section, shall report each employee's state withholding to the United States, this State, and the employee as if the retained withholding had been paid over to the State pursuant to Chapter 9 of this title.
(F) Any job development fee of a qualifying business permanently lapses upon expiration or termination of the revitalization agreement. In the event of termination, the qualifying business shall immediately cease to retain employee withholding and immediately cease spending funds from the escrow account. Within thirty days of the expiration or termination of the revitalization agreement, the qualifying business shall pay over all the funds remaining in the escrow account to the department as withholding taxes.
Section 12-10-90. If a qualifying business fails to achieve the level of capital investment or employment set forth in the revitalization agreement, the department may terminate the revitalization agreement and reduce or suspend all or any part of the incentives until the time the anticipated capital investment and employment levels are met. However, these incentives must not be suspended retroactively. The council shall provide in the revitalization agreement entered into in connection with a project for the levels of capital investment and employment which must be achieved and for the time period in which the levels must be achieved.
Section 12-10-100. (A) The council shall establish criteria for the determination and selection of qualifying businesses and the approval of revitalization agreements. These criteria must give greatest weight to the creditworthiness of the business, the number, type, and quality of new jobs to be provided by the project to residents of this State, and the economic viability of the business. The council may include in its criteria requirements relating to the capital costs of, and projected employment to be produced by, projects eligible for benefits under this chapter and requirements relating to the employment of previously unemployed or underemployed persons.
With respect to each business and project, the council shall request the materials and make the inquiries necessary to determine whether the business and its proposed project satisfy the council's announced criteria and to conduct an adequate cost/benefit analysis with respect to the proposed project and the incentives proposed to be granted by the council with respect to the project. After a review of the relevant materials and completion of its inquiries and analysis, the council may by resolution of its members designate an applicant business as a qualifying business and authorize the undertaking of its project according to the revitalization agreement.
(B) The council shall establish an application fee schedule, not to exceed two thousand dollars for each qualifying business, for undertaking the provisions of this chapter. The State Treasurer shall establish an account for these fees which must be expended by the council only for meeting administrative, data collection, credit analysis, cost/benefits analysis, reporting, and any other obligations pursuant to this chapter. This account may retain funds for expenditure in the next fiscal year only for purposes enumerated in this section.
(C) By March first of each year, the council shall prepare a public document that itemizes each revitalization agreement concluded during the prior calendar year. The report shall list each revitalization agreement, the results of each cost/benefits analysis, and receipts and expenditures of application fees. This document must be forwarded to the State Budget and Control Board, Senate Finance Committee, and House Ways and Means Committee. This document may not contain any proprietary or confidential information that is otherwise exempt under Chapter 4 of Title 30, the Freedom of Information Act, and nothing in this section must be construed to require the release of such exempt information.
(E) Notwithstanding any other provision of law, the council may promulgate regulations to implement the provisions of this chapter immediately upon the effective date of this chapter. These regulations remain in effect until the convening of the General Assembly for the 1996 session, at which time the council shall comply with the requirements of Chapter 23 of Title 1. The regulations initially promulgated by the council remain in effect until compliance with Chapter 23 of Title 1 during the 1996 session of the General Assembly.
Section 12-10-110. This chapter must be liberally construed in conformity with the findings provided in Section 12-10-20."
SECTION 2. Title 12 of the 1976 Code is amended by adding:
Section 12-14-10. This chapter may be cited as the Economic Impact Zone Community Development Act of 1995.
Section 12-14-20. It is the purpose of this chapter to establish a program of providing tax incentives for the creation of economic impact zones in order:
(1) to revitalize economically and physically distressed areas impacted as a result of the closing or realignment of a federal military installation area, primarily by encouraging the formation of new businesses and the retention and expansion of existing businesses;
(2) to promote meaningful employment for economic impact zone residents; and
(3) to encourage individuals to reside in the economic impact zones in which they are employed.
Section 12-14-30. For purposes of this chapter:
(1) 'economic impact zone' means a county or municipality, any portion of which is located within fifty miles of the boundaries of an applicable federal military installation, and any area not otherwise included as part of the economic impact zone if the State Budget and Control Board determines the area to be adversely impacted by the closing or realignment of an applicable federal military installation. An applicable federal military installation is one which is closed or realigned under:
(a) the Defense Base Closure and Realignment Act of 1990;
(b) Title II of the Defense Authorization Amendments and Base Closure and Realignment Act; or
(c) Section 2687 of Title 10, United States Code.
(2) 'Internal Revenue Code' has the meaning provided in Section 12-7-20(11).
Section 12-14-40. (A) The designation of an area as an economic impact zone must be made by the State Budget and Control Board. It remains in effect during the period beginning on the date the board designates the area an economic impact zone and ending on the earlier of:
(1) December thirty-first of the fifteenth calendar year following the calendar year in which the designation occurs, or
(2) a termination date designated by legislative enactment of the General Assembly.
(B) A designation may be revoked by the General Assembly only after a hearing on the record in which officials of the county or municipality involved may participate.
Section 12-14-50. (A) In the case of an individual, there is allowed as a deduction against South Carolina taxable income an amount equal to twenty percent of the aggregate amount paid in cash by the taxpayer during the taxable year for the purchase of economic impact zone stock.
(B)(1) The maximum amount allowed as a deduction under subsection (A) to a taxpayer for the taxable year may not exceed the lesser of:
(a) ten thousand dollars; or
(b) the excess of one hundred thousand dollars over the amount allowed as a deduction under this section to the taxpayer for all prior taxable years.
(2) If the amount otherwise deductible by the person under subsection (A) exceeds the limitation under subsection (B)(1)(a):
(a) the amount of such excess is treated as an amount paid to which subsection (A) applies during the next taxable year; and
(b) the deduction allowed for any taxable year must be allocated proportionately among the economic impact zone stock purchased by the person on the basis of the respective purchase prices a share.
(3) The taxpayer and members of the taxpayer's family are treated as one person for purposes of subitem (1), and the limitations contained in such subitem must be allocated among the taxpayer and such members in accordance with their respective purchases of economic impact zone stock. For purposes of this section, an individual's family includes only such individual's spouse and minor children.
(C) For purposes of this section:
(1) the term 'economic impact zone stock' means stock of a corporation if:
(a) such stock is acquired on original issue from the corporation; and
(b) such corporation is, at the time of issue, a qualified enterprise zone issuer.
(2) (a) 'Economic impact zone stock' includes such stock only to the extent that the proceeds of the stock issue are used by the issuer during the twelve-month period beginning on the date of issuance to purchase qualified economic impact zone property.
(b) For purposes of this section, the term 'qualified economic impact zone property' means property to which Section 168 of the Internal Revenue Code applies:
(i) the original use of which in an economic impact zone commences with the issuer; and
(ii) substantially all of the use of which is in an economic impact zone.
(3) The term 'economic impact zone stock' does not include any stock acquired from a corporation which made a substantial stock redemption or distribution (without a bona fide business purpose therefor) in an attempt to avoid the purposes of this section.
(D) For purposes of this section, the term 'qualified economic impact zone issuer' means any 'C' corporation if:
(1) the corporation is an economic impact zone business or, in the case of a new corporation, the corporation is being organized for purposes of being an economic impact zone business;
(2) the sum of:
(a) the money;
(b) the aggregate adjusted bases of property owned by the corporation; and
(c) the fair market value of property leased to the corporation (as determined by the Department of Revenue and Taxation for property tax purposes), does not exceed five million dollars; and
(3) more than twenty percent of the total voting power, and twenty percent of the total value, of the stock of the corporation is owned directly by individuals or estates or indirectly by individuals through partnerships or trusts. The determination under subsection (3) must be made as of the time of issuance of the stock in question but shall include amounts received for the stock.
(E) The basis of any economic impact zone stock must be reduced by the amount of the deduction allowed under this section with respect to the stock.
(F) (1) In the case of a partnership or an 'S' corporation, the limitations under subsection (B) apply at the partner and shareholder level and do not apply at the partnership or corporation level.
(2) Estates and trusts are not treated as individuals for purposes of this section.
Section 12-14-80. (A) There is allowed as a credit against the tax imposed pursuant to Chapter 7 of this title an economic impact zone investment tax credit for any taxable year in an amount equal to five percent of the aggregate bases of economic impact zone qualified manufacturing and productive equipment properties placed in service during such taxable year in the economic impact zone.
(B) For purposes of this section:
(1) 'economic impact zone qualified manufacturing and productive equipment property' means any property:
(a) which is used as an integral part of manufacturing, production, or extraction of or furnishing transportation, communications, electrical energy, gas, water, or sewage disposal services in the economic impact zone;
(b) which is tangible property to which Section 168 of the Internal Revenue Code applies;
(c) which is Section 1245 property (as defined in Section 1245(a)(3)of the Internal Revenue Code); and
(d) (i) the construction, reconstruction, or erection of which is completed by the taxpayer in the economic impact zone; or
(ii) which is acquired by the taxpayer if the original use of such property commences with the taxpayer inside the economic impact zone.
(2) In the case of any computer software which is used to control or monitor a manufacturing or production process inside the economic impact zone and with respect to which depreciation (or amortization in lieu of depreciation) is allowable, the software must be treated as qualified manufacturing and productive equipment property.
(C) This section does not apply to any property to which the other tax credits would apply unless the taxpayer elects to waive the application of the other credits to the property.
Section 12-14-90. (A) For purposes of this chapter, 'economic impact zone business' means, with respect to any taxable year, any corporation if for such year:
(1) (a) every trade or business of such corporation is the active conduct of a qualified business within an economic impact zone; and
(b) at least eighty percent of the total gross income of the corporation is derived from the active conduct of the business;
(2) substantially all of the use of the tangible property of the corporation (whether owned or leased) is within an economic impact zone;
(3) substantially all of the intangible property of the corporation is used in, and exclusively related to, the active conduct of any such business;
(4) substantially all of the services performed for the corporation by its employees are performed within an economic impact zone;
(5) at least one-third of its employees are residents of an economic impact zone;
(6) less than five percent of the average of the aggregate unadjusted bases of the property of such corporation is attributable to collectibles (as defined in Section 408(m)(2) of the Internal Revenue Code) other than collectibles that are held primarily for sale to customers in the ordinary course of such business; and
(7) less than five percent of the average of the aggregate unadjusted bases of the property of such corporation is attributable to nonqualified financial property.
(B) For purposes of this chapter:
(1) Except as otherwise provided in this subsection, the term 'qualified business' means any trade or business.
(2) The rental to others of real property located in an economic impact zone may be treated as a qualified business only if:
(a) in the case of real property which is not residential rental property (as defined in Section 168(e)(2) of the Internal Revenue Code), the lessee is an economic impact zone business; or
(b) in the case of residential rental property:
(i) the property was originally placed in service after the date the economic impact zone was designated; or
(ii) the property is rehabilitated after such date in a rehabilitation which meets requirements based on the principles of Section 42(e)(3) of the Internal Revenue Code.
(3) The rental to others of tangible personal property must be treated as a qualified business only if substantially all of the rental of the property is by economic impact zone businesses or by residents of an economic impact zone.
(4) 'Qualified business' does not include any trade or business consisting predominantly of the development or holding of intangibles for sale or license.
(5) The term 'qualified business' does not include:
(a) any trade or business consisting of the operation of any facility described in Section 144(c)(6)(B) of the Internal Revenue Code; and
(b) any trade or business the principal activity of which is farming (within the meaning of subsections (A) or (B) of Section 2032A(e)(5) of the Internal Revenue Code), but only if, as of the close of the preceding taxable year, the sum of:
(i) the aggregate unadjusted bases (or, if greater, the fair market value) of the assets owned by the taxpayer which are used in such trade or business; and
(ii) the aggregate value of assets leased by the taxpayer which are used in such a trade or business, exceeds five hundred thousand dollars.
For purposes of subitem (b), rules similar to the rules of Section 1395(b) of the Internal Revenue Code apply.
(6) For purposes of this chapter, the term 'nonqualified financial property' means debt, stock, partnership interests, options, futures contracts, forward contracts, warrants, notional principal contracts, annuities, and other similar property specified in regulations, except that the term does not include:
(a) reasonable amounts of working capital held in cash, cash equivalents, or debt instruments with a term of eighteen months or less; or
(b) debt instruments described in Section 1221(4) of the Internal Revenue Code."
SECTION 3. Section 12-7-1200 of the 1976 Code is amended to read:
"Section 12-7-1200. When a taxpayer maintains books of accounts and records in such manner as to clearly reflect the true net income accruing or arising from sources within this State the return may, with the approval of the Commission, be based upon such books of account or records and the tax paid upon the net income so determined. When the Commission finds the books of account and records sufficiently clear, in its opinion, to show the true net income arising from sources within this State it may require the return to be filed upon such basis and calculate the tax due upon the net income so determined.
(A) If the allocation and apportionment provisions of this chapter do not fairly represent the extent of the taxpayer's business activity in this State, the taxpayer may petition for, or the department may require, in respect to all or any part of the taxpayer's business activity, if reasonable:
(1) separate accounting;
(2) the exclusion of one or more of the factors;
(3) the inclusion of one or more additional factors which will fairly represent the taxpayer's business activity in the State; or
(4) the employment of any other method to effectuate an equitable allocation and apportionment of the taxpayer's income.
(B) For the purposes of this chapter, the department may enter into an agreement with the taxpayer establishing the allocation and apportionment of the taxpayer's income for a period not to exceed five years, if the following conditions are met:
(1) the taxpayer is planning a new facility in this State or an expansion of an existing facility;
(2) the taxpayer asks the department to enter into a contract under this subsection reciting an allocation and apportionment method; and
(3) after reviewing the taxpayer's proposal and planned new facility or expansion, the Advisory Coordinating Council for Economic Development certifies that the new facility or expansion will have a significant beneficial economic effect on the region for which it is planned and that its benefits to the public exceed its costs to the public. It is within the Advisory Coordinating Council for Economic Development's sole discretion to determine whether a new facility or expansion has a significant economic effect on the region for which it is planned."
SECTION 4. This act takes effect upon approval by the Governor./
Amend title to conform.
Senator PASSAILAIGUE explained the amendment.
On motion of Senator PASSAILAIGUE, with unanimous consent, the following perfecting amendment (GJK\21565HTC.95) proposed by Senator PASSAILAIGUE was adopted:
Amend the bill, as and if amended, by striking all after the enacting words and inserting:
/SECTION 1. Title 12 of the 1976 Code is amended by adding:
Section 12-10-10. This chapter may be cited as the Enterprise Zone Act of 1995.
Section 12-10-20. The General Assembly finds:
(1) that the economic well-being of the citizens of the State will be enhanced by the increased development and growth of industry within the State, and that it is in the best interest of the State to induce the location or expansion of manufacturing, processing, distribution, warehousing, research and development, corporate offices, and certain tourism facilities within the State in order to promote the public purpose of creating new jobs within the State;
(2) that the inducement provided in this chapter will encourage the creation of jobs which would not otherwise exist and will create sources of tax revenues for the State and its political subdivisions;
(3) the powers to be granted to the Advisory Coordinating Council for Economic Development by this chapter and the purposes to be accomplished are proper governmental and public purposes and that the inducement of the location or expansion of manufacturing, processing, distribution, warehousing, research and development, corporate offices, and certain tourism facilities within the State is of paramount importance.
Section 12-10-30. As used in this chapter:
(1) 'Council' means the Advisory Coordinating Council for Economic Development.
(2) 'Department' means the South Carolina Department of Revenue and Taxation.
(3) 'Employee' means an employee of the qualifying business who works full-time within the enterprise zone.
(4) 'Manufacturing' means engagement primarily in an activity or activities listed under the Standard Industrial Classification (SIC) Codes 20 through 39 as published in the Office of Management and Budget's Standard Industrial Classification Manual.
(5) 'Qualifying business' means an employer that meets the requirements of Section 12-10-50 and other applicable requirements of this chapter and, where required under Section 12-10-50, enters into a revitalization agreement with the council to undertake a project under the provisions of this chapter.
(6) 'Project' means an investment for one or more purposes in Section 12-10-80(B) needed for a qualifying business to locate, remain, or expand in an enterprise zone and otherwise fulfill the requirements of this chapter.
(7) 'Withholding' means employee withholding under Chapter 9 of this title.
Section 12-10-40. Annually, by December thirty-first, using the most current data available, the State Budget and Control Board shall designate the enterprise zones within this State as provided in this section. Each enterprise zone must be located in this State and meet one of the following criteria:
(1) consist of a census tract in which either the median household income is eighty percent or less of the state average, or at least twenty percent of households are below the poverty level according to the most recent United States census;
(2) consist of a county classified as less developed pursuant to Section 12-7-1220;
(3) be located in a federal military base or installation which was closed, or designated to be closed, or in a federal facility in which the permanent employment was reduced by three thousand or more jobs after December 31, 1990;
(4) consist of a census tract with at least one hundred manufacturing jobs, at least fifty percent of which are textile and apparel jobs;
(5) consist of a census tract where a manufacturing facility has closed or experienced permanent layoffs and notified the Employment Security Commission under the federal Worker Adjustment and Retaining Notification (WARN) Act of 1988. The enterprise zone designation applies only for five years after the date of closure or layoff, and the number of jobs permanently lost must equal twenty-five percent or more of the total manufacturing workforce in the tract at the time the layoff occurred. The job loss shall have occurred no more than five years prior to the effective date of this chapter, except in any census tract where a catastrophic loss of one thousand or more jobs from a single employer has occurred since 1980 and fewer than half the job losses have been replaced. Any such tract will remain an enterprise zone until at least half the catastrophic job losses have been replaced. Where a municipality in which the catastrophic job loss occurred is split by census tracts, each tract containing any part of the municipality meets the catastrophic job loss criteria; or
(6) consist of a census tract, any part of which is within twenty miles of a federal facility that has reduced its permanent civilian employment by three thousand or more jobs after December 31, 1990, for ten years after the effective date of this chapter.
Section 12-10-50. To qualify for the benefits provided in this chapter, a business must be located within an enterprise zone and satisfy the following criteria:
(1) the business in the enterprise zone must be primarily engaged in a business of the type identified in Section 12-7-1220;
(2) the business in the enterprise zone shall provide a benefits package to full-time employees which includes health care;
(3) the qualifying business shall enter into a revitalization agreement which is approved by the council, except that no revitalization agreement is required for a qualifying business with respect to Sections 12-10-70(2), 12-10-70(3), and 12-10-80(D); and
(4) the council shall determine that the available incentives are appropriate for the project, and the council shall certify to the department that the total benefits of the project exceed the costs to the public, and that the qualifying business otherwise fulfills the requirements of this chapter. No provision of this chapter must be construed to allow the council to negotiate a fee-in-lieu of property taxes agreement or approve job training or retraining.
Section 12-10-60. The council may enter into a revitalization agreement with each qualifying business with respect to the project. The terms and provisions of each revitalization agreement must be determined by negotiations between the council and the qualifying business. The revitalization agreement must set a date by which the qualifying business shall have completed the project. Within three months of the completion date, the qualifying business shall document the actual costs of the project in a manner acceptable to the council.
Section 12-10-70. Qualifying businesses are entitled to the following benefits in addition to all others provided by law:
(1) If at least fifty-one percent of the full-time employees hired for the project either reside in an enterprise zone at the time of employment, have a household income that is eighty percent or less of the median household income for the county prior to employment, or have been a recipient of Aid to Families with Dependent Children (AFDC) payments within the past twelve months, the qualifying business is entitled to the jobs tax credit for the period and in the amount provided in Section 12-7-1220(B); in addition, a qualifying business is entitled to an additional five hundred dollars a year tax credit in the third, fourth, and fifth year of any AFDC recipient's continued employment with the qualifying business, based on the status of the employee at the time of beginning employment. A new job is not considered a new job for the purpose of this credit if it replaces the same job that was part of a reduction in force in the preceding twelve months.
(2) The qualifying business is eligible for the benefits provided in Section 4-29-67 if it meets one-half of the quantitative requirements of that section.
(3) The business is eligible to use the special source revenue bonds authorized under Sections 4-29-68 and 4-1-175.
Section 12-10-80. (A) Upon certification by the council to the department of the council's determination that a business is a qualifying business, a qualifying business may collect a job development fee by retaining an amount of employee withholding permitted by subsection (C) or (D), but not both, for the purposes permitted by subsection (B) or (D), respectively. The amount withheld must be maintained in an escrow account with a bank which is insured by the Federal Deposit Insurance Corporation. To the extent the money is not used as permitted by subsection (B) or (D), it must be treated as misappropriated employee withholding. Employee withholding may not be retained before the entry of the qualifying business into a revitalization agreement. If a qualifying business retains employee withholding under this section, it shall make its payroll books and records available for inspection by the council and the department at the times the council and the department request. Each qualifying business retaining employee withholding under this section shall file with the council and the department the information and documentation respecting the retention and use of the employee withholding according to the revitalization agreement. Each qualifying business which retains in excess of ten thousand dollars in any calendar year shall furnish an audited report prepared by an independent certified public accountant which itemizes the sources and uses of the funds. The audited report must be filed with the council and the department no later than April fifteenth following the calendar year of the retention. Each qualifying business retaining employee withholding under this section is allowed a credit against the withholding tax liability provided in Chapter 9 of this title otherwise owed to the State, the credit not to exceed the lesser of the amount of such tax or the aggregate amount of employee withholding retained.
(B) A qualifying business may collect a job development fee under the revitalization agreement for a period not to exceed fifteen years. A qualifying business must create at least ten new, full-time jobs at the South Carolina facility described in the revitalization agreement. Capital expenditures from the escrow account must be expended at the above-described facility or for utility or transportation improvements that serve this facility. The qualifying business may expend funds from the escrow account if (a) the expenditures are incurred during the term of the revitalization agreement, (b) the expenditures from the escrow account are authorized by the revitalization agreement, (c) the expenditures are approved in writing by the council and the department prior to expenditure, and (d) the expenditures are for any of the following purposes:
(1) training costs and facilities;
(2) acquiring and improving real estate whether acquired by lease, purchase, installment payment, or otherwise, the escrow account can be spent only for capital improvements made after entering a revitalization agreement;
(3) improvements to both public and private utility systems including water, sewer, electricity, natural gas, and telecommunications;
(4) fixed transportation facilities including highway, rail, water, and air; and
(5) construction or improvements of any real property and fixtures constructed or improved primarily for the purpose of complying with local, state, or federal environmental laws or regulations.
(C) The total amount retained from employee withholding by the qualifying business may not exceed the sum of the following amounts:
(1) two percent of the gross wages of each new employee who earns six dollars or more an hour but less than eight dollars an hour;
(2) three percent of the gross wages of each new employee who earns eight dollars or more an hour but less than ten dollars an hour;
(3) four percent of the gross wages of each new employee who earns ten dollars or more an hour but less than fifteen dollars an hour; and
(4) five percent of the gross wages of each new employee who earns fifteen dollars or more an hour.
The hourly gross wage figures set forth in this section must be adjusted annually by an inflation factor determined by the State Budget and Control Board.
(D) Subject to the conditions in this section, any qualifying business in an enterprise zone may negotiate with the council to retain from employee withholding an amount equal to five hundred dollars a year for each production employee being retrained, where this retraining is necessary for the qualifying business to remain competitive or to introduce new technologies. This retraining must be approved by and performed by the technical college under the jurisdiction of the State Board for Technical and Comprehensive Education serving the designated enterprise zone. In addition to the yearly limits, the amount retained from employee withholding may not exceed two thousand dollars over five years for each production employee being retrained. Additionally, the qualifying business must match on a dollar-for-dollar basis the amount retained from employee withholding. The total amount retained from withholding and all of the qualifying business' matching funds must be paid to the technical college that provides the training to defray the cost of the training program. Any training cost in excess of the job development fees and matching funds is the responsibility of the qualifying business based on negotiations with the technical college.
(E) Each qualified business which has retained employee withholding under this section, shall report each employee's state withholding to the United States, this State, and the employee as if the retained withholding had been paid over to the State pursuant to Chapter 9 of this title.
(F) Any job development fee of a qualifying business permanently lapses upon expiration or termination of the revitalization agreement. In the event of termination, the qualifying business shall immediately cease to retain employee withholding and immediately cease spending funds from the escrow account. Within thirty days of the expiration or termination of the revitalization agreement, the qualifying business shall pay over all the funds remaining in the escrow account to the department as withholding taxes.
Section 12-10-90. If a qualifying business fails to achieve the level of capital investment or employment set forth in the revitalization agreement, the department may terminate the revitalization agreement and reduce or suspend all or any part of the incentives until the time the anticipated capital investment and employment levels are met. However, these incentives must not be suspended retroactively. The council shall provide in the revitalization agreement entered into in connection with a project for the levels of capital investment and employment which must be achieved and for the time period in which the levels must be achieved.
Section 12-10-100. (A) The council shall establish criteria for the determination and selection of qualifying businesses and the approval of revitalization agreements. These criteria must give greatest weight to the creditworthiness of the business, the number, type, and quality of new jobs to be provided by the project to residents of this State, and the economic viability of the business. The council may include in its criteria requirements relating to the capital costs of, and projected employment to be produced by, projects eligible for benefits under this chapter and requirements relating to the employment of previously unemployed or underemployed persons.
With respect to each business and project, the council shall request the materials and make the inquiries necessary to determine whether the business and its proposed project satisfy the council's announced criteria and to conduct an adequate cost/benefit analysis with respect to the proposed project and the incentives proposed to be granted by the council with respect to the project. After a review of the relevant materials and completion of its inquiries and analysis, the council may by resolution of its members designate an applicant business as a qualifying business and authorize the undertaking of its project according to the revitalization agreement.
(B) The council shall establish an application fee schedule, not to exceed two thousand dollars for each qualifying business, for undertaking the provisions of this chapter. The State Treasurer shall establish an account for these fees which must be expended by the council only for meeting administrative, data collection, credit analysis, cost/benefits analysis, reporting, and any other obligations pursuant to this chapter. This account may retain funds for expenditure in the next fiscal year only for purposes enumerated in this section.
(C) By March first of each year, the council shall prepare a public document that itemizes each revitalization agreement concluded during the prior calendar year. The report shall list each revitalization agreement, the results of each cost/benefits analysis, and receipts and expenditures of application fees. This document must be forwarded to the State Budget and Control Board, Senate Finance Committee, and House Ways and Means Committee. This document may not contain any proprietary or confidential information that is otherwise exempt under Chapter 4 of Title 30, the Freedom of Information Act, and nothing in this section must be construed to require the release of such exempt information.
(E) Notwithstanding any other provision of law, the council may promulgate regulations to implement the provisions of this chapter immediately upon the effective date of this chapter. These regulations remain in effect until the convening of the General Assembly for the 1996 session, at which time the council shall comply with the requirements of Chapter 23 of Title 1. The regulations initially promulgated by the council remain in effect until compliance with Chapter 23 of Title 1 during the 1996 session of the General Assembly.
Section 12-10-110. This chapter must be liberally construed in conformity with the findings provided in Section 12-10-20."
SECTION 2. Title 12 of the 1976 Code is amended by adding:
Section 12-14-10. This chapter may be cited as the Economic Impact Zone Community Development Act of 1995.
Section 12-14-20. It is the purpose of this chapter to establish a program of providing tax incentives for the creation of economic impact zones in order:
(1) to revitalize economically and physically distressed areas impacted as a result of the closing or realignment of a federal military installation area, primarily by encouraging the formation of new businesses and the retention and expansion of existing businesses;
(2) to promote meaningful employment for economic impact zone residents; and
(3) to encourage individuals to reside in the economic impact zones in which they are employed.
Section 12-14-30. For purposes of this chapter:
(1) 'economic impact zone' means a county or municipality, any portion of which is located within fifty miles of the boundaries of an applicable federal military installation, and any area not otherwise included as part of the economic impact zone if the State Budget and Control Board determines the area to be adversely impacted by the closing or realignment of an applicable federal military installation. An applicable federal military installation is one which is closed or realigned under:
(a) the Defense Base Closure and Realignment Act of 1990;
(b) Title II of the Defense Authorization Amendments and Base Closure and Realignment Act; or
(c) Section 2687 of Title 10, United States Code.
(2) 'Internal Revenue Code' has the meaning provided in Section 12-7-20(11).
Section 12-14-40. (A) The designation of an area as an economic impact zone must be made by the State Budget and Control Board. It remains in effect during the period beginning on the date the board designates the area an economic impact zone and ending on the earlier of:
(1) December thirty-first of the fifteenth calendar year following the calendar year in which the designation occurs, or
(2) a termination date designated by legislative enactment of the General Assembly.
(B) A designation may be revoked by the General Assembly only after a hearing on the record in which officials of the county or municipality involved may participate.
Section 12-14-50. (A) In the case of an individual, there is allowed as a deduction against South Carolina taxable income an amount equal to twenty percent of the aggregate amount paid in cash by the taxpayer during the taxable year for the purchase of economic impact zone stock.
(B)(1) The maximum amount allowed as a deduction under subsection (A) to a taxpayer for the taxable year may not exceed the lesser of:
(a) ten thousand dollars; or
(b) the excess of one hundred thousand dollars over the amount allowed as a deduction under this section to the taxpayer for all prior taxable years.
(2) If the amount otherwise deductible by the person under subsection (A) exceeds the limitation under subsection (B)(1)(a):
(a) the amount of such excess is treated as an amount paid to which subsection (A) applies during the next taxable year; and
(b) the deduction allowed for any taxable year must be allocated proportionately among the economic impact zone stock purchased by the person on the basis of the respective purchase prices a share.
(3) The taxpayer and members of the taxpayer's family are treated as one person for purposes of subitem (1), and the limitations contained in such subitem must be allocated among the taxpayer and such members in accordance with their respective purchases of economic impact zone stock. For purposes of this section, an individual's family includes only such individual's spouse and minor children.
(C) For purposes of this section:
(1) the term 'economic impact zone stock' means stock of a corporation if:
(a) such stock is acquired on original issue from the corporation; and
(b) such corporation is, at the time of issue, a qualified enterprise zone issuer.
(2) (a) 'Economic impact zone stock' includes such stock only to the extent that the proceeds of the stock issue are used by the issuer during the twelve-month period beginning on the date of issuance to purchase qualified economic impact zone property.
(b) For purposes of this section, the term 'qualified economic impact zone property' means property to which Section 168 of the Internal Revenue Code applies:
(i) the original use of which in an economic impact zone commences with the issuer; and
(ii) substantially all of the use of which is in an economic impact zone.
(3) The term 'economic impact zone stock' does not include any stock acquired from a corporation which made a substantial stock redemption or distribution (without a bona fide business purpose therefor) in an attempt to avoid the purposes of this section.
(D) For purposes of this section, the term 'qualified economic impact zone issuer' means any 'C' corporation if:
(1) the corporation is an economic impact zone business or, in the case of a new corporation, the corporation is being organized for purposes of being an economic impact zone business;
(2) the sum of:
(a) the money;
(b) the aggregate adjusted bases of property owned by the corporation; and
(c) the fair market value of property leased to the corporation (as determined by the Department of Revenue and Taxation for property tax purposes), does not exceed five million dollars; and
(3) more than twenty percent of the total voting power, and twenty percent of the total value, of the stock of the corporation is owned directly by individuals or estates or indirectly by individuals through partnerships or trusts. The determination under subsection (3) must be made as of the time of issuance of the stock in question but shall include amounts received for the stock.
(E) The basis of any economic impact zone stock must be reduced by the amount of the deduction allowed under this section with respect to the stock.
(F) (1) In the case of a partnership or an 'S' corporation, the limitations under subsection (B) apply at the partner and shareholder level and do not apply at the partnership or corporation level.
(2) Estates and trusts are not treated as individuals for purposes of this section.
Section 12-14-80. (A) There is allowed as a credit against the tax imposed pursuant to Chapter 7 of this title an economic impact zone investment tax credit for any taxable year in an amount equal to five percent of the aggregate bases of economic impact zone qualified manufacturing and productive equipment properties placed in service during such taxable year in the economic impact zone.
(B) For purposes of this section:
(1) 'economic impact zone qualified manufacturing and productive equipment property' means any property:
(a) which is used as an integral part of manufacturing, production, or extraction of or furnishing transportation, communications, electrical energy, gas, water, or sewage disposal services in the economic impact zone;
(b) which is tangible property to which Section 168 of the Internal Revenue Code applies;
(c) which is Section 1245 property (as defined in Section 1245(a)(3)of the Internal Revenue Code); and
(d) (i) the construction, reconstruction, or erection of which is completed by the taxpayer in the economic impact zone; or
(ii) which is acquired by the taxpayer if the original use of such property commences with the taxpayer inside the economic impact zone.
(2) In the case of any computer software which is used to control or monitor a manufacturing or production process inside the economic impact zone and with respect to which depreciation (or amortization in lieu of depreciation) is allowable, the software must be treated as qualified manufacturing and productive equipment property.
(C) This section does not apply to any property to which the other tax credits would apply unless the taxpayer elects to waive the application of the other credits to the property.
Section 12-14-90. (A) For purposes of this chapter, 'economic impact zone business' means, with respect to any taxable year, any corporation if for such year:
(1) (a) every trade or business of such corporation is the active conduct of a qualified business within an economic impact zone; and
(b) at least eighty percent of the total gross income of the corporation is derived from the active conduct of the business;
(2) substantially all of the use of the tangible property of the corporation (whether owned or leased) is within an economic impact zone;
(3) substantially all of the intangible property of the corporation is used in, and exclusively related to, the active conduct of any such business;
(4) substantially all of the services performed for the corporation by its employees are performed within an economic impact zone;
(5) at least one-third of its employees are residents of an economic impact zone;
(6) less than five percent of the average of the aggregate unadjusted bases of the property of such corporation is attributable to collectibles (as defined in Section 408(m)(2) of the Internal Revenue Code) other than collectibles that are held primarily for sale to customers in the ordinary course of such business; and
(7) less than five percent of the average of the aggregate unadjusted bases of the property of such corporation is attributable to nonqualified financial property.
(B) For purposes of this chapter:
(1) Except as otherwise provided in this subsection, the term 'qualified business' means any trade or business.
(2) The rental to others of real property located in an economic impact zone may be treated as a qualified business only if:
(a) in the case of real property which is not residential rental property (as defined in Section 168(e)(2) of the Internal Revenue Code), the lessee is an economic impact zone business; or
(b) in the case of residential rental property:
(i) the property was originally placed in service after the date the economic impact zone was designated; or
(ii) the property is rehabilitated after such date in a rehabilitation which meets requirements based on the principles of Section 42(e)(3) of the Internal Revenue Code.
(3) The rental to others of tangible personal property must be treated as a qualified business only if substantially all of the rental of the property is by economic impact zone businesses or by residents of an economic impact zone.
(4) 'Qualified business' does not include any trade or business consisting predominantly of the development or holding of intangibles for sale or license.
(5) The term 'qualified business' does not include:
(a) any trade or business consisting of the operation of any facility described in Section 144(c)(6)(B) of the Internal Revenue Code; and
(b) any trade or business the principal activity of which is farming (within the meaning of subsections (A) or (B) of Section 2032A(e)(5) of the Internal Revenue Code), but only if, as of the close of the preceding taxable year, the sum of:
(i) the aggregate unadjusted bases (or, if greater, the fair market value) of the assets owned by the taxpayer which are used in such trade or business; and
(ii) the aggregate value of assets leased by the taxpayer which are used in such a trade or business, exceeds five hundred thousand dollars.
For purposes of subitem (b), rules similar to the rules of Section 1395(b) of the Internal Revenue Code apply.
(6) For purposes of this chapter, the term 'nonqualified financial property' means debt, stock, partnership interests, options, futures contracts, forward contracts, warrants, notional principal contracts, annuities, and other similar property specified in regulations, except that the term does not include:
(a) reasonable amounts of working capital held in cash, cash equivalents, or debt instruments with a term of eighteen months or less; or
(b) debt instruments described in Section 1221(4) of the Internal Revenue Code."
SECTION 3. Section 12-7-1200 of the 1976 Code is amended to read:
"Section 12-7-1200. When a taxpayer maintains books of accounts and records in such manner as to clearly reflect the true net income accruing or arising from sources within this State the return may, with the approval of the Commission, be based upon such books of account or records and the tax paid upon the net income so determined. When the Commission finds the books of account and records sufficiently clear, in its opinion, to show the true net income arising from sources within this State it may require the return to be filed upon such basis and calculate the tax due upon the net income so determined.
(A) If the allocation and apportionment provisions of this chapter do not fairly represent the extent of the taxpayer's business activity in this State, the taxpayer may petition for, or the department may require, in respect to all or any part of the taxpayer's business activity, if reasonable:
(1) separate accounting;
(2) the exclusion of one or more of the factors;
(3) the inclusion of one or more additional factors which will fairly represent the taxpayer's business activity in the State; or
(4) the employment of any other method to effectuate an equitable allocation and apportionment of the taxpayer's income.
(B) For the purposes of this chapter, the department may enter into an agreement with the taxpayer establishing the allocation and apportionment of the taxpayer's income for a period not to exceed five years, if the following conditions are met:
(1) the taxpayer is planning a new facility in this State or an expansion of an existing facility;
(2) the taxpayer asks the department to enter into a contract under this subsection reciting an allocation and apportionment method; and
(3) after reviewing the taxpayer's proposal and planned new facility or expansion, the Advisory Coordinating Council for Economic Development certifies that the new facility or expansion will have a significant beneficial economic effect on the region for which it is planned and that its benefits to the public exceed its costs to the public. It is within the Advisory Coordinating Council for Economic Development's sole discretion to determine whether a new facility or expansion has a significant economic effect on the region for which it is planned."
SECTION 4. This act takes effect upon approval by the Governor./
Amend title to conform.
Senator PASSAILAIGUE explained the amendment.
Senator LEATHERMAN proposed the following Amendment No. 4 (GJK\21554SD.95), which was adopted:
Amend the bill, as and if amended, in Section 12-10-20 of the 1976 Code, as contained in SECTION 1, by inserting after /processing,/ on line 8, page 2, and on line 19, page 2, /services,/;
Amend the bill further, as and if amended, in Section 12-10-30 of the 1976 Code, as contained in SECTION 1, by adding a new item (6) to read:
/(6) 'Services' means engagement primarily in an activity or activities listed under the Standard Industrial Classification (SIC) Code 80 according to the Federal Office of Management and Budget Standard Industrial Classification Manual 1987 edition./;
Amend the bill further, as and if amended, in Section 12-10-50 of the 1976 Code, as contained in SECTION 1, by striking item (1) which begins on line 40, page 3, and inserting:
/(1) it must be primarily engaged in a business of the type identified in Section 12-7-1220, or in the alternative it must be primarily engaged in a business providing services as defined in Section 12-10-30;/;
Amend the bill further, as and if amended, in Section 12-10-70 of the 1976 Code, as contained in SECTION 1, by adding a new item (4) to read:
/(4) If the qualifying business is of a type that does not qualify for the jobs tax credit as provided in Section 12-7-1220 because it only provides services as defined in Section 12-10-30, notwithstanding any other provision of law, it shall be entitled to receive the jobs tax credit for new jobs created under Section 12-7-1220 if it locates or expands in an enterprise zone and otherwise meets the requirements of Section 12-7-1220./
Renumber sections to conform.
Amend totals and title to conform.
Senator PASSAILAIGUE explained the amendment.
There being no further amendments, the Bill was read the third time and ordered returned to the House of Representatives with amendments.
The following Bill was read the third time and ordered sent to the House of Representatives:
S. 97 -- Senators Hayes, Elliott, Giese and Wilson: A BILL TO AMEND SECTION 16-13-420, AS AMENDED, CODE OF LAWS OF SOUTH CAROLINA, 1976, RELATING TO FAILURE TO RETURN RENTED OBJECTS AND FRAUDULENT APPROPRIATION OF THE SAME, SO AS TO, AMONG OTHER THINGS, ESTABLISH CERTAIN NEW MISDEMEANOR OFFENSES, INCLUDING THAT OF WILFUL AND FRAUDULENT FAILURE TO RETURN A MOTOR VEHICLE FOR MORE THAN ONE WEEK AFTER THE LEASE OR RENTAL AGREEMENT HAS EXPIRED, AND PROVIDE PENALTIES.
By prior motion of Senator COURTNEY of Thursday, February 9, 1995, the Senate agreed that, when the Senate stands adjourned on Thursdays in statewide session, it stand adjourned to reconvene on Fridays at 11:00 A.M., under the provisions of Rule 1 for the purpose of taking up local matters and uncontested matters which have previously received unanimous consent to be taken up; and that when the Senate stands adjourned on Fridays, that it stand adjourned to reconvene on Tuesdays at 12:00 Noon.
At 12:35 P.M., on motion of Senator DRUMMOND, the Senate adjourned to meet tomorrow at 11:00 A.M. under the provisions of Rule 1 for the purpose of taking up local matters and uncontested matters which have previously received unanimous consent to be taken up.
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