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Indicates Matter Stricken
Indicates New Matter
Indicates Matter Stricken
Indicates New Matter
COMMITTEE AMENDMENT AMENDED AND ADOPTED AND AMENDED
May 29, 2008
H. 4470
Introduced by Reps. Harrell, Leach, Cato, Hagood, Hamilton, Harrison, Limehouse, Merrill, Scarborough, W.D. Smith, Stavrinakis, Walker, Young, Gambrell, Haley, Bedingfield, Mahaffey, Cotty, McLeod, Owens, Rice, Bowen, Viers and Shoopman
S. Printed 5/29/08--S.
Read the first time February 19, 2008.
TO AMEND THE CODE OF LAWS OF SOUTH CAROLINA, 1976, BY ADDING SECTION 12-6-3680 SO AS TO ALLOW A STATE INCOME TAX CREDIT FOR THE PURCHASE, INSTALLATION, OR IMPROVEMENT OF A FIRE SPRINKLER SYSTEM AND TO PROVIDE THE ADMINISTRATION OF THE CREDIT; TO AMEND SECTION 5-31-670, RELATING TO MUNICIPAL AND SPECIAL SERVICE DISTRICT WATER SYSTEMS, SO AS TO LIMIT CHARGES FOR SEPARATE LINES FOR FIRE SPRINKLER SYSTEMS TO ACTUAL COSTS; TO AMEND SECTION 12-36-2120, AS AMENDED, RELATING TO SALES TAX EXEMPTIONS, SO AS TO EXEMPT FIRE SPRINKLER SYSTEMS; TO AMEND SECTION 12-37-220, AS AMENDED, RELATING TO PROPERTY TAX EXEMPTIONS, SO AS TO ALLOW AN EXEMPTION FROM COUNTY TAXES FOR FIVE YEARS FOR THE FIRST FIFTY THOUSAND DOLLARS OF THE COST OF ADDING TO AND UPGRADES OF FIRE SPRINKLER SYSTEMS IN MANUFACTURING ESTABLISHMENTS IN EXISTENCE BEFORE JULY 1, 2008; TO AMEND SECTION 12-37-930, AS AMENDED, RELATING TO DEPRECIATION ALLOWED IN THE VALUATION OF MANUFACTURING PROPERTY FOR PURPOSES OF THE PROPERTY TAX, SO AS TO ALLOW A TWENTY PERCENT ANNUAL DEPRECIATION FOR THE ADDITION OR UPGRADE OF A FIRE SPRINKLER SYSTEM INSTALLED OR UPGRADED IN A MANUFACTURING ESTABLISHMENT IN EXISTENCE BEFORE JULY 1, 2008, AND TO ALLOW THIS COST TO BE COMPLETELY DEPRECIATED; AND TO AMEND SECTION 23-9-40, RELATING TO THE DUTIES OF THE STATE FIRE MARSHAL, SO AS TO ADD AUTHORITY RELATING TO FIRE SPRINKLER SYSTEMS.
Whereas, when fire sprinklers are present, the chances of a person dying in a fire are reduced by one-half to three-fourths; and
Whereas, when fire sprinklers are present, the average property loss per fire is cut by one-half to two-thirds, compared to fires where fire sprinklers are not present; and
Whereas, the National Fire Protection Association has no record of a fire killing more than two people in a completely sprinklered public assembly, educational, institutional or residential building where the system was working properly; and
Whereas, fire caused 10,672,000,000 dollars in direct property damage in the United States in 2005; and
Whereas, fire sprinklers are highly reliable, and when present in the fire area, operate in all but seven percent of fires large enough to activate the system. Human error was a factor in most of the failures, and the system was shut off in approximately two-thirds of the failures; and
Whereas, it is the purpose of this Act to create meaningful incentives for the installation of fire sprinkler systems. Now, therefore,
Be it enacted by the General Assembly of the State of South Carolina:
SECTION 1. Chapter 5, Title 58 of the 1976 Code is amended by adding:
"Section 58-5-390. A publicly or privately owned utility may not impose a tap fee, other fee, or a recurring maintenance fee of any nature or however described for the installation and maintenance of a fire sprinkler system that exceeds the actual costs associated with the water line to the system.
For purposes of this section, actual costs include direct labor, direct material, the necessity of increased capacity, and other direct charges associated with the separate fire sprinkler line. The direct costs must be documented by either an invoice or work order that specifically assigns the costs to the separate fire sprinkler line.
Nothing in this section may be construed as requiring a utility to provide service to support a private fire protection system."
SECTION 2. A. Article 25, Chapter 6, Title 12 of the 1976 Code is amended by adding:
"Section 12-6-3622. (A)(1) Subject to the terms and conditions of this section, a taxpayer who installs a fire sprinkler system in a commercial or residential structure, whether the structure or fire sprinkler is new or existing, when such installation is not required by law, regulation, or code is eligible for a credit against real property taxes levied by a local taxing entity equal to twenty-five percent of the direct expenses, not including any type of fee charged by the publicly or privately owned utility, incurred by the taxpayer if the local taxing entity has consented to the tax credit.
(2) In any year in which the local taxing entity consents to a tax credit, the taxpayer may also claim an income tax credit equal to the amount of the credit against real property taxes.
(3) The credit earned pursuant to this subsection by a "S" corporation owing corporate level income tax must be used first at the entity level. Any remaining credit passes through to each shareholder in a percentage equal to each shareholder's percentage of stock ownership.
(4) The credit earned pursuant to this subsection by a general partnership, limited partnership, limited liability company, or any other entity taxed as a partnership must be passed through to its partners and may be allocated among any of its partners, including without limitation, an allocation of the entire credit to one partner, in a manner agreed by the partners that is consistent with Subchapter K of the Internal Revenue Code. As used in this subsection, the term "partner" means a partner, member, or owner of an interest in the pass-through entity, as applicable.
(B) The Department of Revenue shall develop a form on which a taxpayer may claim the credit against real property taxes. The taxpayer may claim the credit against real property taxes by submitting the form with the payment of real property taxes to the local taxing entity. The taxpayer may claim the credit against income taxes by submitting the form with the taxpayer's return.
(C) The owner of the structure may transfer, devise, or distribute any unused credit to the tenant of the eligible site. To be effectual, the local taxing entity must receive written notification.
(D) For purposes of this section, fire sprinkler system has the same meaning as in Section 40-10-20."
B. This section takes effect upon approval of this act by the Governor and applies for taxable years beginning after 2007.
SECTION 3.A. Section 12-37-3130(1) of the 1976 Code is amended to read:
"Section 12-37-3130. As used in this article:
(1) "Additions" or "improvements" mean an increase in the value of an existing parcel of real property because of:
(a) new construction;
(b) reconstruction;
(c) major additions to the boundaries of the property or a structure on the property;
(d) remodeling; or
(e) renovation and rehabilitation, including installation.
Additions or improvements do not include minor construction or ongoing maintenance and repair of existing structures. The repair or reconstruction of a structure damaged or destroyed by a disaster, to include, but not limited to, construction defects, defective materials, fire, wind, hail, flood, and acts of God, is not an addition or improvement to the extent that the structure as repaired or reconstructed is similar in size, utility, and function of the structure damaged or destroyed, and the rebuilding or reconstruction is begun within eight years after determination of the damage or destruction. Construction of facilities in a home that make the home handicapped accessible is not an addition or improvement if the utility and function of the structure remains unchanged. The installation of a fire sprinkler system in a commercial or residential structure when the installation is not required by law, regulation, or code is not an addition or improvement if the utility and function of the structure remains unchanged."
B. This section takes effect upon approval of this act by the Governor and applies for taxable years beginning after 2007.
SECTION 4. Chapter 1, Title 10 of the 1976 Code is amended by adding:
"Section 10-1-80. (A) For purposes of this section, 'places of worship' mean new or existing buildings that are included within the Group A occupancies as contained in either the International Fire Code or the most recently adopted nationally recognized fire code.
(B) The General Assembly finds that the tradition of bringing natural cut trees is an important symbol in celebrations occurring in places of worship.
(C) Neither the Fire Marshal nor a governing body of a county or municipality shall enforce that portion of either the International Fire Code or a nationally recognized fire code that prohibits natural cut trees from being located in places of worship which do not fall within the exceptions provided for structures that have approved automatic sprinkler systems installed in accordance with the International Fire Code or a nationally recognized fire code.
(D) This section does not affect the authority of the Fire Marshal or a governing body of a county or a municipality to enforce the other provisions of the International Fire Code or a nationally recognized fire code that pertain to decorative vegetation in new and existing buildings."
SECTION 5.A. Section 12-37-220(B) of the 1976 Code is amended by adding an appropriately numbered item at the end to read:
"( ) All fire sprinkler system equipment and the value attached thereto that is installed on a commercial or residential structure when the installation is not required by law, regulation, or code until there is an accessible transfer of interest as determined by Section 12-37-3150."
B. This section takes effect upon approval of this act by the Governor and applies for taxable years beginning after 2007.
SECTION 6. Except as otherwise provided, this act takes effect upon approval by the Governor.
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