Legislative eNews
Federal
Immigration
With Congress in recess, President Bush continued his push to pass immigration reform. Bush's speech to the U.S. Chamber was intended to build momentum for Senate and House negotiators to resolve disputes and produce a compromise. The two houses passed sharply different versions of the legislation.
President Bush told the prominent business group yesterday that "unscrupulous" employers have contributed to the illegal immigration crisis in the United States by knowingly hiring undocumented workers, and called for steep new penalties on those exploiting the shadow economy.
On the business requirements, Bush noted that the government is working to make it easier for businesses to check the status of would-be workers. He said both House and Senate bills would require employers to use a new online verification system called Basic Pilot. But he said the penalties for violating the law are too light, noting that a business that fails to check an employee's identification faces a fine as low as $100, and that one who knowingly hires an illegal immigrant faces a fine as low as $250. He suggested those fines increase.
The U.S. Chamber has supported the overall approach passed by the Senate, but has concerns about the implementation of the Basic Pilot registry program and its impact on business.
H-2B Visas
Several local business leaders continued to communicate with staff for Senators Graham and DeMint to ensure that the H-2B visa program is extended so that the local tourism industry will be meet its employment needs next year.
State
Budget
The General Assembly ended its regular session Thursday without a finished state budget bill, as the annual spending plan became a source of conflict between lawmakers and the governor. The legislature is expected to return June 14 to finish the budget process and other outstanding issues.
The $6.6 billion budget has been approved by both chambers. The South Carolina Chamber of Commerce points to following items as important to the business community:
The three days after Thanksgiving will serve as sales tax holidays for all items and will result in a $14 million reduction in General Fund revenue. $2.4 million is included for the South Carolina State Ports Authority (SPA) harbor dredging. The South Carolina Department of Transportation (SCDOT) will receive $5 million for port access roads. The Education and Economic Development Act (EEDA) will be funded at $14.9 million. The Commission on Higher Education will receive $1.3 million for the implementation of EEDA. The High School to Work program is funded at $1.1 million. 4-year-old kindergarten for at-risk children will receive $15.7 million. Some funding for First Steps is included at $1.9 million, and an additional pilot program is included at $6 million. The Governor's School for Math and Science and the Governor's School for Arts and Humanities will receive $2.5 million each. Continuation of GEAR UP is funded at $600,000. South Carolina technical schools will receive $4.2 million for CATT training. $109 million is allocated for Medicaid annualization. The South Carolina Department of Parks, Recreation, and Tourism (PRT) will receive $7.1 million for advertising. The South Carolina Department of Commerce will receive $7 million for a closing fund, $2.25 million for recruitment employees, $450,000 for a hydrogen fuel cell coalition, and $3 million for a capital access program. The South Carolina Manufacturing Extension Partnership (SCMEP) will be funded at $1.2 million. The state's Endowed Chairs program at universities will be funded at $30 million. Property tax
Businesses could be exposed to higher costs in the near future as a result of the hotly debated residential property tax reform bill that has been enrolled for ratification and will be sent to the governor for his signature.
The business community will need to closely monitor the long-term effects of this reform package. The commitment from the General Fund and anticipation by the Board of Economic Advisors (BEA) that dollars will diminish over the next three years is troubling as the state accepts the burden of this year's relief. It will take an estimated $700 million to fund property tax relief each year with the sales tax imposition only generating $582 million according to the South Carolina Chamber of Commerce.
What ultimately emerged from the 2006 legislative session was better than discussions at the beginning of the year. But as valuations increase and the number of homes continues to grow in many areas, the need for funding could outpace sales tax growth, leading to the need to identify additional funding sources. When this happens, it will be critical for the business community to engage while the General Assembly considers additional funding sources, including but not limited to levying additional taxes on business.
The relief package includes a 1-cent increase in the state sales tax to fund relief on owner-occupied homes for school operating purposes and takes effect on June 1, 2007. A $2.5 million minimum allocation per county to address equity funding issues, a reduction in the tax on food from 5 cents to 3 cents, and three sales tax free days after Thanksgiving also are included. A local option allowance through referendum will allow for sales tax increases up to 1-cent.
Eminent Domain
Consideration of legislation limiting local governments' ability to obtain private property continued late into the session. So far, conference committee members have failed to resolve a key difference on takings. The House version reforming eminent domain would require compensation in cases where rezoning reduced an owner's property value. The Senate version does not include the language. The issue will likely be considered when lawmakers return later this month to handle budget vetoes.
Local
Open Space Referendum
A group of Beaufort County residents interested in quality of life issues have organized themselves as The Citizens for Open Space -- an action committee to generate public support of November's ballot referendum which will allow the continued purchase of open space resources throughout the county for purposes of protecting critical lands and helping manage the county's growth.
Barry Connor, George Johnston and Tom Taylor, three prominent residents of the county with a history of active involvement in growth management and environmental issues, have been named voluntary chairs of the committee representing the three county regions: North of the Broad River, Bluffton/Okatie and Hilton Head Island. In November, the county-wide referendum will ask voters if they are willing to use tax dollars to purchase land or development rights to land in order to: alleviate traffic congestion in high growth areas; preserve wildlife areas and park lands; and protect water quality and wetlands.
If the referendum is approved, Beaufort County will borrow $50 million. A similar referendum was approved in 2000 and passed with 73% of the votes cast. Now those initial dollars have been exhausted
