Legislative eNews-october 30, 2007

STATE

State Sales Tax Changes for Unprepared Food

Effective November 1, 2007, sales of unprepared food items will be exempt from the state sales and use tax rate. Subsequently, the 3 percent state sales and use rate presently imposed will be deleted due to this exemption.  This exemption does not apply to local sales and use taxes administered and collected by the SC Department of Revenue on the behalf of counties and other jurisdictions unless otherwise specifically exempted.   Beaufort County has a 1 percent transportation sales tax that will continue to be collected. 

For additional information relating to local taxes imposed and their exemptions as administered by the Department of Revenue visit their website at www.sctax.org or call (803) 898-5788.

Workers' Compensation

On Wednesday, Oct. 24, Governor Sanford issued two executive orders, the first to clarify his Sept. 20 Order regarding the South Carolina Workers' Compensation Commission's use of American Medical Association (AMA) guidelines or other objective standards in determining disability judgment. Governor Sanford, at the request of the Workers' Compensation Commission, clarified his original order, writing, "my intent was to faithfully execute the laws as passed by the General Assembly and interpreted by the Supreme Court of our state. No more, no less."

Sanford's second executive order is designed to address the problem of attorneys' fees accounting for a considerable portion of  workers' compensation awards without proper consideration of whether those fees are fair under state ethics rules. The governor's order reminds the commission that the workers' compensation system is in place to aid workers who are injured on the job, and those workers should receive the largest portion of their entitled payment. The order instructs the Workers' Compensation Commission to confirm that all attorneys' fees are reasonable under state ethics laws.

On Thursday, October 25, the South Carolina Workers' Compensation Commission held a special review to hear from both sides regarding Governor Sanford's executive orders. Friday, October 26, the South Carolina Workers' Compensation Commission issued an order stating that they would not comply with Governor Sanford's Sept. 20 order requiring the Workers' Compensation Commission to use widely accepted and objective guidelines or other objective standards in determining levels of disability based on specific injuries.  The debate continues on implementing this landmark law for the business community.

Coastal Caucus Meeting
 
On Friday October 26th, the Coastal Caucus, a group of state legislators from the state coastal region, met in Charleston to hear from groups as they form their agenda for the 2008 sessions.  The meeting was organized by Rep. Ben Hagood, R-Charleston, the chair of the caucus at the urging of Sen. Catherine Ceips, R-Beaufort. There were thirteen legislators in attendance, including local Senator Ceips, and Reps. Curtis Brantley and Kenneth Hodges. 
 
The caucus welcomed the Coastal Chamber's Alliance, led by the Hilton Head Island-Bluffton and Charleston Chambers, to provide input on the agenda.  The Coastal Chamber Alliance discussed the need to alter the funding formula for education, resolve the transportation funding crisis, implement a statewide energy policy, and not force business owners to become federal immigration agents.
 
The Coastal Caucus also heard about SCDOT reform, the potential impact of the Georgia water crisis on South Carolina, state grants for hurricane mitigation and coastal beach erosion.
LOCAL

Immigration Update

The South Carolina Chamber stepped into the state's immigration debate this week.  Last session, the South Carolina Chamber maintained that immigration was a federal issue, most properly addressed at the national level. Through that process, the chamber committed to leaders like President Pro Tempore Glenn McConnell and Senator Jim Ritchie that the business community would help find common sense solutions at the state level if the federal government did not. Congress is not anticipated to pass comprehensive legislation until 2008.

The South Carolina Chamber continues to believe that the federal government should take action to achieve sound immigration reform that provides workable solutions for employers to verify the legal status of employees, but the Chamber also recognizes that now is the time for South Carolina to address meaningful immigration reform since the federal government has not.

The South Carolina Chamber supports a bill offered by Sen. Ritchie, S.392, with added language to pre-empt local governments from passing additional laws, thereby making it extremely difficult for businesses to comply with numerous immigration rules and regulations throughout the state.   The South Carolina Chamber, along with President Pro Tempore McConnell and Senator Ritchie, will
Work over the coming months to draft language to add this important pre-emption amendment to S.392.    S. 392 is only one of several proposed bills, so the chamber will stay on top of this important issue as it moves in Columbia.

Locally, Beaufort County officials have been struggling with economic realities and pressing immigration issues.  Last year, Beaufort County, with the oversight of Sheriff P.J. Tanner, considered participating in a federal program that gives deputies increased authority to enforce immigration laws.   The program, known as the 287(g) program, is administered by the US Department of Homeland Security.    The 287(g) program would allow local deputies to check immigration status during traffic stops or other infractions if probable cause exists that a person is in the country illegally.   Immigration officials told Tanner earlier this month that certification into the program hinges on the county's ability to find more than 75 beds in its already overcrowded detention center to devote solely to holding illegal immigrants.  Thus, the county is considering its options in participation in the 287(g) program.

FEDERAL
 
Senate Moves Forward on Changes to National Flood Insurance Program
 
The Senate Committee on Banking, by a unanimous vote passed a bill to reform the National Flood Insurance Program (NFIP) on October 17. The bill:
 
· Extends the NFIP for five years (to September 30, 2013);
· Forgives the existing debt of approximately $17.5 billion;
· Requires FEMA to map the 500-year floodplain as part  of its map modernization effort;
· Eliminates subsidies for vacation and second homes by increasing premiums by 25% per year until an  actuarial rate is achieved;
· Expands the "mandatory purchase" area to include properties located behind levees and dams;
· Raises the cap on annual premium increases to 15% from 10% per year;
· Increases the minimum deductibles for claims for all  properties;
· Extends the pilot program for mitigating severe repetitive loss properties; and
· Establishes a special reserve fund to handle future catastrophic flooding events.
 
Unlike the bill passed by the House, the Senate bill does not include a provision to expand the NFIP to offer coverage for wind in addition to flooding. Senators Schumer (D-NY) and Martinez (R-FL) support an amendment to add wind to the NFIP, but withdrew the amendment. It is possible that they may offer such an amendment when the bill is considered by the full Senate. Adding wind coverage to the NFIP was the most contentious aspect of the flood bill passed by the House.
 
The House  passed an NFIP reform bill on September 27 by a vote of 263-146. Timing for consideration of the NFIP bill by the Senate has not been established. The NFIP must be reauthorized by September 30, 2008.

 

LOCAL

SCDOT Considers Transferring Roads to Counties

The South Carolina Department of Transportation is studying a plan to give responsibility for some state-owned roads to counties.  Highway Commissioner Joe Young, who represents all or part of Berkley, Charleston, Dorchester, Georgetown and Horry Counties, has instructed SCDOT staff to examine the impact of transferring lesser used roads to the counties in the state. South Carolina has one of the largest state road systems in the country and many of the roads do not qualify for federal funding.  Commissioner Young has suggested transferring dirt roads, parking lots, neighborhood roads, and driveways. 

Governor Signs Workers' Compensation Order

On Thursday, Governor Mark Sanford signed an Executive Order requiring the Workers' Compensation Commission to use widely accepted and objective American Medical Association (AMA) guidelines or other objective standards in determining levels of disability based on specific injuries. Sanford's order directs workers' compensation commissioners, whom he appoints, to confirm in writing starting Jan. 1 that they are using objective standards to award payments.

South Carolina now joins the 32 other states that follow AMA guidelines or other objective standards, a decision that the business community has encouraged in order to bring predictability and stability to the workers' compensation system. The National Council on Compensation Insurance (NCCI), a U.S. insurance rating and data collection bureau specializing in workers' compensation, predicts that in South Carolina's $800 million workers' comp system, businesses should save about 9 percent, or $72 million. This will allow employers to do things like expand, create new jobs, and enhance employee benefits like health insuranccoverage.Opponents of the order are likely to file a lawsuit. 

Upcoming Chamber Events
 
 

Chamber Offers Trip to China

China Adventure Trip Briefing is scheduled for
Tuesday, October 2, 6-7 p.m.
The Crowne Plaza Resort at Shipyard Plantation
Come learn more about the China Adventure!
    To register for the trip briefing, call Lynn Ramirez at 341-8374.

It is a perplexing land of huge proportions and baffling contrasts. It may be the world's oldest civilization, but today, China is known for a booming economy and its increasing world power. The Hilton Head Island-Bluffton Chamber of Commerce invites you on The China Adventure: A Business Leadership Tour.
The 9-day adventure includes visits to Beijing, Changhai and many other cities. Travel arrangements from JFK International Airport, lodging, and meals are all included in the package price of $1,699. This excursion is action-packed with the sights, sounds, and flavors that are both modern and reach back thousands of years.
 

The trip is for chamber members, family, friends, and other residents of the entire region. Learn more at www.hiltonheadisland.org.