By Bill Davis, senior editor | The 2016 legislative session’s agenda in the General Assembly is so brief it could be contained on a bumper sticker: “Gas tax — and MAYBE education.”
House Minority Leader Todd Rutherford (D-Columbia) laughed about the seeming brevity during a break from a caucus meeting Friday morning.
“Yeah, I don’t see much else or anything that makes me go, ‘Oh, goodness,’ but I know it’s coming,” he said.
2016, an election year, brings with it a host of well-documented pressures: The need for roads spending exacerbated by a historic flood in the fall; a state Supreme Court order to shore up public K-12 education; and a surplus of $1 billion in tax revenues.
According to observers and partisans, all three pressures are as inexorably linked as the issues on the abbreviated agenda. Here’s why: Money. There is only so much of it, especially in a state where so many legislators facing reelection campaigns equate raising taxes with political death.
Statehouse leaders from both sides of the aisle are tasked with finding ways to fund $41 billion in transportation infrastructure shortfalls over the next quarter century even before trillions of gallons of rain drenched South Carolina in October.
Last year,the General Assembly approved more in per-pupil school funding than it had in recent years in response to Gov. Nikki Haley’s call for improved reading programs. Still, lawmakers didn’t meet state requirements for school funding, which required $600 million more than they actually appropriated.
So with education and roads underfunded, at play will be how lawmakers split the one-time surplus and try to figure out long-term, sustainable sources of tax money for big needs. Unfortunately in an election year, no one is excited about tying their wagon to raising taxes — even though many privately agree that something’s got to give.
ROADS AND GAS TAX
State Sen. Larry Martin (R-Pickens), chair of the Judiciary Committee, thinks how the legislature handles the infrastructure funding issue in the early part of the session will “set the tenor for the whole session.”
Martin said all but his most entrenched colleagues in the Senate see the need for making repairs to the state’s roads and bridges. But, he said, many of his colleagues are dead set against spending political capital in an election year to fund new, big projects that have been on regional wish lists for years.
Martin was referring to a plan to expand I-73 in the Florence area, the stomping ground of its biggest supporter, state Senate President Pro Tempore Hugh Leatherman (R-Florence), who chairs the Finance Committee.
Harder-line conservatives in the Senate, backed by Haley, have been pushing for the roads project to be tied to reform of the Department of Transportation, which went through a separate transformation several years ago.
When former Lt. Gov. Glenn McConnell left his longtime Senate seat a couple of years back, he broke ranks with his Republican base and party-members and said the General Fund was tapped out, and that the only way to fund roads programs was through raising the gas tax.
Haley last year also made it clear for much of the session that she would veto any roads-funding bill that would not be offset by an equal cut in state taxes elsewhere, making the extra spending “revenue neutral.”
The House responded to Haley’s position and proffered a beefy infrastructure bill that would reduce the state’s income tax. That bill sits in “interrupted debate” in the Senate from last year’s session.
A Senate plan, shepherded by Sen. Paul Campbell (R-Goose Creek), has emerged that would take five years to reduce the income rates from 7-percent to 5-percent, that he said offset the spending.
That prospect has little love in Democratic circles, where slim margins of the base would ever get to see their personal tax bill reduced by such a move. House Minority Leader Rutherford pooh-pooh’ed the maneuver, labeling it a “shell game,” where Republicans are stealing from a needy Peter to offset a hungry Paul, “and hope no one remembers what happened.”
What will happen? Despite the S.C. Chamber this week pushing for $600 million in sustainable infrastructure revenues, the path to getting there remains unclear.
EDUCATION
House Speaker Jay Lucas (R-Darlington) last year called for the formation of a special school improvement committee to report back proposed actions before the session. Yesterday, Lucas said publicly that the improvements would be focused primarily on poorer, rural school districts.
Former House Majority Leader Kenny Bingham (R-Cayce) served on the committee that met repeatedly over the break between sessions and better defined those areas of focus.
Bingham said many counties in the “minimally adequate education” lawsuit, which has been hanging around the state’s neck like an albatross for years, don’t have the ability to address their lagging academic attainment issues, for one of several reasons.
The rough sketch of the plan to help troubled districts would be to provide state funding for new school facilities, enhanced transportation, teacher incentives and technology upgrades to bring higher-level coursework to smaller counties that can’t support an expensive stand-alone AP Chemistry teacher, for instance.
But, that assistance would come with certain strings, according to Bingham. Consolidation of school districts may be required in certain areas to help save money, he said, as could be increased accountability. “This will be done a case-by-case basis, as no two counties situations are the same and ‘one size fits all’ doesn’t work.”
Meanwhile, state Superintendent of Education Molly Spearman this week suggested that poorer school districts needed to be helped by state grants, not loans that would have to be paid back, because they don’t have the capacity to pay back loans.
Another potentially thorny issue may be adjusting millage rates of school districts that sign on for state help. Bingham acknowledged that economic realities have forced some rural counties to have three- to four-times higher commercial property millage rates than richer counties.
Raising those millage rates further to pay for new schools to cut an hour off morning bus rides to distant schools could run off commercial investment, further worsening an area’s economy.
Bingham said he believes that his colleagues will see the need for the committee’s recommendations and not turn it into “schools versus roads” issue for the extra tax revenues.
What will happen? Again, it’s anybody’s guess at this point.
Bill Davis is senior editor of Statehouse Report. Have a comment? Send to: feedback@statehousereport.com
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