Bill Text: SC H3137 | 2019-2020 | 123rd General Assembly | Comm Sub
Bill Title: State Aid to Subdivisions Act
Spectrum: Bipartisan Bill
Status: (Passed) 2019-06-10 - Act No. 84 [H3137 Detail]
Download: South_Carolina-2019-H3137-Comm_Sub.html
COMMITTEE REPORT
January 30, 2019
H. 3137
Introduced by Reps. G.M. Smith, Lucas, Ott, Stavrinakis, Simrill, Rutherford, Pope, Clyburn, S. Williams, Cobb-Hunter, Bailey, Erickson, Bradley, Yow, Forrest, Kirby, Sottile, Murphy, Chellis, Kimmons, Rose and Wheeler
S. Printed 1/30/19--H.
Read the first time January 8, 2019.
To whom was referred a Bill (H. 3137) to amend Chapter 27, Title 6, Code of Laws of South Carolina, 1976, relating to the State Aid to Subdivisions Act, so as to change the name, etc., respectfully
That they have duly and carefully considered the same and recommend that the same do pass with amendment:
Amend the bill, as and if amended, SECTION 1, by striking Section 6-27-20 through Section 6-27-30(B) and inserting:
/ Section 6-27-20. There is created the Local Government Fund administered by the State Treasurer. This fund is part of the general fund of the State. It is the intent of the General Assembly that this fund not be subject to mid-year cuts. However, if mid-year cuts are mandated by the State Budget and Control Board to avoid a year-end deficit, this fund is not subject to such cuts, except by a majority vote of the entire State Budget and Control Board which is separate and apart from any other reduction. These cuts are permitted only to the extent that counties and municipalities do not receive less funding than received in the immediate preceding fiscal year. The Local Government Fund must be financed as provided in this chapter.
Section 6-27-30. (A) In the annual general appropriations act, an amount equal to not less than four and one-half percent of general fund revenues of the latest completed fiscal year must be appropriated the General Assembly must appropriate funds to the Local Government Fund.
(B)(1) In any fiscal year in which general fund revenues are projected to increase, the appropriation to the Local Government Fund for the upcoming fiscal year must be increased by the same projected percentage increase, but not to exceed five percent, when compared to the appropriation in the current fiscal year. For purposes of this subsection, beginning with the initial forecast required pursuant to Section 11-9-880, the percentage increase in general fund revenues must be determined by the Revenue and Fiscal Affairs Office by comparing the current fiscal year's recurring general fund expenditure base with the Board of Economic Advisors' most recent projection of recurring general fund revenue for the upcoming fiscal year. Upon the issuance of the initial forecast, the Executive Director of the Revenue and Fiscal Affairs Office, or his designee, shall notify the Chairman of the Senate Finance Committee, the Chairman of the House Ways and Means Committee, and the Governor of the projected percentage increase. The executive director, or his designee, shall provide similar notice if subsequent modifications to the forecast change the projected percentage increase. However, the forecast in effect on May thirty-first of the current fiscal year is the final forecast for which the percentage increase is determined, and no subsequent forecast modifications shall have any effect on that determination.
(2) The Governor shall include the appropriation increase to the Local Government Fund in the Executive Budget.
(3) The Revenue and Fiscal Affairs Office shall determine the current fiscal year's recurring general fund expenditure base, and determine any projected increase in general fund revenues. If an increase is projected, the appropriation for the upcoming fiscal year must be adjusted accordingly. /
Amend the bill further, SECTION 1, page 3, by striking Section 6-27-40(A) and inserting:
/ Section 6-27-40. (A) Not later than thirty days after the end of the calendar quarter, the State Treasurer shall distribute the monies appropriated to the Local Government Fund as follows:
(1) Eighty-three and two hundred seventy-eight thousandths percent must be distributed to counties. Of the total distributed to counties, each county must receive an amount based on the ratio that the county's population is of the whole population of this State according to the most recent United States Census.
(2) Sixteen and seven hundred twenty-two thousandths percent must be distributed to municipalities. Of the total distributed to municipalities, each municipality must receive an amount based on the ratio that the municipality's population is of the population of all municipalities in this State according to the most recent United States Census. /
Renumber sections to conform.
Amend title to conform.
G. MURRELL SMITH, JR. for Committee.
Explanation of Fiscal Impact
Introduced on January 8, 2019 Local Revenue
This bill amends the State Aid to Subdivisions Act by changing the name of the Local Government Fund to the Local Government Revenue Sharing Fund and deleting the provision regarding mid-year cuts. Additionally, the requirement that the Local Government Fund receive no less than four and one-half percent of the general fund revenues of the latest completed fiscal year is removed. The bill provides that in any fiscal year in which general fund revenues are projected to increase, the appropriation to the Local Government Revenue Sharing Fund must also increase by the same projected percentage, not to exceed 5 percent. This proposal requires the percentage increase in general fund revenues to be calculated by comparing the current year's recurring general fund expenditure base with the Board of Economic Advisors' (BEA) most recent projection of recurring general fund revenue for the upcoming fiscal year. Additionally, this proposal changes the allocation percentages for county and municipal distributions. Current law requires that 83.278 percent of the fund be distributed to counties and 16.722 percent distributed to municipalities. This bill changes the county distribution to 83 percent and the municipal distribution to 17 percent.
The provisions of this bill would take effect in FY 2020-21. The revenue impact of this bill in FY 2020-21 is undetermined, as the amount of the recurring general fund expenditure base and BEA forecast of recurring general fund revenue for FY 2020-21 are undetermined.
If the bill was applied to the general appropriations process for FY 2019-20, the November 8, 2018, BEA forecast estimates the growth in general fund revenue over the preliminary expenditure base for FY 2019-20 will exceed five percent, with an estimated 6.06 percent growth. We anticipate FY 2019-20 county distributions to total $183,080,311 and municipal distributions to total $37,226,418 based on current funding levels. Fifty cents per capita, or $2,312,682, is withheld from the county allocation pursuant to Section 44-6-146 for Medicaid services. Under this proposal, with the 5 percent increase and the modified allocations, we calculate county distributions will total $191,700,135, and municipal distributions will total $39,737,565 in FY 2019-20. Again, the fifty cents per capita, or $2,312,682, will be withheld from the county allocation. Therefore, we estimate that an additional $8,619,824 will be distributed to counties, and an additional $2,511,147 will be distributed to municipalities. This amounts to an additional $11,130,971 in local revenue in FY 2019-20.
The attached tables show the FY 2019-20 estimated distributions by county and municipality under current statute and this proposal.
COUNTY FY 2019-20 FY 2019-20 DIFFERENCE FY 2019-20 PRO- DIFFERENCE
STATUTORY ESTIMATED BETWEEN FY POSED LEGISLA- BETWEEN
FORMULA APPROPRIATION 2019-20 ESTIM TION ESTIMATE PROPOSED
ATED APPROP (5%) LEGISLATION
RIATION AND FY 2019-20
FY 2019-20 STA- ESTIMATED
TUTORY FOR- APPROPRIATION
MULA
ABBEVILLE $1,660,327 $1,006,045 ($654,283) $1,053,411 $47,367
AIKEN $10,458,227 $6,336,995 ($4,121,232) $6,635,355 $298,360
ALLENDALE $680,606 $412,388 ($268,217) $431,804 $19,416
ANDERSON $12,223,725 $7,406,770 ($4,816,955) $7,755,497 $348,727
BAMBERG $1,044,327 $632,780 ($411,547) $662,573 $29,793
BARNWELL $1,477,683 $895,372 ($582,310) $937,529 $42,156
BEAUFORT $10,597,628 $6,421,469 ($4,176,159) $6,723,805 $302,337
BERKELEY $11,617,327 $7,039,346 ($4,577,981) $7,370,774 $331,428
CALHOUN $991,284 $600,650 ($390,634) $628,930 $28,280
CHARLESTON $22,876,878 $13,861,907 ($9,014,971) $14,514,557 $652,649
CHEROKEE $3,623,299 $2,195,543 ($1,427,755) $2,298,849 $103,306
CHESTER $2,164,821 $1,311,734 ($853,087) $1,373,493 $61,759
CHESTERFIELD $3,052,828 $1,849,807 ($1,203,022) $1,936,900 $87,093
CLARENDON $2,284,428 $1,384,215 ($900,213) $1,449,387 $65,172
COLLETON $2,540,562 $1,539,412 ($1,001,149) $1,611,891 $72,479
DARLINGTON $4,486,483 $2,718,504 ($1,767,979) $2,846,498 $127,993
DILLON $2,094,402 $1,269,058 ($825,344) $1,328,808 $59,750
DORCHESTER $8,920,251 $5,405,080 ($3,515,171) $5,659,563 $254,483
EDGEFIELD $1,762,755 $1,068,109 ($694,646) $1,118,398 $50,289
FAIRFIELD $1,564,890 $948,209 ($616,680) $992,853 $44,644
FLORENCE $8,941,807 $5,418,152 ($3,523,656) $5,673,250 $255,099
GEORGETOWN $3,929,731 $2,381,161 ($1,548,570) $2,493,271 $112,110
GREENVILLE $29,475,597 $17,860,290 ($11,615,307) $18,701,191 $840,902
GREENWOOD $4,550,500 $2,757,299 ($1,793,201) $2,887,119 $129,820
HAMPTON $1,377,673 $834,773 ($542,900) $874,076 $39,303
HORRY $17,591,031 $10,659,009 ($6,932,022) $11,160,858 $501,850
JASPER $1,618,520 $980,706 ($637,814) $1,026,880 $46,174
KERSHAW $4,022,099 $2,437,066 ($1,585,033) $2,551,874 $114,808
LANCASTER $5,007,177 $3,034,025 ($1,973,152) $3,176,874 $142,849
LAURENS $4,346,430 $2,633,647 ($1,712,783) $2,757,645 $123,998
LEE $1,255,518 $760,754 ($494,764) $796,571 $35,818
LEXINGTON $17,140,299 $10,385,908 ($6,754,391) $10,874,899 $488,991
MCCORMICK $668,455 $405,028 ($263,427) $424,098 $19,070
MARION $2,159,726 $1,308,640 ($851,086) $1,370,253 $61,614
MARLBORO $1,890,005 $1,145,204 ($744,801) $1,199,122 $53,919
NEWBERRY $2,450,154 $1,484,616 ($965,538) $1,554,515 $69,899
OCONEE $4,851,772 $2,939,849 ($1,911,924) $3,078,263 $138,415
ORANGEBURG $6,042,489 $3,661,350 ($2,381,139) $3,833,734 $172,384
PICKENS $7,788,129 $4,719,096 ($3,069,033) $4,941,282 $222,185
RICHLAND $25,117,147 $15,219,356 ($9,897,791) $15,935,917 $716,561
SALUDA $1,298,305 $786,678 ($511,627) $823,716 $37,039
SPARTANBURG $18,571,929 $11,253,379 ($7,318,550) $11,783,213 $529,834
SUMTER $7,019,402 $4,253,303 ($2,766,099) $4,453,558 $200,255
UNION $1,891,834 $1,146,321 ($745,513) $1,200,292 $53,971
WILLIAMSBURG$2,248,631 $1,362,520 ($886,111) $1,426,671 $64,150
YORK $14,767,880 $8,948,788 ($5,819,092) $9,370,116 $421,328
TOTAL $302,144,970 $183,080,311 ($119,064,659) $191,700,135 $8,619,824
Frank A. Rainwater, Executive Director
Revenue and Fiscal Affairs Office
A BILL
TO AMEND CHAPTER 27, TITLE 6, CODE OF LAWS OF SOUTH CAROLINA, 1976, RELATING TO THE STATE AID TO SUBDIVISIONS ACT, SO AS TO CHANGE THE NAME OF THE LOCAL GOVERNMENT FUND, TO DELETE THE REQUIREMENT THAT THE FUND RECEIVE NO LESS THAN FOUR AND ONE-HALF PERCENT OF THE GENERAL FUND REVENUES OF THE LATEST COMPLETED FISCAL YEAR, TO DELETE A PROVISION REGARDING MIDYEAR CUTS, TO PROVIDE THAT THE APPROPRIATION TO THE FUND MUST BE INCREASED BY THE SAME PERCENTAGE THAT GENERAL FUND REVENUES ARE PROJECTED TO INCREASE, IF APPLICABLE, BUT NOT TO EXCEED FIVE PERCENT, TO REQUIRE THAT THE PERCENTAGE INCREASE, IF APPLICABLE, BE INCLUDED IN ALL STAGES OF THE BUDGET PROCESS, TO AMEND THE DISTRIBUTION PERCENTAGE OF THE FUND, AND TO DELETE A PROVISION REQUIRING AMENDMENTS TO THE STATE AID TO SUBDIVISIONS ACT BE INCLUDED IN SEPARATE LEGISLATION.
Be it enacted by the General Assembly of the State of South Carolina:
SECTION 1. Chapter 27, Title 6 of the 1976 Code is amended to read:
Section 6-27-10. This chapter may be cited as the 'State Aid to Subdivisions Act'.
Section 6-27-20. There is created the Local Government Revenue Sharing Fund administered by the State Treasurer. This fund is part of the general fund of the State. It is the intent of the General Assembly that this fund not be subject to mid-year cuts. However, if mid-year cuts are mandated by the State Budget and Control Board to avoid a year-end deficit, this fund is not subject to such cuts, except by a majority vote of the entire State Budget and Control Board which is separate and apart from any other reduction. These cuts are permitted only to the extent that counties and municipalities do not receive less funding than received in the immediate preceding fiscal year. The Local Government Revenue Sharing Fund must be financed as provided in this chapter.
Section 6-27-30. (A) In the annual general appropriations act, an amount equal to not less than four and one-half percent of general fund revenues of the latest completed fiscal year must be appropriated the General Assembly must appropriate funds to the Local Government Revenue Sharing Fund.
(B)(1) In any fiscal year in which general fund revenues are projected to increase, the appropriation to the Local Government Revenue Sharing Fund for the upcoming fiscal year must be increased by the same projected percentage increase, but not to exceed five percent, when compared to the appropriation in the current fiscal year. For purposes of this subsection, beginning with the initial forecast required pursuant to Section 11-9-880, the percentage increase in general fund revenues must be determined by the Revenue and Fiscal Affairs Office by comparing the current fiscal year's recurring general fund expenditure base with the Board of Economic Advisors' most recent projection of recurring general fund revenue for the upcoming fiscal year. Upon the issuance of the initial forecast, the Executive Director of the Revenue and Fiscal Affairs Office, or his designee, shall notify the Chairman of the Senate Finance Committee, the Chairman of the House Ways and Means Committee, and the Governor of the projected percentage increase. The executive director, or his designee, shall provide similar notice if subsequent modifications to the forecast change the projected percentage increase. However, the forecast in effect on May thirty-first of the current fiscal year is the final forecast for which the percentage increase is determined, and no subsequent forecast modifications shall have any effect on that determination.
(2) The Governor shall include the appropriation increase to the Local Government Revenue Sharing Fund in the Executive Budget.
(3) The Revenue and Fiscal Affairs Office shall determine the current fiscal year's recurring general fund expenditure base, and determine any projected increase in general fund revenues. If an increase is projected, the appropriation for the upcoming fiscal year must be adjusted accordingly.
(C) For purposes of this section:
(1) 'Recurring general fund revenue' means the forecast of recurring general fund revenues pursuant to Section 11-9-880 after the amount apportioned to the Trust Fund for Tax Relief, as required in Section 11-11-150, is deducted.
(2) 'Recurring general fund expenditure base' means the total recurring general fund appropriations authorized in the current general appropriations act less any reduced appropriations mandated by the General Assembly or the Executive Budget Office pursuant to Section 11-9-890B.
Section 6-27-40. (A) Not No later than thirty days after the end of the calendar quarter, the State Treasurer shall distribute the monies appropriated to the Local Government Revenue Sharing Fund as follows:
(1) Eighty-three and two hundred seventy-eight thousandths percent must be distributed to counties. Of the total distributed to counties, each county must receive an amount based on the ratio that the county's population is of the whole population of this State according to the most recent United States Census.
(2) Sixteen and seven hundred twenty-two thousandths Seventeen percent must be distributed to municipalities. Of the total distributed to municipalities, each municipality must receive an amount based on the ratio that the municipality's population is of the population of all municipalities in this State according to the most recent United States Census.
(B) In making the quarterly distribution to counties, the State Treasurer must notify each county of the amount that must be used for educational purposes relating to the use of alcoholic liquors and for the rehabilitation of alcoholics and drug addicts. Counties may pool these funds with other counties and may combine these funds with other funds for the same purposes. The amount that must be used as provided in this subsection is equal to twenty-five percent of the revenue derived pursuant to Section 12-33-245 allocated on a per capita basis according to the most recent United States Census.
Section 6-27-50. No section of this chapter may be amended or repealed except in separate legislation solely for that purpose.
Section 6-27-55. From funds distributed to the county pursuant to Section 6-27-40, a county council shall provide a reasonable amount of funds for all county offices of state agencies for which the council is required to provide funding by state law."
SECTION 2. This act takes effect on July 1, 2019, and first applies for the annual general appropriations bill process for Fiscal Year 2020-2021.
