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ISSUE 12.18
May. 03, 2013

RECENT ISSUES:
12/04 | 11/27 | 11/20 | 11/13

Index

News :
Trash talk
Legislative Agenda :
Budget floor debate to start in Senate
Radar Screen :
Slowly winning the race?
Palmetto Politics :
More on the Senate budget proposal
Commentary :
South Carolina may get more angels
Spotlight :
Municipal Association of South Carolina
My Turn :
Looking at the past while eyeing the future
Feedback :
Debunking' Tata's attack
Scorecard :
Up on gun measure, down on two
Stegelin :
Strange bedfellows in SC-1
Megaphone :
Deal breaker
Tally Sheet :
From taxes to education

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EDITOR'S NOTE

What's Next, South Carolina?

Statehouse Report will host two conferences at the end of May to explore civic engagement with experts discussing South Carolina's economic, educational,  governmental and health care systems. If you live in the Pee Dee, learn how to join us May 29 in Florence.  Sumter-area residents can join us May 30 in Sumter

We're planning other sessions of the "What's Next, South Carolina?" conference series later this year in Beaufort, Charleston and Columbia.  More online.

NUMBER OF THE WEEK

<$2,000

South Carolina spends less than $2,000 per pre-kindergarten student. That’s “good” enough for one of the third lowest amounts in the country, according to a new study. More.

MEGAPHONE

Deal breaker

“They did nothing to end the self-policing … That’s the deal breaker for calling this real reform.”

-- Ashley Landess, president of the S.C. Policy Council, commenting on the House’s passage of an ethics reform bill that created a joint House-Senate panel to review accusations against lawmakers. More.

TALLY SHEET

From taxes to education

With the legislature scrambling to meet the crossover deadline to ensure existing bills got to the other chamber without needing a supermajority, there wasn’t much action for new bills, other than the usual scads of congratulatory resolutions and regulatory matters. Of note:

Property rights. S. 661 (S. Martin) would bar “adopting and developing environmental and developmental policies that, without due process, would infringe or restrict the private property rights” of owners.

Crossover. H. 4048 (White) would get rid of the crossover deadline in the first year of a two-year session.

Ethics. H. 4069 (Rules) would set a special order for the House to consider ethics reform legislation, with several provisions.

Electronic cigarettes. H . 4074 (White) would tax electronic cigarettes, with several provisions.

Homestead exemption. H. 4075 (Vick) would expand the homestead tax exemption for seniors to $75,000 for their homes.

Edumax. H. 4088 (Rivers) calls for the Education Maximum Act to require public school students to demonstrate performance at his or her grade level to get promoted, with several provisions.

Health financing. H. 4095 (Crawford) seeks to establish a “responsible consumer health care program “ to help poor people without health insurance. It’s a complex state-based response for refusing to take federal Medicaid expansion dollars.

Find any bill through these links:

ENCYCLOPEDIA

Tabby

Along the coasts of Florida, Alabama, Georgia, and the Carolinas, tabby was introduced by the Spanish in the seventeenth century as a low-cost and accessible building material. It was manufactured following methods long practiced throughout southern Spain by mixing various compounds including earth, limestone, and clay with lime and then pounding or pouring the resultant mix between boards positioned to define the required building shape. Once the cast was set, the form work was dismantled, repositioned, and refilled with the mix at successively higher building levels.

Tabby in North America is distinguished by the use of oyster shell aggregates and lime derived by burning shells. As with the earlier manufacture along the Mediterranean, the lime and the aggregate were mixed with sand and water and tamped into reusable wooden forms, usually made of horizontal tongue-and-groove timbers. The French Duc de La Rochefoucauld-Liancourt provides a late eighteenth-century observation of the casting process he saw in Beaufort County: "Mortar is poured into frames the length and thickness of the wall to be constructed. These forms have no bottoms but their sides are joined at certain intervals at top and bottom by pieces of wood. The mortar is pounded in with force and when brim full left for two or three days."

Although no tabby structure securely dated before 1730 survives above ground in South Carolina or Georgia, it is clear that tabby played an important role in shelter and defenses for early Europeans. Other durable building materials, such as brick and stone, were not easily available, especially in the Sea Islands, which lacked outcrops of clay and rock.

Recent research indicates that tabby manufacture was understood around Charleston before 1726, but it did not appear in Beaufort County until construction began in 1731 at Fort Frederick on the Beaufort River. Eventually it became ubiquitous to Beaufort County, where it was used in fortifications, houses, stores, and a variety of outbuildings. It is now represented by a handful of structures in the city of Beaufort (including the Barnwell-Gough House, Tabby Manse, and the Saltus House) and on Spring, St. Helena, Callawassie and Hilton Head Islands.

Excerpted from the entry by Maxine Lutz. To read more about this or 2,000 other entries about South Carolina, check out The South Carolina Encyclopedia by USC Press. (Information used by permission.)

PALMETTO PRIORITIES

Palmetto Priorities Statehouse Report encourages state leaders to develop and implement Palmetto Priorities involving several issues to make the state better a better place. Click the link to learn more about our suggestions for bipartisan policy objectives.

Here is a summary of our Palmetto Priorities:

CORRECTIONS: Reduce the prison population by 25 percent by 2020.

EDUCATION: Cut the state's dropout rate in half by 2020.

ELECTIONS: Increase voter registration to 75 percent by 2015.

ENVIRONMENT: Adopt a state energy policy that requires energy producers to generate 20 percent of energy from renewable sources by 2020.

ETHICS: Overhaul state ethics laws.

HEALTH CARE: Ensure affordable and accessible health care.

JOBS: Develop a Cabinet-level post to add, retain 10,000 small business jobs per year.

POLITICS: Have a vigorous two- or multi-party political system of governance.

ROADS: Strengthen all bridges and upgrade state roads by 2015.

SAFETY: Cut the state's violent crime rate by one-third by 2016.

TAX REFORM: Remove outdated special interest sales tax exemptions as part of an overall reform of the state's tax structure to be completed by 2014.

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News

Trash talk

The irony of the debate over landfills

By Bill Davis, senior editor

MAY 3, 2013 -- To dump or not to dump? That is a question that continues to bedevil South Carolina. And now, the question has gotten more complicated, thanks to a companion bills moving forward in the state House and Senate.              

On one hand, South Carolina has vociferously fought against the federal government’s use of the Savannah River Site near Aiken to dump nuclear waste from around the country. Not in our backyard, they say.

But on the other hand comes the real irony. The state legislature is considering a measure that would bar counties from keeping waste from other counties or states out of their dumps.  The S.C. House of Representatives in mid-April passed a bill largely along partisan lines that would stop counties from denying the inflow of out-of-county waste into landfills within their borders, and making any current or future ordinances from doing so null and void.

The bill now sits in the Senate where it has small but stern opposition. Last year, a similar bill died in the waning weeks of the legislative session.

Background

The impetus for the bill, dubbed the “Business Freedom to Choose Act,” came from an ordinance passed a few years ago by Horry County that required solid waste from that county to be dumped within that county.

A court battle ensued, and in January, a federal court ruled in favor of the ordinance in a state where roughly 80 percent of all landfills are privately owned. (A photo of the Lee County landfill is at right.)

Now, the fight continues with supporters, like state Sen. Creighton Coleman (D-Winnsboro), saying the ordinance created a “monopoly” for Horry County.

Coleman said Horry’s ordinance ignored existing licensing and dumping agreements for private haulers. “They said to everyone, ‘Bring your trash to us or be fined.’ And that’s what they did,” he said.

Critics like Wes Covington, a lawyer with the S.C. Association of Counties, countered that the bill purports to support small-landfill owners, but in fact is a shill for national waste management companies. They want, he alleged, to protect their ability to open future landfills in the state wherever they want so they can dump whatever they want inside South Carolina. 

Currently, Greenwood County is considering a similar ordinance that, according to Randall Essick, a spokesman for national Waste Management Inc., does not allow the business to have a say where they can take their trash.

Essick said fees at the Greenwood landfill are nearly 50 percent higher per ton than at a nearby site in a neighboring county. Essick stressed all his company wants is freedom to choose where to dump.     

Bill’s name is disingenuous, critic says

Covington, however, scoffed at what he sees as a cleverly disingenuous bill name. He said the bill, if passed into law, would actually strip not only freedoms from a county to decide what goes on within its borders, but responsibilities – like trash collection and policing – mandated to them by the state constitution.

He said that by passing along the mandate to handle trash, but not the ability to control where it goes, the state would be gravely harming counties’ ability to repay the bonds and other debt incurred to build and manage landfills.

He said the measure, if passed, would also invalidate large portions of the state’s Solid Waste Act of 1991, and would turn the trash business into a “free-for-all” across South Carolina.

Covington accused “big waste” of using local issues as a veil for their industry’s best interests, and claimed that all four of the authors of the Senate version of the bill had taken money from the waste industry. [UPDATE: After publication, Covingon said he did not say any four specific lawmakers received contributions from the waste lobby, but emphasized that he told Statehouse Report that the industry was "generous with many legislators."]

Friday morning, Coleman, speaking from his law office, denied that he had taken money, but that he would double-check to make sure.

Ann Timberlake, executive director for the Conservation Voters of South Carolina environmental watchdog group, said that taking “communities out of the decision-making process” regarding waste disposal would be disastrous.

Timberlake said communities would not be able to bring pressure on a privately-owned landfill within its borders of the bill passed. She added that citizens have to have a level of trust in their government’s making the right decision with the trash they put on the curb, that’s being taking to the right place, at the right price, and being safely managed.

A red herring

Coleman attacked the assertion that the bill’s real intention was to protect national waste companies’ interest was a “red herring,” quoting a letter from DHEC that said the matter was an “economic” issue with environmental “implications.”

Timberlake said she wished the debate wasn’t about where to put the state’s trash load – estimated at 5 million tons every year – but how to reduce the total amount through cogent and widespread recycling programs.

She also worried that unwanted ramifications of the bill, if passed, would give the national companies, like Waste Management and Republic, the ability to permit more landfills in South Carolina.

Essick dismissed Timberlake’s concern, saying there are few sites suitable for a major landfill. And, he added, there are still state requirements, like demonstration of need procedures, and local barriers, like comprehensive plans, that can keep companies like his out.

Crystal ball: It’s surprising that the state, so quick to complain when the larger federal government forces its (radioactive) trash on South Carolina, but is quick to preempt the efforts of a smaller government to handle its trash. (So much for home rule.) While the bill in the Senate has serious procedural hurdles to clear before hitting the floor for a full debate, the matter may be eventually have to be decided in the courts.

Bill Davis is editor of Statehouse Report.  He can be reached at:  billdavis@statehousereport.com. Recent news stories include:

Legislative Agenda

Budget floor debate to start in Senate

 Looks like Statehouse Report was ahead of the curve on the House’s decision to furlough itself for the past week. Way out ahead. In that it is actually next week that the House is taking a furlough. That being said, we blew it. We apologize for any inconvenience. Now, to get the red off of our face ...

Next week in the Senate with the budget package completed this week, floor debate next week will focus on a transportation-funding bill for shoring up the state’s infrastructure. There are plenty of points of contention on this bill, and debate will likely take most of the week to hash out, according to sources. This means the full floor debate on the budget won’t begin until the following week.

  • Senate Judiciary. A subcommittee will meet on Tuesday at 3 p.m. in 308 Gressette to discuss a package of ethics reform bills. Agenda.

  • Senate Education. The full committee will meet Wednesday at 10 a.m. in 209 Gressette to discuss bills dealing with charter schools and K-4 expansion. Agenda.
Radar Screen

Slowly winning the race?

Just the fact that the Senate Finance and Education committees have considered allocating money in their budget packages to expand K-4 opportunities is a signal, albeit a dim one, that the legislature is considering getting serious about education funding reform in the near future.

Palmetto Politics

More on the Senate budget proposal

The state Senate put together its budget proposal this week for the 2013-14 fiscal year. The Senate version weighs in at $6.3 billion in the General Fund, which includes state tax collections, and $22.8 billion in total, which includes fees, other funds and federal pass-through dollars.

The budget does not include any money for expanding Medicaid, despite a last-ditch effort by Democrats to include some measure of expansion. It also doesn’t include an increase in the state gas tax to fund roads improvement and maintenance projects, despite it being the third-lowest in the country. Instead, it shuffles money, raises fees and borrows the money to begin fixing roads and bridges.

Installment plan

Ethics reform took a step forward in the House this week, though not as bold a step as some wanted.

Representatives overwhelmingly passed a bill that could result in much faster and more complete personal financial disclosures from politicians. But, critics contend, it didn’t go far enough in terms of self-policing and barring leadership political action committees.

Instead of handing over review of alleged legislator misdeeds to an independent panel, the measure would create a joint panel with House and Senate members reviewing and policing allegations. Instead of the fox protecting the henhouse, it’s the fox and his cousin.

Additionally, one of the hot-button reform topics has been PACs led by House and Senate brass being a potential conduit for ersatz bribery, whereby interested parties could contribute big chunks of cash in exchange for hoped-for “considerations.” That effort is still stalled in the House, where Speaker Bobby Harrell (R-Charleston) has been criticized for the power and wealth of a PAC he has had ties to in the past.

Commentary

South Carolina may get more angels

MAY 3, 2013 -- It looks like South Carolina’s going to get more angels soon -- angel investors, that is.

The House and Senate this year have approved virtually identical bills that would provide a 35 percent income tax credit to home-grown investors who provide capital to support business start-ups. Typically, this “angel funding” ranges from $100,000 to $500,000 for new businesses that are more than just a idea and need a nudge in funding to make a proven product or service successful by focusing on sales, production or marketing.

“This bill will have two major impacts on South Carolina's economy,” said Gavin M. McCulley, a Charleston investor who is bringing peers together as a group to take stakes in South Carolina startups. “First, investors are incentivized to put their capital to work in the start-up business space and second, businesses are encouraged to start their job-producing, economy-stimulating, fast-growing companies here in South Carolina.

“This effort keeps talent and capital right here in South Carolina."

In legislative parlance, angel investors are helpful because they encourage development of “early stage, high-growth, job-creating businesses” that “expand the economy of this state by enlarging its base of wealth-creating businesses.” In regular guy language, that means by giving tax credits to wealthier people to invest in new ventures that have some risk, more South Carolina businesses -- often ignored by Silicon Valley venture capitalists and big investment -- could grow beyond the concept stage into real job producers here.

The state Senate passed its version [S. 262] of the “High Growth Small Business Job Creation Act” in March by a 39-4 vote. The House voted 96-10 on April 25 to approve its version [H. 3505 ]. Both bills now are in each chamber’s finance-related committees. Because they’re so similar -- the Senate bill has two extra reporting requirements on how many investors take the tax credits annually -- it’s very likely they’ll pass after being a dream for a few years.

In 2011 when the House passed an angel investment bill that didn’t make its way through the legislative process, House Speaker Bobby Harrell noted the critical role played by entrepreneurs to expand and create jobs in the Palmetto State.

“This bill gives South Carolinians an opportunity and incentive to invest in our state’s economy,” he said, adding that the proposal was the brainchild of the late S.C. Rep. Bill Wylie of Greenville. “Adding to our state’s strong pro-business reputation, this measure will make South Carolina a more attractive destination for the type of innovative private sector investment our economy needs to grow and prosper.” 

Eric Dobson, a former Charleston resident who took a shipping technology business from startup until it was sold to a larger company, now works as chief financial analyst with Angel Capital Group. It  reviews angel projects and presents good ones to its new network of investors, each of whom will bet at least $10,000 each a year on different deals. 

“If you think of the economy as a ‘food chain,’ the entrepreneurs are the plankton, or the root, of the food chain.  They are consumed by bigger fish, who are consumed by bigger fish, and so on, ad infinitum.  Angels are the nutrients in the water that give the plankton life. 

“Angels fund 90 percent of startups,” he continued, referring to the 30,000 deals a years in which angels invest. “Without angels, our economy would collapse.  And, some of those startup companies go on to become Google or Facebook and other companies. This is only possible through angel investors taking calculated risks for great rewards.”

Dobson said that to encourage more recovery in the economy, the country -- and South Carolina -- has to accelerate the rate of business startups to create more future jobs. Yes, some will fail. But without entrepreneurs having capital to take the risk, no new jobs will be created.

“Angel groups simultaneously provide the accelerant for small businesses to grow and create wealth for the entrepreneurs and angels.  Angel capital is consistently one of the best performing asset classes in the market, regularly outperforming the S&P 500 by a factor of two to three times.”

Spotlight

Municipal Association of South Carolina

The public spiritedness of our underwriters allows us to bring Statehouse Report to you at no cost. This week's spotlighted underwriter is the Municipal Association of South Carolina. Formed in 1939, the association represents and serves the state's 270 incorporated municipalities. The Association is dedicated to the principle of its founding members: to offer the services, programs and products that will give municipal officials the knowledge, experience and tools for enabling the most efficient and effective operation of their municipalities in the complex world of municipal government.
My Turn

Looking at the past while eyeing the future

Envision SC interview
Special to Statehouse Report

MAY 3, 2013 -- Few people will ever truly understand the complicated and peculiar history of South Carolina the way that Dr. Lacy K. Ford Jr., does. Having dedicated his life to the study of the South and 19th and 20th Century American History, Dr. Ford is well acquainted with the economic glory years of the state.

His vast wealth of historical knowledge has driven him to publish a number of books, essays and articles on various aspects of the South and South Carolina. As a noted historian, Ford is well equipped to enlighten South Carolinians on the mistakes of the past, and a possible road map for the future.

Ford sat down with Envision South Carolina co-founder Phil Noble recently to offer an in-depth look into the culture and economics of historical South Carolina with a keen eye towards the state’s future.

NOBLE: How was South Carolina “world class” in the past?

FORD: South Carolina like some of the other portions of the world in the 18th and 19th century was able to ride some of the great, staple crop booms that occurred in the world; particularly rice, which was the first great economic engine of South Carolina beginning in the 1720s and lasting for another 150 years or so.

Enormous fortunes were made off of rice along the coast and in the Lowcountry. These were made possible by the very large number of slaves that were first imported to work in the very dangerous rice fields. The second big economic engine of the state was the cotton boom which began in the 1790s, and you had booms on and off in the cotton economy as far as the 1950s …

Those early booms were driven by the emergence of world markets, which South Carolina participated in very vigorously… But at the same time, they were not economic engines that required positioning in society for a strong economy in the long term. They were very much dependent upon the success of rice and the success of cotton, just like some Middle Eastern economies today are very dependent upon oil.

And then South Carolina had a less significant, but still a 100 years commitment to the textile industry which didn’t bring it the type of wealth that the earlier agriculture booms had but did become a critical contributor to the economy. That too, as important as it was, did not necessarily leave the state particularly well prepared for economic change to transition out of that economy into another one. It’s a cliché that change is inevitable, but if you want to have economic success, you have to prepare for it. And I think that is something that South Carolina has not done as well as it could have in part because it succumbed to the temptation of what’s in hand, what’s easy to do; what makes us the most money the quickest, and not to be concerned about preparing the society as a whole for durable economic success.

NOBLE: You’ve said that we have to invest long term in human capital in this state. What are some of the historic barriers and the current barriers to our doing that?

FORD: Historically, I think it’s because the state has been committed to the success of some of its citizens but not all of its citizens. This of course refers to a long time reliance on slavery as a labor system, a continued segregation and disenfranchisement of African Americans from the end of the Civil War down into the 1960s. For much of that time, African Americans were more than half the state’s population. They’re now about a third of the state’s population.

We have to be committed to opportunity for everyone, regardless of race, place, or economic background. You have to work harder to give everybody an opportunity. …I think committing to human capital is the only option. Other portions of the country have done a better job than we have and they’re profiting more from it. The fact that we did not have high levels of human capital left us more vulnerable to global competition that we’ve lost a lot of jobs to. It’s one thing to complain about those jobs and maybe things happened in the loss of those jobs that wasn’t always fair, but it’s also just absolutely true that those kinds of things are going to happen and you have to put
yourself in a position that you can adapt. I’d say adaptability is the key to the state’s future.

NOBLE: What are some other aspects of our state; the things that are special or unusual that can be assets in that long-term process of investing in human capital and economic prosperity?

FORD: I do think to a striking degree for the early 21st century South Carolinians, whether they’re native South Carolinians or newcomers who’ve arrived in the state, have a fairly strong sense of community identity. They identify with where they are, where they live, maybe where they grew up.

I think that strong sense of community can generate a strong desire to give back to that community. I think we have communities in the state, including some of our larger cities which are significantly different from each other and we sometimes perceive that as a problem that there’s too much competition between the Charleston area, the Columbia area, and the Greenville/Spartanburg area. But they really are different types of communities and they provide an array of options for people in terms of lifestyle, in terms of the local economy; in terms of location, and I think that amount of geographical, demographical diversity within a fairly small space, can be a strength if we would learn how to play it as a strength…

I think we need to realize it’s a small state that lags behind the nation in many indicators. We don’t need to be internally divisive. We need to pool together all of the resources and strengths we have.

Envision SC is a collaborative project to highlight people's visions across the state to enable South Carolinians to dream, connect and learn how to make the Palmetto State become world-class and better connected throughout the globe.  Learn more.

Feedback

Debunking' Tata's attack

To the editor:

Your April 26th edition contained a letter from Eruch Tata from my home county of Lexington.  Mr. Tata does not agree that the state should expand Medicaid as allowed under the Affordable Care Act, a position supported by the South Carolina Small Business Chamber of Commerce (SCSBCC) and numerous other local chambers of commerce across the state.  Unfortunately, Mr. Tata chose to question my business experience as the head of SCSBCC saying I had “probably never owned or run a business”. 

Since 1991, I and my family have and continue to own and operate successful small businesses both in Columbia and in Lexington County.  This is in addition to my co-founding of the SCSBCC in 2000 which has given me insight and understanding of the crisis unaffordable health insurance has been to small businesses. 

I don’t agree that the Affordable Care Act threatens future Medicare premiums (I will be paying those in a few years) or is a major threat to our nation’s debt.  But the Act does offer the best option Congress could agree on, if implemented correctly, to address our health insurance affordability crisis.

-- Frank Knapp Jr., President & CEO, South Carolina Small Business Chamber of Commerce

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Scorecard

Up on gun measure, down on two

To safety. Gov. Nikki Haley and her family were safely and quickly evacuated from the Governor’s Mansion today due to a small fire. More.

Gun control. Haley signed into law this week a bill that would seek to keep guns out of the hands of the mentally ill. More.

DEW. Gov. Nikki Haley has tabbed a replacement, a former Bush White House attorney, to head the state’s unemployment office two months after last director left. More.

S.C. State. More Board of Trustees at the embattled black college were voted out this week, and it’s only the start. More.

Ethics. The House this week passed SOME ethics reform. More.

Haley. You attended a Koch brothers' retreat? Could you get any more partisan? What about changing your name from “Nikki” to “Howard Rich?” More.

Ford. The Senate Ethics Commission accused state Sen. Robert Ford (D-Charleston) of altering documents it requested related to charges of him misusing campaign donations. More.
Stegelin

Strange bedfellows in SC-1


RECENT STEGELIN: 4/26 | 4/19 | 4/124/5
credits

Statehouse Report

Editor and Publisher: Andy Brack
Senior Editor: Bill Davis
Contributing Photographer: Michael Kaynard

Phone: 843.670.3996

© 2002 - 2018 , Statehouse Report LLC. Statehouse Report is published every Friday by Statehouse Report LLC, PO Box 22261, Charleston, SC 29413.
Excerpts from The South Carolina Encyclopedia are published with permission and copyrighted 2006 by the Humanities Council SC. Excerpts were edited by Walter Edgar and published by the University of South Carolina Press. Statehouse Report has partnered with USC Press to provide readers with this interesting weekly historical excerpt about the state. Republication is not allowed. For additional information about Statehouse Report, including information on underwriting, go to http://www.statehousereport.com/.