Send your feedback:
feedback@statehousereport.com

ISSUE 8.45
Nov. 06, 2009

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

Index

News :
Entwined in a tax maze
Legislative Agenda :
Spare the rod
Radar Screen :
Payback time
Palmetto Politics :
Mixed bag o' ethics
Commentary :
Hidden gems flourish across Palmetto State
Spotlight :
The S.C. Education Association
My Turn :
Voter ID bill would chill voting
Feedback :
Let your fingers do the walking ...
Scorecard :
Up, down and in the middle
Stegelin :
Investment strategy
Megaphone :
A fundamental wrong
In our blog :
In the blogs
Encyclopedia :
Paul Rinaldo Redfern (1902-1927)

© 2002 - 2018, Statehouse Report LLC. All Rights Reserved. South Carolina Statehouse Report is published weekly.

News tips or calendar info?
E-mail
the editor.

Phone: 843.670.3996

Send
General e-mail

Credits.

UNDERWRITERS

SEARCH THE ARCHIVES

powered by

NUMBER OF THE WEEK

3

THREE:  That’s the number of counties in South Carolina that made it to the 20 most economically stressed counties in the nation in September, according to The Associated Press Economic Stress Index. Those counties are Chester, Marion and Union counties, ranking 17 to 19, respectively.  More: Associated Press.

MEGAPHONE

A fundamental wrong

"There is something fundamentally wrong in a system in which politicians shut the door when making decisions about (taxpayer money) and refuse to tell them what they are."

-- S.C. Policy Council head Ashley Landess criticizing state government’s decision not to divulge the particulars of the deal to bring Boeing expansion to South Carolina. More.

IN OUR BLOG

In the blogs

In the blogs

Wolfe Reports blogged about the little things that popped out at the genial, environment-themed first gubernatorial debate this week, including candidate Lt. Gov. Andre Bauer’s “unibrow:”
 
“Somebody please head out to the store and pick up Sen. Robert Ford a neck. His head is sitting right there on his shoulders with nothing separating them. Where did the neck go?”

ENCYCLOPEDIA

Paul Rinaldo Redfern (1902-1927)

Aviator Paul Rinaldo Redfern was born on February 24, 1902, in Rochester, New York, the son of Frederick and Blanche Redfern. The family moved to Columbia, South Carolina, in 1910 after Paul's father accepted a teaching position at Benedict College. From an early age the younger Redfern displayed considerable interest in aviation. In 1916, during his second year at Columbia High School, Redfern constructed a standard-sized wooden airplane, lacking only an engine. The following year he worked for the Army Air Corps as a production inspector at Standard Aircraft Company's plant in Elizabeth, New Jersey. In February 1919 he returned to Columbia to complete high school.

With several helpers, Redfern assembled an airplane and transported passengers on day trips around the Carolinas. He became a noted stunt pilot at air exhibitions held throughout the Southeast. In 1925 Redfern met Gertrude Hildebrandt in Toledo, Ohio, while working for her father, and they were married that same year.

In 1926 the U.S. Customs Service in Savannah, Georgia, hired Redfern to be an aerial scout. However, he was ambitious to gain fame and fortune by undertaking an international solo air flight. In 1927 a group of prominent businessmen in Brunswick, Georgia, agreed to underwrite a flight from their city to Rio de Janeiro, Brazil. In June 1927 Redfern supervised the construction of a monoplane by the Stinson Aircraft Corporation of Detroit, Michigan. This aircraft, known as the Port of Brunswick, was painted primarily green and yellow-Brazil's national colors.

At 12:45 p.m. on August 25 Redfern took off from Brunswick. Five hours later a seaplane spotted him approximately three hundred miles east of the Bahamas. At 3:30 p.m. on August 26 a Norwegian freighter, the Christian Krogh, sailing west of Trinidad, encountered Redfern's aircraft. The pilot dropped a canister into the water containing a handwritten note, which requested that the crewmen indicate the direction and the approximate distance to Venezuela's northern coastline. Subsequently, Redfern was seen by numerous eyewitnesses when the plane passed over the Orinoco delta in Venezuela. … Several observers noted a conspicuous trail of black smoke coming from the aircraft. The last definitive sighting of Redfern was approximately one hundred miles south of Ciudad Bolivar, only two flying hours from northern Brazil.

By August 29 Redfern had failed to reach any of his proposed destinations in Brazil. Reports that he had landed at various Brazilian locales proved false. Rumors circulated for more than two decades that he was alive and being held prisoner by Indians within a remote locale along the upper Amazon River. Despite several search-and-rescue missions, Redfern and his airplane have never been found.

In an attempt to capitalize on the public fascination with Redfern, MGM Studio included his saga as a subplot within the 1938 adventure movie Too Hot to Handle. A street in Rio de Janeiro was named in Redfern's honor. Although Redfern failed in his ultimate goal, he did achieve the first solo flight over the Caribbean. He also successfully completed the first nonstop air voyage between North and South America.

-- Excerpted from the entry by Miles S. Richards. 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.)

Go to S.C. Encyclopedia

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.

SUBSCRIBE FOR FREE

Subscriptions to Statehouse Report are now free. Click here to subscribe.

YOUR COMMENTARY SOUGHT

Every week in our new My Turn section, we seek guest commentaries on issues of public and policy importance to South Carolina. If you're interested, click here to learn more.

OPPORTUNITY

Become an underwriter

Statehouse Report is an underwriter-supported legislative forecast with new added features that provide more information about what’s going to happen at the SC General Assembly and in state government.

Organizations and companies that underwrite the publication receive a host of exciting benefits through branding, information spotlights and more.

To learn more about our exciting transformation and how your organization or business can benefit, click here. Or give us a holler on the phone at: 843.670.3996.

Statehouse Report -- making it easier to learn more about state politics and policy.

News

Entwined in a tax maze

Lawmakers working on straightening out SC's tax puzzle

By Bill Davis, senior editor

NOV. 6, 2009 -- Fixing the state’s convoluted tax structure may be as hard as straightening out a knotted ball of twine while walking backward in a maze. Especially since the legislature may have tied one hand behind its back.

Faced with historic drops in tax revenues and a tax structure that business leaders say is hampering the state’s economic competitiveness, the legislature earlier this year passed a bill that created the Taxation Realignment Commission.
 
The TRAC commission originally was to be a blue-ribbon panel that would produce a single bill for a single up-or-down vote that would take on the $2 billion-plus in state sales tax exemptions that some in the Statehouse believe have contributed to the state’s difficulties in funding its budget.
 
But as the bill wound its way through the General Assembly, it was concurrently watered down and expanded. Legislators wanted the bill to create a commission to take on a wider scope of taxation issues, but still allowed them to amend the eventual product.
 
Bill watered down
 
Initially, TRAC legislation was to be offered up without amendments. But as legislators added horsepower to the bill, they also wanted the ability to reign it in. As it is, the commission is now charged with simply producing a set of recommendations next year for the legislature to consider.
 
One of the most contentious compromises inserted into the bill was that the commission would leave alone Act 388, the state law that in recent years shifted the funding source for public K-12 education from local residential property taxes to a statewide sales tax increase.
 
Some have argued that not addressing how the state funds its $2 billion-plus in education costs, one of its biggest duties, might doom the commission’s recommendations to a dusty slot on legislators’ and staffers’ shelves alongside other past tax restructuring efforts.
 
But after a 2009 legislative session when even House and Senate leaders admitted that little major was accomplished beyond passing a state budget, TRAC recommendations could become a major focus in the 2010 legislative session.
 
No wonder, considering how much money and taxes are being discussed in the TRAC commission’s ongoing meetings.
 
Sales tax base actually shrinks
 
At a recent meeting of the commission, staffers from the Senate Finance Committee presented a set of numbers that indicated an expanding economy between FY1999 and FY2008 may have become a tightening noose on state government.
 
Staffers found that the percentage of state’s net taxable sales in the state over that time had actually dropped from nearly 48 percent to just under 41 percent. So as the state’s economy grew, until this latest recession, the percentage of what could be taxed actually dropped, thanks to special-interest exemptions and other legislative giveaways.
 
During the recent commission hearing, members learned that roughly half of the state's retail sales were subject to tax 10 years ago. But now, that number has become “perilously” close to 40 percent. That may surprise some, especially since there had been a 55-percent increase in retail sales over the last decade, according to the report. Some would argue, however, that taxing a larger retail sales tax base still generated much more revenue to the state than what happened 10 years ago. Others would counter that things cost more too and the increases didn't keep pace with inflation, growth and demand for services.

Compounding the shrinkage to the sales tax base was that while the state’s retail sales grew at close to an adjusted 5 percent a year over that same time, researchers discovered that a legislature allowed the tax base to grow 3 percent. That equated to less than the rate of growth of the state’s population and inflation – and that was before the recession.
 
Researchers warned commission members that this “structural deficiency” may have cost the state $450 million over the last 10 years. They said the gap could worsen, as the state’s economy continues to grow away from a goods-based to a service-based economy, where the majority of taxation will be on non-tangible items.
 
What does the business community say?
 
So, the state’s sales grew while the sales tax base shrunk. And the business community must be ecstatic, right? In a word, no -- because problems with the state‘s tax structure go deeper than that.
 
The state’s current sales tax is 6 percent. A House Ways and Means staffer, responding to a request from the TRAC chairman, calculated that if all of the state’s sales tax exemptions were removed, the state would only need a 3.4 percent sales tax to raise the same amount of money for its General Fund budget.
 
The argument that has emerged is the state needs to broaden its tax base, tax more items and categories, but reduce its overall rate – in short, hit more pockets, but hit’em more lightly.
 
There are bigger business tax numbers at play. According to a 2009 study completed by a Washington, D.C. tax watchdog office, businesses paid $590 billion in state and local taxes nationally in FY2008, paying 83 percent more than the value of services they received. (View the study here)  According to that same report, South Carolina businesses kicked in $6 billion in state and local business taxes in FY 2008, including $2.9 billion in local property taxes.

An interesting idea
 
So what does Otis Rawl, president and chief executive officer of the S.C. Chamber of Commerce, see as the solution to the state’s taxation mess?  Another tax.
 
Huh?
 
Among other things, Rawl argued this week for a new, statewide commercial property tax to independently fund and support public K-12 education, a service he said that was vital to the state increasing its competitiveness. He also said there should be a corresponding property tax reduction on the local level.
 
Rawl said that while the TRAC bill took Act 388 off the plate, the commission and legislators should look at all the other possibilities, like commercial property taxes. And Rawl was and is desperate for a mechanism to make rural counties more attractive to investment and corporate expansion.
 
Rawl pointed to Kershaw County, which he said was forced to heavily tax businesses “because they are the only ones left standing” in the current economy.
When a prospective business considers rural South Carolina, in many cases, according to
 
Rawl, they see the comparative advantage of cheap land and available work force evaporated by increasingly higher property tax rates.
 
Frank Knapp, who heads up the S.C. Small Business Chamber, worried about taking commercial property taxes away from counties and municipalities. “How would they fund anything they needed to do, then?” asked Knapp, who had little optimism for the TRAC’s outcome.
 
Knapp liked the original single bill/single vote structure, and now sees too many opportunities for special interests to muck up the process. He’s not too sure that Rawl's new state tax will play well in 2010, an election year.
 
Knapp, fighting for the little guy, hoped the legislature would figure out a way to balance the books, “smooth-out inequities,” and not hamstring municipalities and counties.
 
Crystal ball: There may not be enough political will in the upcoming legislative session to do something monumental about the state’s tax structure. Knapp argued that South Carolina has tended to do better, historically, with incremental change. And that’s probably what voters can expect from TRAC: incremental change with a big chunk of the debate and heavy lifting put off (again) for the following years. Oh – and there will probably be something else in the coming political year – some sort of tax cut, which may exacerbate the revenue problem.

RECENTLY IN NEWS

10/30:  Sentencing reform in the crosshairs
10/23:  Lawmakers to return to deal with ESC bungling
10/16:  Legislative audit on Corrections roils waters
10/9:  State mulls leasing its digital spectrum

Legislative Agenda

Spare the rod

The two biggest meetings scheduled in Columbia next week will be the Sentencing Reform Commission, with will convene Thursday and Friday 10 a.m. days in 105 Gressette, and the S.C. Taxation Reform Commission, which will also convene at 10 a.m. Thursday in 308 Gressette.

What makes the latter more interesting is that it will be an opportunity for lobbyists and special interest groups to plead with the TRAC commission as to why their sales tax exemption should be spared.

Radar Screen

Payback time

Gov. Mark Sanford has already been eating plate after plate of crow since admitting to an extramarital dalliance this year. While he has toured the state apologizing to anyone who’ll still listen, it looks like the crow buffet’s just opened.

Word from the Statehouse was that while the House may move to impeach him, the Senate may drag out its decision on whether to remove him from office. Citing the need for the S.C. Ethics Commission to complete its investigation will be the first course.

What may follow could be seven months of limbo for Sanford -- one month for each year he tormented the legislature since taking office. It seems the legislature has taken a liking to the passive, almost invisible, Sanford, who signs off on bills (ESC) and keeps out of the way big deals (Boeing). Look for this most “Parliamentarian” version of government (think: no king) to continue deep into the summer. Unless, that is, Sanford reverses course (again), and breaks promises of compromise. Then he could get the ax, but quick.

Palmetto Politics

Mixed bag o' ethics

Gov. Mark Sanford didn’t win the battle this week to keep secret findings from an S.C. Ethics Commission investigation into his alleged misdeeds (abandoning the state, taking a mistress, state plane use, campaign fund dipping-into). But he didn’t lose, either, and the same can be true for the rest of the legislature.

Sanford had sued the state, asking that the findings be kept out of legislators’ hands until he and his office could craft a response. He likened the release to creating a kangaroo court of public opinion, with only half of the story told.

House Speaker Bobby Harrell (R-Charleston) followed suit with his own suit, asking the state to make sure legislators get the ethics report findings. The S.C. Supreme Court denied Sanford’s claim this week, but also denied Harrell’s request. Instead, the court ruled the decision to release the report lay with the commission, which may bode well for Sanford, considering how many commissioners he appointed.

Commentary

Hidden gems flourish across Palmetto State

By Andy Brack, editor and publisher

NOV. 6, 2009 – Our state, known for its “smiling faces, beautiful places,” has countless hidden gems – restaurants, parks, communities that shine for their uniqueness and special offerings.

We all have a special place that we value, whether it's a waterfall, a mountain walk, a blackwater river, a country store, a prime fishing hole or a tucked-away corner of a beach. Over the last week, we've asked people from across South Carolina to share their hidden gem. Here are some of the best:

Stumphouse Tunnel, Walhalla. State Sen. Kevin Bryant, R-Anderson, suggests a trip to this uncompleted tunnel started during the Civil War. Cool in the steamy summers, it reportedly is where Clemson's famous blue cheese was housed in the early days. “It's very dark, wet and creepy in the back,” Bryant says – just the thing for a kid around Halloween time. More.

Williamsburg County. S.C. Coastal Conservation League leader Dana Beach says a great place to check out is this rural, poor county that is abundant with natural resources – “the Black River, Black Mingo Creek, beautiful longleaf pine forests and small towns without the clutter of development.” And if you're hungry, stop by Brown's to get some of the best barbecue around. More.

Chesterfield County. Wendy Wagner at Chesterfield General Hospital writes, “Enjoy the peace and beauty of nature in Sandhills Wildlife Refuge in an area with the best air and water quality around – Chesterfield.” More.

Beautiful Charleston view. Former 1974 gubernatorial candidate Pug Ravenel of Charleston recommends a visit to the top floor restaurant on the round Holiday Inn on the Ashley River in Charleston because it has “the best panoramic view in South Carolina – marshes, Ravenel Bridge, the Citadel, Fort Sumter, downtown old houses and the Atlantic Ocean.”


Some of the birds spotted at Caw Caw Interpretive Center near Ravenel.
Willington. Charleston politico Phil Noble says a must-visit is to the small McCormick town of Willington, which is rebranding itself as a destination for book-lovers to buy books.Willington is truly an inspiration,” he says. “It was once a thriving little town that nearly died and is now coming back to life. And they are doing it in a unique and creative way that can show countless other struggling communities – in South Carolina and across the country – what can be done with bold leadership, a sense of a caring community….and just plain hard work. They are true heroes.”

Orangeburg restaurant. S.C. Chamber of Commerce President Otis Rawl couldn't say enough about the Four Moons Restaurant and says that some of his well-traveled friends rate it as one of the top dining spots in the world. “The menu and wine selection is second to none. The atmosphere is delightful. The quality and the variety of the food is the experience.”

Belton eatery. Not to be outdone is Grits and Groceries, a Belton restaurant that is a favorite of GOP gubernatorial candidate Gresham Barrett. “Grits and Groceries offers a taste of New Orleans right here in rural South Carolina. Heidi and Joe [the owners] always live up to their motto of 'real food, done real good.'”

Hitchcock Woods, Aiken. Steve Hale says this 2,000-acre preserve in Aiken is “a true treasure and people in Aiken would riot if someone wanted to disturb it.” More.

Conway. Allen Stalvey of the S.C. Hospital Association recommends his hometown and its “small streets, beautiful old homes, large oak trees, a nice riverfront area near the beach.”  More.

The Joe. Charleston RiverDogs General Manager Dave Echols says one of the nicest, soothing spots in Charleston is the back railing near the marsh during sunset at Charleston's Joseph Riley Stadium.

Glencairn Garden, Rock Hill. Marketing coordinator Laurie Helms says the renovated 11-acre garden is a jewel in the heart of Rock Hill: “No matter who visits, no matter the time of year, Glencairn Garden leaves guests with the strong imprint of the beauty and history that live within its flower-filled borders.” More.

And one of my hidden gems? Caw Caw Interpretive Center near Ravenel. This Charleston County park is a wonder of calming marsh vistas and trails. Wildlife is abundant. On recent visits, my daughters thrilled to the swooping flight of a great blue heron, jumping mullet and baby foot-long alligators within a few feet of their 8-foot mother.

If you have a hidden gem to share, send an email to: brack@statehousereport.com. We'll keep a running list on our Web site.

 RECENT COMMENTARY

Spotlight

The S.C. Education Association

The public spiritedness of our underwriters allows us to bring SC Statehouse Report to you at no cost. This week's spotlighted underwriter is The South Carolina Education Association (The SCEA) is the professional association for educators in South Carolina. Educators from pre-K to 12th grade comprise The SCEA. The SCEA is the leading advocate for educational change in South Carolina. Educators in South Carolina look to The SCEA for assistance in every aspect of their professional life. From career planning as a student to retirement assessment as a career teacher, The SCEA offers assistance, guidance, and inspiration for educators. Learn more: TheSCEA.org.

My Turn

Voter ID bill would chill voting

By Victoria Middleton
ACLU South Carolina National Office

NOV. 6, 2009 -- A lot of our fellow citizens went to the polls to vote in local elections this week. In some municipalities, the turnout was disappointing. One way to discourage still more people from exercising their constitutional right to vote would be to pass H. 3418, the so-called “Voter ID” bill. In this case, our legislators would best serve the public interest of South Carolina citizens by not acting on this legislative solution in search of a problem.

On the surface, H. 3418 seems deceptively uncontroversial: it links a proposed Voter ID requirement to an early voting bill. Almost everyone in South Carolina has a valid driver’s license, right? Wrong.  In reality, this flawed legislation would make it impossible for an estimated 350,000 already-registered voters in our state to exercise their most fundamental democratic right – to make their voices heard during an election. 

In a state with 4.4 million people, where 3.3 million are eligible to vote, only about 2.5 million are registered.  It is a shame that approximately 1 million South Carolinians are eligible to vote but fail to register.  But suppressing the votes of 350,000 responsible citizens who meet state eligibility requirements and are already registered to vote is to disenfranchise voters.  Rather than erecting hurdles that prevent South Carolinians from voting, lawmakers should ensure that every eligible voter can vote, and that every vote counts.  

"Adding an additional hurdle to voting in the form of a Voter ID, as proposed in H. 3418, would be a step backwards in our quest for a more open and democratic society."
Think that Voter IDs protect the “integrity of the process” of voting? Wrong again. They add an expensive and unneeded burden. South Carolina election commission officials have stated that our recent history holds no examples of impersonation of voters, no evidence that anyone has tried to steal another citizen’s vote.
 
The real threat of vote theft comes from the undue impact of Voter IDs on minorities, limited-income persons, and seniors. People who belong to these groups are less likely to have access to the documents required to obtain a photo ID, and the birth certificates, passports, and other documents required to get an ID are not available free of charge.  The added requirements will exclude voters in key constituencies -- low-income, racial and ethic minority voters, senior citizens, voters with disabilities, students, and others who lack a photo ID or the means to acquire one.
 
If H. 3418 were passed, the state would have to fund new training for poll workers and election officials to avoid adding wait time for voters on election day. The state would also have to mount a public education campaign to alert people of the new ID requirement. Surely we have more pressing needs for scarce tax dollars in the current economic climate than to add an additional bureaucratic layer to the voting process.
 
The right to vote is protected by more constitutional amendments – the First, Fourteenth, Fifteenth, Nineteenth, and Twenty-Sixth – than any other right we enjoy as Americans. The history of the U.S. is that of the expansion of voting rights to include most Americans. The right to vote protects all our other rights. Adding an additional hurdle to voting in the form of a Voter ID, as proposed in H. 3418, would be a step backwards in our quest for a more open and democratic society.
 
Victoria Middleton is executive director of the ACLU South Carolina national office in Charleston.
 
RECENT MY TURNS

Feedback

Let your fingers do the walking ...

Want to send us a letter?  Letters to the editor are published weekly. We reserve the right to edit for length and clarity. We generally publish all comments about South Carolina politics or policy issues, unless they are libelous or unnecessarily inflammatory. One submission is allowed per month. Submission of a comment grants permission to us to reprint. Comments are limited to 250 words or less. 

Scorecard

Up, down and in the middle

Biz climate. Up nationally from tenth to sixth. More.


Transparency. While the S.C. Supreme Court shot down Gov. Mark Sanford’s lawsuit to keep secret the findings of the S.C. Ethics Commission’s investigation into his various alleged misdeeds, it also stopped short of requiring it to be made public. More.

Boeing. The state is still getting a huge economic boon ($10 billion) in the arrival of Boeing expansion here; but what it’s not getting is information on how the deal was crafted by state politicians to land the aviation giant. For a year. More.

H1N1. Schools across the state are becoming inoculation centers for swine flu.  That may be good because most schools are Petri dishes for diseases like flu.

Guns. The number of 2009 concealed permits issued have almost doubled last year’s total; “If they all lived in one place, the people who can legally carry a concealed weapon in South Carolina would comprise the state's third-largest city, behind Charleston and Columbia.” More.

Stegelin

Investment strategy

Also from Stegelin: 10/30 | 10/23 | 10/16 | 10/9 | 10/2 | 9/25

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/.