South Carolina General Assembly
115th Session, 2003-2004

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Bill 560

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HOUSE AMENDMENTS AMENDED, RETURNED TO HOUSE

January 28, 2004

S. 560

Introduced by Senators Leatherman, Ritchie, Knotts, Grooms, Verdin, Giese, Branton, Mescher, McConnell, McGill, J. Verne Smith, Alexander, Martin, Short, Moore, Ravenel, O'Dell, Drummond, Hayes and Setzler

S. Printed 1/28/04--S.

Read the first time May 6, 2003.

            

A BILL

TO ENACT THE SOUTH CAROLINA LIFE SCIENCES ACT, BY DEFINING A LIFE SCIENCES FACILITY AND PROVIDING THAT A LIFE SCIENCES FACILITY PROJECT IN WHICH IS INVESTED AT LEAST ONE HUNDRED MILLION DOLLARS AND AT WHICH AT LEAST TWO HUNDRED NEW JOBS ARE CREATED WITH ANNUAL CASH COMPENSATION AT LEAST ONE HUNDRED FIFTY PERCENT OF AVERAGE PER CAPITA INCOME IN THIS STATE IS ELIGIBLE FOR EMPLOYEE RELOCATION EXPENSE REIMBURSEMENT AND THE WAIVER ALLOWED ON THE LIMIT FOR JOB DEVELOPMENT CREDITS FOR PURPOSES OF THE ENTERPRISE ZONE ACT OF 1995, TO ALLOW A TAXPAYER OPERATING A LIFE SCIENCES FACILITY TO ENTER INTO AN AGREEMENT WITH THE DEPARTMENT OF REVENUE NOT TO EXCEED FIFTEEN YEARS DURATION FOR ALLOCATION AND APPORTIONMENT FOR PURPOSES OF CORPORATE INCOME TAX, TO AMEND SECTION 12-37-930, AS AMENDED, CODE OF LAWS OF SOUTH CAROLINA, 1976, RELATING TO THE DEPRECIATION ALLOWANCE FOR PURPOSES OF THE PROPERTY TAX, SO AS TO INCREASE THE ANNUAL DEPRECIATION ALLOWANCE FOR USE OF CLEAN ROOMS FROM TEN TO FIFTEEN PERCENT AND TO PROVIDE A TWENTY PERCENT ANNUAL DEPRECIATION ALLOWANCE FOR MACHINERY AND EQUIPMENT USED FOR MANUFACTURING IN A LIFE SCIENCES FACILITY AND TO DEFINE "LIFE SCIENCES FACILITY", TO AMEND SECTIONS 11-41-20, 11-41-30, AND 11-41-70, RELATING TO THE STATE GENERAL OBLIGATION ECONOMIC DEVELOPMENT BOND ACT, SO AS TO REVISE ITS FINDINGS, DEFINITIONS, AND NOTICE REQUIREMENTS TO ALLOW SUCH BONDS TO BE USED FOR INFRASTRUCTURE FOR A LIFE SCIENCES FACILITY IN A PROJECT IN WHICH IS INVESTED AT LEAST ONE HUNDRED MILLION DOLLARS AND AT WHICH AT LEAST TWO HUNDRED NEW JOBS ARE CREATED WITH AN ANNUAL CASH COMPENSATION AT LEAST TWICE PER CAPITA INCOME IN THE STATE AND PROVIDE THAT, WHILE INFRASTRUCTURE PROVIDED BY THESE BONDS MUST RELATE SPECIFICALLY TO THE PROJECT, SUCH INFRASTRUCTURE IS NOT REQUIRED TO BE LOCATED AT THE PROJECT, AND TO AMEND SECTION 11-41-120, RELATING TO FORMALITIES IN THE ISSUING OF THESE BONDS, SO AS TO REVISE THESE REQUIREMENTS.

Amend Title To Conform

Be it enacted by the General Assembly of the State of South Carolina:

SECTION    1.    (A)    This section may be cited as the South Carolina Life Sciences Act.

(B)    For purposes of this section, a "life sciences facility" means a business engaged in pharmaceutical, medicine, and related laboratory instrument manufacturing, processing, or research and development. Included in this definition are the following North American Industrial Classification Systems, NAICS Codes published by the Office of Management and Budget of the federal government:

(1)    3254 Pharmaceutical and Medical Manufacturing;

(2)    334516 Analytical Laboratory Instrument Manufacturing.

(C)(1)    For all purposes of Chapter 10, Title 12 of the 1976 Code, the Enterprise Zone Act of 1995, including all definitions applicable to that chapter:

(a)    Employee relocation expenses that qualify for reimbursement pursuant to Section 12-10-80(C)(3)(f) of the 1976 Code include such expenses associated with a new or expanded life sciences facility investing a minimum of one hundred million dollars in the project, as defined in Section 12-10-30(8) of the 1976 Code, and creating at least two hundred new full-time jobs at the project with an average annual cash compensation of at least one hundred fifty percent of annual per capita income in this State or the county in which the facility is located, whichever is less. Per capita income must be determined using the most recent per capita income data available as of the end of the taxable year in which the jobs are filled.

(b)    The waiver that may be approved by the Coordinating Council for Economic Development pursuant to Section 12-10-80(D)(2) of the 1976 Code on maximum job development credits that may be claimed also may be approved for a life sciences facility meeting the requirements of subitem (a) of this subsection. In determining whether to approve a waiver for such a facility, the Coordinating Council for Economic Development shall consider the creditworthiness of the business and economic viability of the project, as defined in Section 12-10-30(8) of the 1976 Code.

(2)    The provisions of item (1) of this subsection apply with respect to capital investment made and new jobs created after June 30, 2004 and before July 1, 2008.

(D)    In the case of a taxpayer establishing a life sciences facility meeting the requirements of subsection (C)(1)(a) of this section, the South Carolina Department of Revenue, in its discretion, may enter into an agreement with the taxpayer pursuant to Section 12-6-2320 of the 1976 Code for a period not to exceed fifteen years if the facility otherwise meets the requirements of that section.

SECTION    2.    A. Section 12-37-930 34. of the 1976 Code, as last amended by Section 3(Q)2, Act 399 of 2000, is further amended to read:

"34.    Use of Clean Rooms ......................................... 10% 15%

A manufacturer who uses a Class 100 or better clean room, as that term is defined in Federal Standard 209E, in manufacturing its product may elect an annual allowance for depreciation for property tax purposes of ten fifteen percent on clean room modules and associated mechanical systems, and on process piping, wiring environmental systems, and water purification systems associated with the clean room instead of a depreciation allowance for which the manufacturer otherwise is entitled. Included are waffle flooring, wall and ceiling panels, foundation improvements that isolate the clean room to control vibrations, clean air handling and filtration systems, piping systems for fluids and gases used in the manufacturing process and in the clean room that touch the product during the process, flat panel displays, and liquid crystal displays, process equipment energy control systems, ultra pure water processing and wastewater recycling systems, and safety alarm and monitoring systems.

35.    Life sciences.................................................. 20%

Includes machinery and equipment used directly in the manufacturing process by a life sciences facility. For purposes of this item, life sciences facility means a business engaged in pharmaceutical, medicine, and related laboratory instrument manufacturing, processing, or research and development that invests a minimum of one hundred million dollars in the project, as defined in Section 12-10-30(8), and creates at least two hundred new full-time jobs at the project with an average cash compensation level of at least one hundred and fifty percent of the annual per capita income in this State or the county in which the facility is located, whichever is less. Per capita income must be determined using the most recent per capita income data available as of the end of the taxable year in which the jobs are filled. Included in this definition are the following North American Industrial Classification Systems, NAICS Codes published by the Office of Management and Budget of the federal government:

(i)        3254 Pharmaceutical and Medical Manufacturing;

(ii)    334516 Analytical Laboratory Instrument Manufacturing."

B.        In the case of machinery and equipment otherwise eligible for the depreciation allowed pursuant to Section 12-37-930 of the 1976 Code, as amended in subsection A of this section, if the project with which the machinery and equipment is associated is the subject of an inducement agreement between the project sponsor and the county, the initial inducement agreement must have been entered into between these parties after September 1, 2003.

SECTION    3. A.    Section 11-41-20(3) of the 1976 Code, as added by Act 254 of 2002, is amended to read:

"(3)    In order to foster economic development and to encourage the creation of high-paying jobs in the life sciences industry within the State, it is in the best interests of the State that the limitation on general obligation debt imposed by Article X, Section 13(6)(c) be increased to five and one-half percent with the additional debt service capacity available at any time as a consequence of the increase available only for the repayment of general obligation bonds issued to provide infrastructure required for significant economic development projects within the State, including those related to the life sciences industry that create high-paying jobs and meet certain investment criteria."

B.        Items (2) and (3) of Section 11-41-30 of the 1976 Code, as added by Act 254 of 2002, are amended to read:

"(2)(a)    'Economic development project' or 'project' means a project in this State as defined in Section 12-44-30(16) in which a total of at least four hundred million dollars is invested in the project by the sponsor and at least four hundred new jobs are created at the project by the sponsor. To qualify as an economic development project for purposes of this chapter, the investment and job creation requirements must be attained no later than the eighth year after the project first begins operations.

(b)    'Project' also includes a life sciences facility in this State defined as a business engaged in pharmaceutical, medicine, and related laboratory instrument manufacturing, processing, or research and development. Included in this definition are the following North American Industrial Classification Systems, NAICS Codes published by the Office of Management and Budget of the federal government:

(i)        3254 Pharmaceutical and Medical Manufacturing;

(ii)    334516 Analytical Laboratory Instrument Manufacturing.

With respect to a life sciences facility, the sponsor must invest in the project at least one hundred million dollars and create at the project at least two hundred new jobs with an average annual cash compensation level of at least twice the annual per capita income in this State. Per capita income must be determined by using the most recent per capita income data available at the time the request for funding is made pursuant to this chapter.

(c)    To qualify as an economic development project for purposes of this chapter, the investment and job creation requirements must be attained no later than the eighth year after the project first begins operations.

(3)    'Infrastructure' must relate specifically to, but is not required to be located at, the economic development project and means:

(a)    land acquisition;

(b)    site preparation;

(c)    road and highway improvements;

(d)    rail spur construction;

(e)    water service;

(f)    wastewater treatment;

(g)    employee training which may include equipment used for such purpose;

(h)    environmental mitigation; and

(i)        training and research facilities and the necessary equipment therefor."

C.        Section 11-41-70(2) of the 1976 Code, as added by Act 254 of 2002, is amended to read:

"(2)    a description of the infrastructure for which the bonds are to be issued, including a certification by the secretary of the department that each the economic development project to benefit from the expenditure of the proceeds of the bonds consists of the following:

(a)    an investment in the State at the project of not less than four hundred million dollars and creates creation at the project of no fewer than four hundred new jobs; or

(b)    in the case of a life sciences facility, an investment in the project of not less than one hundred million dollars and creation at the project of no fewer than two hundred new jobs with an average cash compensation of at least twice the per capita income in this State. Per capita income must be determined by using the most recent per capita income data available at the time the request for funding is made pursuant to this chapter."

D.    Section 11-41-120 of the 1976 Code, as added by Act 254 of 2002, is amended to read:

"Section 11-41-120.    All bonds issued under this chapter must be signed by the Governor and the State Treasurer and attested by the Secretary of State. The Governor, and State Treasurer, and Secretary of State may sign these obligations by a facsimile of their signatures. The Great Seal of the State must be affixed to, impressed on, or reproduced upon each of them and each must be attested by the Secretary of State. The delivery of the bonds executed and authenticated, as provided in the resolution, is valid notwithstanding changes in officers or seal occurring after the execution or authentication."

SECTION    4.    Beginning January 1, 2005, the Department of Revenue annually shall report to the Joint Committee on Taxation the revenue impact of this act, and the Department of Commerce annually shall report the cost and benefit of this act, together with the job creation and capital investment made by qualifying businesses.

SECTION    5.    Title 11 of the 1976 Code is amended by adding:

"CHAPTER 45

Venture Capital Investment Act of South Carolina

Section 11-45-10.    This chapter may be cited as the 'Venture Capital Investment Act of South Carolina'.

Section 11-45-20.    The General Assembly desires to increase the availability of equity, near-equity, or seed capital in amounts of one hundred million dollars or more for emerging, expanding, relocating, and restructuring enterprises in the State, so as to help strengthen the state's economic base, and to support the economic development goals of this State as described in the strategic plan of the Department of Commerce to be published annually beginning in 2003. The General Assembly also desires to address the long-term capital needs of small-sized and medium-sized firms, to address the needs of micro enterprises, to expand availability of venture capital, and to increase international trade and export finance opportunities for South Carolina based companies.

Section 11-45-30.    For purposes of this chapter:

(1)    'Authority' means the South Carolina Department of Commerce.

(2)    'Certificate' means a document executed by the fund verifying a tax credit for any year to which a lender is entitled.

(3)    'Equity, near-equity, or seed capital' means capital invested in common or preferred stock, debt with equity conversion rights, royalty rights, limited partnership interests, limited liability company interests, and any other securities or rights that evidence ownership in private business.

(4)    'Fund' means the South Carolina Venture Capital Fund.

(5)    'Investor' means any corporation, limited liability company, community development corporation, or unincorporated business entity, including a general or limited partnership, that is selected by the fund to receive investments from the fund and then make venture capital investments therewith that meet the requirements of this chapter. An investor or a senior member of its management team must be a legal resident of this State and have a minimum of five years' experience in venture capital investing. In addition, substantially all of an investor's business activity shall be venture capital investing.

(6)    'Innovation Fund' means the South Carolina Technology Innovation Fund.

(7)    'Person' means any individual, corporation, partnership, or other lawfully organized entity.

(8)    'Research and development' means laboratory, scientific, or experimental testing and development related to new products, new uses for existing products, or improvements to existing products. Research and development also includes intellectual property, information technology, or technology transfer endeavors. The term does not include efficiency surveys, management studies, consumer surveys, economic surveys, advertising, or promotion, or research in connection with literary, historical, or similar projects.

(9)    'Tax credit' means a credit against a lender's bank tax liability pursuant to Chapter 11, Title 12, or insurance premium tax liability pursuant to Chapter 7, Title 38 or other tax liability under Title 38, as the case may be, or in the case of a repeal or reduction by the State of the tax liability imposed by these sections, any other tax imposed upon such a lender by this State.

(10)    'Venture capital' means equity, near-equity, and seed capital financing including, without limitation, early stage research and development capital for startup enterprises, and other equity, near-equity, or seed capital for growth and expansion of entrepreneurial enterprises.

(11)    'Lender' means a banking institution subject to the income tax on banks under Chapter 11 of Title 12, insurance and insurance companies subject to a state premium tax liability under Chapter 7 of Title 38, and a captive insurance company regulated under Chapter 90 of Title 38.

(12)    'Capital commitment' means the amount of money committed by the fund to an investor for a term of up to ten years, which term may be extended to provide for an orderly liquidation of the investor's portfolio investments.

(13)    'Community development corporation' is as defined in Section 34-43-20(2).

Section 11-45-40.    (A)    There is created, within the authority, a separate and distinct fund to be an independent instrumentality exercising essential public functions, and to be known as the 'fund' as defined in Section 11-45-30(4).

(B)(1)    The fund must be governed by a board composed of seven directors one of whom must be appointed by the Speaker of the House of Representatives, one of whom must be appointed by the Chairman of the House Ways and Means Committee, one of whom must be appointed by the President Pro Tempore of the Senate, one of whom must be appointed by the Chairman of the Senate Finance Committee, and three of whom must be appointed by the Governor, one of whom shall serve as chairman. No sitting member of the General Assembly may be appointed to serve on the board in any capacity including an ex officio capacity. Directors must be selected based upon outstanding knowledge and leadership, must be knowledgeable in the management of money and finance, and must possess experience in the management of investments similar in nature and in value to those of the fund. Directors serve for a term of office of four years and until their successors are appointed and qualify, except that of the initial directors appointed, the member appointed by the Speaker of the House of Representatives shall serve for an initial term of two years, the members appointed by the President Pro Tempore of the Senate shall serve for an initial term of two years, and one member appointed by the Governor shall serve for an initial term of two years so as to allow the terms of the directors to be staggered.

(2)    The directors have the authority to govern the fund in accordance with the requirements of this chapter.

(3)    A conflict of interest is considered to exist if a director of the fund, an officer, agent, or employee thereof, or any for-profit firm or corporation in which a director, officer, agent, or employee of the fund, or any member of his immediate family, as defined in Section 2-17-10(7), is an officer, partner, or principal stockholder engages in business activity with the fund either directly or indirectly in which the director, officer, agent, employee, or firm would personally benefit. In this case, the director, officer, agent, or employee shall refrain from any involvement of any type in regard to the activity including, but not limited to, discussing the proposed activity with another person associated with the entity desiring to engage in the activity with the fund, negotiating any aspects of the proposed activity with the fund, voting on any matter pertaining to the activity, and communicating with other board members, officers, agents, or employees of the fund concerning the activity. When a conflict arises, the director, officer, agent, or employee involved in the conflict, at the discretion of the board, shall resolve the conflict or resign from the position creating the conflict. Directors, officers, agents, and employees of the fund are subject to all provisions of Chapter 17, Title 2 and Chapter 13, Title 8, and the provisions of this item are supplemental to and not in lieu of the provisions of Chapter 17, Title 2 and Chapter 13, Title 8.

(C)    The fund must be located within the Department of Commerce and is separate and distinct from the state general fund. The monies deposited in the accounts of the fund must be managed and invested by the directors with the assistance, if necessary, of professionals in the area of financial management and selected by a process as determined by the board of directors.

Section 11-45-50.    (A)    The fund must seek capital commitments to the fund in accordance with procedures approved by the State Budget and Control Board. The fund may retain an amount annually not to exceed one percent of the capital commitments received for expenses incurred by the fund. Capital contributions received by the fund must be in cash or in immediately available funds and are to be used only as provided by this chapter.

(B)    The fund shall retain any fees earned after repayment to lenders to use as a contingency fund for future obligations to lenders and to fulfill additional capital commitments. If at any time a principal or interest payment is due and the fund has insufficient monies to repay same, the fund shall issue tax credit certificates in an amount to meet the obligation as provided for below, and tax credits as stipulated in subsection (C) are hereby established in these required amounts.

(C)    These tax credits may be used to offset the lenders' state bank tax or premium tax liability in the event the fund does not meet its obligation to repay the lenders' cash investment together with required interest at the date and time the payment is due. These tax credits may be carried forward without limitation but are not refundable.

(D)    The tax credits may also be transferred among bank or insurance company lenders for consideration, and then used by the subsequent holder. These tax credits shall take the form of a certificate issued by the board of the fund stating the amounts, year, and conditions of the tax credits reflected on the certificate.

(E)    The board in accepting loans to the fund giving rise to these tax credits shall ensure that no more than fifty million dollars in total tax credit certificates are issued and outstanding at any one time with no more than ten million dollars in tax credit certificates being redeemable for any one year.

(F)    The fund is authorized to use the proceeds of loans received from lenders, together with other available monies, for making investments with venture capital investors and for paying and funding services as necessary.

(G)    No part of the fund may inure to the benefit of or be distributed to its employees, officers, or board of directors, or to members of their immediate families as this term is defined in Section 2-17-10(7), except that the fund is authorized to pay reasonable compensation for services provided by employees of the fund and out-of-pocket expenses incurred by its employees, officers, or board members, as long as such compensation does not create a conflict of interest pursuant to Section 11-45-40. The provisions of this subsection are supplemental to and not in lieu of the provisions of Chapter 17, Title 2 and Chapter 13, Title 8.

Section 11-45-60.    The fund shall solicit from investors plans for the investing of capital in the fund in accordance with the requirements of this chapter. The fund shall consider and select the investment plans and shall select investors qualified to:

(1)    make the most effective and efficient utilization of the investment; and

(2)    invest in venture capital investments, requiring equity, near-equity, or seed capital which promote the economic development goals of this State as described in the strategic plan of the Department of Commerce adopted and published as of that date.

Section 11-45-70.    In order for the board of directors of the fund to place monies of the fund with an investor for the purpose of making a venture capital investment, the following requirements must be met:

(1)    No investment by an investor in any one investment may exceed five million dollars or fifteen percent of the committed capital of the investor, whichever is less. In addition, an investor must agree to invest at least an amount equal to the fund's capital commitment to such investor in South Carolina based companies.

(2)(a)    While the board of directors of the fund shall give preference to investors, otherwise qualified, that maintain either a headquarters or an office staffed by an investment professional in South Carolina, investments may be made with investors not principally located in South Carolina; provided, that the investors are otherwise qualified under this chapter and have other venture capital investments in South Carolina or in South Carolina based companies at least equal to the total amount of monies placed with that investor by the fund.

(b)    'South Carolina based companies' for purposes of this section means any corporation, limited liability company, community development corporation or unincorporated business organization, including a general or limited partnership, that has its principal place of business located in this State and has at least fifty percent of its gross assets and fifty percent of its employees located in this State at the time of the initial investment. If a corporation, limited liability company, or unincorporated business organization is a member of an affiliated group, the gross assets and the number of employees of all of the members of the affiliated group, wherever those assets and employees are located, shall be included for the purpose of determining the percentage of the corporation's, company's, or organization's gross assets and employees located in this State.

(3)    When selecting investors with which to place the fund's venture capital investments, the board of directors shall give preference to investors that have on or before the date of the fund's capital commitment, aggregate capital commitments of at least three times the amount of the fund's capital commitment. An investor's capital commitments for purposes of this requirement include private, federal, or other nonstate funds secured by the investor.

(4)    Investors must develop a repayment plan based on expected liquidity events of its portfolio investments. All repayments must occur within ten years, subject to extension as described in Section 11-45-30(12).

(5)    No investment may violate the provisions of Section 11, Article X of the Constitution of this State.

Section 11-45-80.    In addition to and apart from the other duties and functions of the fund, there is created under the administration of the board of directors of the fund, another fund entitled the South Carolina Technology Innovation Fund which shall receive that funding as may be provided by law. The board shall contract with a tax exempt organization under Section 501(c)(3) of the Internal Revenue Code of 1986, as amended, for administration of the Innovation Fund.

The Innovation Fund must be used by the board to:

(1)    award small grants for the best and most creative ideas from South Carolina research universities' technology incubators with the awards to be available for eligible students and innovative knowledge-based enterprises that are located in a research university incubator. These grants are to be awarded to inspire and encourage knowledge-based technology and intellectual property transfers from research university faculty and students to the marketplace;

(2)    design a major education, marketing, and public relations program to ensure that residents of South Carolina, members of the General Assembly, and potential venture capital investors understand and support the requirements for participation in the fund, the strategic need for venture capital funding, and for grant support for deserving entrepreneurs.

Section 11-45-90.    (A)    The board shall provide loan, investment, tax credit, and expense reports at least quarterly during the fiscal year to the Governor, the General Assembly, and other appropriate officials and entities.

(B)    In addition to the quarterly reports provided in subsection (A), the board shall provide an annual report to the Governor, the General Assembly, and other appropriate officials and entities containing at a minimum the following information:

(1)    monies from the fund placed in venture capital investments with approved investors cumulatively and during that fiscal year;

(2)    the extent of current loan obligations including principal and interest requirements;

(3)    the amount and time lines of tax credit certificates issued both cumulatively and during that fiscal year;

(4)    a description of a material interest held by a director, officer, or employee of the fund with respect to the investments or assets of the fund;

(5)    a schedule of the rates of return, net of total investment expense, on assets of the fund overall and on assets aggregated by category over the most recent one-year, three-year, five-year, and ten-year periods, to the extent available; and

(6)    a schedule of the sum of total investment expense and total general administrative expense for the fiscal year expressed as a percentage of the fair value of assets of the fund on the last day of the fiscal year, and an equivalent percentage for the preceding five fiscal years, if applicable.

(C)    These disclosure requirements are cumulative to and do not replace other reporting requirements provided by law.

Section 11-45-100.    The fund has the power to promulgate regulations and make a contract, execute a document, perform an act, or enter into a financial or other transaction necessary to implement this chapter."

SECTION    6.    Upon certification to the Secretary of State by the President of the Palmetto Seed Capital Corporation that the remaining investments of the private sector limited partners of the Palmetto Seed Capital Fund Limited Partnership have been liquidated, Chapter 44 of Title 41 of the 1976 Code is repealed, and any remaining public assets and liabilities of the Palmetto Seed Capital Corporation shall be transferred to the South Carolina Venture Capital Fund herein created.

SECTION    7.    Sections 59-101-1 through 59-101-410 of the 1976 Code are designated as Article 1, General Provisions.

SECTION    8.    Chapter 101, Title 59 of the 1976 Code is amended by adding:

"Article 3

Public Institutions of Higher Learning

"Section 59-101-710.    A public institution of higher learning may spend federal and other nonstate appropriated sources of revenue to provide lump-sum bonuses at levels outlined in a plan approved by the governing body of the respective public institution of higher learning and according to guidelines established in the plan. The public institution of higher learning must maintain documentation to show that the use of federal funds for this purpose is in compliance with federal law. This payment is not a part of the employee's base salary and is not earnable compensation for purposes of employee and employer contributions to the respective retirement systems.

Section 59-101-720.    A public institution of higher learning may offer educational fee waivers to no more than four percent of the total student body.

Section 59-101-730.    Notwithstanding any other provision of law, and in recognition and support of the opportunities for economic development presented through the expansion of research activities, a public institution of higher learning may establish research grant positions funded by federal grants, public charity grants, private foundation grants, research grants, medical school practice plans, individual private gifts, externally generated revenue for service or testing activities, and grant generated revenue or a combination of these, without regard to the authorized number of full-time equivalency (FTE) positions allocated to the public institution of higher learning, provided that:

(1)    state funds must not be used to fund any portion of research grant positions. FTE positions funded solely or partially by state or other funding sources shall remain subject to the number of FTE positions authorized for each public institution of higher learning;

(2)    research grant positions shall not occupy FTE positions;

(3)    research grant positions may be established using other funds during the proposal development or pre-award stages of grant funding in anticipation of specific grant or project funding;

(4)    research grant positions may be established for multiple years; however, research grant positions are limited to and may not exist beyond the duration of the funding for the project or grant or any subsequent renewal. At the discretion of the public institution of higher learning other funds may be used to fund continued employment between the expiration of one grant and the subsequent renewal of the same or similar grant or the award of an additional grant. When funding for the project or grant ends or is insufficient to continue payments under the conditions of the project or grant, research grant employees must be terminated and these positions must cease to exist. Research grant employees are exempt from the provisions of Sections 8-17-310 through 8-17-380;

(5)    persons occupying research grant positions may be eligible for all benefits, not to exceed those benefits available to covered state employees, provided that funds are available within the grant or project or by use of grant-generated revenue;

(6)    persons occupying research grant positions are employed at-will and do not have grievance rights afforded to covered state employees or faculty of the respective public institution of higher learning. Research grant employees are not entitled to compensation beyond the date of termination, other than for the part of the project or grant that has been performed; and

(7)    discretionary determinations by a public institution of higher learning as to whether to hire an employee pursuant to this section are final and not subject to administrative or judicial appeal.

Section 59-101-740.    A public institution of higher learning may offer and fund, from any source of revenue, health insurance to full-time graduate assistants according to a plan approved by the governing body of the respective public institution of higher learning.

Section 59-101-750.    The board of trustees of a public institution of higher learning is vested with the power of eminent domain. The authority granted in this section applies only to private lands. The lands condemned must be used by the public institution of higher learning in the performance of its functions in the acquisition, construction, and operation of facilities for the public institution of higher learning, and is subject to the approval of the State Budget and Control Board.

Section 59-101-760.    A public institution of higher learning may negotiate for its annual audit and quality review process with reputable certified public accountant firms selected from a list preapproved by the State Auditor's office."

SECTION    9.    Section 59-147-30 of the 1976 Code, as last amended by Act 302 of 1996, is further amended to read:

"Section 59-147-30.    (A)    Subject to the approval of the State Budget and Control Board by resolution duly adopted, the university may issue revenue bonds of the university for the purpose of financing or refinancing in whole or in part the cost of acquisition, construction, reconstruction, renovation and improvement of land, buildings, and other improvements to real property and equipment for the purpose of providing facilities serving the needs of the university including, but not limited to, dormitories, apartment buildings, dwelling houses, bookstore and other university operated stores, laundry, dining halls, cafeterias, parking facilities, student recreational, entertainment and fitness related facilities, inns, conference and other nondegree educational facilities and similar auxiliary facilities of the university and any other facilities which are auxiliary to any of the foregoing excluding, however, athletic department projects which primarily serve varsity athletic teams of the university.

(B)    For purposes of this chapter, 'permanent improvement' is defined as:

(1)    acquisition of land, regardless of cost;

(2)    acquisition, as opposed to the construction, of buildings or other structures, regardless of cost;

(3)    construction of additional facilities and work on existing facilities for any given project including their renovation, repair, maintenance, alteration, demolition in those instances in which the total cost of all work involved is $500,000 or more;

(4)    architectural and engineering and other types of planning, and design work, regardless of cost, which is intended to result in a permanent improvement project. Master plans and feasibility studies are not permanent improvement projects and are not to be included;

(5)    capital lease purchase of a facility acquisition or construction; and

(6)    equipment that either becomes a permanent fixture of a facility or does not become permanent but is included in the construction contract should be included as a part of a project.

A permanent improvement that meets the above definition must become a project, regardless of the source of funds. However, an agency that has been authorized or appropriated capital improvement bond, capital reserve fund, state appropriated funds or state infrastructure bond fund by the General Assembly for capital improvements shall process a permanent improvement project, regardless of the amount."

SECTION    10.    Title 11 of the 1976 Code is amended by adding:

"CHAPTER 51

South Carolina Research University Infrastructure Act

Section 11-51-10.    This chapter may be cited as the 'South Carolina Research University Infrastructure Act'.

Section 11-51-20.    The General Assembly finds:

(1)    That by Section 4, Act 10 of 1985, the General Assembly ratified an amendment to Article X, Section 13(6)(c), of the Constitution of this State, 1895. As amended, Article X, Section 13(6)(c) limits the issuance of certain general obligation debt of the State such that the maximum annual debt service on general obligation bonds of the State, excluding highway bonds, state institution bonds, tax anticipation notes, and bond anticipation notes, may not exceed five percent of the general revenues of the State for the fiscal year next preceding, excluding revenues that are authorized to be pledged for state highway bonds and state institution bonds.

(2)    Article X, Section 13(6)(c), as amended, further provides that the percentage rate of general revenues of the State by which general obligation bond debt service is limited may be reduced to four or increased to seven percent by legislative enactment passed by two-thirds vote of the total membership of the Senate and a two-thirds vote of the total membership of the House of Representatives.

(3)    That pursuant to Article X, Section 13(6)(c), the General Assembly, in Act 254 of 2002, increased to five and one-half percent the percentage rate of the general revenues of the State by which general obligation bond debt service is limited with the additional debt service capacity available at any time as a consequence of the increase available only for the repayment of general obligation bonds issued to provide infrastructure for economic development within the State.

(4)    Facility and infrastructure constraints prevent the advancement of research projects as well as restrict the ability of the research universities, as defined in Section 11-51-30, to retain faculty and generate research dollars. A dedicated source of funds to repay general obligation debt authorized pursuant to this chapter would provide a consistent funding stream for capital improvements at the research universities and allow for improved planning of capital expenditures to meet the mission of the research universities.

(5)    In order to advance economic development and create a knowledge based economy, thereby increasing job opportunities, and to facilitate and increase research within the State at the research universities, it is in the interest of the State that, pursuant to Article X, Section 13(6)(c), that the limitation on general obligation debt imposed by Article X, Section 13(6)(c) be increased to six percent with the additional debt service capacity available at any time as a consequence of the increase available only for the repayment of general obligation debt issued pursuant to the provisions of this chapter.

(6)    That Article X, Section 13(5) of the Constitution of this State, 1895, authorizes the General Assembly to authorize general obligation debt by two-thirds vote of the members of each House of the General Assembly, subject to such conditions or restrictions limiting the incurring of such indebtedness contained in the authorization to incur such indebtedness, and the provisions of Article X, Section 13(3) of the Constitution of this State.

(7)    That Article X, Section 13(5) provides additional constitutional authority for the bonds authorized by this chapter and the designated principal amount of general obligation bonds to be issued pursuant to the debt limit as it existed prior to this chapter.

Section 11-51-30.    As used in this chapter:

(1)    'Facilities and administration costs' means depreciation and use allowances, interest on debt associated with buildings, equipment and capital improvements, operation and maintenance expenses, library expenses, general administration expenses, departmental administration, sponsored projects administration, and student administration and services.

(2)    'General obligation debt' means any indebtedness of the State which must be secured in whole or in part by a pledge of the full faith, credit and taxing power of the State, including, but not limited to, bonds, notes and other evidences of indebtedness, and issued pursuant to the provisions of this chapter.

(3)    'Research Centers of Excellence Review Board' means the board created pursuant to Section 2-75-10.

(4)    'Research infrastructure project' or 'project' means a project that would advance economic development and create a knowledge based economy, thereby increasing job opportunities, or facilitate and increase externally funded research at the research universities, including, but not limited to, land acquisition, acquisition or construction of buildings, equipment, furnishings, site preparation, road and highway improvements, water and sewer infrastructure, and other things necessary or convenient to advance economic development or to facilitate and increase research at the research universities.

(5)    'Research universities' means Clemson University, The Medical University of South Carolina, and the University of South Carolina - Columbia.

(6)    'State Board' means the South Carolina State Budget and Control Board.

Section 11-51-40.    To obtain funds for allocation to the research universities for the financing of research infrastructure projects, there may be issued general obligation debt pursuant to the conditions prescribed by this chapter.

Section 11-51-50.    (A)    Pursuant to the provisions of Article X, Section 13(6)(c) of the Constitution of this State, 1895, as amended, and by enactment of this chapter, the General Assembly provides that general obligation debt may be issued pursuant to this chapter only at such times as the maximum annual debt service on all general obligation bonds of the State, including economic development bonds and bonds issued pursuant to this chapter, outstanding and being issued, but excluding highway bonds, state institution bonds, tax anticipation notes, and bond anticipation notes, will not exceed six percent of the general revenues of the State for the fiscal year next preceding, excluding revenues that are authorized to be pledged for state highway bonds and state institution bonds. The State may not issue general obligation bonds, excluding economic development bonds and bonds authorized pursuant to this chapter, highway bonds, state institution bonds, tax anticipation notes, and bond anticipation notes, if at the time of issuance the maximum annual debt service on these general obligation bonds, outstanding and being issued, exceeds five percent of the general revenues of the State for the fiscal year next preceding, excluding revenues that are authorized to be pledged for state highway bonds and state institution bonds.

(B)    At the time of issuance of general obligation debt pursuant to this chapter, the maximum annual debt service on such general obligation debt outstanding or being issued must not exceed one-half of one percent of the general revenues of this State for the fiscal year next preceding, excluding revenues which are authorized to be pledged for state highway bonds and state institution bonds.

(C)    With respect to the first eight hundred fifty million dollars in principal amount of general obligation bonds issued after the effective date of this chapter within the debt service constraints set forth in subsections (A) and (B) of this section, the General Assembly provides additional constitutional authorization for such bonds pursuant to Article X, Section 13(5) of the Constitution of this State, 1895.

Section 11-51-60.    In the event the research infrastructure project is used for a purpose other than as approved by the Research Centers of Excellence Review Board pursuant to Section 11-51-80(2), the research university for which the research infrastructure project was originally established shall reimburse the State a percentage of debt service on the general obligation debt issued to finance the debt, the percentage to be equal to the percentage of the research infrastructure project which is used for an unapproved purpose. Amounts reimbursed to the State pursuant to this section must be applied, as directed by the State Board, to the debt service on the applicable general obligation debt, either currently or by way of defeasance, or to the general fund of the State.

Section 11-51-70.    As a condition precedent to the issuance of general obligation debt pursuant to the provisions of this chapter, the Research Centers of Excellence Review Board shall certify to the State Board that at least fifty percent of the cost of such research infrastructure project is being provided by private, federal, municipal, county or other local government sources. This portion of the cost, in the discretion of the Research Centers of Excellence Review Board, may be in the form of cash; cash equivalent; buildings including sale-lease back; gifts in kind including, but not limited to, land, roads, water and sewer, and maintenance of infrastructure; facilities and administration costs; equipment; or furnishings.

Section 11-51-80.    Before the issuance of general obligation debt, the Research Centers of Excellence Review Board shall provide the Joint Bond Review Committee and the State Board the following:

(1)    a description of the research infrastructure project for which general obligation debt is requested to be issued;

(2)    a certification by the Research Centers of Excellence Review Board that the provisions of Section 11-51-70 have been met, that the source of funding has been identified, and that the research infrastructure project complies with the provisions of this chapter ;

(3)    the total cost of the research infrastructure project and the principal amount of general obligation debt requested to be issued;

(4)    a tentative time schedule setting forth the period of time during which the proceeds of the general obligation debt requested to be issued will be expended;

(5)    a debt service schedule showing the annual principal and interest requirements, at a projected current rate of interest, on the requested general obligation debt;

(6)    the total amount of the general obligation debt issued pursuant to this chapter; and

(7)    a debt service schedule showing the principal and interest requirements for the general obligation debt outstanding and the proposed general obligation debt at a projected current rate of interest.

Section 11-51-90.    The principal amount of the general obligation debt must be provided to each of the research universities on a competitive basis by the Research Centers of Excellence Review Board.

Section 11-51-100.    Following the receipt of the information presented pursuant to Section 11-51-80, and after approval by the Joint Bond Review Committee, the State Board, by resolution duly adopted, shall effect the issuance of general obligation debt, or pending the issuance of the general obligation debt, effect the issuance of general obligation debt anticipation notes pursuant to Chapter 17 of this title.

Section 11-51-110.    To effect the issuance of general obligation debt, the State Board shall adopt a resolution providing for the issuance of general obligation debt pursuant to the provisions of this chapter. The authorizing resolution must include:

(1)    a schedule showing the aggregate principal amount of general obligation debt issued, the annual principal payments required to retire the general obligation debt, and the interest on the general obligation debt;

(2)    the amount of general obligation debt proposed to be issued;

(3)    a schedule showing future annual principal requirements and estimated annual interest requirements on the general obligation debt to be issued;

(4)    a certificate evidencing that the provisions of Section 11-51-70 of this chapter have been or will be met; and

(5)    a certificate of the State Auditor as to the general fund revenues of the State for the fiscal year next preceding, excluding revenues pledged to the payment of State Highway Bonds and State Institution Bonds.

Section 11-51-120.    The general obligation debt must bear the date and mature at the time that the State Board resolution provides, except that the general obligation debt may not mature more than thirty years from its date of issue. The general obligation debt may be in the denominations, be payable in the medium of payment, be payable at the place and at the time, and be subject to redemption or repurchase and contain other provisions determined by the State Board before its issue. The general obligation debt may bear interest payable at the times and at the rates determined by the state board.

Section 11-51-125.    (A)    Of the funds authorized pursuant to this act, public institutions of higher learning as defined in Section 59-103-5, not including research universities, are authorized twelve percent of the total amount authorized under Section 11-51-50. The eligible institutions may only use the funds authorized under this subsection for deferred maintenance projects. The twelve percent authorized for the institutions, not including research universities, must be allocated by the Commission of Higher Education to eligible institutions as follows:

(1)    Sixty five percent of the total twelve percent must allocated based on a reported deferred maintenance needs list from each eligible institutions; and

(2)    Thirty five percent of the total twelve percent must be allocated by FTE student enrollment from the prior academic year at each eligible institution.

The Research Centers of Excellence Review Board has no jurisdiction over these projects and no matching requirement is imposed for these projects. The Joint Bond Review Committee and the State Budget and Control Board must approve all projects.

(B)(1)    After the aggregate total of bonds issued pursuant to this chapter, including the bonds authorized pursuant to subsection (A) of this section, equals one half percent of general revenues for the State for the fiscal year next preceeding, all further proceeds of bonds authorized pursuant to this chapter must be authorized as follows:

(a)    Eighty eight percent for the research universities in the manner and for the purposes provided pursuant to this chapter;

(b)    Twelve percent to public institutions of higher learning as defined in Section 59-103-5, not including the research universities, for deferred maintenance projects allocated as follows:

(i)        one-half for the state's ten comprehensive teaching universities distributed among them as provided in item (2) of this subsection; and

(ii)    one-half for the state's two year and technical colleges distributed among them as provided in item (2) of this subsection.

(2)    The Commission on Higher Education shall distribute amounts allocated pursuant to item (1)(b)(i) and (ii) of this subsection among the two categories of eligible institutions as follows:

(a)    thirty five percent in equal shares to each eligible institution; and

(b)    sixty-five percent based on FTE student enrollment from the prior academic year at eligible institutions.

(3)    The Research Centers of Excellence Review board has no jurisdiction over projects funded by bonds issued pursuant to item (1)(b) of this subsection and no matching requirement is imposed for these projects. All projects must be approved by the Joint Bond Review Committee and the State Budget and Control Board.

Section 11-51-130.    General obligation debt issued pursuant to this chapter is exempt from taxation as provided in Section 12-2-50.

Section 11-51-140.    General obligation debt issued pursuant to this chapter must be signed by the Governor and the State Treasurer and attested by the Secretary of State. The Governor, State Treasurer, and Secretary of State may sign the general obligation debt by a facsimile of their signatures. The Great Seal of the State must be affixed to, impressed on, or reproduced upon the general obligation debt. The delivery of the general obligation debt executed and authenticated, as provided in the State Board resolution, is valid notwithstanding changes in officers or seal occurring after the execution or authentication.

Section 11-51-150.    For the payment of the principal of and interest on the general obligation debt issued and outstanding pursuant to this chapter there is pledged the full faith, credit, and taxing power of this State, and in accordance with the provisions of Section 13(4), Article X of the Constitution of this State, 1895, the General Assembly allocates on an annual basis sufficient tax revenues to provide for the punctual payment of the principal of and interest on the general obligation debt authorized by this chapter.

Section 11-51-160.    General obligation debt must be sold by the Governor and the State Treasurer upon sealed proposals, after publication of a summary notice of the sale one or more times at least seven days before the sale, in a financial paper published in New York City which regularly publishes notices of sale of state or municipal bonds. The general obligation debt may be awarded upon the terms and in the manner as prescribed by the State Treasurer. The right is reserved to reject bids and to re-advertise the general obligation debt for sale. For the purpose of bringing about successful sales of the general obligation debt, the State Treasurer may do all things ordinarily and customarily done in connection with the sale of state or municipal bonds. Expenses incident to the sale of the general obligation debt must be paid from the proceeds of the sale of the general obligation debt.

Section 11-51-170.    The proceeds of the sale of general obligation debt must be received by the State Treasurer and applied by him to the purposes for which issued, but the purchasers of the general obligation debt are in no way liable for the proper application of the proceeds to the purposes for which they are intended.

Section 11-51-180.    It is lawful for executors, administrators, guardians, and other fiduciaries to invest monies in their hands in general obligation debt issued pursuant to this chapter.

Section 11-51-190.    The proceeds received from the issuance of general obligation debt, after deducting the costs of issuance, must be expended only for the purpose of providing research infrastructure projects.

Section 11-51-200.    The research universities while engaging in projects related to this act shall be exempt from the state procurement process but must submit a procurement process to the State Commission on Higher Education to be forwarded to the State Budget and Control Board for approval. These processes shall include provisions for audit and recertification.

Section 11-51-210    No provision of this Act is intended nor shall any provision of this Act be construed to appropriate funds. The intent of the General Assembly is authorizing bonds according to the terms pursuant to this act only."

SECTION    11.    Chapter 75, Title 2 of the 1976 Code, is amended by adding:

"Section 2-75-90.    (A)    Notwithstanding the provisions of Sections 2-75-05(B)(4) and (6) and 2-75-50 of the 1976 Code, to meet the endowed professorships matching requirement of those provisions, a research university may use funds specifically provided for use in the areas provided for in subsection (B) that are derived from private, federal, municipal, county, or local government sources, excluding state appropriations to the institution, tuition, or fees. Subject to the restrictions in subsection (B), only federal dollars received after July 1, 2003, may be used to meet the endowed professorships matching requirement.

(B)    The matching funds in subsection (A) may be used only in the areas of Engineering, Nanotechnology, Biomedical Sciences, Energy Sciences, Environmental Sciences, Information and Management Sciences, and for other sciences and research that create well-paying jobs and enhanced economic opportunities for the people of South Carolina and that are approved by the Research Centers of Excellence Review Board."

SECTION    12.    Article 5, Chapter 53, Title 59 of the 1976 Code is amended by adding:

"Section 59-53-425.    Notwithstanding any other provision of law, the governing commission of Trident Technical College may establish a four-year culinary curriculum program and award baccalaureate degrees in culinary arts for students graduating from this program. This program must be established pursuant to guidelines established by the State Board for Technical and Comprehensive Education in conjunction with the Commission on Higher Education. However, prior approval of either the State Board for Technical and Comprehensive Education or the Commission on Higher Education to establish this program is not required.

In Fiscal Year 2003-2004 funding for this program shall be provided by the State Board for Technical and Comprehensive Education from existing appropriations for instructional programs or from other sources as determined by the state board, only if any funds are available.

Beginning in Fiscal Year 2004-2005 and thereafter, formula funding for this program shall be provided by the State Board for Technical and Comprehensive Education from appropriations to be determined by the General Assembly in a manner consistent with funding for other similar third and fourth years of baccalaureate degrees."

SECTION    13.    Notwithstanding any other provision of law, the University of South Carolina-Sumter is authorized to offer four-year degrees at the Sumter campus. The provisions of this section are contingent upon the local governments in USC-Sumter's service area providing additional funding for USC-Sumter of two hundred-fifty thousand dollars per year. The degree programs as well as a schedule for their implementation must be established by USC-Sumter in conjunction with the Commission on Higher Education, and the Commission on Higher Education must promulgate regulations to effectuate the intent of this section. However, prior approval of the Commission on Higher Education to establish these degree programs is not required.

SECTION    14.    No campus of the University of South Carolina shall be closed without prior authorization of the General Assembly by act or joint resolution.

SECTION    15.    Any public institution of higher education is required to annually report the number of out-of-state undergraduate students in attendance at the respective University for the Fall and Spring semester. Each University will also be required to report an out-of-state undergraduate student policy and how that policy was enacted by each University. The report will be required to be submitted to the Governor and each member of the General Assembly no later than September 15 of each year for the latest completed school year.

SECTION    16.    Section 59-149-50(A) of the 1976 Code is amended to read:

"(A)    To be eligible for a LIFE Scholarship, a student must be either a member of a class graduating a student who has graduated from a high school located in this State, a student who has completed at least three of the final four years of high school within this State, a home school student who has successfully completed a high school home school program in this State in the manner required by law, or a student graduating who has graduated from a preparatory high school outside this State, while a dependent of a parent or guardian who is a legal resident of this State and has custody of the dependent, and these. These students must also meet the requirements of subsection (B) and be eligible for in-state tuition and fees as determined pursuant to Chapter 112 of Title 59 and applicable regulations. In addition, beginning with the 1998-99 school year for those students who graduate from high school on or after May 1998 the student must have graduated from high school with a minimum of a 3.0 cumulative grade average on a 4.0 scale and have scored 1000 or better on the Scholastic Aptitude Test (SAT) or have the equivalent ACT score, 1050 or better, beginning with school year 2000-2001, and 1100 or better, beginning with school year 2002-2003; provided that, if the student is to attend such a public or independent two-year college or university in this State, including a technical college, the SAT requirement does not apply. If a student chooses to attend such a public or independent institution of this State and does not make the required SAT score or the required high school grade point average, as applicable, the student may earn a LIFE Scholarship after his freshman year if he meets the grade point average and semester credit hour requirements of subsection (B)."

SECTION    17.    Section 59-149-10(B)(2) of the 1976 Code is amended to read:

"(2)    a public or independent bachelor's level institution chartered before 1962 whose major campus and headquarters are located within South Carolina; or an independent bachelor's level institution which has attained 501(c)(3) tax status and is accredited by the Southern Association of Colleges and Secondary Schools or the New England Association of Colleges and Schools; or a public or independent two-year institution which has attained 501(c)(3) tax status. Institutions whose sole purpose is religious or theological training, or the granting of professional degrees do not meet the definition of 'public or independent institution' for purposes of this chapter."

SECTION    18.    Section 59-149-50(B) of the 1976 Code is amended to read:

"(B)    Students receiving a LIFE Scholarship to retain it and students currently enrolled in an eligible institution to receive such a scholarship must earn a 3.0 cumulative grade point average on a 4.0 scale each year and earn at least thirty credit hours each year for the maximum of semesters permitted at that institution by Section 59-149-60. The cumulative grade point average calculation, for purposes of LIFE scholarship eligibility, must be inclusive of the student's grade point average at all public or independent institutions, as defined in Section 59-149-10(B), attended by the student."

SECTION    19. Chapter 127, Title 59 of the 1976 Code is amended by adding:

"Section 59-127-470.    There is established a committee to study the feasibility and need for a School of Law at the South Carolina State University in Orangeburg. This committee shall consist of nine members as follows:

(1)    three to be appointed by the Senate Pro Tempore;

(2)    three to be appointed by the Speaker of the House

(3)    three to be appointed by the Legislative Black Caucus.

These members are to be appointed no later than July 1,2004. The senior member of the Legislative Black Caucus is to call the fisrt meeting of the committee no later than July 15, 2004 and is to serve as Chairman until such time as the committee elects a Chairman. This committee is to produce a report to be provided to the members of the General Assembly and the Governor no later than December 31, 2004. The report is to address the following:

(1)    feasibility of having a law school at South Carolina State University;

(2)    need for additional attorneys in the State of South Carolina;

(3)    cost of implementation; and

(4)    impact to the economy."

SECTION    20.    No provision of this Act shall be construed to appropriate funds. The intent of the General Assembly is to authorize bonds only according to the terms of this act.

SECTION    21.    If any section, subsection, paragraph, subparagraph, sentence, clause, phrase, or word of this act is for any reason held to be unconstitutional or invalid, such holding shall not affect the constitutionality or validity of the remaining portions of this act, the General Assembly hereby declaring that it would have passed this act, and each and every section, subsection, paragraph, subparagraph, sentence, clause, phrase, and word thereof, irrespective of the fact that any one or more other sections, subsections, paragraphs, subparagraphs, sentences, clauses, phrases, or words hereof may be declared to be unconstitutional, invalid, or otherwise ineffective.

SECTION    22.    This act takes effect upon approval by the governor.

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