H 4115 General Bill, By Harrison, Knotts, McGee, D. Smith and Wilkins
 A BILL TO AMEND CHAPTER 13, TITLE 1, CODE OF LAWS OF SOUTH CAROLINA, 1976, BY
 ADDING SECTION 1-13-5 SO AS TO PROHIBIT THE STATE OF SOUTH CAROLINA OR ANY OF
 ITS POLITICAL SUBDIVISIONS FROM USING RACE, SEX, COLOR, ETHNICITY, OR NATIONAL
 ORIGIN AS A CRITERION FOR EITHER DISCRIMINATING AGAINST OR GRANTING
 PREFERENTIAL TREATMENT TO ANY INDIVIDUAL OR GROUP IN THE OPERATION OF THE
 STATE'S SYSTEM OF PUBLIC EMPLOYMENT, PUBLIC EDUCATION, OR PUBLIC CONTRACTING.

   05/07/97  House  Introduced and read first time HJ-35
   05/07/97  House  Referred to Committee on Judiciary HJ-35
   05/29/97  House  Committee report: Favorable Judiciary HJ-4
   05/29/97  House   Committee Report not received--Rule 5.12 not
                     waived (did not receive necessary 2/3 vote to
                     waive Rule 5.12) HJ-4
   01/13/98  House  Requests for debate-Rep(s). Harrison, Cotty,
                     Barrett, Sandifer, Scott, J. Brown, Knotts,
                     Kirsh, Woodrum, Neal, Govan, Clyburn, Howard,
                     Harrell, Davenport, R. Smith & Moody-Lawrence HJ-65
   01/22/98  House  Member(s) added as co-sponsor(s): Rep(s) Knotts HJ-15
   01/29/98  House  Debate adjourned HJ-25
   01/29/98  House  Debate adjourned until Tuesday, February 3, 1998 HJ-31
   02/03/98  House  Debate adjourned HJ-18
   02/04/98  House  Amended HJ-24
   02/04/98  House  Debate interrupted HJ-29
   02/04/98  House  Member(s) added as co-sponsor(s): Rep(s) McGee HJ-14
   02/04/98  House   Rep. Limbaugh (Prime Sponsor)-no longer a member
                     of the House-Point of Order raised and sustained HJ-24
   02/05/98  House  Debate adjourned HJ-13
   02/05/98  House  Debate interrupted HJ-17
   02/10/98  House  Requests for debate removed-Rep(s). Govan HJ-17
   02/12/98  House  Amended HJ-15
   02/12/98  House  Debate interrupted HJ-54
   02/18/98  House  Read second time HJ-42
   02/18/98  House  Roll call Yeas-73  Nays-43 HJ-42
   02/19/98  House  Read third time and sent to Senate HJ-32
   02/19/98  House  Roll call Yeas-74  Nays-37 HJ-35
   02/19/98  Senate Introduced and read first time SJ-4
   02/19/98  Senate Referred to Committee on Judiciary SJ-4

February 18, 1998

H. 4115

Introduced by Reps. Harrison, Wilkins, D. Smith, Knotts and McGee

S. Printed 2/18/98--H.

Read the first time May 7, 1997.

Given the language included in the proposed legislation, the primary potential fiscal impact is concentrated in the flow of federal funds to state agencies and localities. The Office of State Budget indicates that most state agencies accept federal grants by signing some type of contractual arrangement with the appropriate federal agency. Included in those contractual arrangements are requirements that the recipient state agencies adhere to the various federal laws regarding the federal definition of discrimination. Examples of such laws are: Title VI of the Civil Rights Act of 1964, Section 504 of the Rehabilitation Act of 1973, the Age Discrimination Act of 1975, and the Americans with Disabilities Act. Further, included in some federal agency contracts with state agencies is language that states that "affirmative action shall be taken to ensure that applicants are employed and that employees are treated during employment without regard to their handicap, age, race, color, religion, sex or national origin."

Determining the potential fiscal impact of the proposed legislation is predicated on several points. First, a determination must be made as to whether the "affirmative action" requirements listed in the contractual agreements between a federal agency and a state agency are incongruent with the proposed legislation. Second, if such circumstances are identified, an estimate of the legal actions taken by federal authorities must be made. Third, if legal actions are taken by federal authorities, an estimate of legal success by state authorities, most likely in a federal court, must be made.

The total federal funds appropriated in the state's budget for Fiscal Year 97-98 is $3,451,883,984. Of the 105 budgeted sections listed in the state budget, 63 have budgeted federal funds. From a theoretical standpoint, the possible range of fiscal impact for the proposed legislation is from zero to $3.4 billion, depending upon the specific answers to the points mentioned above.

Given the complexity of this issue, the Office of State Budget contacted two agencies, the Department of Health and Human Services (DHHS) and the Department of Transportation (DOT). DHHS administers the state's Medicaid program which appropriates federal dollars in excess of $1.5 billion. DOT is the recipient agency for federal highway grant dollars which exceed $300 million. Thus, these two agency programs combined total more than half all federal funds appropriated through the state budget. Both agencies were asked to respond to the possible fiscal impact of the proposed legislation, and the responses are displayed below. Based on these responses, there are no reliable data upon which to base a fiscal impact. Thus, the fiscal impact is indeterminable.

According to DHHS, there is potential conflict with federal law, rules and regulations raising concern of the possible loss of federal Medicaid funds; however, the fact of that conflict or the degree and scope of that impact is not known at that time.

According to DOT, South Carolina could loose approximately $300 million in federal funds by failing to carry out a Disadvantaged Business Enterprise (DBE) program for projects funded with federal-aid highway funds. Federal law requires that not less than ten percent of federal-aid highway funds be expended with small business owned and controlled by socially and economically disadvantaged individuals. (See Pub. L. 102-240, Title I, Section 1003(b), also known as "ISTEA") Receipt of federal funds by DOT is conditional upon DOT's carrying out a U. S. Dept. of Transportation-approved DBE program.

Based on a Local Government Finance Report produced by the State Budget & Control Board for fiscal year 1994-95, local governments received a total of $98.9 million in federal funds for fiscal year 1994-95. $51.9 million of those funds were derived from community development block grants and housing and urban development grants. The impact of the legislation upon these federal funds is not known at this time.

Approved By:

Frank A. Rainwater

Office of State Budget

A BILL

TO AMEND CHAPTER 13, TITLE 1, CODE OF LAWS OF SOUTH CAROLINA, 1976, BY ADDING SECTION 1-13-5 SO AS TO PROHIBIT THE STATE OF SOUTH CAROLINA OR ANY OF ITS POLITICAL SUBDIVISIONS FROM USING RACE, SEX, COLOR, ETHNICITY, OR NATIONAL ORIGIN AS A CRITERION FOR EITHER DISCRIMINATING AGAINST OR GRANTING PREFERENTIAL TREATMENT TO ANY INDIVIDUAL OR GROUP IN THE OPERATION OF THE STATE'S SYSTEM OF PUBLIC EMPLOYMENT, PUBLIC EDUCATION, OR PUBLIC CONTRACTING.

Amend Title To Conform

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

SECTION 1. Chapter 13 of Title 1 of the 1976 Code is amended by adding:

"Section 1-13-5. (A) Neither the State of South Carolina nor any of its political subdivisions shall use race, sex, color, ethnicity, or national origin religion, age or disability as a criterion for either discriminating against or granting preferential treatment to any individual or group in the operation of the state's system of public employment, public education, or public contracting.

No preferential treatment may be granted to any family member of a member of the general assembly with regard to employment with the State or any political subdivision of the State.

(B) This section shall apply only to state action taken after the effective date of this section.

(C) Nothing in this section shall be interpreted as prohibiting classifications based on sex that are reasonably necessary to the normal operation of the state's system of public employment or public education.

(D) Nothing in this section shall be interpreted as invalidating any court order or consent decree that is in force as of the effective date of this section.

(E) Nothing in this section shall be construed as prohibiting a public agency from obeying a court order requiring the consideration of racial, ethnic, national origin, gender, or religious characteristics to remedy the effects of its own past discriminatory practices.

(F) If any part or parts of this section are found to be in conflict with federal law or the United States Constitution, the section shall be implemented to the maximum extent permitted by federal law and the United States Constitution. Any provision held invalid shall be severable from the remaining portions of this section.

(G) Nothing in this section shall be interpreted to prohibit a bona fide state agency from its responsibilities to monitor and implement state laws assuring equal employment opportunity to all persons.

(H) For purposes of this section, "political subdivision" includes, but is not limited to, a city, county, municipality, special service district, and public service district.

(I) Nothing in this section must be construed as preventing State Agencies from performing their responsibilities pursuant to Section 1-13-110."

SECTION 2. Notwithstanding any other provision of law, the employment of quotas to achieve equality is prohibited.

SECTION 3. This act takes effect upon approval by the Governor.