H 3622 General Bill, By Boan, J.L. Harris, Keegan, Kennedy and D.E. McTeer
 A Bill to amend the Code of Laws of South Carolina, 1976, by adding Sections
 4-9-142, 5-21-70, and 6-1-60 so as to provide a spending limit for counties,
 municipalities, and special purpose and public service districts; and to amend
 the 1976 Code by adding Section 59-73-35 so as to impose a limit on ad valorem
 tax revenues for school districts.

   02/16/95  House  Introduced and read first time HJ-7
   02/16/95  House  Referred to Committee on Ways and Means HJ-7

A BILL

TO AMEND THE CODE OF LAWS OF SOUTH CAROLINA, 1976, BY ADDING SECTIONS 4-9-142, 5-21-70, AND 6-1-60 SO AS TO PROVIDE A SPENDING LIMIT FOR COUNTIES, MUNICIPALITIES, AND SPECIAL PURPOSE AND PUBLIC SERVICE DISTRICTS; AND TO AMEND THE 1976 CODE BY ADDING SECTION 59-73-35 SO AS TO IMPOSE A LIMIT ON AD VALOREM TAX REVENUES FOR SCHOOL DISTRICTS.

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

SECTION 1. Article 1, Chapter 9, Title 4 of the 1976 Code is amended by adding:

"Section 4-9-142. Beginning with county government spending for fiscal year 1995-96, total spending by a county government in a fiscal year may not exceed total county government spending in the prior fiscal year by more than the percentage increase in the consumer price index in the twelve months ending December 31 preceding the fiscal year as determined by the Bureau of Labor Statistics of the United States Department of Labor. Total spending by a county government for purposes of this limitation is the total of all county government spending in a fiscal year from all sources of funds and for all purposes, but total county government spending does not include:

(1) spending in an amount not exceeding the amount represented by applying the county's tax millage for the most recently completed property tax year to the assessed value of new construction and improvements to existing property not previously taxed;

(2) spending of fee revenues generated by income-producing services first extended to customers in the current fiscal year;

(3) spending of funds not derived from local taxes or fees and for purposes of this item, local taxes do not include the local sales and use tax levied pursuant to Chapter 10, Title 4 of the 1976 Code;

(4) a capital expenditure financed without borrowing using funds derived from any source other than county property taxes;

(5) spending for debt service and lease-purchase payments;

(6) spending to offset a prior year deficit; and

(7) spending approved by at least a three-fourths vote of the governing body of the county.

The limitation imposed by this section may not be extended except by separate legislation enacted expressly for this purpose."

SECTION 2. Article 1, Chapter 21, Title 5 of the 1976 Code is amended by adding:

"Section 5-21-70. Beginning with municipal government spending for fiscal year 1995-96, total spending by a municipal government in a fiscal year may not exceed total municipal government spending in the prior fiscal year by more than the percentage increase in the consumer price index in the twelve months ending December 31 preceding the fiscal year as determined by the Bureau of Labor Statistics of the United States Department of Labor. Total spending by a municipal government for purposes of this limitation is the total of a municipal government spending in a fiscal year from all sources of funds and for all purposes, but total municipal government spending does not include:

(1) spending in an amount not exceeding the amount represented by applying the municipality's tax millage for the most recently completed property tax year to the assessed value of new construction and improvements to existing property not previously taxed;

(2) spending of fee revenues generated by income-producing services first extended to customers in the current fiscal year;

(3) spending of funds not derived from local taxes or fees and for purposes of this item, local taxes do not include the local sales and use tax levied pursuant to Chapter 10, Title 4;

(4) a capital expenditure financed without borrowing using funds derived from any source other than county property taxes;

(5) spending for debt service and lease-purchase payments;

(6) spending to offset a prior year deficit; and

(7) spending approved by at least a three-fourths vote of the governing body of the municipality.

The limitation imposed by this section may not be extended except by separate legislation enacted expressly for this purpose."

SECTION 3. Chapter 1, Title 6 of the 1976 Code is amended by adding:

"Section 6-1-60. Beginning with special purpose or public service district spending for fiscal year 1995-96, total spending by a special purpose or public service district in a fiscal year may not exceed total special purpose or public service district spending in the prior fiscal year by more than the percentage increase in the consumer price index in the twelve months ending December 31 preceding the fiscal year as determined by the Bureau of Labor Statistics of the United States Department of Labor. Total spending by a special purpose or public service district for purposes of this limitation is the total of special purpose or public service district spending in a fiscal year from all sources of funds and for all purposes, but does not include:

(1) spending in an amount not exceeding the amount represented by applying the district's tax millage for the most recently completed property tax year to the assessed value of new construction and improvements to existing property not previously taxed;

(2) spending of fee revenues generated by income-producing services first extended to customers in the current fiscal year;

(3) spending of funds not derived from local taxes or fees;

(4) a capital expenditure financed without borrowing using funds derived from any source other than county property taxes;

(5) spending for debt service and lease-purchase payments;

(6) spending to offset a prior year deficit; and

(7) spending approved by at least a three-fourths vote of the governing body of the district.

The limitation imposed by this section may not be extended except by separate legislation enacted expressly for this purpose."

SECTION 4. Chapter 73, Title 59 of the 1976 Code is amended by adding:

"Section 59-73-35. Beginning with school district ad valorem tax revenues for operating purposes for school year 1995-96, total revenues of a school district from ad valorem taxes levied for operating purposes for a school year may not exceed the total of such revenues in the prior school year by more than the Education Finance Act inflation factor applicable for the current school year. However, the limitation on revenues imposed by this section does not apply to:

(1) ad valorem tax revenues in an amount represented by applying the school district's tax millage for the most recently completed tax year to the assessed value of new construction and improvements to existing property in the district not previously taxed;

(2) ad valorem tax revenues for debt service and lease-purchase payments;

(3) ad valorem tax revenues to offset a prior year deficit; and

(4) revenues of additional ad valorem taxes approved by at least a three-fourth's vote of the governing body authorized by law to levy school tax millage in the school district.

If the limit on revenue increases allowed by this section is insufficient to permit a school district to meet the maintenance of effort requirement of Section 59-21-1030, then additional revenues may be raised by ad valorem taxes sufficient to meet this requirement."

SECTION 5. This act takes effect upon approval by the Governor.