Journal of the House of Representatives
of the Second Session of the 111th General Assembly
of the State of South Carolina
being the Regular Session Beginning Tuesday, January 9, 1996

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| Printed Page 210, Jan. 17 | Printed Page 230, Jan. 17 |

Printed Page 220 . . . . . Wednesday, January 17, 1996

S. 879--RECONSIDERED, AMENDED, AND RETURNED

TO THE SENATE WITH AMENDMENTS

Rep. MARCHBANKS moved to reconsider the vote whereby the following Bill was given a third reading, which was agreed to.

S. 879 -- Senators Martin and Alexander: A BILL TO AMEND SECTION 7-7-450, CODE OF LAWS OF SOUTH CAROLINA, 1976, RELATING TO THE VOTING PRECINCTS FOR PICKENS COUNTY, SO AS TO CONSOLIDATE THE UNIVERSITY PRECINCT AND THE FORT HILL PRECINCT IN PICKENS COUNTY INTO A SINGLE PRECINCT ENTITLED THE "FORT HILL" PRECINCT.

Rep. MARCHBANKS, with unanimous consent, proposed the following Amendment No. 1 (Doc Name P:\amend\PT\2152DW.96), which was adopted.

Amend the bill, as and if amended, SECTION 2, beginning on Page 3, Line 43, after /document/ by deleting /P-/ and on Page 4, Line 1, by deleting /77-93/ and inserting /P-7796/.

Amend title to conform.

The Bill, as amended, was read the third time, and ordered returned to the Senate with amendments.

H. 4397--AMENDED AND ORDERED TO THIRD READING

The following Bill was taken up.

H. 4397 -- Reps. Wilkins, Huff, Sharpe, H. Brown, D. Smith, Cato, Townsend, Haskins, J. Brown, Littlejohn, Herdklotz, Hutson, J. Young, Jennings, Simrill, Bailey, Harrell, Allison, Law, Walker, Gamble and Richardson: A BILL ENACTING THE ECONOMIC DEVELOPMENT INDUSTRIAL CLUSTER ACT OF 1996, BY AMENDING THE CODE OF LAWS OF SOUTH CAROLINA, 1976, BY ADDING SECTIONS 12-6-3480, 38-7-190, AND 12-10-45 SO AS TO ALLOW CERTAIN INCOME TAX CREDITS TO BE APPLIED AGAINST INSURANCE PREMIUM TAX LIABILITIES AND VICE VERSA AND TO PROVIDE FOR THE DESIGNATION OF ADDITIONAL ENTERPRISE ZONES IN THE CASE OF PROJECTS OF QUALIFYING TIRE MANUFACTURERS; TO AMEND SECTION 12-6-3360, AS AMENDED, RELATING TO THE TARGETED JOBS TAX CREDIT, SO AS TO EXTEND THE TAX CREDIT CARRY FORWARD PERIOD FROM TEN TO FIFTEEN YEARS; TO AMEND SECTION 12-10-70,


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RELATING TO ADDITIONAL TAX CREDITS ALLOWED IN ENTERPRISE ZONES AND OTHER SITUATIONS RELATED TO SOCIO-ECONOMIC STATUS, SO AS TO EXTEND THESE PROVISIONS TO QUALIFYING TIRE MANUFACTURERS AND ALLOW THE QUALIFICATION OF A PERCENTAGE OF TRANSFERRED EMPLOYEES AS NEW EMPLOYEES IN THE CASE OF AN ELIGIBLE TIRE MANUFACTURER; TO AMEND SECTION 12-10-80, RELATING TO THE JOB DEVELOPMENT FEES ALLOWED QUALIFYING BUSINESSES, SO AS TO CLARIFY THE STATUS OF THE FEES IN THE EVENT OF DISQUALIFICATION AND PROVIDE ADDITIONAL CIRCUMSTANCES UNDER WHICH JOB DEVELOPMENT FEES MAY BE EXPENDED; TO AMEND SECTION 12-14-30, RELATING TO DEFINITIONS UNDER THE ECONOMIC IMPACT ZONE COMMUNITY DEVELOPMENT ACT OF 1995, SO AS TO PROVIDE ADDITIONAL ELIGIBILITY FOR QUALIFYING FOR THE BENEFITS ALLOWED IN THE ACT; TO AMEND SECTION 12-21-2423, AS AMENDED, RELATING TO THE RETENTION OF A PORTION OF ADMISSIONS LICENSE TAXES FOR MAJOR TOURISM OR RECREATION PROJECTS, SO AS TO CLARIFY THE APPLICATION OF THE PROVISION ALLOWING THE RETENTION OF THESE TAX REVENUES; AND TO AMEND SECTION 12-37-930, AS AMENDED, RELATING TO VALUATION OF PROPERTY AND ALLOWABLE DEPRECIATION OF PROPERTY FOR PURPOSES OF PROPERTY TAXATION, SO AS TO ALLOW A HIGHER DEPRECIATION RATE FOR RUBBER PRODUCTS AND ALLOW A LOWER DEPRECIATION LIMIT FOR QUALIFYING TIRE MANUFACTURERS.

The Ways and Means Committee proposed the following Amendment No. 1 (Doc Name P:\amend\GJK\22199HTC.96), which was adopted.

Amend the bill, as and if amended, by striking Sections 3 and 4 and inserting:

/SECTION 3. A. Article 25, Chapter 6, Title 12 of the 1976 Code is amended by adding:

"Section 12-6-3480. (A) Notwithstanding any other provision of law:

(1) Any credits under Title 38 may be applied against any taxes imposed under this chapter or license fees imposed under Chapter 20 of this title.

(2) Any credits under this chapter which are earned by one member of a controlled group of corporations may be used and applied by that


Printed Page 222 . . . . . Wednesday, January 17, 1996

member and by any other members of the controlled group of corporations.

(3) Any limitations upon the total amount of liability for taxes or license fees that can be reduced by the use of a credit must be computed before any other credit is used to reduce any tax or license fee liability under this chapter or Chapter 20 of this title. Subject to item (4), the taxpayer may apply any credits arising under this chapter in any order the taxpayer elects.

(4) No credit may be sued more than once, and all credits must be used, to the extent possible in any given year, first by the company that earned them, and second against the tax which generated them.

(5) As used in this section:

(a) the term `controlled group of corporations' has the same meaning as provided under Section 1563 of the Internal Revenue Code without regard to Section 1563(a)(4), (b)(2)(A), only with respect to corporations which are in existence for less than one-half the number of days in the tax year referred to therein, and (b)(2)(C) and (D);

(b) the term `tax credit' or `credit' means a statutorily directed or authorized reduction in the tax liability made after any applicable tax rates are applied.

B. This section is effective for tax years beginning after 1995."

SECTION 4. A. Chapter 20, Title 12 of the 1976 Code, as added by Act 76 of 1995, is amended by adding:

"Section 12-20-105. License fees may be reduced by credits as provided in Section 12-6-3410 or Section 12-6-3480, or both of these sections.

B. This section is effective for tax year beginning after 1995."

SECTION 5. A. Chapter 7, Title 38 of the 1976 Code is amended by adding:

"Section 38-7-190. (A) Notwithstanding any other provision of law:

(1) Any credits under Chapter 6 of Title 12 may be applied against any taxes, license fees, and other assessments imposed under this title.

(2) Any credits under this title which are earned by one member of a controlled group of corporations may be used and applied by that member and any other members of the controlled group of corporations.

(3) Any limitations upon the total amount of liability for taxes that can be reduced by the use of a credit must be computed before any credit is used to reduce any tax liability under this title. Subject to item (4), the taxpayer may apply any credits arising under this title in any order the taxpayer elects.


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(4) No credit can be used more than once, and all credits must be used, to the extent possible in any given year, first by the company that earned them, and second against the tax which generated them.

(5) As used in this section:

(a) The term `controlled group of corporations' has the same meaning as provided under Section 1563 of the Internal Revenue Code without regard to Section 1563(a)(4), (b)(2)(A) only with respect to corporations which are in existence for less than one-half the number of days in the tax year referred to therein, and (b)(2)(C) and (D);

(b) The term `tax credit' or `credit' means a statutorily directed or authorized reduction in the tax liability made after any applicable tax rates are applied.

B. This section is effective for tax years beginning after 1995."/

Amend further, by striking Section 12-10-70(1)(b), as contained in Section 7, page 5, and inserting:

/(b) If the business is a tire manufacturer that has a capital investment in this State which exceeds one billion dollars and employs more than five thousand employees in this State at all times during the tax year for which the credit is claimed, the qualifying business is entitled to the jobs tax credit for the period and in the amount provided in Section 12-7-1220(B) 12-6-3360(C)(1); in addition, a qualifying business is entitled to an additional five hundred dollars a year tax credit in the third, fourth, and fifth year of any AFDC recipient's continued employment with the qualifying business, based on the status of the employee at the time of beginning employment. Except as stated below, a new job is not considered a new job for the purpose of this credit if it replaces the same job that was part of a reduction in force in the preceding twelve months. A tire manufacturer may qualify as new jobs up to ninety percent of the employees transferred from an existing project in the State to one of up to three new projects approved by the council if:

(i) the tire manufacturer has a capital investment in this State which exceeds one billion dollars, as defined in Section 12-10-45;

(ii) the tire manufacturer employs more than five thousand employees in this State at all times during the tax year for which the credit is claimed;

(iii) the tire manufacturer makes a capital investment in excess of five hundred million dollars in this State over the five-year period beginning on the stipulated date; and

(iv) the council and the tire manufacturer enter into a revitalization agreement that, among other provisions:

(A) clearly defines the three new projects,


Printed Page 224 . . . . . Wednesday, January 17, 1996

(B) limits the credit for transferred jobs to jobs that were either backfilled by other new hires in the State or the transfer was needed to retain an employee's employment in the State,

(C) includes a provision for an audit by the Department of Revenue and Taxation to ensure that the credit for transferred employees is only allowed for employees transferred for valid business reasons from projects in operation in the State on the stipulated date to one of the three defined new projects, and

(D) no credit will be allowed for employees transferred solely to obtain the credit./

Amend further, Section 12-10-80(A), as contained in Section 8A, page 6, line 17, by striking /April fifteenth/ and inserting /June thirtieth/ so that when amended Section 12-10-80(A) reads:

"(A) Upon certification by the council to the department of the council's determination that a business is a qualifying business, a qualifying business may collect a job development fee by retaining an amount of employee withholding permitted by subsection (C) or (D), or both but not both, for the purposes permitted by subsection (B) or (D), respectively. The amount retained is the property of the business, subject to all of the conditions in this section including the later possible requirement that the funds be transferred to this State as withholding and the possible forfeiture of the funds to this State as misappropriated withholding. The retained withholding withheld must be maintained in an escrow account with a bank which is insured by the Federal Deposit Insurance Corporation. To the extent the money is not used as permitted by subsection (B) or (D), it must be treated as misappropriated employee withholding. Employee withholding may not be retained from an employee whose job was created in this State before the entry of the qualifying business into a revitalization agreement. If a qualifying business retains employee withholding under this section, it shall make its payroll books and records available for inspection by the council and the department at the times the council and the department request. Each qualifying business retaining employee withholding under this section shall file with the council and the department the information and documentation respecting the retention and use of the employee withholding according to the revitalization agreement. Each qualifying business which retains in excess of ten thousand dollars in any calendar year shall furnish an audited report prepared by an independent certified public accountant which itemizes the sources and uses of the funds. The audited report must be filed with the council and the department no later than June thirtieth following the calendar year of the retention. Each


Printed Page 225 . . . . . Wednesday, January 17, 1996

qualifying business retaining employee withholding under this section is allowed a credit against the withholding tax liability provided in Chapter 9 of this title otherwise owed to the State, the credit not to exceed the lesser of the amount of such tax or the aggregate amount of employee withholding retained. No employer may withhold an amount that results in any employee ever receiving a smaller amount of wages on either a weekly or on an annual basis than the employee would otherwise receive in the absence of this chapter."

Amend further, by inserting an appropriately numbered penultimate section to read:

/SECTION . As used in the amendments to Section 12-10-70(1)(b) contained in this act, the phrase "stipulated date" means the general effective date of this act and the Code Commissioner in the preparation of the cumulative supplement to the Code of Laws of South Carolina, 1976, is directed to delete the phrase "stipulated date" and insert the calendar date that is the general effective date of this act./

Renumber sections to conform.

Amend title to conform.

Rep. KENNEDY spoke against the Bill.

Rep. WILKES spoke in favor of the Bill.

Rep. WHITE spoke against the Bill.

Rep. McABEE proposed the following Amendment No. 5 (Doc Name P:\amend\GJK\22235HTC.96), which was tabled.

Amend the bill, as and if amended, by adding an appropriately numbered section to read:

/SECTION . Chapter 10, Title 12 of the 1976 Code is amended by adding:

"Section 12-10-75. The provisions of Section 12-14-50 apply in an enterprise zone in the same manner that the benefits allowed pursuant to that section apply in economic impact zones as provided in Chapter 14 of this title, mutatis mutandis."/

Renumber sections to conform.

Amend title to conform.

Rep. McABEE explained the amendment.

Rep. HARRELL spoke against the amendment.

Rep. McABEE spoke in favor of the amendment.

Rep. HARRELL moved to table the amendment.


Printed Page 226 . . . . . Wednesday, January 17, 1996

Rep. McABEE demanded the yeas and nays, which were taken resulting as follows:

Yeas 58; Nays 55

Those who voted in the affirmative are:

Allison              Brown, H.            Cain
Cato                 Cooper               Cotty
Dantzler             Davenport            Easterday
Fulmer               Gamble               Hallman
Harrell              Harris, J.           Harrison
Herdklotz            Hutson               Jaskwhich
Keegan               Kelley               Klauber
Knotts               Koon                 Lanford
Law                  Lee                  Limehouse
Marchbanks           Mason                McCraw
McKay                Meacham              Phillips
Quinn                Rice                 Riser
Robinson             Sandifer             Seithel
Sharpe               Shissias             Simrill
Smith, D.            Smith, R.            Thomas
Tripp                Trotter              Vaughn
Walker               Wells                Whatley
Wilkins              Witherspoon          Wofford
Worley               Wright               Young
Young-Brickell

Total--58

Those who voted in the negative are:

Anderson             Bailey               Baxley
Boan                 Breeland             Brown, G.
Brown, T.            Byrd                 Canty
Carnell              Cave                 Chamblee
Clyburn              Cobb-Hunter          Delleney
Fleming              Govan                Harris, P.
Harvin               Hines, J.            Hines, M.
Howard               Inabinett            Jennings
Kennedy              Keyserling           Kirsh
Limbaugh             Littlejohn           Lloyd
Martin               McAbee               McElveen
McMahand             McTeer               Moody-Lawrence

Printed Page 227 . . . . . Wednesday, January 17, 1996

Neal                 Neilson              Richardson
Rogers               Scott                Sheheen
Spearman             Stille               Stoddard
Stuart               Townsend             Tucker
Waldrop              Whipper, L.          Whipper, S.
White                Wilder               Wilkes
Williams             

Total--55

So, the amendment was tabled.

Reps. NEAL, SCOTT and KENNEDY spoke against the Bill.

Reps. JENNINGS, RICHARDSON, G. BROWN and WILKES spoke in favor of the Bill.

The question then recurred to the passage of the Bill, as amended, on second reading.

Rep. NEAL demanded the yeas and nays, which were taken resulting as follows:

Yeas 113; Nays 1

Those who voted in the affirmative are:

Allison              Anderson             Askins
Bailey               Baxley               Boan
Breeland             Brown, G.            Brown, H.
Brown, J.            Brown, T.            Byrd
Cain                 Carnell              Cato
Cave                 Chamblee             Clyburn
Cobb-Hunter          Cooper               Cotty
Cromer               Dantzler             Delleney
Easterday            Felder               Fleming
Fulmer               Gamble               Govan
Hallman              Harrell              Harris, J.
Harris, P.           Harrison             Harvin
Herdklotz            Hines, J.            Hines, M.
Hodges               Howard               Hutson
Inabinett            Jaskwhich            Jennings
Keegan               Kelley               Keyserling
Kinon                Kirsh                Klauber
Knotts               Koon                 Lanford

Printed Page 228 . . . . . Wednesday, January 17, 1996

Law                  Lee                  Limbaugh
Limehouse            Littlejohn           Lloyd
Marchbanks           Martin               Mason
McAbee               McCraw               McElveen
McKay                McMahand             McTeer
Meacham              Moody-Lawrence       Neilson
Phillips             Quinn                Rice
Richardson           Riser                Robinson
Rogers               Sandifer             Scott
Seithel              Sharpe               Sheheen
Shissias             Simrill              Smith, D.
Smith, R.            Spearman             Stille
Stoddard             Stuart               Thomas
Townsend             Tripp                Trotter
Tucker               Vaughn               Waldrop
Walker               Wells                Whatley
Whipper, L.          Whipper, S.          Wilder
Wilkes               Wilkins              Williams
Witherspoon          Wofford              Wright
Young                Young-Brickell

Total--113

Those who voted in the negative are:

Canty                

Total--1

So, the Bill, as amended, was read the second time and ordered to third reading.

RECORD FOR JOURNAL

The Enterprise Legislation adopted last year in the General Assembly made South Carolina more competitive, attractive, and equipped to locate, maintain, and help industry expand in South Carolina.

The Economic Development Industrial Cluster Act certainly does help industry that will be locating in certain portions of South Carolina. However, unfortunately, poor-rural areas and counties of South Carolina cannot at this time benefit as much from economic incentive legislation of these type because of some important missing necessities such as:


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Infrastructure - water and sewer, better roads, environmental barriers and all of the regulation hindrances.

Poor-rural counties in South Carolina must be made industry ready. Happily next time, legislation such as The Economic Development Industrial Cluster Act can have impact on poor rural counties because the legislature would have already equipped these poor-rural areas to make them more competitively attractive for industry.

Rep. THEODORE A. BROWN

H. 3879--AMENDED AND ORDERED TO THIRD READING

The following Bill was taken up.

H. 3879 -- Rep. Witherspoon: A BILL TO AMEND SECTION 50-3-315, AS AMENDED, CODE OF LAWS OF SOUTH CAROLINA, 1976, RELATING TO DEPUTY ENFORCEMENT OFFICERS OF THE NATURAL RESOURCES ENFORCEMENT DIVISION OF THE DEPARTMENT OF NATURAL RESOURCES, SO AS TO REVISE THEIR AUTHORITY, POWERS, AND REQUIREMENTS.

The Agriculture, Natural Resources and Environmental Affairs Committee proposed the following Amendment No. 1 (Doc Name P:\amend\DKA\3425HTC.96), which was adopted.

Amend the bill, as and if amended, Section 50-3-315(A), as contained in SECTION 1, page 1, line 36, by striking /officers/ and inserting / officers, except for designated department employees, /, so that when amended Section 50-3-315(A) reads:

/(A) The director may appoint deputy enforcement officers to who serve at the pleasure of the director without pay and shall establish their territorial jurisdiction. The officers, when acting in their official capacity, may enforce all laws and regulations relating to wildlife, marine, or natural resources within have statewide police power. However, the director may restrict their territorial jurisdiction. The powers and duties of the officers must be established by regulations of the department. Deputy enforcement officers serve at the pleasure of the director. No person may be appointed as an officer who holds another public office. The Secretary of State shall transmit to the director the commissions of all officers. The director shall transmit each commission to the office of the clerk of court for the county in which the officer resides only after he files the oaths and officers, except for designated department employees, shall obtain the bonds required by Section 50-3-330./

Amend title to conform.


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