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AMENDED
May 6, 1999
S. 379
Introduced by Senators Bryan, Setzler, Giese, Drummond, Martin, McGill, J. Verne Smith, Ravenel, Anderson, O'Dell, Passailaigue, Moore, Branton, Courtney, Wilson, Hutto, Fair, Hayes, Washington, Alexander, Leventis, Saleeby, Land, Reese, Short, Patterson, Holland, McConnell, Russell, Rankin, Mescher, Thomas, Grooms, Ryberg, Ford, Gregory, Waldrep, Jackson, Matthews, Courson, Glover, Cork, Elliott, Peeler and Leatherman
S. Printed 5/6/99--H.
Read the first time February 18, 1999.
FIRST YEAR GENERAL FUNDS: $0
FIRST YEAR FEDERAL & OTHER FUNDS: $0
ANNUAL TOTAL THEREAFTER: $172,000
EXPLANATION OF IMPACT:
State Department of Education (SDE)
SDE anticipates enactment of this bill would result in additional workload for the Office of Districts Facilities Management (ODFM). This Office at SDE is responsible for approving local school district construction plans (Section 59-23-40 of the S.C. Code of Laws, 1976) and inspecting all new local facilities before they can be occupied (Section 59-23-190 of the S.C. Code of Laws, 1976).
It is estimated that enactment of this bill would result in the need for two additional architects at $56,000 each including fringe benefits, and one administrative specialist at $30,000 including fringe benefits. Other operating expenses including travel, office supplies, rent, etc., are estimated at $30,000 annually. One-time office set-up cost is estimated at $3,500 per FTE. However, since no revenue would be deposited to the fund and no construction would begin until FY 2000-2001, there would be no fiscal impact the first year after enactment. Total fiscal impact in FY 2000-2001 would be $182,500. Subsequent annual costs are estimated at $172,000.
SPECIAL NOTES:
Pursuant to Section 2-7-71 of the 1976 South Carolina Code of Laws the Board of Economic Advisors is the appropriate agency to address any revenue impact of this legislation.
Approved By:
Don Addy
Office of State Budget
REVENUE IMPACT1
There is no revenue loss to the general fund revenue in fiscal year 1999-00.
Explanation
This amended bill will impose a tax on video poker operators equal to fifteen percent of net machine income. On March 11, 1999, the Board of Economic Advisors estimated that such a tax would raise $90,000,000 provided that no new restrictions were placed on the industry and there would be no enforcement of the $125 per day limit on prizes. Since then, U.S. District Court Judge Joe Anderson has ruled that the $125 per day limit does apply. He further ruled that the five video poker operators named in the lawsuit must keep written records detailing their cash payouts. The Board of Economic Advisors expects that in the next fiscal year the enforcement of this limit will apply to all operators and that this action will cause a reduction in activity at the casinos because of their dependence on prize inducements to generate business. Although it is difficult to estimate this reduction, the Board of Economic Advisors believes that it is reasonable to expect a loss of fifty percent of net income at the casinos. The impact is expected to be minimal at the mom and pop stores. The net result will be to reduce the revenue estimate for a fifteen percent tax to $65,000,000. The disbursement of the revenues among the school districts under the amended and original bills is shown in the attachment. The Senate bill disburses $750,000,000 based on the current method used to distribute the Public School Facility Assistance money, which is collected from the companies burying low level radioactive waste at the Barnwell site. The House amended the bill to disburse based on average daily membership of the districts $1,0000,000,000 of revenues, $520,000,000 from the new video poker tax and $480,000,000 from a proposed lottery.
Approved By:
William C. Gillespie
Board of Economic Advisors
1/ This statement meets the requirement of Section 2-7-71 for a state revenue impact, Section 2-7-76 for a local revenue impact, and Section 6-1-85(B) for an estimate of the shift in local property tax incidence.
TO AMEND TITLE 59, CODE OF LAWS OF SOUTH CAROLINA, 1976, BY ADDING CHAPTER 146 SO AS TO ENACT THE "STATE SCHOOL FACILITIES BOND ACT" WHICH AUTHORIZES THE ISSUANCE OF SCHOOL FACILITIES BONDS AS GENERAL OBLIGATION BONDS OF THE STATE OF SOUTH CAROLINA AND TO PRESCRIBE THE TERMS, CONDITIONS, USES, AND DISTRIBUTION OF THE BONDS AND THEIR PROCEEDS.
Amend Title To Conform
Be it enacted by the General Assembly of the State of South Carolina:
SECTION 1. Title 59 of the 1976 Code is amended by adding:
Section 59-146-10. This chapter may be cited as the 'public School Facilities Improvement Fund Act of 1999'.
Section 59-146-30. As used in this chapter:
(1) 'Department' means the State Department of Education.
(2) 'Coin-operated device' means the nonpayout electronic machine which is licensed pursuant to Section 12-21-2720(A)(3).
(3) 'Education Lottery Account' means any funds deposited in an account created and funded for education as a result of the authorization for operation of a statewide lottery.
(4) 'Local school district' means a public body corporate and politic operating as a school district pursuant to Section 59-1-160.
(5) 'Net machine income' means the amount of money that goes into a coin-operated device, less winnings.
(6) 'Value engineering' means a systematic approach of seeking the best functional balance between cost, reliability, and performance of a building design.
Section 59-146-40. There is created in the state treasury an account, separate and distinct from the general fund, titled the 'Public School Facilities Improvement Fund of 1999'. Funds deposited in the account must be allocated as provided in this chapter for the funding of construction and renovation of public school facilities. Any interest earned by the funds in the account must remain in the account and must be allocated to the several school districts of the State with cash balances in the fund, each to the extent the interest is attributable to each of their balances.
Section 59-146-50. The account described in Section 59-146-40 must be funded as follows:
(1) Beginning fiscal year 1999-2000, and thereafter, any funds appropriated to the State Department of Education for school building aid for school districts must be deposited in the Public School Facilities Improvement Fund of 1999.
(2) Beginning fiscal year 2000-2001, and annually each fiscal year until the fiscal year ending June 30, 2008, the General Assembly must appropriate one hundred twenty-five million dollars to the Public School Facilities Improvement Fund of 1999.
Section 59-146-60. (A) Monies in the Public School Facilities Improvement Fund must be allocated annually to the State's several local school districts pursuant to the formula provided for in Section 59-144-100.
(B) A local school district may use monies from the Public School Facilities Improvement Fund to meet its current construction and renovation needs or to retire its existing debt incurred by reason of facilities improvement or incurred through a lease purchase agreement.
Section 59-146-70. The department shall ensure that the local school district facility plan utilizes value engineering to achieve optimum cost effectiveness.
The State Department of Education shall cause to have developed by architects experienced in school building design sets of model school plans for elementary, middle, and high schools that shall be available for use by local school district boards without charge when undertaking school building projects. These plans must be developed and made available by July 1, 2000.
Section 59-146-80. The Education Oversight Committee as defined in Section 59-18-120(1) shall annually report to the General Assembly and the Governor beginning July 1, 2000, the amount of allocations to the several school districts during the previous fiscal year, the manner in which such funds were used, and any improvements in or changes to this School Facilities Improvement Fund Act as it deems appropriate."
SECTION 2. This act takes effect July 1, 1999.
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