Indicates Matter Stricken

Indicates New Matter

 

Committee Report

April 28, 2026

 

H. 5488

 

Introduced by Reps. B. Newton and M. M. Smith

 

S. Printed 4/28/26--H.

Read the first time April 1, 2026

 

________

 

The committee on House Ways and Means

To whom was referred a Bill (H. 5488) to amend the South Carolina Code of Laws by amending Section 12-65-20, relating to definitions for the South Carolina Textiles Communities Revitalization Act, so, etc., respectfully

Report:

That they have duly and carefully considered the same, and recommend that the same do pass:

 

B.W. BANNISTER for Committee.

 

 

statement of estimated fiscal impact

Explanation of Fiscal Impact

State Expenditure

This bill amends the South Carolina Textiles Communities Revitalization Act tax credit to specify that in order for expenses to qualify for the credit, the requirement to renovate or demolish the textile mill and buildings in a Notice of Intent to Rehabilitate applies independently to each notice without regard to the status of any parcel or building not in the notice. This bill would allow a taxpayer that owns a contiguous parcel that qualifies for the credit to claim the credit before the textile mill has been rehabilitated if the parcel on which the textile mill sits is owned by a different, unaffiliated taxpayer. If the parcels are owned by the same or an affiliated taxpayer, then the textile mill and building on the mill site must be either renovated or demolished in order for the expenses related to a contiguous parcel to qualify for the credit.

This bill will not impact expenditures for DOR as the changes to forms and guidance can be completed with existing staff and resources.

 

State Revenue

This bill amends the South Carolina Textiles Communities Revitalization Act tax credit to specify that in order for expenses to qualify for the credit, the requirement to renovate or demolish the textile mill and buildings in a Notice of Intent to Rehabilitate applies independently to each notice without regard to the status of any parcel or building not in the notice. The Act allows taxpayers to claim a credit against local real property taxes or state income tax, corporate license fees, insurance premium taxes, or bank taxes for qualifying expenses incurred to rehabilitate a textile mill site.

Currently, DOR has provided guidance which specifies that in order to qualify for the credit, each owner of a subparcel must renovate or demolish all buildings which were on the original textile mill site, and each taxpayer's eligibility for the credit is dependent on the compliance by all owners of the subparcels with the requirement to renovate or demolish the textile mill and all buildings on the mill site.  This bill would allow a taxpayer that owns a contiguous parcel that qualifies for the credit to claim the credit before the textile mill has been rehabilitated if the parcel on which the textile mill sits is owned by a different, unaffiliated taxpayer. If the parcels are owned by the same or an affiliated taxpayer, then the textile mill and buildings on the mill site must be either renovated or demolished in order for the expenses related to a contiguous parcel to qualify for the credit.

Based on discussions with DOR, this bill would allow a taxpayer to claim a credit for qualifying expenses before the unaffiliated taxpayer completes the demolition or renovation of the textile mill site, but it does not change the amount of the credit or which properties qualify. Therefore, the bill is not expected to change the amount of credits or impact state and local revenues overall although the timing of when the credits are claimed may change.

 

 

Frank A. Rainwater, Executive Director

Revenue and Fiscal Affairs Office

 

_______

 

 

 

 

 

 

 

 

A bill

 

TO AMEND THE SOUTH CAROLINA CODE OF LAWS BY AMENDING SECTION 12-65-20, RELATING TO DEFINITIONS FOR THE SOUTH CAROLINA TEXTILES COMMUNITIES REVITALIZATION ACT, SO AS TO SPECIFY QUALIFYING REQUIREMENTS FOR CERTAIN REHABILITATION EXPENSES.

 

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

 

SECTION 1.  Section 12-65-20(8)(a) of the S.C. Code is amended to read:

 

    (a) "Rehabilitation expenses" means the expenses or capital expenditures incurred in the rehabilitation, renovation, or redevelopment of the textile mill site, including without limitations, the demolition of existing buildings, environmental remediation, site improvements and the construction of new buildings and other improvements on the textile mill site, but excluding the cost of acquiring the textile mill site or the cost of personal property located at the textile mill site. For expenses associated with a textile mill site to qualify for the credit, the textile mill and buildings on the textile mill site included in the Notice of Intent to Rehabilitate must be either renovated or demolished, and this requirement applies independently to each Notice of Intent to Rehabilitate without regard to the rehabilitation status of any parcel or building not included in that notice; provided, however, that for any contiguous parcel included within the textile mill site pursuant to item 4(b), the textile mill and buildings on the textile mill site must be either renovated or demolished if both the textile mill and the contiguous parcel are owned by the same taxpayer or affiliated taxpayers.

 

SECTION 2.  This act takes effect upon approval by the Governor.

----XX----