2025-2026 Bill 3021 Text of Previous Version (May. 07, 2026)

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A bill

TO AMEND THE SOUTH CAROLINA CODE OF LAWS BY ENACTING THE "SMALL BUSINESS REGULATORY FREEDOM ACT" BY ADDING SECTION 1-23-285 SO AS TO PROVIDE THE SMALL BUSINESS REGULATORY REVIEW COMMITTEE SHALL CONDUCT AN INITIAL REVIEW OF REGULATIONS PENDING REAUTHORIZATION AND MAKE RECOMMENDATIONS TO THE GENERAL ASSEMBLY FOR RETAINING OR REMOVING REGULATIONS, TO PROVIDE IT IS THE DUTY OF THE COMMITTEE WHEN REVIEWING REGULATIONS TO REDUCE THE OVERALL REGULATORY BURDEN ON BUSINESSES BY REDUCING THE NUMBER OF REGULATORY REQUIREMENTS BY TWENTY-FIVE PERCENT, AND TO PROVIDE THE COMMITTEE MAY REQUEST ANY NECESSARY INFORMATION FROM STATE AGENCIES AND TO REQUIRE THE COMPLIANCE OF AGENCIES WITH THESE REQUESTS, AMONG OTHER THINGS; BY AMENDING SECTION 1-23-110, RELATING TO THE PROCESS FOR PROMULGATING REGULATIONS UNDER THE ADMINISTRATIVE PROCEDURES ACT SO AS TO PROVIDE AGENCIES MAY NOT PROMULGATE REGULATIONS ABSENT EXPRESS STATUTORY AUTHORITY AND CITATION TO THE SPECIFIC STATUTORY AUTHORITY, TO PROVIDE FOR EVERY REGULATION AN AGENCY PROPOSES, IT MUST IDENTIFY AND PROPOSE TWO OF ITS REGULATIONS TO REMOVE, TO PROVIDE PERSONS AGGRIEVED BY A REGULATION MAY CHALLENGE THE VALIDITY OF THE REGULATION IN A COURT OF COMPETENT JURISDICTION, AND TO PROVIDE COURTS MAY DECLARE REGULATIONS INVALID UPON FINDING AN ABSENCE OF EXPRESS STATUTORY AUTHORITY TO PROMULGATE; BY AMENDING SECTION 1-23-115, RELATING TO ASSESSMENT REPORTS FOR REGULATIONS SUBMITTED FOR PROMULGATION, SO AS TO PROVIDE ALL REGULATIONS SUBMITTED FOR PROMULGATION MUST INCLUDE ASSESSMENT REPORTS, TO ALLOW LONGER REVIEW PERIODS IN CERTAIN CIRCUMSTANCES, TO PROVIDE DISCOUNT RATES MUST BE JUSTIFIED IF APPLIED IN AN ANALYSIS REPORT, TO PROVIDE PROMULGATING AGENCIES MUST CONDUCT RETROSPECTIVE ASSESSMENT REPORTS IN CERTAIN CIRCUMSTANCES, TO PROVIDE ASSESSMENT CONTENTS MUST BE MADE PUBLICLY AVAILABLE IN A CERTAIN MANNER, TO PROVIDE CERTAIN STANDARDIZED ANALYTIC METHODS AND METRICS MUST BE APPLIED TO ALL REGULATIONS, TO REQUIRE RETROSPECTIVE ASSESSMENT REPORTS BE CONDUCTED WHEN REGULATIONS ARE REVIEWED FOR RENEWAL, AMONG OTHER THINGS; BY AMENDING SECTION 1-23-120, RELATING TO DOCUMENTS REQUIRED TO BE FILED TO INITIATE THE REVIEW PROCESS FOR A REGULATION, SO AS TO REQUIRE THE DOCUMENTS INCLUDE AN AUTOMATIC EXPIRATION DATE, AND TO PROVIDE FOR THE AUTOMATIC EXPIRATION AND PERIODIC REVIEW OF REGULATIONS; AND BY AMENDING SECTION 1-23-380, RELATING TO JUDICIAL REVIEW UPON EXHAUSTION OF ADMINISTRATIVE REMEDIES, SO AS TO PROVIDE REQUIREMENTS FOR JUDICIAL REVIEW OF AGENCY INTERPRETATIONS OF REGULATIONS.

Amend Title To Conform

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

SECTION 1. This act may be cited as the "Small Business Regulatory Freedom Act".

SECTION 2. Section 1-23-115(B) of the S.C. Code is amended to read:

(B)(1) A state agency must submit to the Office of Research and Statistics of Revenue and Fiscal Affairs Office, a preliminary assessment report on regulations which have a substantial economic impact. Upon receiving this report the office may require additional information from the promulgating agency, other state agencies, or other sources. A state agency shall cooperate and provide information to the office on requests made pursuant to this section. The office shall prepare and publish a final assessment report within sixty days after the public hearing held pursuant to Section 1-23-110. The office shall forward the final assessment report and a summary of the final report to the promulgating agency and the Code Commissioner.

(2) In addition to the requirements of item (1), if the final assessment report indicates that the regulation's economic impact is estimated to equal or exceed ten million dollars over five years, then the Senate and the House of Representatives are required to approve the regulation by a joint resolution.

SECTION 3. Section 1-23-120(J) of the S.C. Code is amended to read:

(J) Each state agency, which promulgates regulations or to which the responsibility for administering regulations has been transferred, shall by July 1, 1997, and every five years thereafter, conduct a formal review of all regulations which it has promulgated or for which it has been transferred the responsibility of administering, except that those regulations described in subsection (H) are not subject to this review. Upon completion of the review, the agency shall submit to the Code Commissioner a report which identifies those regulations:

(1) for which the agency intends to begin the process of repeal in accordance with this article;

(2) for which the agency intends to begin the process of amendment in accordance with this article; and

(3) which do not require repeal or amendment.

Nothing in this subsection may be construed to prevent an agency from repealing or amending a regulation in accordance with this article before or after it is identified in the report to the Code Commissioner.

SECTION 4. Section 1-23-270(F) of the S.C. Code is amended to read:

(F)(1) Each state agency, which promulgates regulations or to which the responsibility for administering regulations has been transferred, shall by July 1, 1997, and every five years thereafter, conduct a formal review of all regulations which it has promulgated or for which it has been transferred the responsibility of administering, except that those regulations described in Section 1-23-120(H) are not subject to this review. Upon completion of the review, the agency shall submit to the Code Commissioner a report which identifies those regulations:

(a) for which the agency intends to begin the process of repeal in accordance with this article;

(b) for which the agency intends to begin the process of amendment in accordance with this article; and

Nothing in this subsection may be construed to prevent an agency from repealing or amending a regulation in accordance with Article 1 before or after it is identified in the report to the Code Commissioner.

(2) Regulations that take effect on or after the effective date of this article must be reviewed within five years of the publication of the final regulation in the State Register and every five years after thatto ensure that they minimize economic impact on small businesses in a manner consistent with the stated objectives of applicable statutes.

(3) In reviewing regulations to minimize their economic impact on small businesses, the agency shall consider the:

(a) continued need for the regulation;

(b) nature of complaints or comments received concerning the regulation from the public;

(d) extent to which the regulation overlaps, duplicates, or conflicts with other federal, state, and local governmental regulations; and

(e) length of time since the regulation has been evaluated or the degree to which technology, economic conditions, or other factors have changed in the area affected by the regulation.

SECTION 5. Section 1-23-380(5) of the S.C. Code is amended to read:

(5)(a) The court may not substitute its judgment for the judgment of the agency as to the weight of the evidence on questions of fact. The court may affirm the decision of the agency or remand the case for further proceedings. The court may reverse or modify the decision if substantial rights of the appellant have been prejudiced because the administrative findings, inferences, conclusions, or decisions are:

(a)(i) in violation of constitutional or statutory provisions;

(b)(ii) in excess of the statutory authority of the agency;

(c)(iii) made upon unlawful procedure;

(d)(iv) affected by other error of law;

(e)(v) clearly erroneous in view of the reliable, probative, and substantial evidence on the whole record; or

(f)(vi) arbitrary or capricious or characterized by abuse of discretion or clearly unwarranted exercise of discretion.

(b) In interpreting a statute or regulation, the court shall not defer to the agency's interpretation of the statute or regulation and instead shall interpret the statute or regulation de novo.

SECTION 6. Section 1-23-610 of the S.C. Code is amended to read:

Section 1-23-610. (A)(1) For judicial review of a final decision of an administrative law judge, a notice of appeal by an aggrieved party must be served and filed with the court of appeals as provided in the South Carolina Appellate Court Rules in civil cases and served on the opposing party and the Administrative Law Court not more than thirty days after the party receives the final decision and order of the administrative law judge. Appeal in these matters is by right.

(2) Except as otherwise provided in this chapter, the serving and filing of the notice of appeal does not itself stay enforcement of the administrative law judge's decision. The serving and filing of a notice of appeal by a licensee for review of a fine or penalty or of its license stays only those provisions for which review is sought and matters not affected by the notice of appeal are not stayed. The serving or filing of a notice of appeal does not automatically stay the suspension or revocation of a permit or license authorizing the sale of beer, wine, or alcoholic liquor. Upon motion, the administrative law judge may grant, or the court of appeals may order, a stay upon appropriate terms.

(B) The review of the administrative law judge's order must be confined to the record. The court may not substitute its judgment for the judgment of the administrative law judge as to the weight of the evidence on questions of fact. The court of appeals may affirm the decision or remand the case for further proceedings; or, it may reverse or modify the decision if the substantive rights of the petitioner have been prejudiced because the finding, conclusion, or decision is:

(a)(1) in violation of constitutional or statutory provisions;

(b)(2) in excess of the statutory authority of the agency;

(c)(3) made upon unlawful procedure;

(d)(4) affected by other error of law;

(e)(5) clearly erroneous in view of the reliable, probative, and substantial evidence on the whole record; or

(f)(6) arbitrary or capricious or characterized by abuse of discretion or clearly unwarranted exercise of discretion.

(C) In interpreting a statute or regulation, the court shall not defer to the agency's interpretation of the statute or regulation and instead shall interpret the statute or regulation de novo.

SECTION 7. Chapter 23, Title 1 of the S.C. Code is amended by adding:

Article 4

Regulatory Review by Legislative Audit Council

Section 1-23-800. (A) Beginning July 1, 2027, the Legislative Audit Council shall schedule state agencies as defined in Section 2-15-50 so that all state agencies' regulations are formally reviewed at least once every five to eight years, provided if an agency's regulations exceed one hundred pages in the Code of State Regulations, then the Legislative Audit Council may divide the agency's regulations into one or more subject matters for review every five to eight years. In determining the order in which agencies' formal reviews are conducted, the Legislative Audit Council may consult with the President of the Senate, the Speaker of the House of Representatives, the Legislative Oversight Committees in the Senate and House of Representatives, and the chairmen of standing committees in the Senate and House of Representatives.

(B) Based on the schedule it establishes, the Legislative Audit Council shall conduct a formal review of all regulations promulgated by state agencies as defined in Section 2-15-50. The review shall determine:

(1) if the regulations are within the scope of the statutory authority for their promulgation; and

(2) if the regulations continue to operate under their statutory authority or are obsolete.

(C) By January 1 each year, beginning January 1, 2028, the Legislative Audit Council shall deliver a report to the standing committees of the Senate and House of Representatives that have jurisdiction over each agency's statutory authority that must include:

(1) the scope of review;

(2) the regulations determined by the Legislative Audit Council to be obsolete or outside the scope of enabling statutory authority; and

(3) the regulations that the applicable agency intends to begin the process of repeal or amendment in accordance with Chapter 23 of Title 1.

Section 1-23-810. (A) If an agency fails to complete the formal review in accordance with the Legislative Audit Council's schedule, within thirty days of the missed deadline, the Legislative Audit Council must notify the agency of noncompliance.

(B)Within thirty days of receipt, the agency must submit a written certification of noncompliance to the President of the Senate and the Speaker of the House of Representatives. The certification must identify the specific regulations not yet reviewed, the reasons for noncompliance, and a remedial schedule for completing the review.

(C) Failure to complete the formal review within ninety days of the missed deadline for compliance results in the agency being prohibited to file any proposed new regulations except for emergency regulations or regulations to comply with federal law. The prohibition remains in effect until the formal review is completed.

(D) Upon a finding of good cause shown by the agency, the General Assembly by concurrent resolution may waive the prohibition in subsection (C). Any waiver granted under this subsection must specify its duration and not exceed one hundred eighty days.

SECTION 8. Section 2-15-60 of the S.C. Code is amended to read:

Section 2-15-60. It is the duty of the council:

(a) To respond to any request concerning a programmatic or fiscal matter or information related to the purposes set forth in Section 2-15-50 which may be referred to it by the General Assembly or any of its members or committees.

(b) To conduct audits, if authorized by the council, upon request of the General Assembly or either of its respective bodies, a standing committee, the Speaker of the House, the President of the Senate, or not less than five members of the General Assembly, and to submit a report containing its findings and recommendations to the requesting entity or persons and to any member of the General Assembly who may request a copy.

(c) To assist the General Assembly in the performance of its official functions by providing its members and committees with impartial and accurate information and reports concerning the efficiency, programmatic, or fiscal problems matters presented to them as members of the General Assembly.

(d) To establish a system of post audits for all fiscal matters and financial transactions for all state agencies of the state government.

(e) To establish a regular schedule to formally review all agency regulations every five to eight years as provided in Article 4, of Chapter 23 in Title 1. Nothing in this subsection limits, abridges, or otherwise affects the provisions of this section or this chapter.

SECTION 9. Section 1-23-110(C) of the S.C. Code is amended to read:

(C)(1) The agency shall consider fully all written and oral submissions respecting the proposed regulation. All of the written submissions, and transcripts or recordings or oral submissions, must be provided to the Small Business Regulatory Review Committee.

(2) Following the public hearing and consideration of all submissions, an agency must not submit a regulation to the General Assembly for review if the regulation contains a substantive change in the content of regulation as proposed pursuant to subsection (A)(3) and the substantive change was not raised, considered, or discussed by public comment received pursuant to this section. The agency shall refile such a regulation for publication in the State Register as a proposed regulation pursuant to subsection (A)(3).

SECTION 10. Section 1-23-280 (B), (C), and (D) of the S.C. Code is amended to read:

(B) The committee shall consist of eleven members, appointed as follows:

(1) five members to be appointed by the Governor;

(2) three members to be appointed by the President of the Senate; and

(3) three members to be appointed by the Speaker of the House of Representatives.

(C) In addition, the Chairman of the Senate Labor, Commerce and Industry Committee of the South Carolina Senate, the Chairman of Senate Agriculture and Natural Resources Committee, the Chairman of the House of Representatives Agriculture, Natural Resources and Environmental Affairs Committee, and the Chairman of the House of Representatives Labor, Commerce and Industry Committee of the South Carolina House of Representatives, or their designees, shall serve as nonvoting, ex officio members of the committee. During the committee review process, the director or his designee, of the promulgating agency shall be available at the request of the committee for comment on the proposed regulation.

(D) Appointments to the committee must be representative of a variety of small businesses in this State, at least one of which must be engaged in agribusiness. All appointed members shall be either current or former owners or officers of a small business.

SECTION 11. This act takes effect upon approval by the Governor.

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