Indicates Matter Stricken

Indicates New Matter

 

Committee Report

April 2, 2026

 

H. 3771

 

Introduced by Reps. Hartnett, Erickson, M. M. Smith, Wetmore, Bradley, Stavrinakis, Hewitt, Hager, Lawson, Teeple, Brewer, Herbkersman, Landing, Bustos, Spann-Wilder and Kirby

 

S. Printed 4/2/26--H.

Read the first time January 16, 2025

 

________

 

The committee on House Labor, Commerce and Industry

To whom was referred a Bill (H. 3771) to amend the South Carolina Code of Laws by adding Section 50-23-37 so as to require owners of certain boats anchored in the waters of this state to maintain marine, etc., respectfully

Report:

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

 

    Amend the bill, as and if amended, SECTION 1, by striking Section 50-23-37(A), (B), and (C) and inserting:

    (A) An owner of a boatwatercraft that is anchored in the coastal waters of this State more than fourteen days must maintain marine recovery insurance on the boatobtain a marine survey on his watercraft indicating the watercraft is seaworthy and functions as intended.

    (B) To obtain marine recovery insurance, the boat owner must provide the insurer a recent vessel survey that includes a declaration that the boat is seaworthy and that the boat can move under its own power as intended when built. Sailboats must have working sails and powerboats must have a working motor. The survey must have been completed within six months of the policy being issued and completed by a licensed boat surveyor. All policy premiums must be current before a policy can be renewed and new stickers sent to the boat owner. The insurer shall issue two 3 ½ x 3 ½ inch watercraft stickers to the boat owner each time a policy is issued or renewed. The stickers must have the year in one inch font and the insurance company, policy number, and boat registration number on the sticker and be displayed on the boat. The insurer shall require a new survey from the vessel owner after each three-year period before renewing the policy on year four. a marine survey, the watercraft owner must use a licensed surveyor to inspect the following:

       (1) all sailboats must have a complete set of working sails and, if the sailboat includes an inboard or outboard motor, mechanical propulsion capable of moving the watercraft;

       (2) motorboats must have working propulsion mechanisms capable of moving the watercraft;

       (3) all liveaboard watercraft must have a marine toilet system that meets United States Coast Guard standards or receipts that reflect a monthly pump out. Unpowered structures may not be used as liveaboards unless docked at a marina;

       (4) watercraft must be free of hull leaks and must have the ability to be closed up and secured when the owner is not on board;

       (5) all watercraft must have a working bilge pump, charged battery for powering the bilge pump, and solar or equivalent power source for recharging the battery; and

       (6) all watercraft must have working anchor lights.

    (C) The marine survey must be completed within twenty-one days of any watercraft being anchored in the coastal waters of this State. The survey is effective for a period two years.

    (D) Upon the successful completion of the marine survey, the surveyor shall issue two 3 ½ x 3 ½ inch watercraft stickers to the owner of the watercraft. The sticker must be displayed on the watercraft adjacent to the annual state registration sticker. Declared vessels must display the sticker where a state registration sticker would normally be displayed on the hull of the vessel. The sticker must include:

       (1) the expiring year in one inch font;

       (2) the name of the survey company;

       (3) the date of the survey; and

       (4) the boat registration number.

    (C)(E) A person who violates this provision is guilty of a misdemeanor and, upon conviction, must be imprisoned not more than thirty days and fined not more than five hundred dollars or imprisoned not more than thirty days. Each day of non-compliance is considered to be a separate offense. After twenty-one days of noncompliance with this section, a watercraft is deemed abandoned pursuant to Article 2, Chapter 21, of Title 50.

    (F) The Department may grant exemptions from the requirements of this section.

Renumber sections to conform.

Amend title to conform.

 

WILLIAM HERBKERSMAN for Committee.

 

 

statement of estimated fiscal impact

Explanation of Fiscal Impact

State Expenditure

This bill requires owners of boats anchored in South Carolina waters for more than 14 days to maintain marine recovery insurance. This bill also requires those seeking marine recovery insurance to provide a vessel survey to their insurer that includes a declaration that the boat is seaworthy and able to move under its own power. Violations of this provision results in a misdemeanor punishable by imprisonment up to thirty days and a fine of up to $500.

DOI anticipates this bill will have no expenditure impact as the agency can manage any additional responsibilities due to this bill with existing staff and within existing appropriations.

Judicial anticipates this bill may result in an increase in the number of cases in local courts, which may increase the workload of the court system and downstream expenses such as court interpreting. The potential increase will depend on the number of people who are currently engaging in conduct that will now be deemed contrary to the law and how vigorously the law will be enforced. Judicial anticipates the increased expenses can be initially managed within existing appropriations. However, Judicial indicated that if the increase in the caseload and corresponding downstream expenses is significant, it will request additional General Fund appropriations.

 

State Revenue

Based on DOI's response, we anticipate this bill may result in an increase in the number of individuals maintaining marine recovery insurance. Insurance premiums are taxed at 1.25 percent. Insurance premium tax revenue is distributed 2.25 percent to Other Funds and 97.75 percent to the General Fund. Therefore, this bill may increase the General Fund and Other Fund revenue depending upon the increase in premiums for marine recovery insurance.

This bill may result in a change in the fines and fees collected in court due to the potential increase in the caseload in court. Court fines and fees are distributed to the General Fund, Other Funds, and local funds.  Therefore, RFA anticipates this bill may result in a change to local revenue due to the change in fines and fees collections in court.

 

Local Expenditure

RFA contacted all counties in the state and MASC to determine the potential expenditure impact this bill may have for local governments. We received a response from Charleston County, Florence County, Lancaster County, and MASC. Charleston, Florence, and Lancaster Counties indicate that the bill will have no expenditure impact. Additionally, MASC anticipates this bill will have an undetermined impact on municipal courts dependent upon the number of people who are currently engaging in conduct that will now be deemed contrary to the law and how vigorously the law will be enforced.

This bill may result in an increase in the number of local court cases and potentially the number of incarcerations, which may increase the workload of the court system and local jails.  The potential increase in expenses will depend upon the increase in the number of cases and number of incarcerations. Judicial anticipates that the potential increase in caseload can be managed within existing appropriations. The potential increase in expenses for local jails will depend upon the increase in the number of cases and number of incarcerations.

 

 

Frank A. Rainwater, Executive Director

Revenue and Fiscal Affairs Office

 

_______

 

 

 

 

 

 

 

 

A bill

 

TO AMEND THE SOUTH CAROLINA CODE OF LAWS BY ADDING SECTION 50-23-37 SO AS TO REQUIRE OWNERS OF CERTAIN BOATS ANCHORED IN THE WATERS OF THIS STATE TO MAINTAIN MARINE RECOVERY INSURANCE ON THEIR BOATS, AND TO PROVIDE PENALTIES FOR VIOLATIONS.

 

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

 

SECTION 1.  Article 1, Chapter 23, Title 50 of the S.C. Code is amended by adding:

 

    Section 50-23-37.  (A) An owner of a boat that is anchored in the waters of this State more than fourteen days must maintain marine recovery insurance on the boat.

    (B) To obtain marine recovery insurance, the boat owner must provide the insurer a recent vessel survey that includes a declaration that the boat is seaworthy and that the boat can move under its own power as intended when built. Sailboats must have working sails and powerboats must have a working motor. The survey must have been completed within six months of the policy being issued and completed by a licensed boat surveyor. All policy premiums must be current before a policy can be renewed and new stickers sent to the boat owner. The insurer shall issue two 3 ½ x 3 ½ inch watercraft stickers to the boat owner each time a policy is issued or renewed. The stickers must have the year in one inch font and the insurance company, policy number, and boat registration number on the sticker and be displayed on the boat. The insurer shall require a new survey from the vessel owner after each three-year period before renewing the policy on year four.

    (C) A person who violates this provision is guilty of a misdemeanor and, upon conviction, must be imprisoned not more than thirty days and fined not more than five hundred dollars.

 

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

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