Weekly Legislative Update

 

North Carolina South Carolina

North Carolina

Betsy Bailey Victor Barbour 
By Betsy Bailey & Victor Barbour
January 28, 2026

Wetland Loss

In 2018, Hurricane Florence stalled over North Carolina, dumping heavy rain that shattered records across the eastern part of the state. In some areas near the coast, Florence dropped more than 30 inches of rain over several days, and preliminary reports showed totals as high as 35.93 inches in parts of the region. These rainfall amounts contributed to catastrophic flooding as rivers and creeks quickly overwhelmed their banks.

In New Bern, emergency officials said, hundreds of residents had to be rescued from homes, attics and rooftops as neighborhoods were inundated. One report said more than 360 people were rescued after water surged into residential areas.

Nearly eight years later, the Environmental Protection Agency and the U.S. Army Corps of Engineers are poised to revise the definition of Waters of the United States. Environmental advocates warn the proposed changes could leave thousands of acres of wetlands — like the ones surrounding New Bern — open to development. Those wetlands provide natural flood protections, and paving over them could pave the way for more severe flooding from future storms and rising seas.

In 2023 the Supreme Court ruled in Sackett v. EPA that only wetlands with a continuous surface connection to traditionally navigable waters qualify for federal protection under the Clean Water Act. In the 5 to 4 decision, the court narrowed the scope of federal jurisdiction, leaving as muchas 91 percent of the nation’s nontidal wetlands without federal protection and thus open to development. The decision prompted the EPA and the Army Corps to draft a revised definition of what constitutes the waters of the U.S., also referred to as WOTUS. A new rule is expected soon.

The stakes of that shift are highlighted in a recent study by UNC Chapel Hill scientists, whose research suggests that the loss of federal protections for millions of acres of wetlands could amplify the impacts of sea-level rise for coastal communities. The study draws on projections from N.C.’s 2020 Climate Science Report, which indicate that cities like New Bern could experience about half a foot of sea-level rise by 2040 and potentially several feet by the end of the century.

That level of flooding could affect infrastructure crucial to maintaining health, such as hospitals and sewage and water treatment plants.

“Protecting wetlands and connected waters is one of the most effective ways to reduce flood risk and strengthen community resilience, while also providing long-term economic and environmental value,” said Chris Brown, executive director of SmarterSafer.org, a coalition that advocates for environmentally responsible and fiscally sound disaster policy.

If wetlands are submerged or prevented from migrating inland, researchers warn that communities could lose a vital source of natural flood protection, water filtration and storm buffering.

New Bern’s vulnerability is underscored by UNC researchers, who warn that rising seas, combined with land-use constraints, could reduce the wetlands that buffer the town from storm surge and heavy rainfall. As those natural defenses shrink, the city could become increasingly exposed to flooding.

Wilmington Harbor

The harbor deepening project in the Cape Fear River has been put on hold until further notice, as the U.S. Army Corps of Engineers takes stock of public and state concerns. The project has raised issues by municipalities and the public, including further exacerbating already existing PFAS contamination in the Cape Fear, flooding, rising mercury levels, eroding shorelines and its impact on marine life habitats.

The Wilmington Harbor 403 project is being studied to widen and deepen navigable waters leading to the Port of Wilmington. The port has requested the project to bring in larger vessels, alleging economic benefit to the port and city. The $1.35-billion unfunded project is set to augment the river from 42 feet deep to around 47 feet. The dredging would begin 16 miles offshore and is expected to extend 38 miles to the Port of Wilmington.

It’s the USACE’s job to do the actual dredging, but before physical work in the river begins, the federal department has to conduct reviews and studies to ensure the proposal is consistent with preserving the coastal environment and informing the public. USACE published its environmental draft impact statement last fall, but the state also has to oversee consistency.

USACE requested on Jan. 16 the North Carolina Department of Environmental Quality’s Division of Coastal Management temporarily stop its consistency review after receiving comments from both the public and DCM. The review request was first submitted to DCM in October, and the state division will have to evaluate if the project falls in line with coastal management program laws.

The federal consistency review is a requirement under the Coastal Zone Management Act, meant to balance environmental preservation with real estate and business developments. The USACE must meet the enforceable coastal management program policies — like properly preventing further contamination of waters and ensuring fish habitats are maintained — to the best of its ability.

Already, six municipalities have passed resolutions expressing concerns with the harbor deepening, including Southport, Kure Beach, Bald Head Island, Caswell Beach, Leland, and Sunset Beach. On its agenda this week, the City of Wilmington was supposed to take a vote on a resolution requesting the state and USACE further review the project. It was pulled ahead of the Jan. 20 meeting due to the publicized pause.

USACE decided to rescind its review submission in order to revisit the project plans and proposal to address comments it received. The USACE’s public comment period ended in November and the DCM’s ended in December. It is unclear when the pause will be lifted, but once the process resumes, the DCM can either agree or object to the project based on its findings. 

Pollution Rules

The Environmental Management Commission, North Carolina’s foremost authority on water quality regulations, trudged closer to adopting statewide rules on PFAS and 1,4 dioxane at its January meeting. But years of debate over these forms of pollution have stripped back the proposed regulations so far from their original forms that environmental groups called it a “step backwards” for their cause.

Industrial manufacturers often pay municipalities to treat their waste, despite those cities not having the proper technology to remove PFAS and 1,4 dioxane. This results in large quantities of these chemicals being dumped into rivers by wastewater treatment facilities.

“If this pollution goes unchecked, there are very real effects,” Cori Bell, a senior attorney at the Natural Resources Defense Council, said.

The Department of Environmental Quality has worked since 2021 to impose water quality standards for PFAS and 1,4 dioxane despite opposition from industry and cities getting paid to do the dumping. Previous attempts to implement numeric limits of the chemicals in surface water failed to make it through the rulemaking process. On Jan. 8, the Commission voted to proceed with a version of the rules that would simply require industrial facilities to test water samples quarterly for 1,4 dioxane and three types of PFAS and create a “minimization plan” aimed at decreasing the levels of those chemicals in their discharge.

The Southern Environmental Law Center said in a letter penned to the Commission in December, claiming that the rules are “a significant step backwards” in the state’s attempt to reduce chemical pollutants in its drinking water.

That’s because this version of the proposed rules doesn’t give DEQ any powers that it does not already have, namely the ability to require monitoring for 1,4 dioxane and PFAS and, in some cases, institute discharge limits of the chemicals via permits. Under the proposed rules, sampling for 1,4 dioxane and the three PFAS (PFOA, PFOS and GenX) wouldn’t be completed until September 2027, and the implementation of any minimization plans wouldn’t begin until 2029.

“After nearly a decade of studying this pollution, now is not the time to spend years longer on sampling and planning,” SELC’s letter read.

Bell also said she’s worried about the requirement that the state legislature signs off on the spending associated with clean-up costs, thanks to the passage of the Reins Act last year. The approval of such regulations, she said, should be left up to the experts at state agencies, not politicians.

Fiscal notes approved by the Office of State Budget and Management estimated that the water pollution regulations would incur $138 million in implementation costs to the private sector. Costs to local and state governments would be more modest — about $13 million

South Carolina

Leslie Clark  Whitney Williams
By Leslie B. Clark & Whitney Williams
January 28, 2026

Donate to CAGC Industry PACs

2026 Elections Taking Shape

Legislators have started announcing their intentions for the 2026 elections as we near the filing dates for the SC House of Representatives and statewide offices.  In addition to retiring Representatives Davey Hiott (R-Pickens) and Spencer Wetmore (D-Folly Beach), Jermaine Johnson (D-Columbia) has announced his retirement to focus on the gubernatorial campaign.  Long-serving Representative Bill Clyburn (D-Aiken) has also announced his retirement, after 31 years in the SC House. 

Filing for elected office will be held March 16-30, 2026. 

General Assembly Committee Assignments

The four newest members of the House were sworn into office on the first day of session and received their committee assignments from Speaker Murrell Smith (R-Sumter):

  • House Majority Leader Davey Hiott (R-Pickens) filled the vacancy on the Ways and Means Committee (previously served on the Agriculture, Natural Resources, and Environmental Affairs Committee)
  • Representative Greg Ford (R-North Charleston) was assigned to the Agriculture, Natural Resources, and Environmental Affairs Committee
  • Representative John Lastinger (R-Lexington) was assigned to the Medical, Military, Public and Municipal Affairs Committee
  • Representative Dianne Mitchell (R-Greenville) was assigned to the Education and Public Works Committee
  • Representative Keishan Scott (D-Bishopville) was assigned to the Medical, Military, Public and Municipal Affairs Committee

In the Senate, after Senator Lee Bright (R-Spartanburg)’s swearing in, he elected to serve on the following committees:  Agriculture and Natural Resources, Banking and Insurance, Family and Veterans’ Services, Fish, Game and Forestry, and Judiciary.

*Committee assignment/selection varies by chamber – in the House, the Speaker has the sole authority to assign members to committees.  In the Senate, members select their committees based on seniority.

South Carolina Unemployment Trust Fund

South Carolina’s Unemployment Insurance Trust Fund remains strong, with an available balance of $1.799 billion as of January 20. For the week ending January 17, the state recorded 4,047 initial unemployment claims, indicating emerging unemployment, while continued claims totaled 17,252 for the week ending January 10, reflecting the number of insured individuals currently receiving benefits. Job opportunities remain robust, with 69,613 openings listed in SC Works Online Services.

In addition, DEW released its FY2025 Annual Management and Trust Fund Report on January 15, detailing program performance, workforce outcomes across the state’s twelve local areas, and six legislative recommendations, including a new proposal related to trust fund solvency. Individuals who received unemployment benefits in 2025 can expect their 1099-G tax forms to be available in late January or early February, and DEW continues to recruit for multiple positions statewide to support workforce development efforts.

SCDOT Modernization Bill

Similar to House discussions, S.831 was introduced last week with the goal of modernizing the Department of Transportation.  The bill creates a new Coordinating Council for Transportation and Mobility to guide statewide planning, clarify duties of department leadership and internal audit standards, and assign responsibility for the long-range statewide transportation plan to SCDOT. The bill authorizes public-private partnership agreements for transportation projects, allows for tolls, and expands SCDOT’s authority over turnpikes, including feasibility studies and bond issuance procedures. It also includes a road devolution program to transfer certain roads to localities, imposes development congestion mitigation fees, adjusts alternative fuel and electric vehicle charging fees, updates County Transportation Committee responsibilities, and make other technical and financial updates to how highways and infrastructure are planned, funded, and administered.  The subcommittee listened to a presentation from Secretary Justin Powell, then adjourned without taking a vote.  They intend to reconvene this week.

Buy American Iron and Steel Act

A House LCI Subcommittee met on legislation amending the state procurement code to require that any iron or steel products permanently incorporated into public works projects financed with state-appropriated funds must be produced in the United States. The requirement would apply to public entities entering into contracts for construction, maintenance, repair, renovation, or improvement of infrastructure and facilities. However, the bill includes exceptions if U.S.-produced materials are not available in sufficient quantity or quality, would increase project costs by more than 25%, or if domestic sourcing would be inconsistent with the public interest, and allows minimal incidental use of foreign iron or steel under specified cost thresholds. The measure also exempts certain electrical components and honors existing federal obligations. 

The subcommittee voted to approve the bill and it will be placed on the next full House LCI Committee agenda.