Weekly Legislative Update

North Carolina

By Betsy Bailey & Victor Barbour
April 14, 2021

Pipeline Study Proposed in New Legislation

A recent pipeline leak in Huntersville is prompting Sen. Natasha Marcus, D-Mecklenburg, to file legislation to study the condition and environmental impacts of gas pipelines across the state. Senate Bill 549 calls the Huntersville incident the “largest gasoline pipeline leak in state history.” According to the Charlotte Observer, the Colonial Pipeline spilled 1.2 million gallons of gasoline was caused by a crack in the pipeline, but the company isn’t yet certain why the crack formed. The N.C. Department of Environmental Quality has promised a “thorough review ... to determine the full extent of the impact in order to guide the cleanup and protection of public health and the environment.”

SB 549 would task DEQ with overseeing the study to review the issue and recommend any legislation that could “improve pipeline safety and protect the state’s land and waters from pollution caused by leaking or poorly maintained petroleum product pipelines.” The bill includes $200,000 to fund the study. “This bill will give NC DEQ the resources it needs to look out for our health and safety in light of the risks posed by aging hazardous liquid pipelines,” Marcus said in a news release. “For starters, I believe residents find it unacceptable that the state does not currently monitor such pipelines for leaks.  We need to change that.”

Farm Bill Would Exempt Some Construction Projects from SBC Oversight

After a long, complicated slog to pass last session’s farm bill, Sen. Brent Jackson filed this year’s version of the annual agricultural omnibus on Tuesday. Senate Bill 605 will likely see multiple additions and deletions as it moves through the legislative process, but here are a few of the highlights of the initial proposal filed Tuesday by Jackson, R-Sampson and chair of the Senate’s agriculture committee:

  • Exempts Department of Agriculture facility construction projects from the oversight of the State Building Commission
  • Creates a new permit process for what are known as “farm digester systems,” which collect and process animal waste gases to use as a renewable energy source. Digester systems would not be allowed on hog farms if they would increase the farm’s permitted capacity, and they would not be allowed in a 100-year flood plain.
  • Puts a three-year expiration date on driver’s licenses issued to immigrant workers here on H-2A work visas
  • Gives the N.C. Forest Service the option to offer comp time instead of overtime pay for firefighting work
  • Allows magistrates to waive trials and impose fines for people who are charged with violating forest service regulations. 

Minority and Veteran Participation Legislation Filed

Several Democratic Senators have filed legislation that ultimately aims to encourage and promote the use of veteran contractors in state purchasing of goods and services, state construction contracts and state information technology procurement.  SB 558 filed by Senators deViere, Davis and Clark would require the Department of Administration to collect and compile data on the use of veteran businesses in state contracts and would appropriate funds to the Department for this purpose. 

Although the legislation does not require a preference or “set-aside” like previous failed legislation from two years ago, data collected could ultimately be used for that purpose in the future.    

SB 568 would appropriate funds to the Department of Administration to study good faith efforts, to provide grant funds to minority owned businesses and community development institutions and would require a study of local government contracts to collect data on the use of minority owned firms.  The purpose is to increase the number of minority and historically underutilized businesses used in state contracts.  The proposal also clarifies and defines the term “responsible, responsive bidder.”  The new language is underlined:

“All proposals shall be opened in public and the board or governing body shall award the contract to the lowest responsible bidder or bidders, taking into consideration quality, performance performance, and the time specified in the proposals for the performance of the contract.contract, the bidder's compliance with the provisions of G.S. 143-128.2(c), and the bidder's past performance on contracts subject to this Article, including quality, performance, the time specified in the proposals for the performance of the contract, and cooperation with other bidders and persons involved in the project.”

CAGC is currently studying both proposals and conferring with our members to determine their impact. 

South Carolina

By Leslie B. Clark
April 14, 2021

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Last week was crossover week in SC, bills that did not pass one body or the other by the end of this week cannot be considered this session without a 3/5ths vote of both bodies. Therefore, the House and Senate spent most of their time in their respective chambers working through their respective calendars. When not in session, Senate Finance subcommittees were meeting. Below are the highlights of last week’s legislative session.

Additional $1.7B in Revenue, Says the BEA

Late last week the Board of Economic Advisors (BEA) told legislators they could add $1.7 billion in tax revenues to their spending plan. That figure does not include the estimated $2 billion coming to SC from the latest federal aid package or the Savannah River Site settlement with the federal government of $525 million. Legislators were encouraged to continue to plan for negative impacts from the pandemic as there are still many unknowns. The BEA will meet again in May.

Senate Budget Finance Subcommittee Talks Electric Vehicles

The Senate Finance Transportation & Regulatory subcommittee met late last Thursday to hear from SCDOT. The Department pitched the same provisos that the House has already passed. During the brief meeting, there was some discussion about the impact electric vehicles will have on the agency in the future. Secretary of Transportation Christy Hall confirmed they are monitoring this and acknowledged the number of gallons of gas sold continues to decrease, despite the growing numbers of cars on the road. Sen. Ross Turner noted that Sen. Hugh Leatherman has put together a subcommittee to investigate long-term issues such as this.

SCPA State of the Port Presentation

Last week the SC Ports Authority (SCPA) presented their state of the Port presentation to the Senate Transportation Committee. Among many stats and figures, the biggest take away was that The Port of Charleston handled 248,796 twenty-foot equivalent units across the Wando Welch and North Charleston terminals — a 34% year-over-year increase. The previous cargo handling record was 233,110 TEUs, set in August 2019. Year to date, the SCPA has handled 1.86 million TEUs since July.

Building Codes Legislation Passes House

H. 4060, which would change the adoption cycle of the Building Codes for residential and commercial contractors passed the House last week.  Last session Carolinas AGC joined nine other groups (Mechanical Contractors, Architects, Engineers, Firefighters, Insurance industry, Building Officials, Municipal Association, Forestry Association, and reps from ICC) in reaching a compromise with the SC Homebuilders on changes to the Building Codes. The Homebuilders asked to have H. 4060 filed this year but did not include the changes that all the parties agreed to last session. Carolinas AGC, along with members of our Building Codes coalition, quickly rallied to offer amendments to H. 4060 that would more closely reflect the compromise we had originally agreed to. The bill was passed out of the House by a vote of 105-0. As approved, the bill will allow Homebuilders to adopt changes to the Residential Building Code no sooner than five years and not later than six years. It allows the adoption of the Commercial Building Code not sooner than two years and not later than three years. After receiving a perfunctory third reading, the bill was sent to the Senate and referred to the Senate Labor Commerce and Industry Committee.

Capital Use Tax Bill Passes House

Last week the House passed a Capital Use Tax bill, H. 3948. This bill will allow counties to pass a referendum, in a general election, to implement and collect a capital sales tax for water, infrastructure, sewer, and public works projects. The original bill allowed for the implementation of the capital sales tax, in addition to the penny sales tax programs that already exist in the state’s six largest counties. An amendment was offered to the bill that expanded the capital sales tax option to all counties and not just the counties that currently have the penny sales tax programs. The bill passed the House by a vote of 75-29, was given a third reading, and sent to the Senate for consideration.

Senate Transportation Committee Passes IMF Legislation

The Full Senate Transportation Committee met last week and unanimously approved H. 3505.  This bill, which has already passed the House, clarifies that the Infrastructure Maintenance Fee is collected when a vehicle is titled or registered. Current law limits the IMF to be collected only at registration. The bill was reported favorably to the full Senate and placed on the Senate calendar.

Intrastate Commercial Motor Vehicle (CMV) Changes

H.3689 was taken up by the full Senate Transportation Committee last week. This bill exempts large (26,000 lbs. or greater) intrastate commercial motor vehicles from county road and bridge fees. Every county in the state currently has the option to charge these fees, but most do not. The bill also creates a payment plan option for these CMV’s to pay their South Carolina-levied registration fees and road use fees (RUF). The SC Department of Revenue allowed installment payments in the Motor Carrier Act prior to the passage of the motor user tax bill in 2017, which changed that practice. This legislation would allow the Revenue Department to reinstate this partial-pay option. The bill was reported to the full Senate for consideration.

Left Lane Laggers Headed to Conference Committee

The full House voted 107-1 to non-concur in the Senate amendment to the left lane laggers bill, H.3011. The bill includes a fine of $25 for driving too slow in the left lane of a three- lane highway. It also adds language that clarifies when it is appropriate to drive in the left lane and allows for drivers going too slow in the left lane to be stopped and ticketed. There would be no points against a driver’s license if stopped for this violation. The House bill had the fine set at $250 and the Senate changed it to $25. The final details will be worked out in a conference committee made up of members from the House and Senate. The Senate conferees are Sens. Sean Bennett, Ross Turner, and Thomas McElveen. The House conferees are Reps. Adam Morgan, Jay West, and Rosalyn Henderson-Meyers.

SALT Bill Referred to Ways and Means

Last week S.627, also known as the SALT bill, was introduced in the House and referred to the House Ways and Means Committee for consideration. This bill addresses income tax rates for pass-through trade and business income. Specifically, it will grant an election to tax partnerships and “S” Corps and will allow a credit for pass-through business. The 2017 Tax Cuts and Jobs Act (TCJA) imposed a $10,000 cap on the amount of state and local taxes (SALT) South Carolina taxpayers can deduct on their federal returns. This cap hurts employers organized as “pass through” entities that pay taxes on business profits at the individual (owner/partner) level. CAGC is supporting this legislation.

Voluntary COVID-19 Vaccinations

Last week the Senate, by a vote of 43-0, passed S.177 a Joint Resolution that would mandate that employers cannot fire or take adverse actions against an employee who chooses not to receive a COVID-19 Vaccination. Due to concerns that the bill would violate SC’s Right to Work laws, the bill was amended in committee to incentivize employees who receive the vaccine, instead of acting against employees who do not.  The bill also allows employers to publish rules and actions that must be taken if an employee tests positive for COVID-19, including requiring them to quarantine. The resolution was sent to the House for further consideration.

SCDEW Requests BPBP Funding in Senate Subcommittee

Last week the SC Department of Employment and Workforce (SCDEW), during their Senate budget presentation, requested $642,000.00 in state funding for the Be Pro Be Proud truck. A request Carolinas AGC is supporting and pushing for as well. SCDEW Director Dan Ellzey did a great job of sharing information about the truck and its success thus far with members of the Subcommittee, sharing that it is booked solid for the rest of the year. Ellzey went on to share that SCDEW is in complete support of the truck and is requesting the funding because the program has such value and SCDEW thinks public money should be invested to keep it running a second year.

Cox Reappointment to SCDOT Commission

Gov. Henry McMaster submitted statewide appointments and reappointments to members of the legislature last week. Tony K. Cox of Myrtle Beach was reappointed to serve another term on the South Carolina Department of Transportation (SCDOT) Commission. The term is to commence February 15, 2021, and to expire February 15, 2025. This 7th Congressional District reappointment was referred to the Senate Transportation Committee and the House Education and Public Works Committee.