2024 session review: Making headway on much-needed reforms

As we close out the second half of the 2023-24 regular session, South Carolina is pressing forward with changes to advance liberty, provide tax relief, and increase government transparency, among other improvements. Several of these measures are now signed into law, while others are just shy of the finish line.  

We are thrilled to share that these changes deliver on many priorities set by the Policy Council this year, outlined in our 2024 Roadmap to Reform. As we head into summer, now is a great time to recap these achievements and discuss some of the major bills still in play.  
 

IMPROVING JUDICIAL SELECTIONS

After years of effort and a productive session, South Carolina is on its way to passing legislation that will foster a fairer and more transparent judicial selection process. Many changes target the Judicial Merit Selection Commission (JMSC) – the powerful panel charged with vetting and nominating judicial candidates. Under S.1046, the governor would gain several appointments to the JMSC, ending the legislative monopoly over its membership. Members would also face term limits. 

To reconcile differences between House and Senate versions of the bill, S.1046 was sent to conference committee. Should lawmakers reach a likely compromise, it is expected to pass during the June special session! 

Other changes under consideration include:  

• Allowing more candidates who are found qualified to seek election, fostering more competition in judicial races.  
• Requiring the JMSC to livestream its hearings online, making them more open and transparent.  
• Providing more time for legislators to review nominees before those nominees can start seeking vote pledges.  
• Addressing the loophole that allows magistrates to serve beyond the expiration of their statutory terms. This particular issue has been covered extensively by The Nerve – the investigative news arm of the Policy Council.  

In February, we launched our Judicial Reform Action Page – a one-stop shop for learning about the status of judicial bills and empowering citizens to contact their legislators in support of change. The page kept readers up to date on critical developments and amplified their voices, applying constant pressure on the issue of reform. Last year, we covered explosive testimony by state solicitors to a House reform study committee, highlighting accounts of actual or perceived misbehavior that have damaged public trust.  

While not a perfect bill, S.1046 offers welcome improvements that target different stages of the selection process. Its effect will be to strengthen judicial integrity in the short term, while providing a foundation for future reforms.  

In addition, these changes are strongly supported by South Carolinians. According to our Issue Survey conducted in the spring, an overwhelming majority of SCPC readers favor revising the JMSC appointment structure, and 95% support a requirement for the commission to livestream its hearings. When it comes to raising the number of qualified candidates who may seek election, 89% expressed their support. 

ACCELERATING TAX RELIEF

As record-high inflation puts pressure on South Carolina families, SCPC doubled down on tax relief as a top priority this legislative session. These efforts have driven momentum behind a competing pair of tax-cut proposals now vying for a spot in the next state budget.  

In April, the Senate advanced a budget plan to double the size of this year’s planned personal income tax cut, which would bring the top tax rate from 6.4% to 6.2%. The accelerated plan builds on a 2022 tax-relief package championed by the Policy Council, which initially lowered the rate to 6.5% and scheduled yearly 0.1% reductions until it reaches 6.0%. 

The more we cut taxes now, the faster we reach the target rate! 

The plan is strongly favored by taxpayers. Our reader survey found that 85% of respondents said it is very or somewhat important for the accelerated rate cut to pass. The same survey showed that 91% of respondents were very or somewhat concerned with their family’s ability to pay their bills.    

Our January Roadmap to Reform urgently called for accelerating the income tax relief schedule. That same month, our Sustainable Budget report showed how the state could slash the top rate to 6.0% this year using less than half of a projected surplus.  

The House, meanwhile, is backing a proposal to lower the next round of property tax bills on owner-occupied homes. The funding comes from a sales tax surplus that has been accumulating since 2020, now sitting at $600 million. If the full amount were allocated to property tax reduction, we estimate homeowners could see an average credit of $430 on their next tax bill. 

Our research makes a compelling case for maximizing tax relief. We recently uncovered that state law requires the full sales tax surplus in question to be used for property tax credits. More broadly, we demonstrated that South Carolina could pass a final budget incorporating both tax-relief measures (accelerated income tax reduction and property tax credits). 

The details of the relief package are still being worked out in budget conference committee and will be finalized in June. While the results are not yet known, our tax and budget findings throughout the session have positioned South Carolina well for success. 

MINIMIZING THE IMPACTS OF ESG

South Carolina bolstered its pension system this year by ensuring that investment decisions are based on risk, return and maximizing shareholder value. The mandate comes by way of Act 103 (H.3690), signed by Governor Henry McMaster in February, which bans the use of investment factors that promote ESG (environmental, social and governance) or political objectives when it comes to the state retirement plan.   

The law also places limits on when shareholder proxy-voting rights can be delegated to outside parties. Moreover, if the S.C. Retirement System Investment Commission (RSIC), which manages state pension assets, hires a proxy firm for assistance, the firm must certify that it will make investments using the criteria prescribed by law. 

Last year, SCPC described how many large institutions are deprioritizing traditional investment factors in favor of ESG criteria when making investments and offering services. We argued that securing the state retirement plan should be a top legislative priority, highlighting H.3690 as a worthy starting point.  

Supporting these efforts, The Nerve published a trio of stories on the ESG-pension issue in January, February and April 2023. “While I believe that the RSIC has responsibly managed the trust, we want to statutorily guarantee they will continue to do so,” House Speaker Murrell Smith told The Nerve that spring.  

While the fight against ESG is far from over, protecting the public’s assets is a significant first step. Additionally, we must ensure the financial viability of the pension plan, which currently carries an unfunded liability amounting to tens of billions of dollars. 

UPHOLDING ACADEMIC INTEGRITY

Every child deserves a quality education – and every parent deserves reassurance that one is being provided. A bill nearing passage would reinforce these values by upping transparency, banning harmful concepts in the classroom, and making student achievement a priority once more.  

Known as the Transparency and Integrity in Education Act, this sweeping proposal would, among other things: 

• Require all K-12 materials, including library books, to be grade and age appropriate. 
• Keep harmful concepts out of school curriculum, such as the notion that moral character is defined by a person’s race, ethnicity or national origin, or that immutable characteristics inherently make a person racist, privileged or a contributor to oppression.  
• Direct school districts to list all approved textbooks on their websites in a prominent location. 
• Allow individuals who believe that prohibited materials or concepts are being provided to file a formal complaint 
• Provide students and parents with a syllabus for each course outlining its topics, classroom expectations, reading materials and more. 

The bill passed overwhelmingly in the House and Senate last year. However, the chambers insisted on their respective versions, sending it to a conference committee for negotiations. Should the committee approve it during their next June 5, 2024, hearing, it is in a likely position to pass during that month’s special legislative session. 

While the proposal is a win for parents, we recognize that the heart of education lies at the local level. That’s why SCPC partnered with allies in North and South Carolina last year to form the Carolinas Academic Leadership Network (CALN). CALN provides training, resources and networking opportunities to school board members who prioritize student achievement. It also empowers parents and community members through educational sessions and other initiatives.  

Last month, CALN hosted a community event in Raleigh with sessions on academic trends, effective communication and more. “All the information provided was valuable for me,” said one new school board member. Another attendee shared, “The speakers were fabulous, and the data presented was excellent.” A follow-up event will take place in Columbia on June 22. Want to join us? Learn more here! 

MORE POLICY WINS

• Sounded the alarm on a proposed liquor liability insurance program to be backed by taxpayers. Following our research, lawmakers struck the program from the bill before it passed in the House. Meanwhile, we advocated for proper liability reform, which has yet to pass but shows growing support as we look to 2025.  
   
• Objected to a measure imposing heavy regulations on short-term lenders, which would have driven out businesses and reduced consumer choice. Our analysis of the bill was a vital resource for legislators and the public, helping to see the proposal defeated.  
   
• Removed healthcare barriers by championing a measure to exempt at-home acute hospital care programs from Certificate of Need (CON) requirements. The victory comes one year after South Carolina enacted a broad repeal of its CON laws, supported by Policy Council research and polling. 
   
• Bolstered the integrity of our elections via a pending state constitutional amendment. After passing nearly unanimously in the General Assembly, the amendment, which tightens voter eligibility language, heads to the November ballot for voter approval. The proposal compliments a 2022 election reform broadly favored by South Carolinians.  
   
• Expanded individual liberties following the passage of constitutional carry. The updated law allows lawful adult gun owners to carry a handgun, either openly or concealed, without the need for a concealed weapons permit. It also increases the penalties for unlawful handgun possession.