A big victory for counties (and taxpayers this week) as legislation (S.984) to allow counties to continue to implement local fees passed the Senate by a vote of 32-7.
The bill’s primary sponsor, Senator Greg Hembree (R-Horry), introduced the bill in response to the Supreme Court decision that ruled Greenville’s local road use and public safety fees invalid last year. The bill codifies the elements for local fees established in Brown v. Horry County (1992) and removes the requirement that the fee benefits the payer differently from the general public.
Senator Hembree and others contend that existing statutes providing counties the authority to impose fees and the Brown case were consistent, but the Supreme Court ruled otherwise. Therefore, it was up to the legislature to clarify and fix.
Since the Supreme Court decision last year, numerous class-action lawsuits have been filed. We appreciate Senator Hembree’s accurate summary of what is going on with these lawsuits: “You’ve got taxpayers, suing taxpayers, to pay taxpayers.”
The revenue impacts would differ in dollars and percentage of the annual budget depending on the county. However, in most cases, the absence of fees would force counties to increase property taxes. In addition to the fiscal impact of the fee’s absence on local road programs, there would also be detrimental effects on budgets should counties be forced to pay out on some of these lawsuits.
Senator Tom Davis (R-Beaufort) was instrumental in ushering the bill through this week. He chaired the Finance Subcommittee that heard testimony on the bill and fully understands that these local fees help provide vital services. And when it comes to road fees, they cover the cost of everything from minor repairs to helping fund major local projects.
Amendments were adopted to address concerns regarding liability for lawsuits and fears counties that dropped their fees and increased property taxes would re-impose fees.
The bill now moves to the House of Representatives – and needs to pass this year!
There seems to be some confusion that this bill is a green light to raise taxes when in fact, it’s quite the opposite. As we noted, in most cases, the absence of fees would force counties to increase property taxes – and there’s no telling what would need to be done if these class-action lawsuits are successful as the payouts would be astronomical in some cases.