May 7, 2015 For Immediate Release Contact: email@example.com
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Columbia, S.C. – The South Carolina Senate Republican Caucus announced today a comprehensive infrastructure improvement, tax reduction and Department of Transportation reform plan for South Carolina. This plan is will provide much needed long-term funding to fix the ailing road system in the state, provide permanent across-the-board income tax cuts and restructures the DOT Commission to improve performance and accountability.
“The key elements of our plan are reforming and modernizing the DOT; establishing solid long-term funding to make our roads safe; and, a tax cut plan that makes South Carolina more competitive and reduces the growth of government spending. Under this balanced approach, the people of South Carolina will have a solid road funding plan and an overall net decrease in their taxes.” Majority Leader, Senator Harvey Peeler (Gaffney).
Department of Transportation Reform:
Plan restructures DOT governance with an improved Commission plus Secretary model.
The Commission. The selection of the Commission will be based on each congressional district having one seat, and one at-large seat. District Commissioners will be rotated within the district so that small and large counties will have an opportunity to be represented. Each commissioner will serve one six year term. Current DOT commissioners would have their current terms extended by two years.
Selection process. The governor will nominate each new commissioner including the at-large seat. All nominees must be found qualified by the Joint Transportation Review Committee and then be confirmed by the Senate.
The Secretary of Transportation. The Secretary will be hired by the Commission. The Secretary will be screened by the Senate Transportation Committee and confirmed by the full Senate.
Senator Larry Grooms (Berkeley), Chairman of the Transportation Committee, and a key leader for DOT reform praised the new governance structure: “While some plans are full of hot air, our SCDOT reforms make our plan as solid as concrete.”
Long-term funding to put our roads back on track:
The funding plan uses a balanced set of sources and a multiyear phase-in approach. This is important for taxpayers and assures that sufficient funds will be available when the DOT takes action to fix our roads.
Gas tax increase phased in over 3yrs. Total $.12, indexed, and
will never be higher than GA and NC $136,000,000
Current transfer of vehicle sale taxes (FYs 2013-14) $50,000,000
Current transfer of vehicle sale taxes (FY2015) $69,000,000
Increasing the sales tax on vehicles to $600 $88,000,000
Increasing SCDL fees $11,700,000
Increasing Car Registration fees $24,140,000
Hybrid/Electric Car road fees $1,230,000
Road User Fees/Property Tax conversion for commercial
vehicles over 26,000lbs. (out of state portion) $10,000,000
Total Value Year 1 = $390,070,000
Total Value Year 5 = $800,000,000
Year 1 new fees and taxes to SC residents = $215,000,000. Bold = new revenue
Senator Ray Cleary (Georgetown-Horry), Chairman of the Transportation Funding Subcommittee of the Senate Finance Committee endorsed the plan saying: “We have responded to the needs of SC DOT as explained in their letter to the General Assembly last October. Most importantly, we are meeting the state’s needs in a fiscally responsible and conservative manner by having the fees take full effect gradually over about five years.”
Across-the-Board Income Tax Relief:
The final piece of the proposed plan is a reduction in the personal income tax rates in each tax bracket by one full percentage point over five years (.02% per year). The value of the relief to South Carolinians increases from $120,000,000 in year one to approximately $709,000,000 in year five.
South Carolinians pay approximately 66% of the gas taxes. The remainder is paid by out of state motorists. As a result, this plan is not only revenue neutral; it provides a permanent and a substantial reduction in the overall tax burden of South Carolinians. This will help every South Carolinian and will reduce the rate of state government budget growth in the future.
The Bureau of Economic Analysis (BEA) anticipates around 4% growth in each of the next several years. Even after the tax cuts, the BEA expects real tax revenue growth of hundreds of millions of dollars annually.
Senator Sean Bennett (Dorchester), a senator with significant professional experience in finance, assessed the impact of the comprehensive plan this way: “This plan is a game changer for the people of South Carolina. It will improve our overall economic competitiveness and quality of life by dedicating critically needed revenue to our roads, reforming the SCDOT so that those resources are efficiently deployed, reducing overall tax liability to our citizens, and controlling the rate of government growth.”