♪ ♪ >> Welcome to This Week in South Carolina.

I'm Gavin Jackson.

The House last week passed its $13.2 billion budget an effort, an effort led by House Ways and Means Committee Chairman Bruce Bannister, who joins me now.

Chairman, thanks for joining us.

>> Glad to be here.

Appreciate the invitation.

>> So, Chairman, this is your second year that you steered the budget, helped craft it, and then also lead that floor debate as well.

Tell me about the themes in this budget, what you all focused on with this money.

>> So the...the theme I would say this year was sort of keeping our promises.

We made some commitments to teachers.

So we continue to go towards that $50,000 starting salary, a pretty big jump from 42 to 47.

So a starting teacher would have $47,000 as their starting salary.

And then we continue to add raises additional revenue, additional compensation to teachers at every scale.

So, a big push to keep our teachers.

Get good people in education.

Veterans, we made some commitments to veterans and we honored that in this budget with the veterans' homes and the other renovations that we're making there.

Taxpayers, we said, listen, we're going to give you a 1%... we're going to reduce your income tax by 0.1% every year until we hit that 6% income tax number.

And we kept that.

That was a $100 million of additional tax relief in this year's budget.

That felt...it feels good to say, hey, we're going to do it and then, we follow through with those things.

Reserves in South Carolina is high as they've ever been.

Another thing we promised, we won't have another 2008 where we cut government services.

We closed state offices.

So we have the reserves, we feel like to weather that kind of economic downturn, so taxpayers won't get hit with... they can't go to the DMV on Thursday, Friday, Saturday or Sunday.

We have limited hours.

So we're hopeful that those...that commitment to saving for that rainy day was a good thing.

We've got the lowest debt we've ever had in the history of South Carolina.

We can borrow up to 5% and we're at 8.2% of our general fund revenue.

So, we have a lot of flexibility if we needed to make substantial investments in South Carolina or that opportunity presented itself.

We have a lot of room with our our debt ceiling to do that and the revenues there to cover those those debt payments.

We're not going to borrow money any time soon- Gavin> No.

<Bannister> -but it's nice to know you have that what I'll call an equity line... if there was something that we really need to invest in, we'd have the money to do that.

Another thing that kind of... opportunity presented itself, the hex funds when... Gavin> ...Act 3 exemption.

Bannister> Yeah, when Act 3 passed we said, Hey, if there's ever a surplus on the one penny sales tax, we'll give that back to the taxpayer on property tax relief.

And so we kind of honored that with the 500 million additional owner occupied property tax relief.

I understand the Senate was talking about it today.

I'm sure it will look different at the end of the day.

But we believe strongly that that money should go back to taxpayers, which is what we promised them.

>> And then in addition to teacher pay increases, that is quite a substantial jump.

Are you going to get to that $50,000 next year or shortly there after?

What do you think?

>> So, if the, if the economy continues to be on fire like it has over the past several years, then we're looking at next year being the year that we could... we'll be a year early from our commitment originally.

But if we hit 50 next year, we're certainly going to try to do that.

>> Do you think you go beyond that at that point?

I mean, it's still $50,000.

It's still red hot labor market, still hard to keep and retain teachers.

Is it...just become more of a so cost of living increase more at that point?

>> So we won't quit on our commitment to public education, and we're going to reassess once we get to that $50,000.

That's sort of what all the experts said.

We were so low and so far behind the southeast average.

50 was sort of the number they said, if you want people to commit to the education field and they want to be professional teachers where they feel like they're being honored for that sacrifice in doing what they do, 50 is the number you got to get to, if you want those people to stay.

And so that's sort of our goal.

We'll reassess once, once we get there.

And maybe the next thing teachers need is something else that they want us to invest in.

So we'll, we'll look at that.

>> And then there's also money in your budget for state employee pay raises, as well as pay raises for SLED and law enforcement as well.

>> That's right.

That's right.

So, we continue our commitment to law enforcement with... pay raises and making sure they have the facilities and the equipment they need.

Our state law enforcement, I mean, the General Assembly is committed to law enforcement.

That's...that's a...serious topic when you get to it.

And then on the other, the state employees, we understand the lowest paid state employees get hit the hardest with changes in the economy, inflation, other things that hit that disposable income that they don't have.

So we try to back in so they get at least that minimum raise.

And then in our budget, we did a 1.5% for everyone else above, it's either $1,000 or 1.5% raise, whichever is greater.

>> And then you guys have also maintained, you know, health insurance premiums, which have always been going up.

You cover those costs, too.

But, Chairman, tell me more about the tax relief in this House budget proposal.

I was watching the Senate subcommittee hearing about this and there might be some concern or I guess it's the Senate Finance Committee where they're hearing about the current revenue state.

And is there any concern about what this kind of tax relief would do for them for homeowners one year versus the next year, not having that, that money coming to them in terms of rebates?

>> Sure, and the biggest complaints we've heard is from the counties who don't want that property tax bill to go way down.

<Gavin> Yeah.

>> For those owner occupied homes and then go back up when the money's not there the following year.

>> Yeah.

>> And I understand the Senate has some legitimate concerns about homeowners whose escrow and their mortgages would change year to year based on what last year's taxes were.

So they'd get a big refund one year, then they would withhold too little and then have to pony up the next year to catch up those, the escrows, and so they they have a legitimate concern that people may be caught off guard the second year when that tax...that tax reduction isn't there.

But we're looking at that.

I mean they, they have a legitimate point.

We'll...they'll be part of the conference committee and maybe H-2 will, will take a closer look at what would be a sustainable annual property tax relief that we could fund out of those...surplus revenues.

>> I was going to say, I mean, are there any other plans for, you know, lower taxes, rebates, money going back to folks, since you have so much money coming in or is it... are you happy where things are right now in terms of that?

>> So the, so, you know, we're trying to make sure, number one, that we're doing it responsibly.

We don't want to make promises and go too far and then end up having to take that back.

The one time property tax relief is really based on the fact that that's what we told them we would do with the money.

We would give it back to them.

It would be whatever it is, because we haven't done it for several years that numbers about $100 million a year.

And the Senate has, it has sent word or indicated what they would like to do is figure out on the current trend how much can we do and know that that would be an annual amount for four or five or ten years.

And then let's shoot for that ten year tax rebate versus a one year big number.

So we're looking at all those.

So...that and then... continuing to reduce the income tax rate.

When we get to 6%, I think there'll be a lot of discussion about could we go lower and how that's affected our revenues and how much what have we not taxed and how much is that growing the economy and is there a sweet spot to go a little lower?

>> We have about less than 3 minutes left.

I want to ask you about just how revenues are doing.

You have less recurring revenue this year, but you still have requests totaling $1.7 billion for recurring money, $3 billion for non-recurring.

How do you judge that and what's the situation with revenues right now?

Are they stabilizing after having such, you know, sugar highs in our economy?

>> So we did sort of hit a strange point with COVID.

We had a continuing resolution for that year.

So we didn't spend any of the additional recurring or non-recurring dollars.

So we had that one time dollar amount kind of pile on top of a really hot economy coming out of COVID, where we saw huge increases in sales tax and travel and tourist spending.

And South Carolina was one of those early states that was open and generating revenue before everyone else, along with the ARPA relief and the other federal funds that came down.

So we had sort of a meeting of all the good things, a lot of extra dollars.

And now we're seeing the the economy is not slowing down in terms of it looks like it's going to go negative, but the amount of new dollars is coming back to a normal level.

So we're sort of seeing it go back to what we would consider normal sustainable growth.

>> And Chairman, with about 30 seconds left, tell me about working with the Senate.

The Senate now has it's budget, the Finance Committee, they're going to debate it in the middle of April.

Do you see any issues in the future being a little contentious?

You guys seem like things might be a little bit better this year than last year.

How do you see it going forward?

>> So there's...in every negotiation, there's two sides.

We will find a middle ground.

We will fulfill our constitutional duty to pass a...a balanced budget at the end of the day, funding state government, what that looks like and where the rub is, We'll find out shortly.

>> Yeah, it's never easy when you have money, but you have plenty of money to use, right?

>> That's right.

That's right.

A lot of opportunity, if we're blessed.

>> That's House Ways and Means Committee Chairman Bruce Bannister Thank you, sir.

Bannister> Yes, sir.

Gavin> Appreciate it.

Joining me now to discuss the latest action in the State House are two top reporters on that beat, Jeffrey Collins with the Associated Press and Joe Bustos with the State newspaper.

Welcome to you both.

Glad to see you guys again.

>> Good morning, Gavin Thank you for having us.

>> So, Jeffrey, there are seven weeks left in this year's session.

The House just passed its budget to the Senate Finance Committee.

They're working on that.

Both chambers are still working through their calendars.

I want to ask you about what we saw pass this week when it came to expanding the Education the Scholarship Trust fund, the voucher program in the House.

This voucher pilot program was passed into law last year and is still being challenged in the state Supreme Court.

Yet the House is moving to expand it and also fund it to the tune of $30 million.

What's going on here?

How is that moving?

>> Well, it's moving fast, at least for now.

I mean, you know, the.. the bill was proposed at the very end of February and it passed the House, got its key approval last night.

What it does is the original 2023 law has caps on how much a family can earn to be able to get scholarships.

It's going to be around $120,000 when it's all said, (#*position) you know, when we get to the end of the programs phase-in, in about three years.

And it has, you know, some other requirements like caps on how many students can be in the program.

Well, the House bill that passed this week, it eliminates the income caps.

So anyone can, can get one of these.

It eliminates that a student had to be in public school the year before.

So if you've been in private school your entire educational career, you can now get one of these.

And the big deal is it completely eliminates any cap on the number of students involved.

So, you know, they're, they're, they put $30 million aside to expand it.

But in theory, there could be a lot more money that goes into it, depending on how many people enter.

They had more applicants than the 5000 scholarships they had to give out because that window to apply ended.

So the proponents say, hey, you know, this is there's a lot of demand right now.

But...but the future of it is a little bit uncertain.

I mean, Senate Majority Leader Shane Massey says, hey, we'd like to wait and see how this operates before, you know, we put it in place, kind of like a three year pilot program to see how it was going to work.

And then the other thing that complicates all this is the laws before the Supreme Court right now, the South Carolina Supreme Court, which heard arguments two weeks ago on whether or not it's constitutional.

South Carolina's constitution bans direct aid given to anything but public schools.

The folks that say the law's okay, say, well, the money goes to a trust fund and parents pull from it and then they give to the private school.

So it's not like the state gives the money directly to private schools, but that's going to be up to the state Supreme Court to determine.

So all this could be proven moot in a few months when they issue their ruling.

>> Yes.

So, again, going from just a pilot program now to a full blown expansion, I mean, within less than a year, essentially.

And then it sounds like the Senate, like you're saying, is kind of throwing a little cold water on this whole thing and waiting to see where things are going to go first.

>> Yeah, I think that the, the overwhelming sentiment in the Senate, at least Republican leadership in what they were saying last week is, we just want to see if it's going to work.

I mean, let's... let's before we expand it, let's see what happens.

Maybe we can tweak it in some ways and maybe we can't expand it.

I think there's people that want to expand it in the Senate, but they just want to wait and see how it does and what problems there are and things of that nature.

>> Yeah, because I know they're going through something similar in North Carolina and other states have been expanding it, too.

So I'm sure everyone's chomping at it, here in South Carolina to get to that level, but baby steps.

>> Georgia added a $6500 program.

I believe it passed their Senate last night and is probably going to their governor.

So, yes, it is a it's a popular thing.

I mean, they've been pushing for this for 20 years in South Carolina.

So it's not a surprise that they tried to push harder to get to it.

I mean, Mark Sanford, it was a huge thing for him.

Nikki Haley, to a certain extent.

It was a big deal for him...you know, her.

I mean, it's been a big deal for governors and education people.

So, not a surprise they tried to push it just that it came so quickly after they passed this first program.

>> Mmm Hmm.

Yeah.

Good... Good talking points for Republicans in an election year, too.

>> Very much so, yes.

Gavin> Joe, house floor action over the budget wasn't as contentious this year as it was last year, specifically between the members of the far right, House Freedom Caucus and the Republican caucus, a little infighting there, but one of the major points of contention still was over DEI or diversity equity inclusion efforts within institutions of higher education.

So, what happened there with this legislation?

What's moving forward?

How is that maybe mitigating in those arguments?

>> So, last year when we went to the DEI debate during the budget, it slowed down everything that day...actually those two days.

The Freedom Caucus put up a bunch of amendments to try to strip colleges and universities of that funding, at least money that they used for DEI, and then, they eventually brought those down with the agreement that there would be discussion on a bill to ban DEI, or at least address DEI at colleges and universities.

That Bill got heard this week in a...in a committee.

It passed out of the committee so that bill would ban diversity, equity and inclusion considerations in hiring and ban mandatory diversity training at colleges and universities.

So now we'll see how it goes in, in the full House.

>> Mm hmm.

Yeah.

I mean, and just tell me, a little bit of the vibe in the House when it came to the budget this year, too.

I mean, again, not as contentious.

It seems like everyone was just maybe working to get things done because it is an election year.

>> There still was those amendments from the Freedom Caucus.

They were trying to strip money out, trying to move it towards other purposes to what they considered core functions of government.

They tried to strip funding from the Arts Commission.

Those efforts ultimately failed, but they... they got the $13.2 billion budget passed out of the House relatively easy.

They got it done in two days.

So, we all survived that one.

(both laugh) Gavin> Yeah, Joe.

Then we also talk about having extra money.

So we're talking about property tax relief to really mitigate a lot of those issues.

But Jeffrey, I want to talk to you about judicial reform.

That's been a big hot topic since last year when we saw the state Supreme Court overturn the six week abortion ban law last January.

That prompted a lot of calls to reform the judiciary and that, of course, ramped up last year.

We saw Justice Kaye Hearn get off the Supreme Court.

She became the last woman to serve on the Supreme Court.

And then in August, we saw the all male Supreme Court uphold the new six week abortion ban law.

So we did see the Senate pass, this past week, last week, I should say, it's a form of judicial reform.

Do we think that it's actually judicial reform?

How do you classify this?

>> First thing I was going to say is no one can really agree on what it is.

I mean, some people call it judicial reform.

There's some people that say it's legislative reform because it changes how the legislature operates in electing judges.

But what the Senate bill does is it expands.

There's a commission that screens judges to see if they're qualified, and it expands the number of that to 12.

And for the first time, it gives the governor appointments that board.

So it's a four, four, four system, four from the House, four from the Senate four by the governor.

And, you know, there's a lot of talk about whether legislators who are attorneys should be on that panel.

They get to stay.

And in fact, they probably will dominate the, the House and the Senate appointments.

The governor's appointments are people from outside the legislature.

They're attorneys, there, there's a prosecutor.

You know, there's somebody from the prosecution side, somewhere from the defense side.

There's a retired judge that...that is required, the governor is required to appoint.

So, that changes the makeup of that board.

Also, they were only allowed to send out three candidates.

Now they can send out up to six.

They have to send out all the qualified candidates, up to six.

If there's more than six, then they can make a choice and narrow that field down a little.

There's some changes in how the election takes place.

You know, the General Assembly chooses the judges based right now on a majority, Right.

So, there's 170 members, 124 House, 46 senators.

Whoever gets the majority wins.

Now you have to get a majority under the Senate bill of each House, which could create an interesting situation where a candidate gets the majority of the House members and a majority of the votes but can't get over 23 senators.

So we end up going to another election and another election in...in the cycle.

So this all goes over to the House right now.

The House is going to... Speaker Murrell Smith indicated that he tends to if the Senate passed something, that they would probably take up their issue, which should tell you that we're probably not going to get any further than where we're at.

No, no additional reform, so to speak.

We're probably that's probably where we're at.

We're not going to have something like where we eliminate lawyer legislators from the panel or something like that.

So the House is going to take it up.

We have 21 legislative days left.

That's probably enough time to figure it out.

But, you know, something will probably happen.

>> Yeah, if they pass it, they could still say they did something.

But what are they not accomplishing?

What more did... did folks want to see come out of judicial reform?

>> Well, you know, there's talk about eliminating the legislature from the screening process entirely, the thought being that, you know, there's three branches of government.

And since the legislature is picking the judge at the end, should they... should they also be able to pick the candidates that end up... they choose.

Right?

So there was talk about that.

There was talk about...I mean, there's always talk in these things about, well, should the public get to elect him or should we do a federal model where the governor, you know, a- you know, appoints a judge or suggests who should be the judges And, but all that requires a constitutional change and that requires not just a two thirds vote in the General Assembly, but also the public voting in November and approving it.

And so that was taken off the table quickly, because there's just, wasn't going to be the ability to get that kind of support for radically changing the way South Carolina elects judges.

>> Yeah, we're one of two states that has a General Assembly elect the judges, us and the Commonwealth of Virginia.

But it's also interesting to see how those races play out, because we did just see the Supreme Court, a new chief justice, be elected there...Joe...Joe, Justice John Kittredge to replace outgoing Chief Justice Donald Beatty, who's retiring because he's hitting the mandatory retirement age.

But at this point, the way it is right now, it will be an all White male Supreme Court come the beginning of August.

But I know that they've opened elections.

They're opening the application process for that seat that John Kittredge, you know, he's moving up.

There's going to be open seat there.

But what's... what's the vibe like in the Senate, and the House, when it comes to what needs to be done to pick a new judge here for the state Supreme Court?

Joe> Well, we'll see who actually applies for that open position, because ultimately we need if we're going to make...get away from an all White male Supreme Court, we need women to apply.

We're going to need a Black candidate or a diverse candidate to apply.

There are senator... or there are representatives and senators who want more diversity.

But ultimately to do that, you also need to build up that bench, those circuit court judges, those trial judges.

They need to have...we need... there needs to be more diversity, more Black judges on that...on that level.

If you're going to get a more diverse Supreme Court.

They got to come up from somewhere.

>> Yeah, that's the thing, too, with the screening process, with the Judicial Merit Selection Commission, it's pretty cut and dry, how they do it.

It's not like they're asking them, what's your stance on abortion like you might see in U.S. Senate confirmation hearings, but it's more, you know, what's their background, What's their record?

You know, what's their financial history, stuff like that.

So, I know that, that process I said is going to be closing April 8th and then we're going to see a hearing later in May and then an election in June.

So, based on what we've seen before, you know, when we saw that previous race for Gary Hill's seat, for filling... Kaye Hearn seat, I should say, with Gary Hill winning that seat, it seems like there might be some diverse candidates in the pipeline, too.

>> There were.

I mean, there were two, two women who were who, who were up for that seat.

Ultimately, they both withdrew when they saw that the votes weren't going to go with their way.

And Gary Hill was able to win that seat.

>> Yeah, it's going to be interesting to see how the horse trading goes down in the future.

Waiting, by the ramp, talking to people.

Jeffrey, House Speaker Murrell Smith said his priorities for the remainder of session involve a utility reform bill and keep using the word reform, but tell me if this is actually reform.

What's the aim of this bill?

I mean, it seems very complex and we're always talking about utilities.

We have a fraught history with the legislature and utilities trying to reform things, and then all of a sudden it blows up, not physically, but in some ways.

So what's the latest on that bill?

Where's that going to go?

>> Well, the simple goal of the bill is South Carolina.

The Dominion Energy and Santee Cooper want to build a natural gas fired power plant in the Low Country.

And so, the... to fast track that, that's the simple goal of the bill.

But the bill was a big bill.

It's a big bill.

So I mean, some of the other things that, the long term goal of it is to make it easier to bring more power, to generate more power in South Carolina.

I mean, the people that support this bill, they don't want to have to buy power from Georgia companies or from North Carolina companies.

They want to be able to generate South Carolina's power needs.

We're a growing state and we're trying to bring in more manufacturing, as always.

So we need more power.

Um... the question then becomes, though, I mean, you know, I say new power plant, you say V.C.

Summer, And I mean, you know, that's in everybody's mind is, you know, V.C.

Summer that's the, the proposed building two new nuclear reactors spent billions of dollars, never generated a lot of power.

You know, the construction and everything that was just, you know, promises were made, everything went south.

Gavin> Fraud, rate pairs,... on all the... >> Regulators that did not, you know that were in it, depending on how you want to look at it, either there was a law passed that they couldn't do much or they didn't do much, either way.

Either way, it failed.

So, and then the players are still here Santee Cooper and S-C-E and G, which was bought out by Dominion were the players in V.C.

Summer.

So that's the part that everybody pauses on.

And that may be it looks like this bill will probably pass the House, it will be on the House floor next week, probably pass the House, but in the Senate, again, Senate leadership is very leery.

They have long memories, and any time you offer regulators, you know, anytime that you want to alter how regulators look at things, everybody gets very nervous about what happened with V.C.

Summer.

So that's going to be where the...the pause is.

And again, I mentioned 21 days left in legislative session.

If we can get judges done, 21 days is not a lot to get a big bill like this through a very reluctant Senate.

>>Yeah, we're talking about a lot of bills that might not make it through this... the second year of the two year session.

So, if it doesn't make it across the finish line into either chamber and passed off to the governor, perhaps then it's pretty much dead.

So maybe this is just everyone's way of getting their...their place markers out there for next year.

But Joe, we have a few moments...minutes left.

Medical marijuana did pass the Senate.

There was a lot of momentum going there from Senator Tom Davis, the Beaufort Republican who's been pushing this bill for years now, a very conservative bill, type bill.

But what's going on in the House, he got that over to the House before the budget.

It's still in committee.

What's the latest?

Joe> Yeah, the 3M committee has yet to even hold a hearing on the ...on the bill.

So unless Davis may have multiple hearings, just multiple committee hearings on this bill, it might be thematic.

So we'll see when those actually take place and if it does reach the floor.

John McCravy, who got it killed last time with a procedural trick he had... he had a 1000 amendments ready to go, which means a long floor debate, which means being there for a long time and trying to get through, get the bill passed will be very, very difficult.

>> Yeah, especially because they made some House rule changes that they'll have to adopt again, maybe in the future, I should say, but that they have they can rule out of order some of those dilatory amendments.

So it's going to work in their favor.

But we have about a minute left, Jeffrey, and I want to ask you about the two week filing period for all 124 House members, 46 Senate members, and the seven congressional seats that are up for reelection this year.

That closes on April 1st.

We'll be waiting to see what...who's filing for what, But I want to get your take on just what you're seeing right now, what you're thinking it's going to look like when it comes to what primaries might look like, come June 11th.

>> There are four senators who aren't running for reelection, two in the upstate, and they're Republicans, two in the Midlands who are Democrats, including Nikki Setzler who's been in the Senate since I was two.

So there will be a very big there will be some changes there.

And I mean, it was redistricting.

So there are districts that I mean, South Carolina's growing and it's growing in places where rural Democrats like Gerald Malloy or Kent Williams are going to have to find areas where, you know, they're getting Republican areas put in there.

So it could be an interesting for the general election.

And then there are the three Republican women who will all probably get primary challengers who, you know, they're the ones that...that stood that were against the total abortion ban, you know, making it more of a six week heartbeat ban in South Carolina.

Those folks will probably face challengers, too.

So it will be very interesting.

Gavin> And Joe, I want to wrap up really quick, but just 20 seconds on the House, really quick.

Joe> All right.

We might see Kirkman Finlay filing.

He is raising money and at least three Freedom Caucus members have primary challengers.

That would be the fun thing to watch in June.

What does the House look like?

Is it more Freedom Caucus member like?

Is it less Freedom Caucus member like?

>> Yeah, it's going to be a big one for that caucus for sure.

But that's Associated Press reporter, Jeffrey Collins and The State's, Joe Bustos.

Thank you, as always.

>> Always a pleasure, Gavin.

>> And that's it for us this week.

But you can always stay up to date with the latest news throughout the week by checking out the South Carolina Lede podcast, which I host on Tuesdays and Saturdays, that you can find on South Carolina Public Radio .org or wherever you find podcasts for South Carolina ETV.

I'm Gavin Jackson.

Be well, South Carolina.

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