Richland County gets 10-day extension to respond to revenue department penny tax demands

The S.C. Department of Revenue has granted Richland County a 10-day extension on a 30-day deadline to begin making changes to its transportation penny sales tax program.

Friday marks 30 days since DOR director Rick Reames sent a letter to Richland County leaders laying out a list of four demands for action related to his department’s ongoing investigation of the county’s 3-year-old, $1.2 billion penny sales tax program:

▪  Repay from the county’s general fund all penny tax money that has been spent to establish and operate the Small Local Business Enterprise (SLBE) program.

▪  Repay from the county’s general fund all penny tax money that has been spent for public relations purposes not directly related to transportation-specific projects.

▪  Immediately hire an independent accounting firm to audit each year of the penny tax program and require companies who were paid by the penny tax program to provide the county with independent financial audits of expenditures.

▪  Immediately take corrective action to assure that future uses of the penny tax are solely related to capital costs associated with transportation projects and provide the public with information as to how those costs are to be determined.

Reames wrote in his letter that if the county did not begin to take the requested actions within 30 days, the revenue department “is prepared to enforce the state’s tax laws,” though DOR officials did not elaborate on what that means when asked by The State.

DOR spokeswoman Ashley Thomas said Friday that the county had been granted a 10-day extension to respond to those demands. In the meantime, Thomas said, the county and DOR will meet to review and confirm specific next steps.

Reames’ has said the revenue department “has uncovered millions of dollars of potential fraud, waste and abuse” resulting from illegal uses of the penny tax and “numerous conflicts of interest found in the program.”

County leaders have defended some aspects of the program brought into question but have said they are willing to make changes as necessary.

County Council’s next scheduled meeting is April 5.

This story was originally published March 25, 2016 at 9:47 AM with the headline "Richland County gets 10-day extension to respond to revenue department penny tax demands."