The Buzz

Senator: No tax hike needed for roads

After four months of debating how to raise money to repair South Carolina’s crumbling roads, state senators now are debating whether higher taxes are needed at all.

Thursday, for the second day, Sen. Tom Davis, R-Beaufort, held the floor of the state Senate, filibustering a proposal to spend $85 million from a state savings account.

Davis argued that money and most of the roughly $400 million in new state revenues, expected to be added to the state’s general fund budget next week, should be spent on roads, eliminating the need for a gas-tax hike.

That proposed 12-cent-a-gallon increase is unnecessary, Davis argued, threatening to continue his filibuster until the session ends June 4.

However, other legislators argued Davis’ plan — to spend most of the added revenues that the state collects from the improving economy on roads — would continue to starve other state agencies. Those agency budgets were cut during the Great Recession and have never been restored, leading to a host of other problems — from understaffing at the state’s child-care agency to underfunding of schools to higher college tuitions.

With only six days left in the regular session, those lawmakers say a gas-tax increase is essential to provide stable, long-term revenues to the state Department of Transportation and address other needs.

Relying on state savings and surpluses alone “won’t take care of roads. Period,” said Senate President Pro Tempore Hugh Leatherman, R-Florence. Road repairs need to be paid for from state revenues that recur each year, said Leatherman, who supports a Senate plan to increase the gas tax by 12 cents among other fee increases.

Putting one-time money toward road needs is not a long-term solution, agreed state Sen. Shane Massey, R-Edgefield. “DOT and the private sector need to know that there is a dedicated, steady source of revenue that’s going to be coming in every year.”

Some of the state’s growing revenues need to go to other state agencies, other lawmakers said.

“Roads are not the only thing that state government deals with,” said Senate Minority Leader Nikki Setzler, D-Lexington, adding K-12 education and local governments have lost hundreds of millions of dollars in funding since 2008.

Disagreement and distrust

Part of the problem is that legislators do not agree how much money is needed to repair the state’s roads.

The Transportation Department says it needs $1.5 billion more a year to maintain and expand the state’s system of roads and bridges. But other estimates of the added money needed just to repair the road system range as low as $350 million, proposed by Gov. Nikki Haley.

Some legislators, including Davis, also say they do not trust the state Transportation Department or the state’s infrastructure bank to wisely spend any new money.

For example, Davis criticized state plans to four-lane a state highway in the Pee Dee, home of Senate leader Leatherman, saying the highway is so lightly traveled a dog safely could sleep in the middle of it. However, some expansion of the road system may be worthwhile, Davis added, endorsing widening Interstate 95, which goes through his district.

The State Transportation Infrastructure Board also roundly was criticized by senators for showering money on projects in favored, urban areas but ignoring other areas of the state.

Legislators also do not agree on restoring state funding to agencies whose budgets were slashed during the Great Recession.

For example, the budget for the state’s tech school system — widely lauded as helping attract new jobs to South Carolina — is $65 million less today than it was in 2008, state Sen. Vincent Sheheen, D-Kerhsaw, said Thursday.

Other major shortfalls include:

▪  State funding of local governments that is more than $60 million this year below the level set in state law. Those cuts have forced local governments to raise taxes or cut services, Setzler said.

▪  State funding of K-12 education that is $500 million a year lower than the level set by state law. That is in addition to the $94 million in added money the House and Senate have suggested go to schools in the state budget that begins July 1.

▪  State higher education spending that is more than $200 million below 2008 levels. Colleges blame those cuts for increasing tuition costs.

“We have so many needs, obviously, that have been put off year after year after year,” said state Rep. James Smith, D-Richland.

Smith, a major in the S.C. Guard who was deployed to Afghanistan for a year, said some new state revenues should be committed to another need — maintaining state armories. Since the Guard can get federal matching dollars, $15 million in added state money could pay for $29.7 million in overdue maintenance at the armories, Smith said.

‘Bring your pajamas’

The math could be about to get more complicated.

House Ways and Means Committee chairman Brian White, R-Anderson, said Thursday that he plans to introduce a bill Tuesday that would allow lawmakers to spend surplus revenues, which the state’s economic advisers will certify as existing next Friday, separately from the budget.

In a statement, White said he is introducing the standalone proposal because the proposed state budget for the fiscal year that starts July 1 is so far along in the legislative process.

However, Davis said if a deal is not reached to spend the bulk of state savings and added revenues on roads, he will filibuster the remaining six days of the session. A filibuster would block Senate debate of a road-repair plan to increase the state’s 16.75 cent-a-gallon gas tax – the third lowest in the nation.

That plan already faces changes. Senate Republicans plan to amend that proposal, which would raise roughly $800 million a year for roads, to include a 1 percentage point cut in the state’s income tax and give the governor control over the Transportation Department.

Those changes could set off another debate.

Senate President Pro Tem Leatherman said Thursday he intends to clear one hurdle Tuesday when senators return to Columbia. No matter how long it takes, the Senate will act on the spending proposal that Davis has been filibustering, he said.

“When you come Tuesday, bring your pajamas,” Leatherman told senators.

Reach Cope at (803) 771-8657.

How much money is needed for S.C. roads?

Repairing S.C. roads and bridges will be expensive. But how much added money is needed? There is no agreement. A look at the various amounts that have been proposed.

$1.5 billion a year

To maintain, preserve and expand the state’s road, bridge and mass-transit system, according to the S.C. Transportation Department

$1 billion a year

To maintain and preserve only — not expand — the existing road-and-bridge system, according to Transportation

$800 million

The amount the Senate’s roads proposal would raise each year

$427 million

The amount the House’s roads proposal would raise each year

$353 million

The average amount Gov. Nikki Haley’s roads proposal would raise each year