- Associated Press - Saturday, January 2, 2016

COLUMBIA, S.C. (AP) - A new law written to assist Habitat for Humanity’s home-building mission may be a boon in South Carolina’s post-flood rebuilding efforts.

The law that took effect New Year’s Day allows charities that build or renovate homes for needy families to buy those construction materials free of sales tax. When they passed the exemption overwhelmingly in June, legislators could not have foreseen the benefit to a state ravaged by historic flooding months later.

The measure’s main sponsor, Rep. Garry Smith, said he introduced it because it didn’t make sense to tax the work of a charity that seeks to build homes and hope in communities.

“Obviously, we had no idea anything like that would happen,” Smith, R-Simpsonville, said of the October storm. “If it does provide some benefit to people who have lost their homes, that’s great. Every little bit does help.”

Greg Thomas, director of the state’s association for 36 Habitat affiliates, called the law’s timing “an absolute blessing.”

While the state sales tax is 6 percent, local taxes push it to at least 7 percent in most counties.

Eliminating that cost on construction materials will save Habitat between $2,500 and $4,000 for each home built. Ordinarily, Habitat affiliates build roughly 100 homes and repair another 100 annually statewide, Thomas said.

“That’s extra that could be used for additional repairs on other homes, particularly in this flood period and disaster-response time,” he said.

It’s unclear how much the law could help flood victims. Other charities didn’t know about the exemption when contacted by The Associated Press, though they were eager to learn more.

“No one is talking it up yet,” Thomas said.

How the exemption applies may help explain that. The law defines needy as individuals or families making up to 80 percent of their county’s median income. In hard-hit Richland County, for example, household income needs to be less than $39,000; in Charleston County, less than $41,000; in Clarendon County, less than $21,200, according to Census data.

“It’s almost poverty-level folks, so if you’re a middle-income family with damage, those homes aren’t eligible,” Thomas said.

For Habitat-built homes, determining eligibility isn’t an issue. Since the charity acts as the mortgage company, the family’s financials are reviewed before approval. But it’s an uncomfortable question for post-flood work, which often involves mold remediation and new flooring, insulation, and drywall, Thomas said.

“Without having a charitable organization ask, ‘How much money do you make?’ you have to go on the value of the home and make assumptions,” he said.

Flood victims in the 24 counties covered by October’s emergency declaration have until Monday to register with the Federal Emergency Management Agency for federal assistance. But that aid is limited.

As of Dec. 27, FEMA had inspected nearly 81,300 structures for damage, resulting in $78 million in approved aid for 26,108 applicants. That’s an average of less than $3,000 per family. The maximum grant a family can receive is $33,000, according to the agency.

The One SC relief fund, which Gov. Nikki Haley launched in November, awarded $500,000 to 13 charities in its initial round of grants announced Dec. 21, with each receiving between $25,000 and $150,000. Those charities, including two Habitat affiliates, are providing an additional $2.5 million total from other sources to rebuild or remove mold from about 350 homes, said JoAnn Turnquist, president of Central Carolina Community Foundation, which is housing the fund.

The nonprofit is not releasing how much more money has been raised, though Turnquist says people continue to donate. Charities have until Friday to apply for a second-round grant.

“We’re hopeful the fund will continue as long as it’s needed,” she said. “We’ve been told to prepare for a two-to-three-year recovery period.”

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