- Associated Press - Wednesday, October 5, 2016

Recent editorials from South Carolina newspapers:

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Oct. 2

The Post and Courier of Charleston on economic incentives in the state:

Economic development has been a major achievement of Gov. Nikki Haley’s administration. By waging an aggressive campaign for prospects, the governor and her Commerce Department have been able to attract new businesses to South Carolina, and new employment opportunities for its citizens.

But the effort, which typically involves tax breaks and incentives, doesn’t always work out. That’s to be expected. Economic development takes place in a highly competitive environment among the states.

The case involving the payment of $1.2 million in state incentive funds to a Navin Xavier, a Malaysian businessman who promised to redevelop a closed factory in job-hungry Marion is something else, though.

Mr. Xavier is being held in custody by federal officials pending an arraignment on fraud charges. He faces charges in what federal officials describe as a $29 million Ponzi scheme.

Federal authorities allege that some of the money came from the taxpayers of South Carolina, was sent to banks in other countries and also supported the businessman’s lavish lifestyle.

As far as South Carolina is concerned, the question is whether the necessary due diligence was done. The payment of state funds was made by the S.C. Economic Coordinating Council, an arm of the Commerce Department.

So far, neither the governor’s office nor Commerce officials have been very forthcoming about the matter. In comments to our reporter, department spokeswoman Adrienne Fairwell declined to specify whether the agency is changing the way it vets prospective recipients of state incentive money, saying only that “the department is always looking for ways to improve its systems and processes.”

That’s not an adequate response. And the matter can’t be excused by the numerous economic development successes that the state has enjoyed, or the many instances where incentives have proven effective. Anytime there is state funding involved there has to be accountability.

The state inspector general has been involved in the investigation, and the state should expect his findings to be made public at some point.

Otherwise, the Legislative Audit Council should be called in to give the matter a thorough review, and eventually a public airing. The LAC has performed audits related to successful economic development initiatives, such as BMW and Boeing in the past. It could try its hand at one that failed in the worst way.

Lawmakers should be interested in what went wrong with the state’s supposed investment. An LAC review could suggest safeguards for the future. And in doing so it could prevent the sad experience of Marion, when the hopes of a new factory and hundreds of new jobs were dashed.

Incentives are an important part of the state’s economic development efforts. South Carolina has to be prepared to meet the competitive level of other states that are also in the race for new industry and new jobs.

And the nature of that campaign requires a degree of secrecy. This case suggests the need for greater scrutiny and, finally, more public accountability for one that really got away.

The administration is always happy to boast of its achievements in the economic development realm. It should be willing to acknowledge the occasional failure as well. In this instance, the public deserves an explanation.

Online:

https://www.postandcourier.com

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Sept. 25

The Greenville News on a state law that makes it difficult for nonresident college students to vote in South Carolina:

Greenville County should set aside a rule dating to the early 1970s that makes it difficult for nonresident college students to vote here.

Three Furman University students have filed a suit to set aside the unnecessary rule that denies students registering if they list an address on the university campus unless they answer a questionnaire. The 11 questions ask, among other things, where they hold bank accounts, what off-campus ties they have to the community, where they work and where their vehicle is registered.

The lawsuit claims the requirements go beyond state law and that the students are being treated as a “suspect class” whose voter registration applications are being discounted. Another student claimed he was told at the voter registration office at County Square that he would have to vote absentee at the location where his parents reside.

Greenville County says it will fight to preserve the rule, even though a series of court rulings, including one by the U.S. Supreme Court, seems to run counter to the rule. According to that ruling, in 1979, college students have the right to vote either with their college address or their prior home address. Greenville County’s rule was upheld by a 1973 federal court ruling when four Furman students were denied the ability to register. The rule has never been challenged.

A hearing on a temporary injunction to the law is scheduled for Thursday, Oct. 6. If the injunction is issued, students would have two days in advance of the election to register.

It is a waste of resources and time for the county to continue fighting this 40-plus-year-old law. Rather than fighting against the injunction, the county should eliminate the requirement and allow college students from outside the state to register and cast a ballot.

Nancy Bloodgood, a lawyer for the League of Women Voters, got it right in a petition to join the students’ suit: “Impediments to the rights of our state’s college students, most of which are first time voters, not only limits their right to have a voice in today’s elections, it also limits our state’s and the nation’s opportunity to have these educated voters view themselves as ‘voters’ for the rest of their lives.”

Short of partisan reasons, it’s difficult to fathom why college students would be denied the privilege of casting a ballot in person in the presidential election.

Instead of fighting to keep these students from voting, the county should do what it can to ensure that as many people as possible who live in Greenville County have a chance to cast a ballot.

Is it possible that some student could cast a ballot here as well as in his or her home state? Yes. But we should not assume the worst intentions from these voters.

Instead, we should consider that these are adults, eligible by law to cast a ballot. They live in Greenville County for nine or 10 months a year at a minimum. Some of them work here. All of them spend money here. They pay state sales taxes and gas taxes and, sometimes, property taxes.

There is something almost sacred about casting a ballot in person during a momentous election. It is more tangible than casting an absentee ballot in a home state to which these students probably have few adult connections. It is an experience they should be allowed to have.

The ruling that should be handed down on Oct. 6 seems obvious given the case law. Better yet, Greenville County should step aside, remove this impediment to our democracy and let these adults cast a ballot on Nov. 8.

Online:

https://www.greenvilleonline.com

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Oct. 2

The Herald-Journal of Spartanburg on tax reform in the state:

South Carolina lawmakers are looking at undoing some of the tax laws they made in Act 388, the property tax for sales tax swap they instituted 10 years ago.

The changes they made have hurt the state and its communities. They should be rolled back, but that won’t be enough. South Carolina needs a more complete tax overhaul, a total redesign of how it raises revenue and funds state and local governments.

What we have now is a mess of obsolete laws and myriad quick fixes that were intended at some point to appease upset taxpayers. But those quick fixes usually had unintended consequences. Act 388 is the perfect example.

The primary feature of the 2006 law eliminated the property tax on homeowners to pay for school operating costs. It increased the sales tax to make up for the lost revenue. But it did much more. It limited reassessments on property. The assessed value on a property can only rise 15 percent every five years under the law. That is unless the house is sold. Then it is reassessed at market value.

This eliminated the fairness of the tax. Reassessments are meant to keep up with the genuine value of a property so that all properties are taxed on their actual value. When lawmakers limited reassessments, the values on some houses never caught up to market value, while houses that changed hands were assessed properly.

That’s one of the reasons lawmakers are revisiting the law. People are complaining about vastly different assessments on nearly identical homes in the same neighborhood.

Act 388 also shifted the tax burden from homes to businesses and industries. And it undermined local control of city and county budgets. Lawmakers limited the ability of city and county councils to set their own tax rates.

But this law is just one of the quick fixes lawmakers have adopted over the past few decades. They have all had unintended consequences. Spartanburg County’s hated $25 road fee is a direct consequence of the legislature’s vehicle property tax relief.

These laws are always sold as “reforms,” but they usually only make matters worse. They have added up to the point where today we have a patchwork of reforms and changes that make the entire system inequitable and inefficient.

Add to this situation the recent state Supreme Court ruling requiring lawmakers to design a new method for funding schools in the state, and you have the right time for a complete restructuring of our tax system.

Lawmakers don’t need to just roll back Act 388. They need to take a full look at the state’s entire revenue system, wipe the slate clean of all the fixes and changes and create something that is stable, efficient and fair.

South Carolina needs a system that spreads the tax burden evenly and funds local governments and schools effectively without starving rural districts. Further tinkering won’t be enough. Wholesale redesign is needed.

Online:

https://www.goupstate.com

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