- Associated Press - Thursday, April 27, 2017

COLUMBIA, S.C. (AP) - The Senate has approved its plan to fix South Carolina’s crumbling roadways, setting up the possibility that legislators’ top priority for years could become law.

The Senate’s 30-9 vote Thursday sent its compromise to the House, which passed its own version earlier this year.

It marks the first time over several years of debate that the Senate has broken a filibuster and passed a bill with a gas tax increase to help fund road construction, allowing for the state’s first gas tax hike in 30 years. South Carolina’s 16-cents-per-gallon tax is the nation’s second-lowest.

Business groups have been demanding that legislators find a long-term, sustainable funding solution to address what the Department of Transportation calls a $28 billion problem, or risk jobs going elsewhere. DOT Director Christy Hall has said each year of inaction adds roughly $350 million to costs, as roads deteriorate so badly they must be completed reconstructed, rather than repaired.

“Finally, we were able to put together a plan that a majority of the Senate” could support, said Senate President Pro Tem Hugh Leatherman, R-Florence.

And, he noted, the compromise gained the supermajority vote needed to override Gov. Henry McMaster’s promised veto.

But the bill still has a long way to go, with just six days left in this year’s legislative calendar.

House leaders have blasted the Senate’s version as a complicated, nonsensical mess. The House will vote next week to oppose it, setting up a legislative panel to try to find a compromise.

“Now is the time for the House and Senate to come together and deliver for the people of South Carolina,” said state Chamber of Commerce CEO Ted Pitts. “When it comes to infrastructure, we simply can’t afford to wait another year.”

The House plan is expected to raise roughly $530 million additional annually once fully phased in. It increases the state’s gas tax by 10 cents over five years, increases the vehicle sales tax cap to $500, raises vehicle registration fees and creates several fees.

The Senate plan is projected to eventually generate roughly $800 million annually above current collections. It includes raising the state’s gas tax by 12 cents over six years and doubling the vehicle sales tax cap to $600. But the tax cuts and rebates inserted during floor debate could eventually reduce revenue by more than $650 million annually.

“It’s illogical,” said House Majority Leader Gary Simrill, R-Rock Hill. “The point of this bill is to fix the roads.”

The Senate plan expands tax credits to low-wage earners and married couples filing jointly, increases tuition tax credits for college students, cuts businesses’ property taxes and allows South Carolinians to get a rebate for extra taxes paid at the pump.

Whether those tax breaks can survive House and Senate negotiations - and which ones - is unknown.

The proposed rebate is a conundrum even to senators who backed the compromise.

“It definitely gives South Carolinians an opportunity to get something back,” said Sen. Shane Massey, R-Edgefield, though he still thinks it’s bad policy.

If the plan is fully phased in, South Carolina drivers could collectively get back up to $465 million, with $150 million of that taken from the new revenue.

Many senators believe actual reimbursements will be far less, doubting many drivers will go through the hassle of keeping up with a year’s worth of gas fill-up and vehicle maintenance receipts. Other senators say taxpayers will simply estimate on their income tax returns and count on not getting audited.

“That thing could get crazy expensive, and then you’ve got a big hole in the budget,” said Sen. Greg Hembree, R-North Myrtle Beach, who voted against the compromise. “It’s unpredictable.”

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