‘The great earmark debate’ stalls SC Budget compromise with large gap in funding requests

(WPDE) — From $152 million to nearly $320 million, that’s the gap House lawmakers made when they amended the Senate version of the South Carolina state budget with less than a week left in the legislative session.

The argument of short-term rentals was back on the table at the state house in Columbia Tuesday afternoon. (WCIV)

Those numbers are tied to earmarks lawmakers requested to send back to their districts or to other projects throughout the state categorized as “community investment projects”.

Those requests and working out a property tax cut for older homeowners have led us to this point: a state government operating on last year’s budget.

The conference committee, made up of three House members and three Senate members, recessed again without a compromise following Wednesday’s meeting.

“The great earmark debate,” said Senate Finance Chair Harvey Peeler (R-Cherokee). “As government does, this has grown completely out of hand. It’s not a secret, I’m not a fan of earmarks, but if y’all want earmarks, I want earmarks too.”

House lawmakers defend their amendments, saying the projects are needed and support a broader portion of taxpayers than the Senate’s sought-after property tax cuts.

“There are no less taxes being collected,” said House Ways and Means Chair Bruce Bannister (R-Greenville). “As a result of this, it is a select group of people who are paying less taxes, which is a tax cut to them. But I would call it a tax swap, because there’s no reduction in the total revenue of the state; we’re not reducing our revenue, we’ll not reduce the revenue of the counties.”

The SC Revenue and Fiscal Affairs office estimates that, if the Senate can add the exemptions into the budget, similar to the separate legislation tied to the issue, that would decrease local property taxes by approximately $247,667,000 beginning in tax year 2026.

The Senate’s earmarks are mostly tied to local governments, whereas the House’s version branches out to similar public safety and infrastructure needs while supporting private entities and nonprofits.

One glaring item is $7.5 million that Rep. Bannister has earmarked for the Myrtle Beach Cable Landing Site Prep as an “Economic Development” item. DC BLOX, a private data center company, operates the current Myrtle Beach Cable Landing Site. There is also an ongoing permit process with the Department of Environmental Services to see another subsea cable installed off of Myrtle Beach State Park called the Wamkelekile Subsea Fiber Optic Cable.

The list is long of what the House added to the budget in May, ranging from $3.3 million to go towards both the Greenville and Riverbanks Zoos to nearly $8 million for a national non-profit to build a National Medal of Honor Leadership and Education Center in Mount Pleasant.

Closer to the Grand Strand, the House version does not designate a clear budget amount for Senate-proposed earmarks to the City of Conway. Senators had requested $1.5 million to make the Railroad Bridge over Kingston Lake ADA accessible from the now expanded Conway Riverwalk.

The House did add in requests to send $1 million to support the city’s ongoing flood mitigation efforts at the now-stalled Chestnut Bay Project, which was kneecapped after federal officials pulled the federal grants.

The House version did shift its attention more toward the coast, adding in a request of $10 million to resurface the Highway 544 bridge in Socastee, send $8.25 million to the City of Myrtle Beach for downtown public infrastructure improvements, and $2 million for North Myrtle Beach to construct a boardwalk.

But the argument stands from House members on the conference committee that their added earmarks are needed projects.

“I’m not going to vote to get rid of them,” said House Majority Leader David Hiott (R-Pickens). “The only way that you’re going to get rid of them is to let’s vote one at a time.”

The committee will reconvene next Tuesday, July 21. Chairman Peeler left this week’s meeting with a stern request of the House members.