WINTER/SPRING NEWSLETTER
2004 STATE LEGISLATURE SESSION
Senator Wes Hayes            District #15

Limited tax revenues continue to restrict the general Assembly’s ability to fully fund important governmental programs. In addition to the anticipated lack of tax revenues, the necessity to pay a revenue deficit from 2003 recently disclosed by the Comptroller General will strain the State Treasury even further than its present dire condition. The challenge this year will be to create a balanced budget while satisfying existing needs for basic government services such as education, public safety, infrastructure, and social services. The General Assembly is reviewing many different recommendations as to how to deal with current conditions. Significant legislation is pending which will affect many aspects of our lives from changes in public education to the restructuring of state government. Of major concern to York County is the renewed effort of the Catawba Indian Nation to expand its gambling interest. All together this year’s legislative session will be challenging.

CIGARETTE TAX
South Carolina has one of the lowest cigarette taxes in the country, making additional taxing of cigarettes a prime target for fresh revenue. Many legislators see the cigarette tax as a user or excise tax and support increasing the tax on this product. There are two plans circulating as to how to use revenues from an increased cigarette tax. Proponents in the Senate would have the additional revenue used to fully fund medicaid, whereas the Governor’s plan would use the increased revenues to offset a proposed reduction in personal income tax. However, there is also strong opposition to any tax increase including the tax on cigarettes.

STATE GOVERNMENT RESTRUCTURING
The Governor and many state legislators feel the current conditions in state government are such as to merit considerable restructuring of the state’s government bureaucracy. It appears some merging and consolidating of agencies is inevitable. However the degree to which this occurs is at issue. Senator Glenn McConnell, chairman of the Senate Judiciary Committee and President ProTempore of the Senate, has introduced a 1900 page bill to this end. His plan would change all Constitutional Offices, with the exception of State Treasurer and Attorney General, to gubernatorial appointments. Also, he would have the Lieutenant Governor elected on the same ticket as the Governor, similar to the method used at the Federal level for President and Vice-President. He wishes to see the Governor’s Cabinet expanded to include the Department of Mental Health, and the establishment of a new Department Administration to house many small agencies such as the Foster Care Review Board and Guardian Ad Litem Program. He also supports merging the Department of Alcohol and Other Drug Abuse Services under the Department of Health and Human Services. There exist enough momentum to initiate some change. Any change in Constitutional Offices must be decided by referendum at the time of the next General Election.

THE FUNDING FAIRNESS TRIAL
Education still stands in the forefront of important issues in South Carolina. The “Funding Fairness Trial” in Manning has captured the attention of the state. Those who brought suit and proponents, such as former Governor and Secretary of Education Richard Riley, allege that inequities in funding between the state’s rural areas and the more affluent urban areas is a violation of constitutional rights of rural citizens. Also at issue here is the integrity of “Home Rule” and the State’s method of distributing funds for education.

PATHWAYS TO PROSPERITY ACT
The “Pathways to Prosperity Bill” or more formally known, as “the Education and Economic Development Act” would replace the School to Work Act of 1994. Senator Hayes chairs the subcommittee reviewing this bill for the Senate Education Committee. This bill calls for the development of a public school curriculum organized around a career cluster system “that would provide students with both strong academic and real world problem skills.” The cluster system will provide “academic and career oriented choices and greater exposure to career information and opportunities.” This legislation addresses the significant problem of school dropouts and truancy in South Carolina and has the support of both the Department of Education and the State Chamber of Commerce.

S.M.A.R.T FUNDING IN EDUCATION ACT
SMART is an acronym for “Streamlined Management and Accountable Resources for Teaching.” This bill is proposed by Governor Sanford, and would consolidate all current sources of state funding for the State’s School Districts. It is intended to enhance school district flexibility in Kindergarten through Twelfth Grade. In this bill funding is allocated to each district in six general categories:
1) Quality Teaching;
2) Instruction;
3) Technical Assistance;
4) Operations;
5) Workforce Education;
6) Special Needs;
This bill would allow individual school districts to transfer up to 100 percent of funds between programs designated within the same general category. A school district would be able transfer up to twenty percent of from one general category to other general categories.

LIFE SCIENCES ACT
While this bill is considered an “Economic Development” bill, many feel it is related to the higher education. This bill will offer incentives to businesses and research institutions engaged in pharmaceutical, medicine, and related laboratory instrument manufacturing and development activities. It is hoped that research related companies would work in concert with our research institutions. It amends the “Enterprise Zone Act” to add Life Sciences, with $100 million invested, and the creation of 200 new full-time jobs with an average compensation of at least one hundred fifty percent of the annual per capita income in South Carolina. The bill allows for employee relocation expenses to qualify for reimbursement with job development credits and provides generous depreciations on “clean rooms,” machinery, and equipment. It allows Life Science Projects investing $100 million and creating 200 jobs at twice the state per capita to qualify for funding.
Amendments to the bill, if passed, will establish a “Venture Capital Investment Fund,” and will increase the state’s general obligation debt cap to six percent. The additional debt revenue is to be used to allow the state research institutes, which are University of South Carolina, Clemson, and Medical University of South Carolina to develop research infrastructure projects. These projects would help these universities to contract with “cutting edge” research corporations who specialize in development of new technology and new product design, such as pharmaceuticals or automotive products.
Another amendment, introduced by Senator Leventis of Sumter and passed by the Senate, would establish USC-Sumter as a four-year institute. Governor Samford has threatened to veto the legislation if the USC-Sumter provision remains.
The bill has been passed by the Senate with additional amendments, and is now in Conference Committee.

AT WILL EMPLOYMENT ACT
This bill has a good chance of passing this year. If this happens it will revise South Carolina’s “At Will Employment Doctrine” in light of recent court rulings under which employers who use employee handbooks, even with conspicuous disclaimers and employee acknowledgements, may inadvertently create a contract of employment that replaces the intended “at will” employment relationship. The “At Will Employment Doctrine” basically sets forth an understanding that if an employee has the right to terminate his or her employment at will without ramifications, the employer retains that same right of termination unless a contract agreement sets forth other conditions. Under this bill, no handbook, policy, procedure, or other document issued by an employer or its agent may form an expressed or implied contract of employment, unless: a) the contract is in writing; b) the contract is signed by the employee and an authorized agent of the employer; and the contract expressly provides that the parties intend to alter their “at will” employment relationship. The legislation applies to both public and private employment.

ALCOHOLIC BEVERAGES AND MINIBOTTLE REFORM
This legislation, sponsored by Senator Hayes, recommending a Constitutional Amendment to eliminate minibottle requirements should pass the Senate and House in time to be placed on the ballot as a referendum in November. This and the enabling legislation have received stiff opposition from minibottle distributors who hold a monopoly on liquor distribution in the state. As reported in the last newsletter, a minibottle holds 1.75 ounces of alcohol. Using a minibottle in South Carolina to serve alcoholic beverages makes ours the strongest drink in the nation. This is inconsistent with new laws lowering the legal limit for “driving under the influence” to a .08 blood alcohol level. By serving alcohol by using the free pour method, only 1.25 ounces of alcohol is used. Less alcohol per drink means less opportunity and incentive for intoxication. With concerted effort, the referendum bill will pass, but much work is needed to insure the enabling legislation becomes law in a timely manner.

CATAWBA-WATEREE RIVER BASIN BI-STATE COMMISSION
This Senate Bill, sponsored by Senator Hayes, was also introduced in North Carolina with corresponding legislation. Mecklenburg County Senator Clodfelter sponsored the North Carolina Bill. Both bills have passed their respective Senates, and now reside in committees of the North and South Carolina Houses of Representatives. The purpose of this Bi-State Commission will be to continually assess the use and water quality of the Catawba River as it flows through Lake Wylie crossing stateliness to Lake Wateree. It will work to insure that the two states’ regulatory agencies cooperate to provide the purest water possible for the Piedmont area. Passage of the bill looks promising in that other elected representatives that represent districts receiving water from North Carolina and Georgia are interested in establishing similar commissions.

HISTORICAL PROPERTIES TAX CREDITS ACT
Senator Hayes introduced this bill last year at the request of York County Councilman Rick Lee. Currently the State Department of History and Archives controls the process by which a local property owner is eligible for special property tax credits for improvement to unique properties with historical value. This bill will transfer that authority to local governments who offer these incentives. It also gives local governments the latitude to define and coordinate these programs.
Last year the Department of History and Archives offered major changes to this legislation creating questions by the Association of Counties and the Municipal Association. Over the summer these questions were answered and consensus established between the interested parties. The bill has now passed favorably out of subcommittee with appropriate amendments. It is hoped this bill, which is important to the inner cities of York County, will pass without difficulty.

THE CATAWBA INDIAN’S GAMBLING ISSUE
The Catawba Indian Tribe is attempting to change its current agreement with the State of South Carolina in regard to their rights to promote gambling. The Tribe wishes to expand its current bingo operations to include electronic bingo. This method of gambling engages the use of “video poker” type bingo machines. This is a very fast form of bingo that pits the player against the machine or is electronically linked to other machines interacting with bingo players nationwide. The tribe wants to establish a new bingo facility of this type on I-26 in Orangeburg County. The gambling industry refers to these facilities as “Bingosinos.” This type of facility is not allowed by the current agreement, and will require approval by the General Assembly. Senators Hutto and Matthews, representing Orangeburg County, are submitting legislation to amend the current agreement with the Catawba Indians. Senator Hayes is opposed to any change in the current settlement agreement.
The Tribe is also involved in other actions to expand their gaming interest in South Carolina. On the local level they are asserting the opinion that the current settlement allows them the ability to provide video poker devices on their reservation. Solicitor Pope, Sheriff Bryant, and other York County leaders have made it clear that any attempt to install Video Poker machines will be considered a criminal act and appropriate action will be taken.
The Catawba Indian Tribe is attempting to secure Federal legislation that would place the tribe under the Federal Indian Gaming Regulatory Act. If the Tribe becomes fully governed by the IGRA, its ability to conduct organized gambling activities in the State would be greatly expanded without regulatory authority by the State of South Carolina.
Also, recent reports state the intent of The Catawba Indian Tribe to file both State and Federal Suits asserting that South Carolina broke its agreement with The Tribe when it amended its Constitution and established the “Lottery for Education.” The Tribe further alleges the Lottery has caused undue competitions with its present Bingo business resulting in a reduction of revenue because of the State’s Education Lottery.
A large contingency of local and state representatives under the leadership of Senator Hayes are resisting any expansion of gambling activities of the The Catawba Indian Tribe beyond the 1993 agreement.

GRANDPARENTS RIGHTS IN CHILD CUSTODY
Senator Hayes receives numerous inquiries and concerns from grandparents who have been denied access to grandchildren caught in custody battles between divorcing parents. In response, he introduced legislation that will allow anyone, including grandparents, who have been de facto custodians to receive consideration during custody hearing. An example of this would be a grandparent caring for a child regularly while the parents work. This bill would require consideration be given to this de facto custodian as well as the parents.

YOUR INPUT IS NEEDED
Senator Hayes needs your input when there is an issue pending that you have knowledge of or which will have an impact on you. As your State Senator, he presently serves you as Chairman of the York County Legislative Delegation, Chairman of the Senate Ethics Committee, and as a member of the Senate Finance, Education, Banking & Insurance, Medical Affairs, and General Committees. Without your input, the General Assembly may make decisions based on inadequate information.
As your State Senator, his ongoing goal is to give the citizens of York County the best possible representation in State Government. This District #15 Newsletter, concerning events occurring in the General Assembly, is provided as a means to keep you better informed. Due to the cost of mailing, he will not be able to mail a copy to everyone in the District; however, you may find copies of this report placed in various public locations.
Also, this report along with all others may be viewed on the Senator’s website, (www.weshayes.com). A public meeting is usually held twice a year at an accessible location, and you are encouraged to come, express your opinion, and ask any questions which you might have.

Any ideas you may have as to how this newsletter could be improved are most welcome.

If you need assistance or information or want to discuss an issue, you can contact me at:

Disclosure:
This newsletter utilizes printed information provided by the State’s Legislative Council, the State House of Representatives, Department of Research, and the Senate Judiciary Committee.

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