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Friday, April 14    |    Upstate South Carolina News, Sports and Information

Senators seek ways to keep tax relief from sinking
Debate continues, but no vote taken, on how to ease property owners' bills

Published: Friday, April 14, 2006 - 6:00 am


By Tim Smith
STAFF WRITER
tcsmith@greenvillenews.com

COLUMBIA -- Senators on Thursday spent a third day debating -- but not voting on -- the issue of property taxes, likening their situation to a ride on the Titanic.

Sen. Chip Campsen, an Isle of Palms Republican, compared property tax legislation to the damaged ocean liner, which sank after hitting an iceberg.

"And now the passengers are in the water, and it's 28 degrees, zero degrees in my county," he said, adding that members are so desperate to keep tax reform alive "that you grab anything floating by."

But members weren't so desperate Thursday as to attempt a vote.

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Senate President Pro Tem Glenn McConnell said he hopes that will change next week before the body takes up the budget.

"Unfortunately this is so complex an issue that the senators keep waiting for this magical formula to come without the discomfort of a vote," he said. "That isn't going to happen. To get to the finish line, we have to take some uncomfortable votes."

The Senate Finance Committee last week passed a tax plan that would reduce school taxes on cars and owner-occupied homes. But the proposal lacks a consensus, and senators are searching for an alternative to the House plan, which would raise the sales tax by two cents on the dollar and remove most homeowners' property taxes.

Steven Benjamin, chairman of the Richland County Democratic Party and a board member of the South Carolina Chamber of Commerce, said the issue isn't a simple one and that he hopes lawmakers resist the temptation to settle for a quick, political fix.

"Whatever our Legislature does has got to protect our school revenues and has got to protect our pro-business environment in South Carolina," he said.

"This Legislature has a reputation for doing what's politically palatable and not always responsible, and I hope they put the time and effort into a real solution, not a 2006 election-year solution."

Senators have said they want to grant homeowners some relief, but without drawing the ire of business or ignoring the poor. A stumbling block has been how to distribute the money back to school districts, especially in view of an ongoing court case challenging the state's school funding system.

The Senate spent Thursday debating a $2.5 billion plan by Sen. Larry Grooms of Berkeley County that would eliminate school taxes on owner-occupied homes and reduce school taxes on cars and other property.

To pay for the school taxes, the plan would increase the sales tax by two cents on the dollar and double or increase taxes on alcohol and cigarettes. It also would eliminate a number of sales tax exemptions, increase the sales tax cap on cars from $300 to $900, double the deed recording fees and set a statewide school tax rate for property other than owner-occupied homes.

Groom's proposal also would limit homeowners' tax bills to 2 percent of their household income.

The plan would benefit homeowners, car owners and business owners, Grooms explained, by swapping school taxes mostly for consumption taxes.

Several senators embraced the proposal, with some asking to have their names added as co-sponsors.

"I'm encouraged we finally have some direction," said Sen. Danny Verdin, a Laurens Republican.

But the complexity of the proposal drew concern among others.

Sen. David Thomas, a Greenville County Republican, argued that the measure would split property tax reformers who might balk at some of the increases or not understand them.

"It creates more confusion," he said. "You are splintering our support."

Some advised Grooms to use the weekend to tweak his proposal, to which he replied, "I don't think the Easter Bunny is going to bring me a better plan."

Other plans wait in the wings, McConnell said, including one that revises the House plan and another that gives counties an option to participate.

But he said if debate drags on after the budget, passage of any plan would become "iffy."

Wendy Brawley, a Columbia business owner and school board member, said she likes parts of each of the Senate plans debated thus far but isn't sold yet on any package. She said she hopes lawmakers won't rush into anything that will damage schools or business.

"I'm a little leery of anything that restricts the ability of local school districts and local governing bodies to accommodate the needs of local children in schools and pushes that responsibility to the state," she said.

"We all know there are issues now about the equity funding at the state level. And I don't know we're going to make those issues better by giving them total autonomy in terms of the entire state's ability to fund schools at the local level. I think that's probably a mistake."


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