South Carolina General Assembly
113th Session, 1999-2000

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Bill 3835


Indicates Matter Stricken
Indicates New Matter


                    Current Status

Bill Number:                      3835
Type of Legislation:              General Bill GB
Introducing Body:                 House
Introduced Date:                  19990406
Primary Sponsor:                  Robinson
All Sponsors:                     Robinson
Drafted Document Number:          l:\council\bills\dka\3294mm99.doc
Residing Body:                    Senate
Date of Last Amendment:           19990527
Subject:                          Property taxes, county; uniform 
                                  collection and enforcement of, fee in lieu of; 
                                  Political Subdivisions, Counties


                        History

Body    Date      Action Description                     Com     Leg Involved
______  ________  ______________________________________ _______ ____________
House   19990527  Senate amendments amended,
                  returned to Senate with amendment
House   19990526  Debate adjourned on Senate
                  amendments
------  19990520  Corrected - Not re               Versions of This Bill
Revised on April 22, 1999 - Word format
Revised on April 28, 1999 - Word format
Revised on May 13, 1999 - Word format
Revised on May 18, 1999 - Word format
Revised on May 19, 1999 - Word format
Revised on May 20, 1999 - Word format
Revised on May 27, 1999 - Word format

View additional legislative information at the LPITS web site.


(Text matches printed bills. Document has been reformatted to meet World Wide Web specifications.)

Indicates Matter Stricken

Indicates New Matter

AMENDED--NOT PRINTED IN THE HOUSE

Amt. No. 2A (Council\GJK\Amend\20764HTC99.doc)

Amt. No. 3A (Council\PSD\Amend\7542AC99.doc)

Amt. No. 6A (Council\KGH\Amend\15749HTC99.doc)

Amt. No. 10A (Council\DKA\Amend\3589MM99.doc)

Amt. No. 11A (Council\PSD\Amend\7555AC99.doc)

Amt. No. 14A (Council\DKA\Amend\3582MM99.doc)

May 27, 1999 (Updated May 28, 1999)

H. 3835

Introduced by Rep. Robinson

S. Printed 5/19/99--S.

Read the first time May 4, 1999.

            

A BILL

TO AMEND ARTICLE 1, CHAPTER 54, TITLE 12, CODE OF LAWS OF SOUTH CAROLINA, 1976, RELATING TO COLLECTION AND ENFORCEMENT OF TAXES LEVIED BY THE DEPARTMENT OF REVENUE, BY ADDING SECTIONS 12-54-43 SO AS TO PROVIDE FOR CIVIL PENALTIES AND 12-54-44 SO AS TO PROVIDE FOR CRIMINAL PENALTIES; TO AMEND SECTIONS 4-12-30, AS AMENDED, AND 4-29-67, AS AMENDED, BOTH RELATING TO A PROJECT PAYING A FEE IN LIEU OF PROPERTY TAXES, SO AS TO DEFINE "REPLACEMENT PROPERTY" AS REPLACING THE OLDEST PROPERTY IN THE PROJECT SUBJECT TO THE FEE; TO AMEND SECTION 4-29-68, AS AMENDED, RELATING TO A PROJECT PAYING A FEE IN LIEU OF PROPERTY TAXES, SO AS TO ADD CERTAIN CROSS REFERENCES; TO AMEND SECTION 6-1-320, RELATING TO LIMITATIONS ON MILLAGE RATE INCREASES, SO AS TO REFERENCE THE CALENDAR YEAR INSTEAD OF THE FISCAL YEAR AND TO PROVIDE FOR COMPUTATION OF THE ROLLBACK MILLAGE; TO AMEND SECTION 11-1-10, RELATING TO OFFICIAL RECEIPTS FOR MONIES COLLECTED, SO AS TO LIMIT RELEASE OF DOCUMENTS BY THE DEPARTMENT OF REVENUE; TO AMEND SECTION 12-6-50, AS AMENDED, RELATING TO PROVISIONS OF THE INTERNAL REVENUE CODE NOT ADOPTED BY THE STATE, SO AS TO ADOPT SECTION 6015; TO AMEND SECTION 12-6-3360, AS AMENDED, RELATING TO JOB TAX CREDIT, SO AS TO DESCRIBE SPECIFICALLY THE DATA USED TO RANK AND DESIGNATE THE STATE'S COUNTIES AS THE AVAILABLE PER CAPITA INCOME DATA AND UNEMPLOYMENT RATE DATA FROM THE LAST THREE YEARS AND THE DATA USED FOR DETERMINATION OF THE PER CAPITA INCOME OF A COUNTY AS THE LATEST AVAILABLE DATA AND TO PROVIDE FOR THE PASS THROUGH OF THE UNUSED CREDIT TO MEMBERS OF CERTAIN ENTITIES CLAIMING THE CREDIT; TO AMEND SECTION 12-6-4910, RELATING TO THOSE TAXPAYERS REQUIRED TO FILE INCOME TAX RETURNS, SO AS TO REFERENCE THE DEDUCTION FOR RETIREMENT INCOME; TO AMEND SECTIONS 12-6-5060, 12-6-5065, 12-6-5070, AND 12-6-5080, ALL RELATING TO DESIGNATIONS ON THE TAX RETURNS FOR VOLUNTARY CONTRIBUTIONS, SO AS TO PROVIDE THAT THE DEPARTMENT OF REVENUE IS NOT SUBJECT TO THE PROVISIONS OF THE SOUTH CAROLINA SOLICITATION OF CHARITABLE FUNDS ACT; TO AMEND SECTION 12-21-2550, AS AMENDED, RELATING TO FAILURE TO MAKE A CORRECT TAX RETURN OR TO FILE A RETURN, SO AS TO PROVIDE FOR THE DEPARTMENT OF REVENUE TO ESTIMATE THE TAX LIABILITY AND ISSUE A PROPOSED ASSESSMENT; TO AMEND SECTION 12-36-2120, AS AMENDED, RELATING TO SALES AND USE TAX EXEMPTIONS, SO AS TO INCLUDE PROCEEDS FROM THE SALE OF LIQUEFIED PETROLEUM GAS; TO AMEND SECTION 12-37-251, AS AMENDED, RELATING TO THE HOMESTEAD EXEMPTION FROM PROPERTY TAX, SO AS TO DELETE REFERENCE TO CALCULATION OF ROLLBACK MILLAGE; TO AMEND SECTION 12-54-55, AS AMENDED, RELATING TO INTEREST ON UNDERPAYMENT OF ESTIMATED TAX, SO AS TO DELETE LANGUAGE MAKING THE PENALTY INTEREST THE EXCLUSIVE REMEDY; TO AMEND SECTION 12-54-240, AS AMENDED, RELATING TO PROHIBITION OF THE DISCLOSURE OF RECORDS FILED WITH THE DEPARTMENT OF REVENUE, SO AS TO ALLOW THE DISCLOSURE OF NAMES AND ADDRESSES TO THE STATE RETIREMENT SYSTEM IN CONNECTION WITH INACTIVE ACCOUNTS; TO AMEND SECTION 12-56-20, AS AMENDED, RELATING TO DEFINITIONS FOR PURPOSES OF THE SETOFF DEBT COLLECTION ACT, SO AS TO ADD THE UNITED STATES DEPARTMENT OF EDUCATION AS A CLAIMANT AGENCY AND TO CHANGE "INDIVIDUAL" TO "PERSON"; AND TO REPEAL SECTIONS 12-6-5590 RELATING TO REVISION OF THE ASSESSED TAX, 12-54-35 RELATING TO SPOUSAL LIABILITY FOR TAX, AND 12-54-40 RELATING TO PENALTIES IN CONNECTION WITH COLLECTION AND ENFORCEMENT OF TAXES.

Amend Title To Conform

Whereas, pertaining to Part II of this act:

(1) Congress enacted the Telecommunications Act of 1996 to open local telephone markets to competition, and the telecommunications industry is in a state of transition;

(2) In addition to new competitors in traditional local exchange telecommunications markets, a number of new technologies have developed and are developing at a rapid pace, expanding the array of telecommunications providers and services available to consumers;

(3) Since the passage of the Telecommunications Act of 1996, competition in telecommunications services and the number of competitors in the telecommunications industry in South Carolina has grown and continues to grow, as evidenced by the hundreds of new entrants into the industry. In South Carolina, over four hundred companies have been authorized to provide long distance service and over seventy companies have been authorized to provide local telephone service. South Carolina now has over one thousand authorized pay phone service providers and numerous digital and analog wireless and paging providers. Telephony may also now be provided over Internet protocol and cable modems;

(4) The citizens of municipalities in South Carolina have long enjoyed the public benefit of dependable local exchange and long distance telecommunications service provided to them by telecommunications carriers that have constructed, operated, and maintained telecommunications facilities to serve those citizens, and that currently occupy the municipal rights-of-way in the State; and

(5) Congress has stated that nothing in Section 253 of the Telecommunications Act of 1996 affects the authority of the state or local government to manage the public rights-of-way or to require fair and reasonable compensation from telecommunications providers, on a competitively neutral and nondiscriminatory basis, for use of public rights-of-way on a nondiscriminatory basis, if the compensation required is disclosed by such government. The General Assembly finds that shifting of current taxation and fees from a franchise fee basis to the basis outlined in the attached article is necessary and appropriate due to the transition of the telecommunications industry and is fair and reasonable, and taxes and fees exceeding such amount, except upon extraordinary circumstances, would be unreasonable. Now, therefore,

Be it enacted by the General Assembly of the State of South Carolina:

Part I

SECTION 1. Article 1, Chapter 54, Title 12 of the 1976 Code is amended by adding:

"Section 12-54-43. (A) Except as otherwise provided, the civil penalties imposed by this penalty section apply to every revenue or tax law of the State that provides for the filing with the department of a return or statement of the tax or the amount taxable.

(B) The penalties described in this section must be added to and become a part of and collected as the tax imposed by the revenue or tax laws of this State.

(C)(1) In the case of failure to file a return on or before the date prescribed by law, determined with regard to any extension of time for filing, there must be added to the amount required to be shown as tax on the return, a penalty of five percent of the amount of the tax if the failure is for not more than one month, with an additional five percent for each additional month or fraction of the month during which the failure continues, not exceeding twenty-five percent in the aggregate.

(2) In case of a failure to file a return of tax within sixty days of the date prescribed for filing the return, determined with regard to any extension of time for filing, the addition to tax must not be less than the lesser of one hundred dollars or one hundred percent of the amount required to be shown as tax on the return, except in those cases in which the tax owed is one hundred dollars or less.

(3) For the purpose of this subsection, the amount of tax required to be shown on the return must be reduced by the amount of any part of the tax which is paid on or before the date prescribed for payment of the tax and by the amount of any credit against the tax which may be claimed upon the return.

(D) In case of failure to pay the amount shown as tax on any return on or before the date prescribed by law, determined with regard to any extension of time for paying, there must be added to the tax due a penalty of one-half of one percent of the amount of the tax if the failure is for not more than one month, with an additional one-half of one percent for each additional month or fraction of the month, during which the failure continues, not exceeding twenty-five percent in the aggregate.

(E) In case of failure to pay any amount of any tax required to be shown on a return which is not shown, including an assessment within ten days of the date of the notice and demand for payment, there must be added to the amount of tax stated in the notice and demand one-half of one percent of the amount of the tax if the failure is for not more than one month, with an additional one-half of one percent for each additional month or fraction of a month during which the failure continues, not exceeding twenty-five percent in the aggregate.

(F)(1) If part of an underpayment of tax or part of a claim for refund of tax paid is due to negligence or disregard of regulations, there must be added to the tax an amount equal to the sum of five percent of the underpayment or claimed refund and an amount equal to fifty percent of the interest payable under Section 12-54-25.

(2) A portion of an underpayment attributable to fraud with respect to which a penalty is imposed under subsection (G) must not be considered under this subsection.

(3) For purposes of this subsection, 'negligence' includes a failure to make a reasonable attempt to comply with the provisions of this title, and 'disregard' includes careless, reckless, or intentional disregard.

(G)(1) If a part of an underpayment of tax required to be shown on a return is due to fraud, there must be added to the tax an amount equal to the sum of seventy-five percent of the portion of the underpayment which is attributable to fraud and an amount equal to fifty percent of the interest payable under Section 12-54-25 with respect to that portion for the period beginning on the last day prescribed by law for payment of the underpayment, determined without regard to any extension, and ending on the date of the assessment of the tax or, if earlier, the date of the payment of the tax.

(2) If the department establishes that a portion of an underpayment is attributable to fraud, the entire underpayment must be treated as attributable to fraud, except that portion of the underpayment which the taxpayer establishes is not attributable to fraud.

(3) In case of a joint return, this subsection applies to a spouse only if some part of the underpayment is due to the fraud of the spouse.

(4) If a penalty is assessed under this subsection for an underpayment of tax which is required to be shown on a return, a penalty relating to failure to file the return or pay tax may not be assessed with respect to the portion of the underpayment which is attributable to fraud.

(H) A person who must obtain a license or purchase stamps for identification purposes, and who fails to obtain or display the license properly, or to affix the stamps properly, or to comply with statutory provisions, is subject to a penalty of not less than fifty dollars nor more than five hundred dollars for each failure. For failure to obtain or display a license as prescribed in Sections 12-21-2720 and 12-21-2730, the penalty is fifty dollars for each failure to comply.

(I) A person:

(1) who files what purports to be a return of the tax imposed by a provision of law administered by the department but which:

(a) does not contain information on which the substantial correctness of the tax liability may be judged; or

(b) contains information that on its face indicates the liability is substantially incorrect; and

(2) whose conduct is due to:

(a) a position which is frivolous; or

(b) a desire, which appears on the purported return, to delay or impede the administration of state tax laws;

(3) is liable to a penalty of five hundred dollars. This penalty is in addition to all other penalties provided by law.

(J) Whenever it appears to an administrative law judge that proceedings before him have been instituted or maintained by the taxpayer primarily for delay or that the taxpayer's position in the proceedings is frivolous or groundless, damages in an amount not to exceed five thousand dollars must be awarded to the State in the administrative law judge's decision. These damages must be assessed at the same time as the deficiency, paid upon notice and demand from the department, and collected as a part of the tax.

Section 12-54-44. (A) Except as otherwise provided, the criminal penalties imposed by this section apply to every revenue or tax law of the State that provides for the filing with the department of a return or statement of the tax or the amount taxable.

(B)(1) A person who wilfully attempts in any manner to evade or defeat a tax or property assessment imposed by a title administered by the department or the payment of that tax or property assessment, in addition to other penalties provided by law, is guilty of a felony and, upon conviction, must be fined not more than ten thousand dollars or imprisoned not more than five years, or both, together with the cost of prosecution.

(2) A person required by a provision of law administered by the department and who wilfully fails to collect, truthfully account for, and pay over any tax imposed by a provision of law, in addition to other penalties provided by law, is guilty of a felony and, upon conviction, must be fined not more than ten thousand dollars or imprisoned not more than five years, or both, together with the cost of prosecution.

(3) A person required under any provision of law administered by the department and who wilfully fails to pay any estimated tax or tax, or who is required by any provision of law or by any regulation and who wilfully fails to make a return, keep records, or supply information, at the time or times required by law or regulation, in addition to other penalties provided by law, is guilty of a misdemeanor and, upon conviction, must be fined not more than ten thousand dollars, or imprisoned not more than one year, or both, together with the cost of prosecution.

(4) A person required by law or regulation to furnish a statement who wilfully furnishes a false or fraudulent statement in the manner, at the time, and showing the information required by law or regulation, is guilty of a misdemeanor and, upon conviction, must be fined not more than one thousand dollars or imprisoned not more than one year, or both.

(5) A person required to supply information to his employer under Chapter 8 of Title 12 who wilfully supplies false or fraudulent information or who wilfully fails to supply information which would require an increase in the tax to be withheld under Chapter 8, Title 12 is guilty of a misdemeanor and, upon conviction, must be fined not more than one thousand dollars, or imprisoned not more than one year, or both. Offenses in this item are triable in magistrate's court.

(6)(a) A person is guilty of a felony and, upon conviction, must be fined not more than five hundred dollars or imprisoned not more than five years, or both, together with the cost of prosecution, if he:

( i) wilfully makes and subscribes any return, statement, or other document, which contains or is verified by a written declaration that it is made under the penalties of perjury, and which he does not believe to be true and correct as to every material matter; or

(ii) wilfully assists in, or procures, counsels, or advises the preparation or presentation under, or in connection with a matter arising under those provisions of law administered by the department of a return, affidavit, claim, or other document which is fraudulent or is false as to any material matter, whether or not the falsity or fraud is with the knowledge or consent of the person authorized or required to present the return, affidavit, claim, or document.

(b) A person convicted of a crime described in subitem (a)(ii) is prohibited from preparing or assisting in the preparation of a tax return required to be filed under any title administered by the department. A person violating this prohibition is guilty of a felony, and, upon conviction, must be fined ten thousand dollars and imprisoned for at least five years without probation, parole, or suspension of sentence.

(c) A person who:

( i) wilfully removes, deposits, or conceals, or is concerned in removing, depositing, or concealing goods or commodities for which a tax is or must be imposed, or property upon which levying is authorized pursuant to law, with intent to evade or defeat the assessment or collection of any tax imposed by this provision of law administered by the department is guilty of a misdemeanor and, upon conviction, must be fined not more than five thousand dollars or imprisoned not more than three years, or both, together with the cost of prosecution;

( ii) in connection with the preparation of a tax return for another, the filing of a tax return, or the payment of a tax, receives money from the payment of any tax, receives money from the other person with the understanding that it is to be paid over to the department to discharge, in whole or in part, the other person's tax liability and wilfully fails to pay over the same to the department is guilty of a misdemeanor and, upon conviction, must be fined not more than five thousand dollars or imprisoned for not more than three years, or both, for each offense together with the cost of prosecution; or

(iii) wilfully delivers or discloses to the department any list, return, account, statement, or other document known by him to be fraudulent or to be false as to a material matter, is guilty of a misdemeanor and, upon conviction, must be fined not more than five thousand dollars or imprisoned for not more than one year, or both.

(C) A failure to deposit or pay taxes deducted and withheld pursuant to Article 5 of Chapter 8 subjects the withholding agent to a penalty of not less than ten dollars nor more than one thousand dollars. The penalty imposed by this item applies to failure to comply with the provisions of Section 12-54-250.

(D) A machine owner or distributor, as defined in Article 20, Chapter 21 of this title, who allows or causes a machine to be operated without a metering device, or who wilfully places a machine on location or who wilfully allows or causes a machine to be operated with a metering device that does not accurately record the information required under Article 20, Chapter 21 of this title is guilty of a felony and, upon conviction, must be imprisoned for not less than one year nor more than ten years, without benefit of probation, parole, or suspension of sentence, and in addition may be fined not more than twenty-five thousand dollars."

SECTION 2. Section 4-12-30(F)(2)(a) of the 1976 Code, as last amended by Act 462 of 1996, is further amended to read:

"(a) Replacement property does not have to serve the same function as the property it is replacing. Replacement property is deemed to replace the oldest property subject to the fee, whether real or personal, which is disposed of in the same property tax year as the replacement property is placed in service. Replacement property qualifies for fee treatment provided in subsection (D)(2) only up to the original income tax basis of fee property which is being disposed of in the same property tax year it is replacing. More than one piece of replacement property can replace a single piece of fee property. To the extent that the income tax basis of the replacement property exceeds the original income tax basis of the property which it is replacing, the excess amount is subject to payments as provided in Section 4-12-20. Replacement property is entitled to the fee payment for the period of time remaining on the fee period for the property which it is replacing; provided, however, that where a single piece of property replaces two or more pieces of property, the fee period must be measured from the earliest of the dates on which the replaced pieces of property were placed in service."

SECTION 3. Section 4-29-67(F)(2)(a) of the 1976 Code, as last amended by Act 462 of 1996, is further amended to read:

"(a) Replacement property does not have to serve the same function as the property it is replacing. Replacement property is deemed to replace the oldest property subject to the fee, whether real or personal, which is disposed of in the same property tax year as the replacement property is placed in service. Replacement property qualifies for fee treatment provided in subsection (D)(2) only up to the original income tax basis of fee property which is being disposed of in the same property tax year it is replacing. More than one piece of replacement property can replace a single piece of fee property. To the extent that the income tax basis of the replacement property exceeds the original income tax basis of the property which it is replacing, the excess amount is subject to payments as provided in Section 4-29-60. Replacement property is entitled to the fee payment for the period of time remaining on the twenty-year fee period for the property which it is replacing; provided, however, that where a single piece of property replaces two or more pieces of property, such fee period shall be measured from the earliest of the dates on which the replaced pieces of property were placed in service."

SECTION 4. Section 4-29-68(F) of the 1976 Code, as added by Act 4 of 1995, is amended to read:

"(F) A county, municipality, or special purpose district that receives and retains revenues from a payment in lieu of taxes pursuant to Section 4-1-170, 4-12-30, 4-29-60, or 4-29-67, or Chapter 44, Title 12 in which these revenues are derived in whole or in part from a redevelopment project area established pursuant to Title 31, Chapter 6 shall allocate these revenues in accordance with the ordinance of the municipality adopted pursuant to Section 31-6-70 as if these revenues remained ad valorem taxes. All taxes fees collected in the redevelopment project area which are not subject to the ordinance of the municipality adopted pursuant to Section 31-6-70 become payments in lieu of taxes and the portion collected by the municipality may be pledged to secure special source revenue bonds issued by the municipality pursuant to Section 4-1-175 or this section."

SECTION 5. Section 11-1-10 of the 1976 Code is amended to read:

"Section 11-1-10. It shall be is unlawful for any an officer of this State, or his agent, employee, or servant to collect from any a person any delinquent taxes, fine, or other money due the county or State without issuing to such that person an official receipt showing the number, date, name of person, amount collected, and for what purpose,. and such The officer, agent, employee, or servant shall keep a stub similar to the receipt which and he shall at the end of each month turn it over at the end of each month to the county treasurer of the county in which such the collections are made. The county treasurer shall check the amounts turned in to him by such against the stubs and issue a clearance card to such the officer, or his agent, employee, or servant showing all moneys to have been monies turned in according to the stub stubs. Any officer, agent, employee, or servant violating the provisions of this section shall be is guilty of a misdemeanor and, upon conviction, shall be must fined in an amount not exceeding more than one hundred dollars or imprisoned not exceeding more than thirty days for each and every offense. An officer or employee of the Department of Revenue may turn in only those documents and reports as required by rules adopted and regulations promulgated by the director of the department."

SECTION 6. Section 12-6-50(14) of the 1976 Code, as last amended by Act 431 of 1996, is further amended to read:

"(14) Sections 2001 through 7655, 7801 through 7871, and 8001 through 9602, except for Section 6015, and except for Sections 6654 and 6655 which are adopted as provided in Section 12-6-3910."

SECTION 7. Section 12-6-3360(B) and (K) of the 1976 Code, as last amended by Act 462 of 1996, is further amended to read:

"(B) The department shall rank and designate the state's counties by December thirty-first each year using data from the South Carolina Employment Security Commission and the United States Department of Commerce. The counties are ranked using the last three years of available per capita income data from the most recent and the last thirty-six month period months or three years of available unemployment rate data, with equal weight given to unemployment rate and per capita income as follows:

(1) The twelve counties with a combination of the highest unemployment rate and lowest per capita income are designated least developed counties.

(2) The twelve counties with a combination of the next highest unemployment rate and next lowest per capita income are designated under developed counties.

(3) The eleven counties with a combination of the next highest unemployment rate and the next lowest per capita income are designated moderately developed counties.

(4) The eleven counties with a combination of the lowest unemployment rate and the highest per capita income are designated developed counties. The designation by the department is effective for corporate taxable years which begin after the date of designation.

(5)(a) A county, any portion of which is located within twenty-five miles of the boundaries of an applicable military installation or applicable federal facility as defined in Section 12-6-3450(1), shall receive the benefits of the next increased credit designation for five years beginning with the year in which the military installation or federal facility became an applicable military installation or applicable federal facility as defined in Section 12-6-3450(1), with the additional requirement that the military installation must have reduced employment on the installation of at least three thousand employees.

(b) For In addition to the designation in subitem (a), a county in which is located an applicable military installation or applicable federal facility meeting the requirements for the increased credit provided in subitem (a) of this item, the credit allowed is two tiers higher than the credit for which the county would otherwise qualify is located is allowed an additional increased credit designation for five years beginning with the year the installation or facility meets the requirements.

(c) Notwithstanding the designations in Section 12-6-3360, Laurens, Cherokee, and Union Counties shall qualify for the next increased credit designation.

(d) In a county where less than five percent of the work force is in manufacturing, the credit allowed is one tier higher than the credit for which the county would otherwise qualify.

(K)(1) In addition to those credits allowed under subsection (C) of this section a corporation, partnership, or limited liability company that qualifies for a credit under this section as an S corporation, partnership, or limited liability company, entitles each shareholder of the S corporation, partner of the partnership, or member of the limited liability company to a nonrefundable credit against taxes imposed pursuant to Section 12-6-510. An S corporation, limited liability company taxed as a partnership, or partnership that qualifies for a credit under this section may pass through the credit earned to each shareholder of the S corporation, partner of the partnership, or member of the limited liability company. For purposes of this subsection, limited liability company means a limited liability company taxed as a partnership.

(2)(a) The amount of the credit allowed a shareholder, partner, or owner of a limited liability company member by this subsection is equal to the shareholder's percentage of stock ownership, partner's interest in the partnership, or member's interest in the limited liability company for the taxable year multiplied by the amount of the credit the taxpayer would have been entitled to if it were taxed as a corporation earned by the entity. This nonrefundable credit is allowed against taxes due under Section 12-6-510 or 12-6-530 and may not exceed fifty percent of the shareholder's, partner's, or member's tax liability under Sections 12-6-510 or 12-6-530.

(b) Notwithstanding subitem (a), the credit earned pursuant to this section by an S corporation owing corporate level income tax must be used first at the entity level. Only the remaining credit passes through to each shareholder.

(3) A credit claimed under pursuant to this subsection but not used in a taxable year may be carried forward by each shareholder, partner, or member for fifteen years from the close of the tax year in which the credit is earned by the S corporation, partnership, or limited liability company. However, the credit established by this section taken in one tax year may not exceed fifty percent of the taxpayer's tax liability under Section 12-6-510. The entity earning the credit may not carry over credit that passes through to its shareholders, partners, or members."

SECTION 8. Section 12-6-3360(M)(13) of the 1976 Code, as last amended by Act 432 of 1998, is further amended to read:

"(13) 'Qualifying service-related facility' means:

(a) an establishment engaged in an activity or activities listed under the Standard Industrial Classification (SIC) Code 80 according to the Federal Office of Management and Budget Standard Industrial Classification Manual, 1987 edition; or

(b) a business, other than a business engaged in legal, accounting, or investment services or retail sales, which has a net increase of at least:

( i) two hundred fifty jobs at a single location;

( ii) one hundred twenty-five jobs at a single location and the jobs have an average cash compensation level of more than one and one-half times the per capita income in the county where the jobs are located at the time the jobs are filled;

(iii) seventy-five jobs at a single location and the jobs have an average cash compensation level of more than twice the per capita income in the county where the jobs are located at the time the jobs are filled; or

(iv) thirty jobs at a single location and the jobs have an average cash compensation level of more than two and one-half times the per capita income in the county where the jobs are located at the time the jobs are filled.

The per capita income for each county is determined by using the most recent data available from the Board of Economic Advisors. A taxpayer shall use the most recent per capita income data available as of the end of the taxable year in which the jobs are filled. Determination of the required number of jobs is in accordance with the monthly average described in subsection (F)."

SECTION 9. Section 12-6-4910(1)(a) and (b) of the 1976 Code, as added by Act 75 of 1995, is amended to read:

"(a) an individual not listed in (c) whose federal filing status is single, surviving spouse, or head of household who has gross income for the taxable year of at least the federal exemption amount plus the applicable basic standard deduction, plus any deduction the taxpayer qualifies for pursuant to Section 12-6-1170(B). If the individual is sixty-five or older, the standard deduction is increased as provided in Internal Revenue Code Section 63(c)(3) and 63(f)(1)(A).

(b) an individual not listed in (c) who files a joint return and whose combined gross income for the taxable year, is more than the sum of twice the exemption amount plus the applicable basic standard deduction if the individual and spouse had the same household at the close of the taxable year, plus any deduction the taxpayer qualifies for pursuant to Section 12-6-1170(B). If the individual or spouse is sixty-five or older, the standard deduction is increased as provided in Internal Revenue Code Section 63(c)(3) and 63(f)(1)."

SECTION 10. Section 12-6-5060 of the 1976 Code, as added by Act 76 of 1995, is amended by adding at the end:

"(E) For purposes of this section, the South Carolina Department of Revenue is not subject to provisions of the South Carolina Solicitation of Charitable Funds Act as contained in Chapter 56, Title 33."

SECTION 11. Section 12-6-5065 of the 1976 Code, as added by Act 262 of 1996, is amended by adding at the end:

"(E) For purposes of this section, the South Carolina Department of Revenue is not subject to provisions of the South Carolina Solicitation of Charitable Funds Act as contained in Chapter 56, Title 33."

SECTION 12. Section 12-6-5070 of the 1976 Code, as added by Act 90 of 1995, is amended by adding at the end:

"(E) For purposes of this section, the South Carolina Department of Revenue is not subject to provisions of the South Carolina Solicitation of Charitable Funds Act as contained in Chapter 56, Title 33."

SECTION 13. Section 12-6-5080 of the 1976 Code, as added by Section 64A, Part II, Act 155 of 1997, is amended by adding at the end:

"(D) For purposes of this section, the South Carolina Department of Revenue is not subject to provisions of the South Carolina Solicitation of Charitable Funds Act as contained in Chapter 56, Title 33."

SECTION 14. Section 12-21-2550(B) of the 1976 Code, as last amended by Act 432 of 1998, is further amended to read:

"(B) If a person fails to make a true and correct return or fails to file the return, the department shall make a return upon the information it is able to obtain an estimate of the tax liability from the best information available, and issue a proposed assessment for the taxes, including penalties and interest."

SECTION 15. Section 12-36-2120(33) of the 1976 Code, as added by Section 74A, Part II, Act 612 of 1990, is amended to read:

"(33) electricity, natural gas, fuel oil, kerosene, LP gas, coal, or any other combustible heating material or substance used for residential purposes. Individual sales of kerosene or LP gas of twenty gallons or less by retailers are considered used for residential heating purposes;"

SECTION 16. Section 12-54-240(B) of the 1976 Code, as last amended by Act 155 of 1997, is further amended by adding at the end:

"(20) submission of taxpayer names and home addresses to the director of the South Carolina Retirement System to effectuate the provisions of Section 9-1-1650 relating to the disposition of inactive accounts."

SECTION 17. Section 12-56-20(1) of the 1976 Code, as last amended by Section 55A, Part II, Act 419 of 1998, is further amended to read:

"(1) 'Claimant agency' means a state agency, board, committee, commission, public institution of higher learning, political subdivision, South Carolina Student Loan Corporation, housing authorities established pursuant to Articles 5, 7, and 9 of Chapter 3 of Title 31, and the Internal Revenue Service, and the United States Department of Education. It also includes a private institution of higher learning for the purpose of collecting debts related to default on authorized educational loans made pursuant to Chapters 111, 113, or 115 of Title 59. 'Political subdivision' includes the Municipal Association of South Carolina and the South Carolina Association of Counties when these organizations submit claims on behalf of their members or other political subdivisions."

SECTION 18. Section 12-56-20(3) of the 1976 Code, as added by Act 76 of 1995, is amended to read:

"(3) 'Debtor' means any individual a person having a delinquent debt or account with any a claimant agency which has not been adjusted, satisfied, or set aside by court order, or discharged in bankruptcy."

SECTION 19. Sections 12-6-5590, 12-54-35, and 12-54-40 of the 1976 Code are repealed.

SECTION 20. Section 12-4-320(6) of the 1976 Code, as added by Act 516 of 1994, is amended to read:

"(6) if for damage caused by war, terrorist act, or natural disaster or service with the United States armed forces occurs as defined in Section 12-9-310, prescribe temporary rules including, but not limited to, the filing of returns, payment of taxes, and extensions of due dates or national guard in or near a hazard duty zone, extend the date for filing returns, payments of taxes, collection of taxes, and conducting audits, and waive interest and penalties."

SECTION 21. Section 12-60-470(C) of the 1976 Code, as added by Act 60 of 1995, is amended to read:

"(C) Only the taxpayer legally liable for the tax may file a claim for refund or receive a refund, except that after the application of Section 12-60-490:

(1) the assignment of a refund may be made, but only after the department has authorized the refund and issued an order for the refund to the State Treasurer's office; or

(2) a person who acts as a collector and remitter of state taxes may claim a credit or refund of the tax collected, but only if the person establishes that he has paid the tax in question to the State, and

(1)(a) repaid the tax to the person from whom he collected it; or

(2)(b) obtained the written consent of the person from whom he collected the tax to the allowance of the credit or refund."

SECTION 22. Section 12-44-60 of the 1976 Code, as added by Act 149 of 1997, is amended to read:

"Section 12-44-60. (A) The fee agreement may provide that property which is placed in service as a replacement for economic development property may become economic development property. This replacement property is not required to serve the same function as the economic development property it is replacing. Replacement property is deemed to replace the oldest property subject to the fee, whether real or personal, which is disposed of in the same property tax year as the replacement property is placed in service. Replacement property qualifies as economic development property only to the extent of the original income tax basis of the economic development property which is being disposed of in the same property tax year. More than one piece of property can replace a single piece of property.

(B) To the extent that the income tax basis of the replacement property exceeds the original income tax basis of the economic development property which it is replacing, the excess amount is subject to annual payments calculated as if the exemption for economic development property were not allowed. Replacement property is entitled to the fee payment for the period of time remaining during the exemption period for the economic development property which it is replacing. Where a single piece of property replaces two or more pieces of economic development property, the time period remaining must be measured from the earliest of the dates on which the replaced pieces of economic development property were placed in service.

(C) The new replacement property which qualifies for the fee provided in Section 12-44-50 is recorded using its income tax basis, and the fee is calculated using the millage rate and assessment ratio provided on the original economic development property. The fee payment for replacement property must be based on Section 12-44-50(A)(3) if the sponsor originally used an alternative payment method."

SECTION 23. A. Section 6-1-320(A) of the 1976 Code, as added by Act 138 of 1997, is amended to read:

"(A) Notwithstanding Section 12-37-251(E), a local governing body may only increase the millage rate imposed for general operating purposes above the rate imposed for such purposes for the prior preceding tax year only to the extent of the increase in the consumer price index for the preceding fiscal calendar year. However, in the year in which a reassessment program is implemented, the rollback millage, as calculated pursuant to Section 12-37-251(E), must be used in lieu of the previous year's millage rate."

B. This section is effective for property tax years beginning after 1998.

SECTION 24. The Department of Revenue may amend the 1999 Index of Taxpaying Ability, as defined in Section 59-20-20(3), up to June 1, 1999, for purposes of calculating the 1999 Index of Taxpaying Ability.

SECTION 25. Title 12 of the 1976 Code is amended by adding:

"CHAPTER 46

Tax Increment Financing for Counties

Section 12-46-10. This chapter may be cited as the 'Tax Increment Financing Act for Counties'.

Section 12-46-20. (A) The General Assembly finds that:

(1) Section 14(10) of Article X of the Constitution of South Carolina provides that the General Assembly may authorize by general law that indebtedness for the purpose of redevelopment within counties may be incurred and that the debt service of such indebtedness be provided from the added increments of tax revenues to result from the project.

(2) An increasing demand for public services must be provided from a limited tax base. Incentives must be provided for redevelopment in areas which are, or threaten to become, predominantly slum or blighted.

(3) There exist in many counties of this State blighted, conservation, and sprawl areas; the sprawl and conservation areas are rapidly deteriorating and declining and may soon become blighted areas if their decline is not checked; the stable economic and physical development of the blighted areas, conservation areas, and sprawl areas are endangered by the presence of blighting factors as manifested by progressive and advanced deterioration of structures, by the overuse of housing and other facilities, by a lack of physical maintenance of existing structures, by obsolete and inadequate community facilities, and a lack of sound community planning, by obsolete platting, diversity of ownership, excessive tax, and special assessment delinquencies, or by a combination of these factors; that as a result of the existence of blighted areas, areas requiring conservation, and sprawl areas, there is an excessive and disproportionate expenditure of public funds, inadequate public and private investment, unmarketability of property, growth in delinquencies and crime, and housing and zoning law violations in such areas together with an abnormal exodus of families and businesses so that the decline of these areas impairs the value of private investments and threatens the sound growth and the tax base of taxing districts in such areas, and threatens the health, safety, morals, and welfare of the public.

(4) In order to promote and protect the health, safety, morals, and welfare of the public, blighted conditions need to be eradicated and conservation measures instituted, sprawl areas controlled, and redevelopment of such areas undertaken; to remove and alleviate adverse conditions it is necessary to encourage private investment and restore and enhance the tax base of the taxing districts in such areas by the redevelopment of project areas. The eradication of blighted areas and treatment and improvement of sprawl areas and conservation areas by redevelopment projects is declared to be essential to the public interest.

(5) The use of incremental tax revenues derived from the tax rates of various taxing districts in redevelopment project areas for the payment of redevelopment project costs is of benefit to the taxing districts because taxing districts located in redevelopment project areas would not derive the benefits of an increased assessment base without the benefits of tax increment financing. All surplus tax revenues are turned over to the taxing districts in redevelopment project areas, and all taxing districts benefit from the removal of blighted conditions, the eradication of conditions requiring conservation measures, and control of sprawl conditions.

(B) The General Assembly intends to implement the authorization granted in Article X, Section 14 of the Constitution of this State. The authorization in this chapter provides for this State an essential method for financing redevelopment. The governing bodies of the counties are vested with all powers consistent with the Constitution necessary, useful, and desirable to enable them to accomplish redevelopment in areas which are or threaten to become blighted and to sufficiently meet all constitutional requirements pertaining to incurring indebtedness for the purpose of redevelopment and funding the debt service of such indebtedness from the added increment of tax revenues to result from such redevelopment as provided in Section 14(10) of Article X of the Constitution of this State. The indebtedness incurred pursuant to Section 14(10) of Article X of the Constitution is exempt from all debt limitations imposed by Article X. The powers granted in this chapter must be in all respects exercised for the benefit of the inhabitants of the State, for the increase of its commerce, and for the promotion of its welfare and prosperity.

(C) All action taken by any county in carrying out the purposes of this chapter shall perform essential governmental functions.

(D) Pursuant to the authorization granted in Article VIII, Section 13 of the Constitution of this State, if a redevelopment project area is located in more than one county, the powers granted herein may be exercised jointly.

Section 12-46-30. Unless the context clearly indicates otherwise:

(1) 'Blighted area' means any improved or vacant area within the boundaries of a redevelopment project area located within the territorial limits of a county where:

(a) if improved, industrial, commercial, and residential buildings or improvements, because of a combination of five or more of the following factors: age; dilapidation; obsolescence; deterioration; illegal use of individual structures; presence of structures below minimum code standards; excessive vacancies; overcrowding of structures and community facilities; lack of ventilation, light, or sanitary facilities; inadequate utilities; excessive land coverage; deleterious land use or layout; depreciation of physical maintenance; lack of community planning, are detrimental to the public safety, health, morals, or welfare or;

(b) if vacant, the sound growth is impaired by:

(i) a combination of two or more of the following factors: obsolete platting of the vacant land; diversity of ownership of such land; tax and special assessment delinquencies on such land; deterioration of structures or site improvements in neighboring areas adjacent to the vacant land; or

(ii) the area immediately prior to becoming vacant qualified as a blighted area. Any area within a redevelopment plan established by Chapter 10 of Title 31 is deemed to be a blighted area.

(2) 'Conservation area' means any vacant or improved area within the boundaries of a redevelopment project area located within the territorial limits of a county that is not yet a blighted area but, because of a combination of three or more of the following factors: dilapidation; obsolescence; deterioration; illegal use of structures; presence of structures below minimum code standards; abandonment; excessive vacancies; overcrowding of structures and community facilities; lack of ventilation, light, or sanitary facilities; inadequate utilities; excessive land coverage; depreciation of physical maintenance; or lack of community planning, is detrimental to the public safety, health, morals, or welfare and may become a blighted area.

(3) 'Sprawl area' means a vacant or improved area within the boundaries of a redevelopment project area located within the territorial limits of the unincorporated area of a county that is not yet a blighted area nor a conservation area but, because of the existence of one or more of the following conditions, has the potential to become blighted or in need of conservation:

(a) The sprawl area is an unincorporated urban zone, UUZ, which is an area within the unincorporated portion of the county issuing the finding and has a population density equal to or greater than the average population density of the incorporated municipalities within the territorial limits of the county issuing the finding.

(b) The sprawl area is a linear service zone, LSZ, which is an area within the unincorporated portion of the county issuing the finding which is or is likely to become an area no more than two miles wide at its widest point and no less than three miles in length and which, due to development within the zone, represents an impediment to vehicular and pedestrian traffic so that the county finds its existence a detriment to the:

( i) economic health and well-being of the county;

( ii) health or safety of the persons living, working, or traveling through the zone; or

(iii) efficient provision of governmental services both within and without the zone.

(c) The sprawl area is a rural redevelopment zone, RRZ, which is an area within the unincorporated portion of the county issuing the finding which consists primarily of vacant land which, if provided with certain environmental, energy, transportation, or communications infrastructure, could be developed as a planned community consisting of a minimum of one thousand contiguous acres of land, inclusive of flooded land.

(4) 'Municipality' means an incorporated municipality of this State.

(5) 'Obligations' means bonds, notes, or other evidence of indebtedness issued by the county to carry out a redevelopment project or to refund outstanding obligations.

(6) 'Redevelopment plan' means the comprehensive program of the county for redevelopment intended by the payment of redevelopment costs to reduce or eliminate those conditions which qualified the redevelopment project area as a blighted area, conservation area, or sprawl area, or combination of two or three of them, and to enhance the tax bases of the taxing districts which extend into the project redevelopment area. Each redevelopment plan shall set forth in writing the program to be undertaken to accomplish the objectives and shall include, but not be limited to, estimated redevelopment project costs, the anticipated sources of funds to pay costs, the nature and term of any obligations to be issued, the most recent equalized assessed valuation of the project area, an estimate as to the equalized assessed valuation after redevelopment, and the general land uses to apply in the redevelopment project area. A redevelopment plan established by Chapter 10 of Title 31 is deemed a redevelopment plan for purposes of this item.

(7) 'Redevelopment project' means any buildings, improvements, including street improvements, water, sewer and storm drainage facilities, parking facilities, and recreational facilities. Any project or undertaking authorized under Section 6-21-50 may also qualify as a redevelopment project under this chapter. All such projects are to be publicly owned.

(8) 'Redevelopment project area' means an area designated by the county, which is not less in the aggregate than one and one-half acres and in respect to which the county has made a finding that there exist conditions that cause the area to be classified as a blighted area, a conservation area, or a sprawl area, or a combination of two or three of them. The total aggregate amount of all redevelopment project areas of any one county may not exceed five percent of the total acreage of the county.

(9) 'Redevelopment project costs' means and includes the sum total of all reasonable or necessary costs incurred or estimated to be incurred and any costs incidental to a redevelopment project. The costs include, without limitation:

(a) costs of studies and surveys, plans, and specifications; professional service costs including, but not limited to, architectural, engineering, legal, marketing, financial, planning, or special services;

(b) property assembly costs including, but not limited to, acquisition of land and other property, real or personal, or rights or interest therein, demolition of buildings, and the clearing and grading of land;

(c) costs of rehabilitation, reconstruction, repair, or remodeling of a redevelopment project;

(d) costs of the construction of a redevelopment project;

(e) financing costs including, but not limited to, all necessary and incidental expenses related to the issuance of obligations and which may include payment of interest on any obligations issued under the provisions of this chapter accruing during the estimated period of construction of any redevelopment project for which the obligations are issued and including reasonable reserves related thereto;

(f) relocation costs to the extent that a county determines that relocation costs must be paid or required by federal or state law.

(10) 'Taxing districts' means counties, incorporated municipalities, schools, special purpose districts, and public and any other municipal corporations or districts with the power to levy taxes. Taxing districts include school districts which have taxes levied on their behalf.

(11) 'Vacant land' means any parcel or combination of parcels of real property without industrial, commercial, and residential buildings.

(12) 'County' means any county in the State.

Section 12-46-40. Obligations secured by the special tax allocation fund set forth in Section 12-46-70 for the redevelopment project area may be issued to provide for redevelopment project costs. The obligations, when so issued, must be retired in the manner provided in the ordinance authorizing the issuance of the obligations by the receipts of taxes levied as specified in Section 12-46-110 against the taxable property included in the area and other revenue as specified in Section 12-46-110 designated by the county which source does not involve revenues from any tax or license. In the ordinance the county may pledge all or any part of the funds in and to be deposited in the special tax allocation fund created pursuant to Section 12-46-70 to the payment of the redevelopment project costs and obligations. Any pledge of funds in the special tax allocation fund must provide for distribution to the taxing districts of monies not required for payment and securing of the obligations and the excess funds are surplus funds. In the event a county only pledges a portion of the monies in the special tax allocation fund for the payment of redevelopment project costs or obligations, any funds remaining in the special tax allocation fund after complying with the requirements of the pledge are also considered surplus funds. All surplus funds must be distributed annually to the taxing districts in the redevelopment project area by being paid by the county to the county treasurer. The county treasurer shall immediately thereafter make distribution to the respective taxing districts in the same manner and proportion as the most recent distribution by the county treasurer to the affected districts of real property taxes from real property in the redevelopment project area. In addition to obligations secured by the special tax allocation fund, the county may pledge for a period not greater than the term of the obligations toward payment of the obligations any part of the revenues remaining after payment of operation and maintenance, of all or part of any redevelopment project. The obligations may be issued in one or more series, may bear such date or dates, may mature at such time or times not exceeding thirty years from their respective dates, may bear such rate or rates of interest as the governing body shall determine, may be in such denomination or denominations, may be in such form, either coupon or registered, may carry such registration and conversion privileges, may be executed in such manner, may be payable in such medium of payment, at such place or places, may be subject to such terms of redemption, with or without premium, may be declared or become due before the maturity date thereof, may provide for the replacement of mutilated, destroyed, stolen, or lost bonds, may be authenticated in such manner and upon compliance with such conditions, and may contain such other terms and covenants, as may be provided by the governing body of the county. If the governing body determines to sell any obligations, the obligations must be sold at public or private sale in such manner and upon such terms as the governing body considers best for the interest of the county.

A certified copy of the ordinance authorizing the issuance of the obligations must be filed with the treasurer of each county in which any portion of a redevelopment project is situated and shall constitute the authority for the extension and collection of the taxes to be deposited in the special tax allocation fund.

A county also may issue its obligations to refund in whole or in part obligations previously issued by the county under the authority of this chapter, whether at or prior to maturity, and all references in this chapter to 'obligations' are considered to include these refunding obligations. The debt incurred by a county pursuant to this chapter is exclusive of any statutory limitation upon the indebtedness a taxing district may incur. All obligations issued pursuant to this chapter shall contain a statement on the face of the obligation specifying the sources from which payment is to be made and shall state that the full faith, credit, and taxing powers are not pledged for the obligations.

The trustee or depositary under any indenture may be such persons or corporations as the governing body designates, or they may be nonresidents of South Carolina or incorporated under the laws of the United States or the laws of other states of the United States.

Section 12-46-50. The proceeds from obligations issued under authority of this chapter must be applied only for the purpose for which they were issued. Any premium and accrued interest received in any such sale must be applied to the payment of the principal of or the interest on the obligations sold. Any portion of the proceeds not needed for redevelopment project costs must be applied to the payment of the principal of or the interest on the obligations.

Section 12-46-60. The obligations authorized by this chapter and the income from the obligations and all security agreements and indentures executed as security for the obligations made pursuant to the provisions of this chapter and the revenue derived from the obligations are exempt from all taxation in the State of South Carolina except for inheritance, estate, or transfer taxes and all security agreements and indentures made pursuant to the provisions of this chapter are exempt from all state stamp and transfer taxes.

Section 12-46-70. A county, within five years after the date of adoption of an ordinance providing for approval of a redevelopment plan pursuant to Section 12-46-80, may issue obligations under this chapter to finance the redevelopment project upon adoption of an ordinance providing that:

(1) after the issuance of the obligations; and

(2) after the total equalized assessed valuation of the taxable real property in a redevelopment project area exceeds the certified 'total initial equalized assessed value' established in accordance with Section 12-46-100(B) of all taxable real property in the project area, the ad valorem taxes, if any, arising from the levies upon taxable real property in the project area by taxing districts and tax rates determined in the manner provided in Section 12-46-100(B) each year after the obligations have been issued until obligations issued under this chapter have been retired and redevelopment project costs have been paid must be divided as follows:

(a) that portion of taxes levied upon each taxable lot, block, tract, or parcel of real property which is attributable to the total initial equalized assessed value of all taxable real property in the redevelopment project area must be allocated to and when collected must be paid by the county treasurer to the respective affected taxing districts in the manner required by law in the absence of the adoption of the redevelopment plan; and

(b) that portion, if any, of taxes which is attributable to the increase in the current total equalized assessed valuation of all taxable real property in the redevelopment project area over and above the total initial equalized assessed value of taxable real property in the redevelopment project area must be allocated to and when collected must be paid to the county which shall deposit the taxes into a special fund called the special tax allocation fund of the county for the purpose of paying redevelopment project costs and obligations incurred in the payment of the costs and obligations. The county may pledge in the ordinance the funds in and to be deposited in the special tax allocation fund for the payment of the costs and obligations.

Any ordinance adopted based on acts of the county occurring before the effective date of this chapter must incorporate by reference and adopt those prior acts undertaken in accordance with the procedures of this chapter as if they had been undertaken pursuant to this chapter.

When obligations issued under this chapter have been retired and redevelopment project costs incurred under this chapter have been paid or budgeted pursuant to the redevelopment plan, as evidenced by resolution of the governing body of the county, all surplus funds then remaining in the special tax allocation fund must be paid by the county treasurer immediately to the taxing districts in the redevelopment project area in the same manner and proportion as the most recent distribution by the treasurer to the affected districts of real property taxes from real property in the redevelopment project area.

Upon the payment of all redevelopment project costs, retirement of all obligations of a county issued under this chapter, and the distribution of any surplus monies pursuant to this section, the county shall adopt an ordinance dissolving the tax allocation fund for the project redevelopment area and terminating the designation of the redevelopment project area as a redevelopment project area for purposes of this chapter. Thereafter, the rates of the taxing districts must be extended and taxes levied, collected, and distributed in the manner applicable in the absence of the adoption of a redevelopment plan and the issuance of obligations under this chapter.

If five years have passed from the time a redevelopment project area is designated and the county has not issued obligations under this chapter to finance the redevelopment project, upon the expiration of the five-year term, the county shall adopt an ordinance terminating the designation of the redevelopment project area.

Section 12-46-75. If a municipality annexes a tract of property located in a redevelopment project area, the value of each parcel of real property therein for purposes of the ad valorem taxes of the municipality shall be that which is attributable to its initial equalized assessed value before the redevelopment project and not to the increase in its equalized assessed value due to the redevelopment project.

Section 12-46-80. (A) Prior to the issuance of any obligations under this chapter, the county shall set forth by way of ordinance the following:

(1) a copy of the redevelopment plan containing a statement of the objectives of a county with regard to the plan;

(2) a statement indicating the need for and proposed use of the proceeds of the obligations in relationship to the redevelopment plan;

(3) a statement containing the cost estimates of the redevelopment plan and redevelopment project and the projected sources of revenue to be used to meet the costs including estimates of tax increments and the total amount of indebtedness to be incurred;

(4) a list of all real property in the redevelopment project area;

(5) the duration of the redevelopment plan;

(6) a statement of the estimated impact of the redevelopment plan upon the revenues of all taxing districts in which a redevelopment project area is located and, if residential development is included in the plan, the estimated impact on public school enrollment;

(7) findings that:

(a) the redevelopment project area is a blighted, conservation, or sprawl area and that private initiatives are unlikely to alleviate these conditions without substantial public assistance,

(b) property values in the area would remain static or decline without public intervention, and

(c) redevelopment is in the interest of the health, safety, and general welfare of the citizens of the county.

(B) Before approving any redevelopment plan under this chapter, the governing body of the county must hold a public hearing on the redevelopment plan after published notice in a newspaper of general circulation in the county in which the county and any taxing district affected by the redevelopment plan is located not less than fifteen days and not more than thirty days prior to the hearing. The notice shall include:

(1) the time and place of the public hearing;

(2) the boundaries of the proposed redevelopment project area;

(3) a notification that all interested persons will be given an opportunity to be heard at the public hearing;

(4) a description of the redevelopment plan and redevelopment project; and

(5) the maximum estimated term of obligations to be issued under the redevelopment plan.

Not less than forty-five days prior to the date set for the public hearing, the county shall give notice to all taxing districts of which taxable property is included in the redevelopment project area, and in addition to the other requirements of the notice set forth in the section, the notice shall request each taxing district to submit comments to the county concerning the subject matter of the hearing prior to the date of the public hearing.

(C) If a taxing district does not file an objection to the redevelopment plan at or prior to the date of the public hearing, the taxing district is considered to have consented to the redevelopment plan and the issuance of obligations under this chapter to finance the redevelopment project, provided that the actual term of obligations issued is equal to or less than the term stated in the notice of public hearing. The county may issue obligations to finance the redevelopment project to the extent that each affected taxing district consents to the redevelopment plan. The tax increment for a taxing district that does not consent to a redevelopment plan as defined in this chapter must not be included in the special tax allocation fund established pursuant to this chapter.

(D) If the redevelopment plan includes residential development, then to the extent that the findings pursuant to subsection (A)(6) demonstrate increased public school enrollment because of this development, then an amount of the increment equal to the average property tax collected per pupil in the district multiplied by the estimated increased enrollment is not credited to the special tax allocation fund but is instead allocated to the affected school district as other school tax revenue.

(E) Prior to the adoption of an ordinance approving a redevelopment plan pursuant to Section 12-46-80, changes may be made in the redevelopment plan which do not alter the exterior boundaries or do not substantially affect the general land use established in the plan or substantially change the nature of the redevelopment project, without further hearing or notice, provided that notice of the changes is given by mail to each affected taxing district and by publication in a newspaper or newspapers of general circulation within the taxing districts not less than ten days prior to the adoption of the changes by ordinance. Notice of the adoption of the ordinance must be published by the county in a newspaper having general circulation in the affected taxing districts. Any interested party may, within twenty days after the date of publication of the notice of adoption of the redevelopment plan, but not afterward, challenge the validity of such adoption by action de novo in the court of common pleas in the county in which the redevelopment plan is located.

(F) After adoption of an ordinance approving a redevelopment plan, any alteration in the exterior boundaries, general land uses established pursuant to the redevelopment plan, maximum term of maturity of obligations to be issued under the plan, or the redevelopment project must be approved by resolution of each affected taxing district in accordance with the procedures provided in this chapter for the initial approval of a redevelopment project and designation of a redevelopment project area.

Section 12-46-90. When there are any persons residing in the area covered by the redevelopment plan:

(1) the redevelopment plan shall include:

(a) an assessment of the displacement impact of the redevelopment project and provisions for the relocation of all persons who would be displaced by the project, provided that no residents may be displaced by a redevelopment project unless housing is made available to them pursuant to the terms of this section;

(b) provisions for the creation of housing opportunities to the extent feasible to enable a substantial number of the displaced persons to relocate within or in close proximity to the area covered by the redevelopment plan.

(2) Prior to authorizing the demolition of any residential units in connection with a tax increment financing plan, the governing body of the county must ensure that the redevelopment plan complies with the requirements of this section and further that standard housing is made available to all persons to be displaced.

(3) Persons displaced by a redevelopment plan are entitled to the benefits and protections available under Section 28-11-10. The costs of the relocation are proper expenditures for the proceeds of any obligations issued under this chapter.

Section 12-46-100. (A) If a county by ordinance approves a redevelopment plan pursuant to Section 12-46-80, the auditor of the county, immediately after adoption of the ordinance pursuant to Section 12-46-80, upon request of the county, must determine and certify:

(1) the most recently ascertained equalized assessed value of all taxable real property within the redevelopment project area, as of the date of adoption of the ordinance adopted pursuant to Section 12-46-80, which value is the 'initial equalized assessed value' of the property; and

(2) the total equalized assessed value of all taxable real property within the redevelopment project area and certifying the amount as the 'total initial equalized assessed value' of the taxable real property within the redevelopment project area.

(B) After the county auditor has certified the total initial equalized assessed value of the taxable real property in the area, then in respect to every taxing district containing a redevelopment project area, the county auditor or any other official required by law to ascertain the amount of the equalized assessed value of all taxable property within the district for the purpose of computing the rate percent of tax to be extended upon taxable property within such district, shall in every year that obligations are outstanding for redevelopment projects in the redevelopment area ascertain the amount of value of taxable property in a project redevelopment area by including in the amount the certified total initial equalized assessed value of all taxable real property in the area in lieu of the equalized assessed value of all taxable real property in the area. The rate percent of tax determined must be extended to the current equalized assessed value of all property in the redevelopment project area in the same manner as the rate percent of tax is extended to all other taxable property in the taxing district. The method of extending taxes established under this section terminates when the county adopts an ordinance dissolving the special tax allocation fund for the redevelopment project.

Section 12-46-110. Revenues received by the county from any property, building, or facility owned by the county or any agency or authority established by the county in the redevelopment project area may be used to pay redevelopment project costs or reduce outstanding obligations of the county incurred under this chapter for redevelopment project costs. If the obligations are used to finance the extension or expansion of a system as defined in Section 6-21-40 in the redevelopment project area, all or a portion of the revenues of the system, whether or not located entirely within the redevelopment project area, including the revenues of the redevelopment project, may be pledged to secure the obligations issued under this chapter. The county is fully empowered to use any of the powers granted by either or both of the provisions of Chapter 17 of Title 6 (The Revenue Bond Refinancing Act of 1937) or the provisions of Chapter 21 of Title 6 (Revenue Bond Act for Utilities). In exercising the powers conferred by the provisions, the county may make any pledges and covenants authorized by any provision of those chapters. The county may place the revenues in the special tax allocation fund or a separate fund which must be held by the county or financial institution designated by the county. Revenue received by the county from the sale or other disposition of real property acquired by the county with the proceeds of obligations issued under the provisions of this chapter must be deposited by the county in the special tax allocation fund or a separate fund which must be held by the county or financial institution designated by the county. Proceeds of grants may be pledged by the county and deposited in the special tax allocation fund or a separate fund.

Section 12-46-120. Counties and municipalities may jointly adopt redevelopment plans and authorize obligations as provided under the provisions of this chapter and Chapter 6 of Title 31."

SECTION 26. Section 4-35-150 of the 1976 Code, as added by Act 99 of 1993, is amended to read:

"Section 4-35-150. The improvements as defined in Section 4-35-30 are the sole and unrestricted property of the county must be owned by the county, the State, or another public entity for the benefit of the citizens and residents of the improvement district or the entity owning the improvement, and may at any time may be removed, altered, changed, or added to, as the governing body of the owner may determine if except that during the continuance or maintenance of the improvements, the special assessments on property may be utilized for the preservation, operation, and maintenance of the improvements and facilities provided in the improvement plan, for the management and operation of the improvement district as provided in the improvement plan, and for payment of indebtedness incurred."

SECTION 27. A. Chapter 37, Title 12 of the 1976 Code is amended by adding:

"Section 12-37-223. As authorized by Section 3, Article X of the South Carolina Constitution, the General Assembly hereby authorizes the governing body of a county by ordinance to exempt an amount of fair market value of real property located in the county sufficient to limit to fifteen percent any valuation increase attributable to the implementation in the county of a countywide appraisal and equalization program. An exemption allowed by this section does not apply to:

(1) real property valued for property tax purposes by the unit valuation method;

(2) value attributable to permanent improvements not included in the value of the property in the most recently implemented countywide appraisal and equalization program;

(3) property transferred after the implementation of the most recent countywide equalization program, except property transfers between spouses or transfers that are not subject to income tax as defined by the Internal Revenue Code and incorporated by reference or otherwise enacted by the General Assembly.

Assessed value exempted from ad valorem taxation by an ordinance enacted pursuant to this section is nevertheless considered taxable property for purposes of any formula using assessed value of property to determine state aid to school districts for public education and computing the bonded indebtedness limit for a political subdivision or school district.

The ordinance allowed by this section may be given retroactive effect, but no refund of property tax shall result from the retroactive effect of the ordinance."

B. Section 12-43-217 of the 1976 Code, as last amended by Act 431 of 1996, is further amended to read:

"Section 12-43-217. (A) Notwithstanding any other provision of law, once every fifth year each county or the State shall appraise and equalize those properties under its jurisdiction. Property valuation must be complete at the end of December of the fourth year and the county or State shall notify every taxpayer of any change in value or classification if the change is one thousand dollars or more. In the fifth year, the county or State shall implement the program and assess all property on the newly appraised values.

A county by ordinance may postpone for not more than one property tax year the implementation of revised values resulting from the equalization program provided pursuant to subsection (A). The postponement ordinance applies to all revised values, including values for state-appraised property. The postponement allowed pursuant to this subsection does not affect the schedule of the appraisal and equalization program required pursuant to subsection (A) of this section."

C. The Department of Revenue shall expend such funds as necessary from those appropriated to publish such information as necessary to educate citizens and local officials on the implementation of this section."

SECTION 28. Chapter 37, Title 5 of the 1976 Code is amended to read:

"CHAPTER 37

Section 5-37-10. This chapter may be referred to as 'the 'Municipal Improvement Act of 1973 1999,'', and any municipal corporation of this State is hereby authorized to exercise the powers and provisions hereof.

Section 5-37-20. As used in this chapter, the following terms shall have the following meanings:

(1) `Assessment' means a charge against the real property of an owner within an improvement district created pursuant to this chapter which is based either on assessed value, front footage, area, per parcel basis, the value of improvements to be constructed within the district, or any combination of them, as the basis is determined by the governing body of the municipality. In the event the governing body of a municipality determines that another basis for assessment is appropriate or a more equitable allocation of costs among property owners is appropriate, it may substitute such method for any of the foregoing. An assessment imposed upon real property under this chapter remains valid and enforceable in accordance with the provisions of this chapter even if there is a later subdivision and transfer of the property or a part of it. An improvement plan may provide for a change in the basis of assessment upon the subdivision and transfer of real property or upon such other event as the governing body of a municipality considers appropriate.

(2) `Improvements' include open or covered malls, parkways, parks and playgrounds, recreation facilities, athletic facilities, pedestrian facilities, parking facilities, parking garages, and underground parking facilities, and facade redevelopment, the widening and dredging of existing channels, canals, and waterways used specifically for recreational or other purposes, the relocation, construction, widening, and paving of streets, roads, and bridges, including demolition of them, underground utilities, all activities authorized by Chapter 1 of Title 31 (State Housing Law), any building or other facilities for public use, any public works eligible for financing under the provisions of Section 6-21-50, and all things incidental to the improvements, including planning, engineering, administration, managing, promotion, marketing, and acquisition of necessary easements and land, and may include facilities for lease or use by a private person, firm, or corporation. However, improvements as defined in this chapter must comply with all applicable state and federal laws and regulations governing these activities. Any such improvements may be designated by the governing body as public works eligible for revenue bond financing pursuant to Section 6-21-50, and such improvements, taken in the aggregate, may be designated by the governing body as a `system' of related projects within the meaning of Section 6-21-40. The governing body of a municipality, after due investigation and study, may determine that improvements located outside the boundaries of an improvement district confer a benefit upon property inside an improvement district or are necessary to make improvements within the improvement district effective for the benefit of property inside the improvement district.

(3) `Improvement district' means any area within the municipality designated by the governing body pursuant to the provisions of this chapter and within which an improvement plan is to be accomplished. No special improvement district may include the grounds of the State House in the City of Columbia.

(4) `Improvement plan' means an overall plan by which the governing body proposes to effect improvements within an improvement district to preserve property values, prevent deterioration of urban areas, and preserve the tax base of the municipality, and includes an overall plan by which the governing body proposes to effect improvements within an improvement district in order to encourage and promote private or public development within the improvement district.

(5) `Governing body' shall mean means the municipal council or other governing body in which the general governing powers of the municipality are vested.

(6) `Owner' is defined as any person twenty-one years of age, or older, or the proper legal representative for any person younger than twenty-one years of age, and any firm or corporation, who or which owns legal title to a present possessory interest in real estate equal to a life estate or greater (expressly excluding leaseholds, easements, equitable interests, inchoate rights, dower rights, and future interest) and who owns, at the date of the petition or written consent, at least an undivided one-tenth interest in a single tract and whose name appears on the county tax records as an owner of real estate, and any duly organized group whose total interest is at least equal to a one-tenth interest in a single tract.

It is provided, however, that, if any firm or person has a leasehold interest requiring it or him to pay all municipal taxes, such agreement shall not be applicable to charges of the assessment of the district as only the owner has the right to petition on the assessment charge for the improvement district.

Section 5-37-25. A municipality must obtain the consent of the county governing body and any other municipality where the improvement is located to use revenue collected pursuant to this chapter for improvements located outside the municipal boundaries in which the improvement district is located.

Section 5-37-30. The governing body is authorized, within the corporate limits of the city, to acquire, own, construct, establish, install, enlarge, improve, expand, operate, maintain and repair, and sell, lease, and otherwise dispose of any improvement and to finance such acquisition, construction, establishment, installation, enlargement, improvement, expansion, operation, maintenance, and repair, in whole or in part, by the imposition of assessments in accordance with this chapter, by special district bonds, by general obligation bonds of the municipality, or revenue bonds of the municipality from general revenues from any source not restricted from such use by law, or by any combination of such funding sources. In addition to any other authorization provided herein or by other law, the governing body of a municipality may issue its special district bonds or revenue bonds of the municipality under such terms and conditions as the governing body may determine by ordinance subject to the following: such bonds may be sold at public or private sale for such price as is determined by the governing body; such bonds may be secured by a pledge of and be payable from the assessments authorized herein or any other source of funds not constituting a general tax as may be available and authorized by the governing body; such bonds may be issued pursuant to and secured under the terms of a trust agreement or indenture with a corporate trustee and the ordinance authorizing such bonds or trust agreement or indenture pertaining thereto may contain provisions for the establishment of a reserve fund, and such other funds or accounts as are determined by the governing body to be appropriate to be held by the governing body or the trustee. The proceeds of any bonds may be applied to the payment of the costs of any improvements, including expenses associated with the issuance and sale of the bonds and any costs for planning and designing the improvements or planning or arranging for the financing and any engineering, architectural, surveying, testing, or similar costs or expenses necessary or appropriate for the planning, designing, and construction or implementation of any plan in connection with the improvements.

Section 5-37-40. (A) If the governing body finds that:

(1) improvements would be beneficial within a designated improvement district;

(2) the improvements would preserve or increase property values within the district;

(3) in the absence of the improvements, property values within the area would be likely to depreciate, or that the proposed improvements would be likely to encourage development in the improvement district;

(4) the general welfare and tax base of the city would be maintained or likely improved by creation of an improvement district in the city; and

(5) it would be fair and equitable to finance all or part of the cost of the improvements by an assessment upon the real property within the district, the governing body may establish the area as an improvement district and implement and finance, in whole or in part, an improvement plan in the district in accordance with the provisions of this chapter. However, no residential property shall be included as part of an improvement district unless the owner of the residential property gives the governing body written permission to include his property within the district.

(B) If an improvement district is located in a redevelopment project area created under Title 31, Chapter 6, the improvement district being created under the provisions of this chapter must be considered to satisfy items (1) through (5) of subsection (A). The ordinance creating an improvement district may be adopted by a majority of council after a public hearing at which the plan is presented, including the proposed basis and amount of assessment, or upon written petition signed by a majority in number of the owners of real property within the district which is not exempt from ad valorem taxation as provided by law. However, no residential property shall be included as part of an improvement district unless the owner of the residential property gives the governing body written permission to include his property within the district.

Section 5-37-45. The governing body may include within an improvement district an area within the municipality in which the proposed improvements have been constructed or are under construction at the time of the establishment of the improvement district. Before the commencement of the construction of these improvements, a written agreement with the owner of the area to be improved is entered into by the municipality authorizing the construction of the improvements in anticipation of the inclusion of the area which is improved in the improvement district upon such terms and conditions as the governing body agrees, including the reimbursement, as a cost of constructing improvements under this chapter, of any monies expended for the construction before and subsequent to the establishment of the improvement district. Any agreement providing for the construction of the improvements before the establishment of the improvement district must be authorized by an ordinance of the governing body, notice of which must be given by publication in a newspaper of general circulation within the municipality, appearing at least seven days before the final adoption of the ordinance. Any agreements entered into in accordance with the foregoing conditions before the effective date of this section are ratified and confirmed and the area improved declared eligible for inclusion in the improvement district as proposed in the agreement.

Section 5-37-50. The governing body shall, by resolution duly adopted, describe the improvement district and the improvement plan to be effected therein, including any property within the improvement district to be acquired and improved, the projected time schedule for the accomplishment of the improvement plan, the estimated cost thereof and the amount of such cost to be derived from assessments, bonds, or other general funds, together with the proposed basis and rates of any assessments to be imposed within the improvement district. However, no residential property shall be included as part of an improvement district unless the owner of the residential property gives the governing body written permission to include his property within the district. Such resolution shall also establish the time and place of a public hearing to be held within the municipality not sooner than twenty days nor more than forty days following the adoption of such resolution at which any interested person may attend and be heard either in person or by attorney on any matter in connection therewith.

Section 5-37-60. A resolution providing for an improvement district, when adopted, shall be published once a week for two successive weeks in a newspaper of general circulation within the incorporated municipality and the final publication shall be at least ten days prior to the date of the scheduled public hearing. At the public hearing and at any adjournment thereof, all interested persons may be heard either in person or by attorney.

Section 5-37-70. The governing body may provide by the resolution for the payment of the cost of the improvements and facilities to be constructed within the improvement district by assessments on the property therein as defined in Section 5-37-20, or by the issuance of special district bonds, or by general obligation bonds of the municipality, or from general municipal revenues from any source not restricted from such use by law, or from any combination of such financing sources as may be provided in the improvement plan.

Section 5-37-80. The financing of improvements by assessments, bonds, or other revenues, and the proportions thereof, shall be in the discretion of the governing body; and the rates of assessments upon property owners within the improvement district need not be uniform but may vary in proportion to improvements made immediately adjacent to or abutting upon the property of each owner therein, as well as other bases as provided in Section 5-37-20.

Section 5-37-90. The improvements as defined in Section 5-37-20 are to be or become the property of the municipality, State, or other public entity and may at any time be removed, altered, changed, or added to, as the governing body may in its discretion determine; provided, that during the continuance or maintenance of the improvements, the special assessments on property therein may be utilized for the preservation, operation, and maintenance of the improvements and facilities provided in the improvement plan, and for the management and operation of the improvement district as provided in the improvement plan, and for payment of indebtedness incurred therefor.

Section 5-37-100. Not sooner than ten days nor more than one hundred twenty days following the conclusion of the public hearing provided in Section 5-37-50, the governing body may, by ordinance, provide for the creation of the improvement district as originally proposed or with such changes and modifications therein as the governing body may determine, and provide for the financing thereof by assessment, bonds, or other revenues as herein provided. However, no residential property shall be included as part of an improvement district unless the owner of the residential property gives the governing body written permission to include his property within the district. Such ordinance shall not become effective until at least seven days after it has been published in a newspaper of general circulation in the municipality. Such ordinance may incorporate by reference plats and engineering reports and other data on file in the offices of the municipality; provided, that the place of filing and reasonable hours for inspection are made available to all interested persons.

Section 5-37-110. In the event all or any part of improvements and facilities within the district are to be financed by assessments on property therein, the governing body shall prepare an assessment roll in which there shall be entered the names of the persons whose properties are to be assessed and the amount assessed against their respective properties with a brief description of the lots or parcels of land assessed. Immediately after such assessment roll has been completed the governing body shall cause one copy thereof to be deposited in the offices of the municipality for inspection by interested parties, and shall cause to be published at least once in a newspaper of general circulation within the municipality a notice of completion of the assessment roll setting forth a description in general terms of the improvements and providing at least ten days' notice of the time fixed for hearing of objections in respect to such assessments. The time for hearing such objections shall be at least thirty days, and hearings may be conducted by one or more members of the governing body of the municipality, but the final decision on each such objection shall be made by vote of the whole governing body at a public session thereof.

Section 5-37-120. As soon as practicable after the completion of the assessment roll and prior to the publication of the notice provided in Section 5-37-110, the governing body shall mail by registered or certified mail, return receipt requested, to the owner or owners of each lot or parcel of land against which an assessment is to be levied, at the address appearing on the records of the city or county treasurer, a notice stating the nature of the improvement, the total proposed cost thereof, the amount to be assessed against the particular property and the basis upon which the assessment is made, together with the terms and conditions upon which the assessment may be paid. The notice shall contain a brief description of the particular property involved, together with a statement that the amount assessed shall constitute a lien against the property superior to all other liens except property taxes. The notice shall also state the time and place fixed for the hearing of objections in respect to the assessment. Any property owner who fails to file with the municipal council a written objection to the assessment against his property within the time provided for hearing such objections shall be deemed to have consented to such assessment, and the published and written notices prescribed in this chapter shall so state. If all of the owners of property upon which an assessment is to be levied consent in writing to the imposition of such assessment, the provisions of this section shall be deemed satisfied.

Section 5-37-130. The governing body shall hear the objections as provided herein of all persons who have filed written notice of objection within the time prescribed and who may appear and make proof in relation thereto either in person or by their attorney. The governing body, at the sessions held to make final decisions on objections, may thereupon make such corrections in the assessment roll as it may deem proper and confirm the same, or set it aside and provide for a new assessment. Whenever the governing body shall confirm an assessment, either as originally prepared or as thereafter corrected, a copy thereof certified by the clerk of the municipality shall be filed in the office of the clerk of court of the county in which the municipality is situate, and from the time of such filing the assessment impressed in the assessment roll shall constitute and be a lien on the real property against which it is assessed superior to all other liens and encumbrances, except the lien for property taxes, and shall be annually assessed and collected with the property taxes thereon.

Section 5-37-140. Upon the confirmation of an assessment, if any, the governing body shall mail a written notice to all persons who have filed written objections as hereinabove provided of the amount of the assessment finally confirmed. Such property owner may appeal such assessment only if he shall, within twenty days after the mailing of the notice to him confirming the assessment, give written notice to the governing body of his intent to appeal his assessment to the court of common pleas of the county in which the property is situate; but no such appeal shall delay or stay the construction of improvements or affect the validity of the assessments confirmed and not appealed. Appeals shall be heard and determined on the record, in the manner of appeals from administrative bodies in this State.

Section 5-37-150. Nothing contained herein shall be construed to limit or restrict the powers of any incorporated municipality, but the authorizations herein contained shall be in addition to any such powers.

Section 5-37-160. Any written petition or consent signed by a property owner prior to July 18, 1974, requesting or consenting to an assessment in an improvement district shall be effective and binding upon said property and property owner and all acts of any municipality taken under any other law shall be effective and binding upon all property owners in an improvement district.

Section 5-37-170. No street in the State highway system shall be included in a mall development without prior written approval of the South Carolina Highway Commission.

Section 5-37-180. No street which is located in front of the county courthouse and adjacent thereto shall be included in the mall development without prior written approval of the governing body having jurisdiction over such public property. Likewise, no street which shall in effect block the entrance to the courthouse square shall be included in the mall complex without prior written approval of same governing body."

Part II

SECTION 29. Chapter 9 of Title 58 of the 1976 Code is amended by adding:

"Article 20

Municipal Charges to

Telecommunications Providers

Section 58-9-2200. As used in this article:

(1) 'Telecommunications service' means the provision, transmission, conveyance, or routing for a consideration of voice, data, video, or any other information or signals of the purchaser's choosing to a point, or between or among points, specified by the purchaser, by or through any electronic, radio, or similar medium or method now in existence or hereafter devised. The term 'telecommunications service' includes, but is not limited to, local telephone services, toll telephone services, telegraph services, teletypewriter services, teleconferencing services, private line services, channel services, internet protocol telephony, and mobile telecommunications services and to the extent not already provided herein, those services described in Standard Industrial Classification (SIC) 481 and North American Industry Classification System (NAICS) 5133, except satellite services exempted by law.

(2) 'Retail telecommunications service' includes telecommunications services as defined in item (1) of this section but shall not include:

(a) telecommunications services which are used as a component part of a telecommunications service, are integrated into a telecommunications service, or are otherwise resold by another provider to the ultimate retail purchaser who originates or terminates the end-to-end communication including, but not limited to, the following:

(i) carrier access charges;

(ii) right of access charges;

(iii) interconnection charges paid by the providers of mobile telecommunications services or other telecommunications services;

(iv) charges paid by cable service providers for the transmission by another telecommunications provider of video or other programming;

(v) charges for the sale of unbundled network elements;

(vi) charges for the use of intercompany facilities; and

(vii) charges for services provided by shared, not for profit public safety radio systems approved by the FCC;

(b) information and data services including the storage of data or information for subsequent retrieval, the retrieval of data or information, or the processing, or reception and processing, of data or information intended to change its form or content;

(c) cable services that are subject to franchise fees defined and regulated under 47 U.S.C. Section 542;

(d) satellite television broadcast services.

(3) 'Telecommunications company' means a provider of one or more telecommunications services.

(4) 'Cable service' includes, but is not limited to, the provision of video programming or other programming service to purchasers, and the purchaser interaction, if any, required for the selection or use of the video programming or other programming service, regardless of whether the programming is transmitted over facilities owned or operated by the cable service provider or over facilities owned or operated by one or more other telecommunications service providers.

(5) 'Mobile telecommunications service' includes, but is not limited to, any one-way or two-way radio communication service carried on between mobile stations or receivers and land stations and by mobile stations communicating among themselves, through cellular telecommunications services, personal communications services, paging services, specialized mobile radio services and any other form of mobile one-way or two-way communications service.

(6) 'Service address' means the location of the telecommunications equipment from which telecommunications services are originated or at which telecommunications services are received by a retail customer. If this is not a defined location, as in the case of mobile phones, paging systems, maritime systems, and the like, 'service address' means the location of the retail customer's primary use of the telecommunications equipment or the billing address as provided by the customer to the service provider, provided that the billing address is within the licensed service area of the service provider.

(7) 'Bad debt' means any portion of a debt that is related to a sale of telecommunications services and which has become worthless or uncollectable, as determined under applicable federal income tax standards.

Section 58-9-2210. Nothing in this article shall limit a municipality's authority to enter into and charge for franchise agreements with respect to cable services as governed by 47 U.S.C. Section 542.

Section 58-9-2220. Notwithstanding any provision of law to the contrary:

(1) A business license tax levied by a municipality upon retail telecommunications services for the years 1999 through the year 2003 shall not exceed two-tenths of one percent of the gross income derived from the sale of retail telecommunications services for the preceding calendar or fiscal year which either originate or terminate in the municipality and which are charged to a service address within the municipality regardless of where these amounts are billed or paid and on which a business license tax has not been paid to another municipality. For business license tax levied for the year 2004 and every year thereafter the tax shall not exceed five-tenths of one percent of gross income derived from the sale of retail telecommunications services for the preceding calendar or fiscal year which either originate or terminate in the municipality and which are charged to a service address within the municipality regardless of where these amounts are billed or paid and on which a business license tax has not been paid to another municipality. For a business in operation for less than one year, the amount of business license tax authorized by this section must be computed based on a twelve-month projected income.

(2) A business license tax levied by a municipality upon the retail telecommunications services provided by a telecommunications company must be levied in a competitively neutral and nondiscriminatory manner upon all providers of retail telecommunications services.

(3) The measurement of the amounts derived from the retail sale of telecommunications services does not include:

(a) an excise tax, sales tax, or similar tax, fee, or assessment levied by the United States or any state or local government including, but not limited to, emergency telephone surcharges, upon the purchase, sale, use, or consumption of a telecommunications service, which is permitted or required to be added to the purchase price of the service; and

(b) bad debts.

(4) A business license tax levied by a municipality upon a telecommunications company must be reported and remitted on an annual basis. The municipality may inspect the records of the telecommunications company as they relate to payments under this Article.

(5) The measurement of the amounts derived from the retail sale of mobile telecommunications services shall include only revenues from the fixed monthly recurring charge of customers whose service address is within the boundaries of the municipality.

Section 58-9-2230. (A) A municipality must manage its public rights-of-way on a competitively neutral and nondiscriminatory basis and may impose a fair and reasonable franchise or consent fee on a telecommunications company for use of the public streets and public property to provide telecommunications service unless the telecommunications company has an existing contractual, constitutional, statutory, or other right to construct or operate in the public streets and public property including, but not limited to, consent previously granted by a municipality. Any such fair and reasonable franchise or consent fee which may be imposed upon a telecommunications company shall not exceed the annual sum as set forth in the following schedule based on population:

Tier I 1 - 1,000 $100.00

Tier II 1,001 - 3,000 $200.00

Tier III 3,001 - 5,000 $300.00

Tier IV 5,001 - 10,000 $500.00

Tier V 10,001 - 25,000 $750.00

Tier VI Over 25,000 $1,000.00

(B) A municipality must manage its public rights-of-way on a competitively neutral and nondiscriminatory basis and may impose an administrative fee upon a telecommunications company which is not subject to subsection (1) in this Section that constructs or installs or has previously constructed or installed facilities in the public streets and public property to provide telecommunications service. Any such fee which may be imposed on a telecommunications company shall not exceed the annual sum as set forth in the following schedule based on population:

Tier I 1 - 1,000 $100.00

Tier II 1,001- 3,000 $200.00

Tier III 3,001- 5,000 $300.00

Tier IV 5,001- 10,000 $500.00

Tier V 10,001- 25,000 $750.00

Tier VI Over 25,000 $1,000.00

(C) No municipality shall levy any tax, license, fee, or other assessment on, with respect to, or measured by the receipts from any telecommunications service, other than (a) the business license tax authorized by this Article, and (b) franchise fees as defined and regulated under 47 U.S.C. Section 542; provided, however, that nothing herein shall restrict the right of any municipality to impose ad valorem taxes, service fees, sales taxes, or other taxes and fees lawfully imposed on other businesses within the municipalities.

(D) A telecommunications company, including a mobile telecommunications company providing mobile telecommunications services, shall not be deemed to be using public streets or public property unless it has constructed or installed physical facilities in public streets or on public property, provided that the use of public streets or public property under lease, site license or other similar contractual arrangement between a municipality and a telecommunications company shall not constitute the use of public streets or public property under this Article. Without limiting the generality of the foregoing, a telecommunications company shall not be deemed to be using public streets or public property under this article solely because of its use of airwaves within a municipality. Should any telecommunications company, including a telecommunications company providing mobile telecommunications services, request of a municipality permission to construct or install physical facilities in public streets or on public property, such request shall be considered by such municipality in a manner that is competitively neutral and non-discriminatory as amongst all telecommunications companies.

Section 58-9-2240. A municipality may not use its authority over the public street and public property as a basis for asserting or exercising regulatory control over telecommunications companies regarding matters within the jurisdiction of the Public Service Commission or the Federal Communications Commission including, but not limited to, the operations, systems, service quality, service territory, and prices, of a telecommunications company. Nothing in this section shall be construed to limit the authority of a local governmental entity over a cable television company providing cable service as permitted by 47 U.S.C. Section 542.

Section 58-9-2250. A telecommunications company, its successors or assigns, that is occupying the public streets and public property of a municipality on the effective date of this Article with the consent of the municipality to use such public streets and public property shall not be required to obtain additional consent to continue the occupation of those public streets and public property.

Section 58-9-2260. A telecommunications company may include the following statement in any municipal customer's bill when that customer's municipality charges a business license tax to the telecommunications company under this chapter: 'Please note that there may be a line-item charge included in this bill that is for a business license tax assessed by your municipality'.

Section 58-9-2270. No municipality may enforce an ordinance or practice which is inconsistent or in conflict with the provisions of this article, provided, however, that as of the time of the effective date of this article, any municipality which had entered into a franchise agreement or other contractual agreement with a telecommunications provider prior to December 31, 1997, may continue to collect fees under such franchise agreement or other contractual agreement through December 31, 2003, regardless of whether such franchise agreement or contractual agreement expires prior to December 31, 2003. Nothing in this article shall be interpreted to interfere with continuing obligations of any franchise or other contractual agreement in the event that such franchise agreement or other contractual agreement should expire after December 31, 2003. In the event that a municipality collects such fees under a franchise agreement or other contractual agreement herein, then such fees shall be in lieu of fees or taxes that might otherwise be authorized by this Article. Provided, further, that any municipality that, as of the effective date of this article, has in effect a business license tax ordinance, adopted prior to December 31, 1997, under which the municipality has been imposing and a telecommunications company has been paying, a business license tax higher than that permitted under this article, may continue to collect such tax under the ordinance through December 31, 2003, instead of the business license tax permitted under this article."

SECTION 30. A. Article 21, Chapter 37, Title 12 of the 1976 Code is amended by adding:

"Section 12-37-2695. (A) Effective for motor vehicle tax years beginning after 1999, There is allowed as a credit against the property tax due on a private passenger motor vehicle as defined in Section 56-3-630, a motorcycle, and a motor-driven cycle for a motor vehicle tax year an amount determined pursuant to subsection (C) of this section.

(B)(1) There must be reimbursed to political subdivisions of the State, including school districts, amounts not collected in personal property taxes because of the tax credit allowed by this section. The Board of Economic Advisors shall estimate the total property taxes to be paid in the State in the calendar year 2000 on vehicles eligible for the credit. An amount equal to seven percent of that estimate must be credited each calendar year to the Trust Fund for Tax Relief.

(2) There must be distributed to each county a percentage of the total credited to the Trust Fund for Tax Relief pursuant to item (1) for a calendar year that is the same percentage the county receives for the fiscal year ending during the applicable calendar year of the total amount distributed to counties pursuant to Chapter 27 of Title 6, the State Aid to Subdivisions Act. These reimbursements must be paid not less than monthly, and in advance. The reimbursement must be allocated to a taxing entity in the proportion that its revenues from property taxes on eligible vehicles is of the total of such revenues in the county for the calendar year.

(C) From the reimbursements paid a county pursuant to this section for a calendar year, the auditor shall calculate a credit against the personal property tax coming due on eligible motor vehicles during the year, with the credit on each individual vehicle determined by the ratio that its assessed value is of the assessed value of all eligible vehicles registered in the county. This credit shall reduce proportionately the tax otherwise due on the vehicle imposed by each property taxing entity and must be noted on a separate line on the personal property tax bill as 'state motor vehicle tax relief'."

B. Section 11-11-150(A) of the 1976 Code, as added by Act 419 of 1998, is amended to read:

"(A) In calculating estimated state individual and corporate income tax revenues for a fiscal year, the Board of Economic Advisors shall deduct amounts sufficient to pay the reimbursement required pursuant to:

(1) Section 12-37-251 for the residential property tax exemption;

(2) Section 12-37-270 for the homestead exemption for persons over age sixty-five or disabled;

(3) Section 12-37-935(B) for manufacturer's additional depreciation; and

(4) Section 12-37-450 for the inventory tax exemption; and

(5) Section 12-37-2695 for the motor vehicle tax credit."

C. Notwithstanding other effective dates provided in this act, this section takes effect upon approval by the Governor, and applies for motor vehicle tax years beginning after 1999.

SECTION 31. A. Section 12-20-105(C) of the 1976 Code, as last amended by Act 151 of 1997, is further amended to read:

"(C) For the purpose of this section, 'infrastructure' means improvements for water, sewer, gas, steam, electric energy, and communication services made to a building or land which are considered necessary, suitable, or useful to an eligible project. These improvements include, but are not limited to:

(1) improvements to both public or private water and sewer systems;

(2) improvements to both public or private electric, natural gas, and telecommunication telecommunications systems including, but not limited to, ones owned or leased by an electric cooperative, electric utility, or electric supplier, as defined in Chapter 27, Title 58;

(3) fixed transportation facilities including highway, road, rail, water, and air;

(4) for a qualifying project under subsection (B)(2), infrastructure improvements include industrial shell buildings and the purchase of land for an office, business, commercial, or industrial park which is constructed by a county or political subdivision of this State."

B. Section 12-36-2120 of the 1976 Code, as last amended by Act 419 of 1998, is further amended by adding an appropriately numbered item at the end to read:

"( ) clothing and other attire required for working in a Class 100 or better as defined in Federal Standard 209E clean room environment."

C. Section 12-37-930(6)(c) of the 1976 Code, as added by Act 32 of 1995, is amended to read:

"(c) Electronic Interconnection Component Assembly Devices for Computers and Computer Peripherals; semiconductors and semiconductor devices; substrates; flat panel displays; and liquid crystal displays......................................30%

Includes the manufacture of interconnection component assemblies and devices, semiconductors and semiconductor devices, flat panel displays, and liquid crystal displays which are incorporated in computers or computer peripherals, or other electronic control applications, and telecommunications devices. Computer peripherals include tape drives, compact disk read-only memory systems, hard disks, drivers, tape streamers, monitors, printers, routers, servers, and power supplies."

D. The schedule in Section 12-37-930 of the 1976 Code, as last amended by Act 231 of 1996, is further amended by adding an appropriately numbered item at the end to read:

"( ) Class 100 or better as defined in Federal Standard 209E Clean Room Modules and Associated Mechanical Systems, Process Piping, Wiring, Environmental Systems, and Water Purification Systems..........................10%

Includes waffle flooring, wall and ceiling panels; foundation improvements that isolate the clean room to control vibrations; clean air handling and filtration systems; piping systems for fluids and gases used in the manufacturing process and that touch the product during the fabrication of semiconductors, flat panel displays, and liquid crystal displays; process equipment energy control systems; ultra pure water processing and waste water recycling systems; and safety alarm and monitoring systems."

E. Notwithstanding any other effective date provided in this act, subsection A of this section takes effect upon approval by the Governor, and the remaining sections take effect upon approval by the Governor and apply for taxable years beginning after 1998.

SECTION 32. A. Chapter 10 of Title 12 of the 1976 Code is amended by adding:

"Section 12-10-81. (A) A business may claim a job development credit as determined by this section if the:

(1) council approves the use of this section for the business;

(2) business qualifies pursuant to Section 12-10-50; and

(3) business is a manufacturer which has more than one billion dollars in capital invested in this State and employs more than seven thousand employees in this State and which commits within a period of five years from the date of a revitalization agreement, to invest an additional four hundred million dollars and create an additional four hundred jobs in this State qualifying for job development fees or credits pursuant to current or future revitalization agreements. The council, in its discretion, may extend the five-year period for two additional years if the business has made a commitment to the additional four hundred million dollars and makes substantial progress toward satisfying the goal before the end of the initial five-year period. A business that represents to the council its intent to qualify pursuant to this section and is approved by the council may put job development fees computed pursuant to this section into an escrow account until the date the business satisfies the capital and job requirements of this section.

(B)(1) A business qualifying pursuant to this section may claim its job development credit against its withholding on its quarterly state withholding tax return for the amount of job development credit allowable. The credit must be claimed on a quarterly basis. To claim a job development credit, the business must be current with respect to its withholding tax and other tax due and owing the State, and must have maintained its minimum employment requirement for the entire quarter.

(2) To be eligible to apply to the council to claim a job development credit pursuant to this section, a qualifying business must create at least ten new, full-time jobs at the South Carolina facility or facilities described in the revitalization agreement.

(3) To the extent a return of an overpayment of withholding that results from claiming job development credits is not used as permitted by subsection (D), it must be treated as misappropriated employee withholding.

(4) If a qualifying business claims job development credits pursuant to this section, it must make its payroll books and records available for inspection by the council and the department at the times the council and the department request. Each qualifying business claiming job development credits pursuant to this section must file the job development credit and the use of any overpayment of withholding resulting from the claiming of a job development credit according to the revitalization agreement that the council or department requests. Each qualifying business must furnish an audited report prepared by an independent certified public accountant which itemizes the sources and uses of the funds. The audited report must be filed with the council and the department no later than June thirtieth following the calendar year in which the job development credits are claimed. An employer may not claim an amount that results in an employee receiving a smaller amount of wages on either a weekly or on an annual basis than the employee would otherwise receive in the absence of this chapter.

(C)(1) The maximum job development credit a qualifying business may claim for new employees is determined by the sum of the following amounts:

(a) two percent of the gross wages of each new employee who earns $6.34 or more an hour but less than $8.45 an hour;

(b) three percent of the gross wages of each new employee who earns $8.45 or more an hour but less than $10.57 an hour;

(c) four percent of the gross wages of each new employee who earns $10.57 or more an hour but less than $15.85 an hour;

(d) five percent of the gross wages of each new employee who earns $15.85 or more an hour; and

(e) the increase in the state sales and use tax of the business from the year of the effective date of its revitalization agreement pursuant to this section and subsequent years, over its state sales and use tax for the first of the three years preceding the effective date of this revitalization agreement.

(2) The hourly gross wages in item (1) must be adjusted annually by the inflation factor determined by the State Budget and Control Board for the purposes of Section 12-10-80(3). The amount which may be claimed by a qualifying business is limited by the revitalization agreement. The business may proceed by using either the job development fee escrow procedure available pursuant to revitalization agreements with effective dates before 1997, or the job development credit, or a combination of the two. For a business qualifying pursuant to this section, the council also may approve or waive sections of a revitalization agreement and the council's rules as needed, in the council's discretion, to assist the business.

(D) To claim a job development credit, the qualifying business must incur expenditures at the facility or for utility or transportation improvements that serve the facility. The expenditures must be incurred during the term of the revitalization agreement or within sixty days before the execution of a revitalization agreement including a preliminary revitalization agreement authorized by the revitalization agreement, and used for:

(1) training costs and facilities;

(2) acquiring and improving real estate whether constructed or acquired by purchase, or in cases approved by the council, acquired by lease or otherwise;

(3) improvements to both public and private utility systems including water, sewer, electricity, natural gas, and telecommunication;

(4) fixed transportation facilities including highway, rail, water, and air; or

(5) construction or improvements of real property and fixtures constructed or improved primarily for the purpose of complying with local, state, or federal environmental laws or regulations.

(E) A job development credit of a qualifying business permanently lapses upon expiration or termination of the revitalization agreement. If an employee is terminated, the qualifying business immediately must cease to claim job development credits.

(F) The statute of limitations provided by Section 12-54-85 is suspended until the end of the five-year or seven-year period described in item (3) of subsection (A) with respect to state withholding taxes under this section for a business subject to this section."

B. This section applies to taxable years beginning after 1998. Notwithstanding any to the contrary in this section, no business shall be entitled to any benefits under a revitalization agreement entered into under this section before July 1, 2000.

SECTION 33. A. Section 12-36-2120 of the 1976 Code is amended by adding an appropriately numbered item at the end to read:

"( )(a) crutches, hospital beds, and wheelchairs;

(b) equipment, including manual control units, van lifts, van door opening units, and raised roofs, for attaching to or modifying a motor vehicle for use by a permanently physically disabled person;

(c) equipment, including elevators, dumbwaiters, chair lifts, and bedroom or bathroom lifts, whether or not sold for attaching to real property, for use by a permanently physically disabled person in that person's principal dwelling;

(d) equipment, including manual control units, for attaching to or modifying motorized implements of husbandry for use by permanently physically disabled persons."

B. This section takes effect July 1, 2000.

SECTION 34. A. Section 2-7-76 of the 1976 Code, as last amended by Section 115, Part II, Act 497 of 1994, is further amended to read:

"Section 2-7-76. (A) Whenever The chairman of the legislative committee to which a bill or resolution was referred shall direct the Budget Division or the Economic Research Section of the Budget and Control Board, as appropriate, to prepare and affix to it a statement of the estimated fiscal or revenue impact and cost to the counties and municipalities of the proposed legislation before the legislation is reported out of that committee if a bill or resolution:

(1) requires a county or municipality to expend funds allocated to the county or municipality under pursuant to Chapter 27 of Title 6, or whenever a bill or resolution;

(2) is introduced in the General Assembly to require the expenditure of funds by a county or municipality, or whenever a bill or resolution;

(3) requires the use of county or municipal personnel, facilities, or equipment to implement a general law or regulations promulgated pursuant to a general law,; or whenever a bill

(4) relates to taxes imposed by political subdivisions, the chairman of the legislative committee to which the bill or resolution was referred shall direct the Budget Division or the Department of Revenue, as appropriate, to prepare and affix to it a statement of the estimated fiscal or revenue impact and cost to the counties and municipalities of the proposed legislation prior to the legislation being reported out of that committee.

(B) A revised estimated fiscal or revenue impact and cost statement must be prepared at the direction of the presiding officer of the House of Representatives or the Senate by the Budget Division or Department of Revenue prior to Economic Research Section of the Budget and Control Board before third reading of the bill or resolution, if there is a significant amendment to the bill or resolution.

(C) For purposes of this section, political subdivision means a county, municipality, school district, special purpose district, public service district, or consolidated political subdivision."

B. Section 12-6-40(A) of the 1976 Code, as last amended by Act 268 of 1998, is further amended to read:

"(A) 'Internal Revenue Code' means the Internal Revenue Code of 1986 as amended through December 31, 1997 1998, and includes the effective date provisions contained therein."

C. Section 12-6-1120(8) of the 1976 Code, as added by Act 76 of 1995, is amended to read:

"(8) Each partner in the Palmetto Seed Capital Fund Limited Partnership (Fund) established under pursuant to Section 41-44-60 shall exclude from South Carolina gross income, seventy-five percent of the partner's proportionate share of income that the fund derives from a South Carolina business which is either:

( i) established and operated in a less least developed county as defined in Section 12-6-3360,; or

(ii) invested in agriculture, aquaculture, or a related business or in a business created by a socially or economically disadvantaged individual as defined in 13 Code of Federal Regulations, Sections 124.105(A) and 124.106 (1987)."

D. Section 12-6-3410(D)(2) of the 1976 Code, as added by Act 76 of 1995, is amended to read:

"(2) The establishment, expansion, or addition of a corporate headquarters or research and development facility must result in:

(a) the creation of at least seventy-five new full-time jobs performing either:

( i) headquarters related functions and services; or

(ii) research and development related functions and services which.

The jobs must have an average cash compensation level of more than one and one-half times the per capita income of this State at the time the jobs are filled based on the most recent per capita income data available as of the end of the taxpayer's taxable year in which the jobs are filled; and

(b) an average South Carolina employee cash compensation level for all employees in this State of more than twice the per capita income in the State at the time the newly created jobs are filled based on the most recent per capita income data available as of the end of the taxpayer's taxable year in which the jobs are filled."

E. Section 12-6-3465 of the 1976 Code, as added by Act 32 of 1995, is amended to read:

"Section 12-6-3465. A taxpayer who is constructing or operating a qualified recycling facility as defined in Section 12-7-1275 12-6-3460 shall be is entitled to credits in the amount of all funds collected as permitted in Section 12-10-80, which credits can be used to reduce the taxpayer's corporate income tax imposed by Section 12-7-230 12-6-530, sales or use tax imposed by the State or any political subdivision of the State, corporate license fees imposed by Section 12-19-70 12-20-50 or any tax similar to these taxes. Any unused credits may be carried forward to subsequent taxable years until such credits are exhausted."

F. Section 12-16-20(5) of the 1976 Code, as last amended by Act 361 of 1992, is further amended to read:

"(5) 'Internal Revenue Code' means the Internal Revenue Code of 1986, as amended through December 31, 1991 described in Section 12-6-40(A)."

G. Section 12-20-20(A) of the 1976 Code, as added by Act 76 of 1995, is amended to read:

"(A) Except for those corporations described in Section 12-20-110, every domestic corporation, every foreign corporation qualified to do business in this State, and any other corporation required by Section 12-6-530 12-6-4910 to file income tax returns shall file an annual report with the department."

H. The third paragraph of Section 12-36-510(C) of the 1976 Code, as last amended by Act 383 of 1994, is further amended to read:

" 'Special event' means a promotional show, trade show, fair, festival, or carnival for which an admissions fee is required for entering the event or, in the case of a festival, if the festival is listed as a special event in the calendar of events provided by the South Carolina Department of Parks, Recreation and Tourism. In addition, the event must be operated for a period of less than twelve consecutive days."

I. Section 12-37-251(F) of the 1976 Code, as last amended by Section 29C, Part II, Act 419 of 1998, is further amended to read:

"(F) The exemption allowed by this section is conditional on full funding of the Education Finance Act and on an appropriation by the General Assembly each year reimbursing school districts an amount equal to the Department of Revenue's Economic Research Section of the Budget and Control Board estimate of total school tax revenue loss resulting from the exemption in the next fiscal year."

J. The second paragraph of Section 12-54-85(D) of the 1976 Code, as added by Act 60 of 1995, is amended to read:

"Notwithstanding any restrictions on filing a claim for refund provided in subsection (F) below, a corporation may file a claim for refund resulting from an overpayment due to changes in taxable income made by the Internal Revenue Service within thirty ninety days from the date the Internal Revenue Service changes the taxable income."

K. Sections B, C, D, E, F, G, and J are effective for taxable years after 1998 and Section I is effective for property tax years beginning after 1998.

SECTION 35. A. Section 12-56-20(1) of the 1976 Code, as last amended by Section 55A, Part II, Act 419 of 1998, is further amended to read:

"(1) 'Claimant agency' means a state agency, board, committee, commission, public institution of higher learning, political subdivision, South Carolina Student Loan Corporation, housing authorities established pursuant to Articles 5, 7, and 9 of Chapter 3 of Title 31, and the Internal Revenue Service. It also includes a private institution of higher learning for the purpose of collecting debts related to default on authorized educational loans made pursuant to Chapters 111, 113, or 115 of Title 59. 'Political subdivision' includes the Municipal Association of South Carolina and the South Carolina Association of Counties when these organizations submit claims on behalf of their members, or other political subdivisions, or other claimant agencies as defined in this item. A political subdivision who submits a claim through an association is a claimant agency for the purpose of the notice and appeal provisions and other requirements of this chapter."

B. Section 12-56-60 of the 1976 Code, as added by Act 76 of 1995, is amended to read:

"Section 12-56-60. (A) A claimant agency seeking to attempt collection of a delinquent debt through setoff shall notify the department in writing and supply information the department determines necessary to identify the debtor whose refund is sought to be set off. A request for setoff may be made only after the claimant agency has notified the debtor of its intention to cause the debtor's refund to be set off not less than thirty days before the claimant agency's request to the department. This notice must be given in person, left at the dwelling or usual place of business of the debtor, or sent by certified or registered mail to the debtor's last known address no less than thirty days before the claimant agency's request to the department. The notice shall include a statement which sets forth administrative appeal procedures available to the debtor and alternatives available to the debtor which could prevent setoff. The claimant agency promptly shall notify the debtor when the liability out of which the setoff arises is satisfied. Notification to the department and the furnishing of identifying information must occur on or before a date specified by the department in the year preceding the calendar year during which the refund would be paid. Additionally, subject to the notification deadline specified above, the notification is effective only to initiate setoff for claims against refunds that would be made in the calendar year subsequent to the year in which notification is made to the department.

(B) Upon receiving the certification of the claimant agency of the amount of the delinquent debt, the department shall determine if the debtor is due a refund. If the debtor is due a refund of more than twenty-five dollars, the department shall set off the delinquent debt against the amount of the refund in excess of twenty-five dollars and transfer the amount set off to the claimant agency. The department may retain an amount not to exceed twenty-five dollars of each refund set off to defray its administrative expenses. No apportionment is required in cases of refunds resulting from filing joint returns. A person has no property right or property interest in a refund until all amounts due the State and claimant agencies are paid. The department shall consider any certified delinquent debt and debtor list provided by a claimant agency as correct and the department is not liable for a wrongful or improper setoff. Reviews of refund setoffs are with the claimant agency. If, after appropriate review the claimant agency determines that the setoff amount is excessive, it shall refund the appropriate amount to the taxpayer. If, after appropriate review, the claimant agency determines that it is entitled to no part of the amount set off, it shall refund the entire amount plus the administrative fee retained by the department. That portion of the refund reflecting the administrative fee must be paid from claimant agency funds. If a refund has been retained in error, the claimant agency shall pay interest to the taxpayer calculated as provided in Section 12-54-20 from the date provided by law after which interest is paid on refunds until the appeal is final except that no interest accrues when the claimant agency is the Office of Child Support Services of the South Carolina Department of Social Services."

C. Chapter 56 of Title 12 of the 1976 Code is amended by adding:

"Section 12-56-62. The notice of intention to set off must be given by mailing the notice, with postage prepaid, addressed to the debtor at the address provided to the claimant agency when the debt was incurred or at the debtor's last known address. The giving of the notice by mail is complete upon the expiration of thirty days after deposit of the notice in the mail. A certification by the claimant agency that the notice has been sent as required by this section is presumptive proof that the requirements as to notice are met, even if the notice actually has not been received by the debtor. The notice must include a statement of appeal procedures available to the debtor, substantially as follows:

'According to our records, you owe the (claimant agency) a debt in the amount of (amount of the debt) for (type of debt) . You are hereby notified of the (claimant agency's) intention to submit this debt to the South Carolina Department of Revenue to be set off against your individual income tax refund. Pursuant to the Setoff Debt Collection Act, this amount, plus all costs, will be deducted from your South Carolina individual income tax refund unless you file a written protest within thirty days of the date of this notice. If you file a joint return with your spouse, this amount will be deducted from the total joint refund without regard to which spouse incurred the debt or actually withheld the taxes. The protest must contain the following information:

(1) your name;

(2) your address

(3) your social security number;

(4) the type of debt in dispute; and

(5) a detailed statement of all the reasons you disagree or dispute the debt.

The original written protest must be mailed to the (claimant agency) at the following address:

(address of the entity requesting the setoff) .'

Section 12-56-63. (A) A debtor who protests the debt shall file a written protest with the claimant agency at the address provided in the claimant agency's notification of intention to set off. The protest must be filed within thirty days of the date of the notice of intention to set off and must contain the debtor's name, address, and social security number, identify the type of debt in dispute, and give a detailed statement of all the reasons which support the protest. The requirements of this section are jurisdictional.

(B) An association defined as a political subdivision in Section 12-56-20(1) may contract with another political subdivision for the processing of debts to be submitted to the department. These services may be funded through an administrative fee. The association is exempt from the notice and appeal procedures of this chapter. The entity responsible for the notice and hearing requirements of this chapter is the political subdivision which has submitted its claim through the association or governmental entity which has submitted it directly to the department.

Section 12-56-65. (A) Before submitting a debt to the department, the claimant agency shall appoint a hearing officer to hear a protest of a debtor. This hearing officer is vested with the authority to decide a protest in favor of either the debtor or the claimant agency. The claimant agency shall certify to the department, on a form prescribed by the department, that a hearing officer has been appointed and shall inform the department of the name, address, and telephone number of the hearing officer. If this hearing officer is unable to serve at any time, the claimant agency shall appoint another hearing officer.

(B) Upon receipt of a notice of protest, the claimant agency shall notify the department that a protest has been received and shall hold an informal hearing at which the debtor may present evidence, documents, and testimony to dispute the debt. The claimant agency shall notify the debtor of the date, time, and location of the informal hearing. At the conclusion of the informal hearing, the hearing officer shall render his determination. Upon receipt of a sworn certification from the hearing officer that he held an informal hearing and ruled in favor of the claimant agency, the department may proceed with the setoff, regardless of a subsequent appeal by the debtor.

(C) A debtor may seek relief from the hearing officer's determination by requesting, within thirty days of the determination, a contested case hearing before the Administrative Law Judge Division. A request for a hearing before the Administrative Law Judge Division must be made in accordance with its rules.

(D) If a setoff is made and the determination of the hearing officer in favor of the claimant agency is later reversed, the claimant agency shall refund the appropriate amount to the taxpayer. If the claimant agency is found to be entitled to no part of the amount set off, it shall refund the entire amount plus the administrative fee retained by the department. That portion of the refund reflecting the administrative fee must be paid from claimant agency funds. If the claimant agency is found to be entitled to a portion of the amount set off, it is not required to refund the administrative fee retained by the department.

(E) If a refund is retained in error, the claimant agency shall pay to the taxpayer interest calculated as provided in Section 12-54-20 from the date provided by law after which interest is paid on refunds until the appeal is final, except that interest does not accrue when the claimant agency is the Office of Child Support Services of the South Carolina Department of Social Services.

(F) If the claimant agency determines that money has been erroneously or illegally set off, the claimant agency, in its discretion, may refund the amount of the setoff, even if the debtor does not file a protest.

(G) A setoff may not be contested more than one year after the date the setoff was made. The date of the setoff must be conclusively determined by the department. This provision must be construed as a statute of repose and not as a statute of limitation.

Section 12-56-67. This section does not create a right to jury trial where one does not already exist. Where a debtor otherwise is entitled to have a jury determine the issue of indebtedness, that right is preserved specifically. If a right to a jury trial already exists and the debtor wishes to exercise that right, the debtor is not required to request a contested case hearing before the Administrative Law Judge Division, but instead must file a summons and complaint in the Court of Common Pleas and serve the pleadings on the claimant agency within thirty days from the date of the hearing officer's determination. The summons and complaint must name the claimant agency as a defendant and the allegations of the complaint must contest the debt and any potential setoff.

Section 12-56-120. The department is exempt from the notice and appeal procedures of this chapter. The appeal procedures for the setoff of any debt owed to the department is governed by the provisions of Chapter 60 of Title 12 which provides the sole and exclusive remedy for these procedures."

D. Section 12-56-110 of the 1976 Code, as added by Act 76 of 1995, is amended to read:

"Section 12-56-110. The department shall may promulgate regulations and prescribe forms and procedures necessary to implement this chapter."

E. All liabilities incurred and rights accrued before the effective date of this section are unaffected by the provisions of this section.

F. This section applies to a liability incurred or a right accrued on and after that date.

SECTION 36. A. Section 4-10-65 of the 1976 Code, as added by Section 99, Part II, Act 164 of 1993, is amended to read:

"Section 4-10-65. Funds collected by the Tax Commission department from the local option sales tax which are not identified as to the governmental unit due the tax, shall, and cannot be so identified after a reasonable effort by the commission department to determine the appropriate governmental unit, must be deposited to a local option supplemental revenue fund. These funds must be distributed in accordance with Section 4-10-60 to those counties generating less than the minimum distribution."

B. Section 4-10-330(E) of the 1976 Code, as added by Act 138 of 1997, is amended to read:

"(E) All qualified electors desiring to vote in favor of imposing the tax for the stated purposes shall vote 'yes' and all qualified electors opposed to levying the tax shall vote 'no'. If a majority of the votes cast are in favor of imposing the tax, then the tax is imposed as provided in this article and the enacting ordinance. A subsequent referendum on this question must be held on the date prescribed in subsection (C). The election commission shall conduct the referendum under the election laws of this State, mutatis mutandis, and shall certify the result no later than December thirty-first November thirtieth to the county governing body and to the Department of Revenue. Expenses of the referendum must be paid by the governmental entities that would receive the proceeds of the tax in the same proportion that those entities would receive the net proceeds of the tax."

C. Section 4-10-350(C), (D), and (E) of the 1976 Code, as added by Act 138 of 1997, is amended to read:

"(C) Taxpayers A taxpayer required to remit taxes under Article 13, Chapter 36 of Title 12 must identify the county, municipality, or both, in which the personal property purchased at retail is stored, used, or consumed in this State.

(D) Utilities are A utility is required to report sales in the county, municipality, or both, in which the consumption of the tangible personal property occurs.

(E) A taxpayer subject to the tax imposed by Section 12-36-920, who owns or manages rental units in more than one county, municipality, or combination thereof, must report separately in his sales tax return the total gross proceeds from business done in each county or municipality."

D. Section 4-10-360 of the 1976 Code, as added by Act 138 of 1997, is amended by adding at the end:

"However, allocations made as a result of city or county code errors must be corrected prospectively."

E. Article 3, Chapter 10, Title 4 of the 1976 Code is amended by adding:

"Section 4-10-380. Annually, and only in the month of June, funds collected by the department from the local option capital project sales tax, which are not identified as to the governmental unit due the tax, must be transferred, after reasonable effort by the department to determine the appropriate governmental unit, to the State Treasurer's Office. The State Treasurer shall distribute these funds to the county treasurer in the county area in which the tax is imposed and the revenues must be used only for the purposes stated in the imposition ordinance. The State Treasurer shall calculate this supplemental distribution on a proportional basis, based on the current fiscal year's county area revenue collections."

F. Section 4-37-30(A)(4) and (15) of the 1976 Code, as added by Act 52 of 1995, is amended to read:

"(4) All qualified electors desiring to vote in favor of imposing the tax for a particular purpose shall vote 'yes' and all qualified electors opposed to levying the tax for a particular purpose shall vote 'no'. If a majority of the votes cast are in favor of imposing the tax for one or more of the specified purposes, then the tax is imposed as provided in this section; otherwise, the tax is not imposed. The election commission shall conduct the referendum under the election laws of this State, mutatis mutandis, and shall certify the result no later than sixty days November thirtieth after the date of the referendum to the appropriate governing body and to the Department of Revenue. Included in the certification must be the maximum cost of the project or projects or facilities to be funded in whole or in part from proceeds of the tax, the maximum time specified for the imposition of the tax, and the principal amount of bonds to be supported by the tax receiving a favorable vote. Expenses of the referendum must be paid by the jurisdiction conducting the referendum. If the tax is approved in the referendum, the tax is imposed effective the first day of the month occurring one hundred eighty days after May following the date of the referendum. If the certification is not timely made to the Department of Revenue, the imposition is postponed for twelve months.

(15) The revenues of the tax collected in each county under this section must be remitted to the State Treasurer and credited to a fund separate and distinct from the general fund of the State. After deducting the amount of refunds made and costs to the Department of Revenue of administering the tax, not to exceed one percent of the revenues, the State Treasurer shall distribute the revenues and all interest earned on the revenues while on deposit with the State Treasurer him quarterly to the county in which the tax is imposed and these revenues and interest earnings must be used only for the purpose stated in the imposition ordinance. The State Treasurer may correct misallocation costs or refunds by adjusting subsequent later distributions, but these adjustments must be made in the same fiscal year as the misallocation. However, allocations made as a result of city or county code errors must be corrected prospectively."

G. Chapter 37, Title 4 of the 1976 Code is amended by adding:

"Section 4-37-50. Annually, and only in the month of June, funds collected by the department from the local option transportation facility tax, which are not identified as to the governmental unit due the tax, must be transferred, after reasonable effort by the department to determine the appropriate governmental unit, to the State Treasurer's Office. The State Treasurer shall distribute these funds to the county treasurer in the county area in which the tax is imposed and the revenues must be used only for the purposes stated in the imposition ordinance. The State Treasurer shall calculate this supplemental distribution on a proportional basis, based on the current fiscal year's county area revenue collections."

H. 1. Section 6(A) of Act 588 of 1994 is amended to read:

"(A) The revenues of the tax collected in the county under this act must be remitted to the State Treasurer and credited to a fund separate and distinct from the general fund of the State. After deducting the amount of refunds made and costs to the Department of Revenue and Taxation of administering the tax, not to exceed one percent of the revenues, the State Treasurer shall distribute the revenues quarterly to the county treasurer who holds the debt service funds established for payment of principal and interest on the bonds to which the tax is applicable. The State Treasurer may correct misallocation costs or refunds by adjusting subsequent distributions, but these adjustments must be made in the same fiscal year as the misallocation. However, allocations made as a result of city or county code errors must be corrected prospectively."

2. Act 588 of 1994 is amended by adding an appropriately numbered section to read:

SECTION 37. Annually, and only in the month of June, funds collected by the department from the local option school district tax, which are not identified as to the governmental unit due the tax, must be transferred, after reasonable effort by the department to determine the appropriate governmental unit, to the State Treasurer's Office. The State Treasurer shall distribute these funds to the county treasurer in the county area in which the tax is imposed and the revenues must be used only for the purposes stated in the imposition resolution. The State Treasurer shall calculate this supplemental distribution on a proportional basis, based on the current fiscal year's county area revenue collections."

I. Section 12-4-580(B) of the 1976 Code, as added by Section 59A, Part II, Act 458 of 1996, is amended to read:

"(B) The department may charge and retain a reasonable fee for any collection effort made on a governmental entity's behalf. The department may expend the funds resulting from any fees so charged and retained and may carry the funds forward from one fiscal year to the next. The amount of the fee must be negotiated between the governmental entity and the department."

J. Section 12-54-240(B)(6) of the 1976 Code, as added by Act 658 of 1988, is amended to read:

"(6) disclosure of a deficiency assessments assessment to a probate courts and the filing of warrants for uncollected taxes court, the filing of a tax lien for uncollected taxes, and the issuance of a notice of levy;

Part III

SECTION 38. If a section, paragraph, provision, or portion of this article is held to be unconstitutional or invalid by a court of competent jurisdiction, this holding shall not affect the constitutionality or validity of the remaining portions of this article, and the General Assembly for this purpose hereby declares that the provisions of this article are severable from each other.

SECTION 39. This act takes effect upon approval by the Governor; and Sections 2, 3, and 5 are effective for property tax years beginning after 1998, Sections 1, 8, 9, 10, 11, 12, 13, 14, and 18 are effective for taxable years after 1998, and Section 16 is effective July 1, 1999.

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This web page was last updated on Wednesday, December 9, 2009 at 9:25 A.M.