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AS PASSED BY THE SENATE
June 3, 1999
H. 3358
Introduced by Reps. Fleming, Lucas, Taylor, Wilder, Klauber, Harris and Hayes
S. Printed 6/3/99--S.
Read the first time March 2, 1999.
TO AMEND TITLE 33, CODE OF LAWS OF SOUTH CAROLINA, 1976, RELATING TO PARTNERSHIPS, CORPORATIONS, AND ASSOCIATIONS, BY ADDING CHAPTER 36 SO AS TO INCLUDE NONPROFIT CORPORATIONS FINANCED BY BOTH FEDERAL AND STATE LOANS, NOT ONLY BY FEDERAL LOANS, AND TO PROVIDE FOR INCORPORATION, MEMBERSHIP, SALE, CONSOLIDATION, MERGER, AND DISSOLUTION OF CORPORATIONS NOT-FOR-PROFIT; TO AMEND SECTIONS 33-20-103, AS AMENDED, AND 33-31-1708, RELATING TO EXEMPTION OF CERTAIN NONPROFIT CORPORATIONS FROM THE PROVISIONS OF CHAPTERS 1 THROUGH 20 AND CHAPTER 31 OF TITLE 33, SO AS TO EXEMPT NONPROFIT CORPORATIONS ORGANIZED PURSUANT TO CHAPTER 36; TO REPEAL CHAPTER 35 OF TITLE 33 RELATING TO NONPROFIT CORPORATIONS FINANCED BY FEDERAL LOANS; AND TO AMEND SECTION 6-13-120, RELATING TO DISSOLUTION OF A WATER DISTRICT, SECTION 6-19-10, RELATING TO STATE AUTHORITY TO MAKE GRANTS TO WATER AND SEWER AUTHORITIES OR DISTRICTS, SECTION 12-6-550, RELATING TO CORPORATIONS EXEMPT FROM STATE INCOME TAXES, SECTION 12-36-2120, AS AMENDED, RELATING TO EXEMPTIONS FROM SALES AND USE TAXES, AND SECTION 12-37-220, AS AMENDED, RELATING TO EXEMPTIONS FROM PROPERTY TAX, ALL SO AS TO CHANGE CROSS-REFERENCES TO REFLECT REPEAL OF CHAPTER 35 AND ADDITION OF CHAPTER 36.
Amend Title To Conform
Be it enacted by the General Assembly of the State of South Carolina:
SECTION 1. (A)(1) This act must be construed liberally. The enumeration of any object, purposes, power, manner, method, or thing does not exclude like or similar objects, purposes, powers, manners, methods, or things.
(2) The provisions of this chapter may not be repealed by implication. If they conflict with other provisions of the 1976 Code, the provisions of this chapter prevail.
(3) The powers and authorities conferred by this chapter may be added to and supplemented by any other general law.
(B) The General Assembly finds that corporations not-for-profit established pursuant to this chapter have been authorized to provide the local governmental functions of water service or sewage treatment or a combination of both, fire protection service, ambulance service, and medical clinic facilities. Corporations not-for-profit exist for a public purpose, and the General Assembly declares that corporations not-for-profit must be treated like special purpose districts for purposes of Chapter 78 of Title 15, Chapter 56 of Title 12, and Sections 56-3-780 and 58-31-30(23) of the 1976 Code. Corporations not-for-profit may participate, under the same conditions as afforded special purpose districts, in the State Retirement System, the State Health Insurance System, state purchasing programs, and Sections 1-11-140 and 1-11-141 of the 1976 Code.
SECTION 2. Title 33 of the 1976 Code is amended by adding:
Section 33-36-10. As used in this chapter 'corporation not-for-profit' means a corporation which, upon its original organization, is financed in whole or in part by a loan made under the provisions of the Consolidated Farmers Home Administration Act of 1961, as amended by the Food and Agriculture Act of 1962, and acts amending it, and by the State Revolving Fund for Water or Sewer.
Section 33-36-20. A corporation incorporated pursuant to this chapter may not own or issue shares of stock representing ownership interests in the corporation itself. A corporation incorporated pursuant to this chapter may pay compensation in a reasonable amount to its members, board members, and officers for services rendered, and may confer benefits upon its members in conformity with its purposes. Upon dissolution or final liquidation of the corporation incorporated pursuant to this chapter, the residual assets must be disposed of in the manner required for organizations exempt from federal income tax as described in Section 501(c)(12) of the Internal Revenue Code of 1986.
Section 33-36-210. (A) Corporations not-for-profit may be organized pursuant to this chapter by any three or more persons who make, subscribe, acknowledge, and file articles of incorporation with the Secretary of State, and obtain approval from the Secretary of State when the articles of incorporation comply with this chapter.
The written articles of incorporation must contain:
(1) the name of the proposed corporation, which must include the word 'Incorporated' or 'Inc.'. The name may not be the same as, or deceptively similar to, the name of another domestic corporation, or a foreign corporation authorized to do business in this State.
(2) the purpose for which the corporation is organized;
(3) the qualification of members and the manner of their admission;
(4) the term for which the corporation is to exist, which may be perpetual;
(5) by what officers the affairs of the corporation are to be managed, and the times at which they are to be elected or appointed;
(6) the names of the officers who are to serve until the first election or appointment pursuant to the articles of incorporation;
(7) the number of persons constituting the first governing board, which may not be less than three, and the names and addresses of the persons who are to serve as board members, managers, or officers until the first election;
(8) by whom the bylaws of the corporation are to be made, altered, or rescinded;
(9) by whom and in what manner amendments to the articles of incorporation may be proposed and adopted;
(10) the name and address of the corporation's registered agent for service of process;
(11) any provision which the incorporators choose to insert for the conduct of the affairs of the corporation and any provision creating, dividing, limiting, and regulating the powers of the corporation, the board members, managers, or officers not in conflict with this chapter, except that the articles of incorporation do not need to enumerate the powers in Sections 33-36-260 and 33-36-270; and
(12) the signatures of not less than three natural persons competent to contract and an acknowledgment by all of the subscribers before an officer authorized to take acknowledgments.
(B) The original articles of incorporation must be filed with the Secretary of State for approval by any method approved by the Secretary of State. A duplicate copy, signed and acknowledged, also may be filed.
Section 33-36-220. When the articles of incorporation conforming to Section 33-36-210 have been filed with the Secretary of State and the specified filing fee has been paid, the subscribers and their associates and successors constitute a corporation. A duplicate received with the original must be endorsed, certified, and returned to the person from whom it was received upon payment of the fee required for certified copies.
Section 33-36-230. Upon filing articles of incorporation or amendments, or other paper relating to the incorporation, merger, consolidation, or dissolution of a corporation not-for-profit with the Secretary of State, the following fees must be paid:
(1) a filing fee of ten dollars for the filing and approval of articles of incorporation;
(2) a fee of one dollar for the first page, fifty cents for each additional page, and two dollars for authentication for furnishing certified copies of articles of incorporation or other documents concerning a corporation not-for-profit;
(3) a fee of five dollars in each case for filing papers relating to dissolution or amendment of articles of incorporation.
Section 33-36-240. A corporation incorporated pursuant to this chapter may amend its charter as provided in its bylaws. The articles of incorporation may be amended and the amendment incorporated into the articles only if the amendment has been filed with the Secretary of State and all filing fees have been paid.
Section 33-36-250. The Secretary of State shall conform articles of incorporation supplied by his office for 'corporations not-for-profit' to the provisions of Sections 33-36-10 and 33-36-20. In addition, any other forms supplied by the Secretary of State which may be required of a corporation not-for-profit must be conformed to the provisions of this chapter.
Section 33-36-260. A corporation not-for-profit organized pursuant to this chapter, unless otherwise provided in its articles of incorporation or by law, has the power to:
(1) have succession by its corporate name for the period provided for in its articles of incorporation;
(2) sue and be sued and appear and defend in all actions and proceedings in its corporate name to the same extent as a natural person;
(3) adopt and use and alter a common corporate seal;
(4) elect or appoint officers and agents as its affairs require and allow them reasonable compensation;
(5) adopt, change, amend, and repeal bylaws, not inconsistent with law or its articles of incorporation, for the administration of the affairs of the corporation and the exercise of its corporate powers;
(6) increase, by vote of its members cast as the bylaws direct, the numbers of its board members, managers, or officers so that the number is not less than three;
(7) make contracts and incur liabilities, borrow money at the rates of interest the corporation determines, issue its notes, bonds, and other obligations, secure its obligations by mortgage, and pledge all or any of its property, franchises, or income;
(8) conduct its affairs, carry on its operations, and have offices and exercise the powers granted by this chapter in any state, territory, district, or possession of the United States or any foreign country;
(9) purchase, take, receive, lease, take by gift, devise or bequest, or otherwise acquire, own, hold, improve, use, or otherwise deal in and with real or personal property, or any interest in it, wherever situated.
(10) acquire, enjoy, utilize, and dispose of patents, copyrights, and trademarks and licenses and other rights or interests in them;
(11) sell, convey, mortgage, pledge, lease, exchange, transfer, or otherwise dispose of all or part of its property and assets;
(12) purchase, take, receive, subscribe for, or otherwise acquire, own, hold, vote, use, employ, sell, mortgage, lend, pledge, or otherwise dispose of and otherwise use and deal in and with shares and other interests in, or obligations of, other domestic or foreign corporations, whether for profit or not for profit, associations, partnerships, or individuals, or direct or indirect obligations of the United States, or other government, state, territory, governmental district, municipality, or an instrumentality of them;
(13) lend money for its corporate purposes, invest and reinvest its funds, and take and hold real and personal property as security for the payment of funds loaned or invested;
(14) make donations for the public welfare or for religious, charitable, scientific, educational, or other similar purposes;
(15) have and exercise all powers necessary or convenient to effect the purposes for which the corporation is organized.
Section 33-36-270. (A) In addition to the general powers of nonprofit corporations contained within Section 33-36-260, nonprofit corporations created pursuant to this chapter may:
(1) engage in the business of supplying water or sewage disposal, or a combination of water and sewer services, and provide other services and facilities, including but not limited to fire protection services, ambulance services, and medical clinic facilities to individuals, corporations, and political subdivisions within the geographical area specified within the articles of incorporation, including water districts;
(2) exercise, in connection with water or sewage disposal business, the power of eminent domain as prescribed in Section 6-13-50(19);
(3) borrow funds and contract with municipalities, counties, and other political subdivisions for the provision of services and facilities including, but not limited to, fire protection services, ambulance services, and medical clinic facilities in accordance with this chapter and the Rural Development Act of 1972.
(B) Counties, municipalities, and other political subdivisions may contract with nonprofit corporations for those purposes, and water and sewer authorities also may make provision for fire protection. Before providing any of the services authorized in this section, a nonprofit corporation or a group intending to organize a nonprofit corporation must notify the governing body of the county or municipality in which the service is to be provided of its intention and the nature of the service. The governing body shall have a period of ninety days from the date of the notification to approve the request to provide the services or inform the person requesting permission to provide the service that the governing body intends to provide for the service as a public function of government. The notification of intent by the governing body must include a detailed description of the area to be served, the services to be provided, and the time schedule under which the service will be available from the county or municipality. Failure to notify the corporation within ninety days of the governing body's approval or intent to serve is considered approval.
Section 33-36-280. The rates charged for services furnished by a nonprofit corporation created for the purpose of providing water supply or sewage disposal, or a combination of those services, are not subject to supervision or regulation by a state board, commission, or agency or department or division of it.
Section 33-36-290. An irregularity in complying with the provisions of this chapter does not vitiate the incorporation until a direct proceeding to set aside and annul the charter is instituted by the proper authorities of the State. All acts done and contracts entered into have the same force and effect as if no irregularity had existed.
Section 33-36-300. The original bylaws of a corporation not-for-profit must be adopted by its incorporators. After that, bylaws must be adopted, amended, or repealed by the members, except that the corporation's governing body may enact emergency bylaws in the same manner as provided for nonprofit corporations in Section 33-31-207. The governing board also may adopt changes to the bylaws by a two-thirds vote when necessary to conform with state or federal laws governing the operation of the corporation or the services provided by the corporation. This power to amend the bylaws by the board may not be used to conform to permissive powers granted in state or federal legislation or to undertake services not already provided by the corporation.
Section 33-36-410. A person who is not an incorporator may not become a member of a corporation not-for-profit unless the person agrees to use the services furnished by the corporation when the service is available through its facilities. The bylaws of a corporation not-for-profit may provide that a person, including an incorporator, ceases to be a member if he fails or refuses to use the services made available by the corporation. The bylaws may prescribe additional qualifications and limitations in respect to membership.
Section 33-36-420. (A) An annual meeting of the membership of a corporation not-for-profit must be held at times provided in the bylaws. A special meeting of the membership may be called by a majority of its governing board, by not less than ten percent of the membership, or by the principal officer of its governing board.
(B) Meetings must be held at places provided in the bylaws, and in the absence of a provision, the principal office of the corporation is the location of all meetings.
(C) Except as otherwise provided, written or printed notice stating the time and place of each meeting of members and, in the case of a special meeting, the purpose for which the meeting is called, must be given to each member, personally or by mail, not less than ten nor more than twenty-five days before the date of the meeting.
Section 33-36-430. A quorum must be provided in the bylaws, except that the number required by the bylaws may not be less than the number of the governing board who conduct the business of the corporation between meetings of the membership.
Section 33-36-440. Each member is entitled to one vote on each matter submitted to a vote at a membership meeting. Voting must be in person, unless the bylaws provide specifically for voting by proxy and the conditions under which proxy voting may be exercised.
Section 33-36-450. (A) Notwithstanding another provision of this chapter, any proposition embodied in a petition signed by at least ten percent of the members of the corporation, except for dissolution or sale of a substantial portion of the assets of the corporation, must be submitted to the members of the corporation. The submission to the membership must occur at a special meeting of the membership held within forty-five days after the presentation of the petition unless the next annual meeting of members falls within ninety days after the presentation or unless the petition requests the issue be raised at the annual meeting.
(B) The approval of the board is not required for a proposition signed by ten percent of the membership, except for dissolution or the vote to sell a substantial portion of the assets of the corporation, to be submitted to the membership for vote and adopted at a regular or special meeting.
(C) The board must exercise its best efforts to carry out the directives of the membership which are adopted pursuant to a ten percent or greater membership petition, and failure by a board member to exercise his best efforts to carry out the directive is just cause for removal from the board.
Section 33-36-460. The private property of the members of a corporation not-for-profit is exempt from execution for the debts of the corporation, and a member is not liable or responsible for debts of the corporation.
Section 33-36-610. (A) The business and affairs of the corporation must be managed by a board of not less than three persons, each of whom must be a member of the corporation or an agent of a corporation which is a member. If a husband and wife hold a joint membership in a corporation not-for-profit one, but not both, may be elected to the board.
(B) The board may exercise all the powers of a corporation not-for-profit except those powers conferred upon the members by this chapter, its articles of incorporation, or bylaws.
(C) The bylaws must prescribe the number of board members, their qualifications other than those provided for in this chapter, the manner of holding meetings of the board, and the filling of vacancies on the board. The bylaws also may provide for the removal of a board member from office and for the election of his successors.
Section 33-36-620. A majority of the board constitutes a quorum, unless otherwise specified in the bylaws.
Section 33-36-630. Unless limited by its articles of incorporation, a corporation not-for-profit must indemnify against reasonable expenses incurred by a board member who is successful on the merits or otherwise in the defense of a proceeding to which he is a party because of his board membership.
Section 33-36-640. General standards for board members are the same as those required of directors of nonprofit corporations under Section 33-31-830.
Section 33-36-650. The bylaws may provide for the division of the service area of the corporation into two or more districts for designating seats on its governing board. The bylaws also may provide that a district have two or more seats on its governing board. One or more members may be elected from each district to fill the seats designated for the district. The entire membership must vote on election of board members even though only members from certain geographic districts are qualified candidates for district board seats. The bylaws may provide, further, that board elections be staggered so that no less than one-third or more than one-half of all board members' terms expire each year.
Section 33-36-660. All board members of corporations not-for-profit are immune from suits arising from the conduct of the affairs of the corporation, unless conduct amounts to wilful, wanton, or gross negligence. Nothing in this article grants immunity to a corporation not-for-profit.
Section 33-36-670. A corporation not-for-profit has the officers described in its bylaws, and they are chosen by the board in accordance with the bylaws. A duly appointed officer may have one or more assistant officers if authorized by the bylaws. The bylaws of the corporation must delegate to one officer the customary responsibilities of an officer commonly known as 'president', to one officer the customary responsibilities of an officer known as 'secretary', and one officer the customary responsibilities of an officer commonly known as 'treasurer'. The responsibilities of secretary and treasurer may be held by the same person. An officer may be removed from office and his successor selected in the manner prescribed by the bylaws.
Section 33-36-810. (A) A corporation not-for-profit may sell its assets. A 'sale' means a sale, lease, exchange, donation, or other disposition of assets, except a mortgage of or other security interest in the assets.
(B) A sale of all or substantially all the property and assets, with or without the goodwill of a corporation not-for-profit, may be made upon terms and conditions and for consideration, which may consist in whole or in part of money or property, real or personal, including shares of any other corporation, domestic or foreign, as are authorized, in the following manner:
(1) Two-thirds of the board must adopt a resolution recommending the sale and directing the submission of it to a vote at a special or annual meeting of members.
(2) Written or printed notice must be given to each member of record entitled to vote at the meeting, within the time and in the manner provided for the giving of notice of meetings of members, and must state that the purpose of the meeting is to consider the proposed sale.
(3) At the meeting the members may authorize the sale by an affirmative vote of at least two-thirds of all the members, and may fix, or authorize the board to fix, the terms and conditions of the sale and the consideration to be received by the corporation.
Section 33-36-820. Two or more corporations not-for-profit, each of which is designated a 'consolidating corporation', may consolidate into a new corporation not-for-profit, designated the 'new corporation', by complying with the following requirements:
(1) The proposition for consolidating into a new corporation and proposed articles of consolidation must be approved first by the board of each consolidating corporation. The proposed articles of consolidation must recite in the caption that they are executed pursuant to this chapter and must state:
(a) the name of each consolidating corporation, the address of its principal office, and the date of the filing of its articles of incorporation with the Secretary of State;
(b) the name of the new corporation and the address of its principal office;
(c) the names and addresses of the persons who constitute the first board of the new corporation;
(d) the terms and conditions of the consolidation and the mode of effecting it, including the manner and basis of converting memberships in each consolidating corporation into memberships in the new corporation and the issuance of certificates of membership for the converted memberships; and
(e) any provisions not inconsistent with this chapter considered necessary or advisable for the conduct of the business and affairs of the new corporation.
(2) Upon approval by the board of each consolidating corporation, the proposition for consolidating and the proposed articles of consolidation must be submitted to a vote of the members of each consolidating corporation at an annual or special meeting, the notice of which must explain fully the proposed consolidation. The proposed consolidation and the proposed articles of consolidation are approved upon the affirmative vote of not less than two-thirds of those members of each consolidating corporation voting at the meeting.
(3)(a) Upon approval by the members of the respective consolidating corporations, articles of consolidation in the approved form must be executed and acknowledged on behalf of each consolidating corporation by the officers specified in their bylaws, and attested under seal by the officer specified in their bylaws.
(b) The chief officer of each consolidating corporation, by whatever name designated in the bylaws, must execute the articles of consolidation and make and attach to them an affidavit stating that the provisions of this section were duly complied with by the corporation not-for-profit.
(c) The articles of consolidation and affidavits must be submitted to the Secretary of State for filing as provided in this chapter.
Section 33-36-830. Any one or more corporations not-for-profit, each of which is designated a 'merging corporation', may merge into another corporation not-for-profit, designated the 'surviving corporation', by complying with the following requirements:
(1) The proposition for merging into a surviving corporation and proposed articles of merger must be approved first by the board of each merging corporation and by the board of the surviving corporation. The proposed articles of merger must recite in the caption that they are executed pursuant to this chapter and must state:
(a) the name of each merging corporation, the address of its principal office, and the date of the filing of its articles of incorporation with the Secretary of State;
(b) the name of the surviving corporation and the address of its principal office;
(c) a statement that each merging corporation elects to be merged into the surviving corporation;
(d) the terms and conditions of the merger and the mode of effecting it, including the manner and basis of converting the memberships in the merging corporation or corporations into memberships in the surviving corporation and the issuance of certificates of membership for the converted memberships; and
(e) any provisions not inconsistent with this chapter considered necessary or advisable for the conduct of the business and affairs of the surviving corporation.
(2) After approval by the boards of the respective parties to the proposed merger, the proposition for merging into a surviving corporation and the proposed articles of merger must be submitted to a vote of the members of each corporation at an annual or special meeting, the notice of which must explain fully the proposed merger. The proposed merger and the proposed articles of merger are approved upon the affirmative vote of not less than two-thirds of those members of each corporation voting at the meeting.
(3)(a) Upon approval by the members of the respective parties to the proposed merger, articles of merger in the approved form must be executed and acknowledged on behalf of each such corporation by its chief officer, by whatever name designated in its bylaws, and attested under seal by the officer specified in its bylaws.
(b) The chief officer of each corporation executing the articles of merger also must make and attach to them an affidavit stating that the provisions of this section were duly complied with by the corporation.
(c) The articles of merger and affidavits must be submitted to the Secretary of State for filing as provided in this chapter.
Section 33-36-840. The effect of consolidation or merger is as follows:
(1) The several parties to the consolidation or merger are a single corporation not-for-profit. In the case of a consolidation, it is the new corporation provided for in the articles of consolidation and, in the case of a merger, it is the surviving corporation. The separate existence of all corporate parties to the consolidation or merger, except the new or surviving corporation, ceases.
(2) The new or surviving corporation has all the rights, privileges, immunities, and powers and is subject to all the duties and liabilities of a corporation not-for-profit organized pursuant to this chapter, and possesses all the rights, privileges, immunities, and franchises of a public or private nature, and all property, real and personal, applications for membership, all debts due on whatever account, and all other choses in action of each of the consolidating or merging corporations. Every interest of, or belonging or due to, each of the consolidating or merging corporations are transferred to and vested in the new or surviving corporation without further act or deed. The title to real estate, or an interest in real estate, vested in a consolidating or merging corporation does not revert or is not impaired by reason of the consolidation or merger.
(3) The new or surviving corporation is responsible and liable for all of the liabilities and obligations of each of the consolidating or merging corporations, and a claim existing or action or proceeding pending by or against any of the corporations may be prosecuted as if the consolidation or merger had not taken place, except that the new or surviving corporation may be substituted in its place.
(4) Neither the rights of creditors nor liens upon the property of consolidating or merging corporations are impaired by consolidation or merger.
(5) In the case of a consolidation, the articles of consolidation are the articles of incorporation of the new corporation, and in the case of a merger, the articles of incorporation of the surviving corporation are considered to be amended to the extent that the changes are provided for in the articles of merger.
Section 33-36-1010. A corporation not-for-profit which has not commenced business may dissolve voluntarily by delivering to the Secretary of State for filing articles of dissolution, executed and acknowledged on behalf of the corporation, and stating:
(1) the name of the corporation;
(2) the address of its principal office;
(3) the date of its incorporation;
(4) that the corporation has not commenced business;
(5) that the amount, if any, actually paid in an amount of membership fees, less any part disbursed for necessary expenses, has been returned to those entitled to it;
(6) that no debt of the corporation remains unpaid; and
(7) that a majority of the incorporators elects that the corporation be dissolved.
Section 33-36-1020. A corporation not-for-profit which has commenced business may dissolve voluntarily and wind up its affairs in the following manner:
(1) Two-thirds of the board shall adopt a resolution recommending dissolution and directing the submission of the question to a vote at an annual or special meeting of members.
(2) Written or printed notice must be given to each member of record entitled to vote at the meeting within the time and in the manner provided for the giving of notice of meetings of members, and must state that the purpose of the meeting is to consider the dissolution.
(3) At the meeting the members may authorize the dissolution and may fix, or authorize the board to fix, its terms and conditions. Each member may vote and the authorization requires the affirmative vote of at least two-thirds of all the members.
Section 33-36-1030. (A) Upon meeting the requirements of Section 33-36-1020, a certificate of election to dissolve must be executed and acknowledged on behalf of the corporation by its chief officer, by whatever name designated by the bylaws, and attested under seal by the officer specified in its bylaws.
(B) The certificate must state:
(1) the name of the corporation;
(2) the address of its principal office;
(3) the names and addresses of its board members; and
(4) the total number of members of the corporation, the number voting for dissolution, and the number voting against dissolution.
(C) The corporate officer executing the certificate of election to dissolve also must make, as an attachment to the certificate, an affidavit stating compliance with the provisions of Section 33-36-1020.
Section 33-36-1040. The certificate of dissolution and affidavit must be submitted to the Secretary of State for filing and the corporation not-for-profit must cease to carry on its business, except as is necessary for the winding up of its business. Its corporate existence continues until articles of dissolution have been filed by the Secretary of State.
Section 33-36-1050. The board has full power to wind up and settle the affairs of the corporation not-for-profit. It shall collect the debts owing to the corporation, sell and dispose of its property and assets, and pay, satisfy, and discharge its debts, obligations, and liabilities. After paying or adequately providing for the payment of all debts, obligations, and liabilities, the board shall dispose of the residual assets in accordance with the requirements of Section 501(c)(12) of the United States Internal Revenue Code of 1986.
Section 33-36-1060. Upon the filing of the certificate of dissolution by the Secretary of State, the board immediately shall cause notice of the winding up proceedings to be mailed to each known creditor and claimant and to be published once a week for two successive weeks in a newspaper of general circulation in the county in which the principal office of the corporation is located.
Section 33-36-1070. (A) When all debts, liabilities, and obligations of the corporation have been paid and all remaining property and assets distributed, the board shall authorize the execution of articles of dissolution, executed and acknowledged on behalf of the corporation by its chief officer, by whatever name designated in its bylaws, and attested under seal by the officer specified in its bylaws.
(B) The articles of dissolution must recite in the caption that they are executed pursuant to this chapter and must state:
(1) the name of the corporation;
(2) the address of the principal office;
(3) that the corporation has delivered to the Secretary of State a certificate of election to dissolve and the date on which the certificate was filed by the Secretary of State in the records of his office;
(4) that all debts, obligations, and liabilities of the corporation have been paid and discharged or that adequate provisions have been made for payment or discharge;
(5) that all residual assets of the corporation have been distributed in accordance with Section 501(c)(12) of the 1986 Internal Revenue Code;
(6) that no actions or suits are pending against the corporation.
(C) The officer executing the articles of dissolution also shall make and attach to them an affidavit stating that the provisions of this article have been duly complied with. The articles of dissolution and affidavit, accompanied by proof of the publication required in Section 33-36-1060, must be submitted to the Secretary of State for filing.
Section 33-36-1210. A domestic corporation organized and governed pursuant to Chapter 35 of Title 33 before the effective date of this chapter is deemed to have been organized pursuant to this chapter as of its effective date and must be governed by the provisions of this chapter."
SECTION 3. Section 33-20-103 of the 1976 Code, as last amended by Act 384 of 1994, is further amended to read:
"Section 33-20-103. Except for corporations organized under or transacting business pursuant to the provisions of Chapter 49 of this title, except for corporations organized under or transacting business pursuant to Chapter 45 of this title or any other provision of law in this title relating to telephone cooperatives, except for corporations not-for-profit organized or operating pursuant to Chapter 36 of this title, and except for those nonprofit corporations which are governed exclusively by the provisions of Chapter 31 of this title, Chapters 1 through 20 of this title apply to every domestic nonprofit corporation and to any other foreign nonprofit corporation which is authorized to or transacts business in this State except as otherwise provided in Chapters 1 through 20 of this title or by the law regulating the organization, qualification, or governance of the nonprofit corporation."
SECTION 4. Section 33-31-1708 of the 1976 Code, as added by Act 384 of 1994, is amended to read:
"Section 33-31-1708. Other sections of this chapter notwithstanding, cooperative nonprofit membership corporations organized under or transacting business pursuant to Chapter 49 of this title, and telephone cooperatives organized under or transacting business pursuant to Chapter 45 or any other provision of law in this title, and corporations not-for-profit organized under and operating pursuant to Chapter 36 of this title are not subject to the provisions of this chapter and no provision of this chapter shall repeal repeals or amend amends any provision of Chapter 49 of this title, or any provision of Chapter 45 of this title or any other provision of law in this title relating to telephone cooperatives, or any provisions of Chapter 36 of this title."
SECTION 5. Chapter 35 of Title 33 of the 1976 Code is repealed.
SECTION 6. A. Section 6-13-120(A) of the 1976 Code, as added by Act 6 of 1993, is amended to read:
"(A) For purposes of this section, 'assuming service provider' includes, but is not limited to, a county, municipality, special purpose district as defined by Section 6-11-810(d), or corporation not for profit as defined by Section 33-35-10 33-36-10."
B. Section 6-19-10 of the 1976 Code is amended to read:
"Section 6-19-10. The State may make grants in aid in the financing of any public water supply authorities or districts, any sewer authorities or districts, any water and sewer authority, any rural community water or sewer system legally organized in the State, any nonprofit corporation organized pursuant to Sections 33-35-10 to 33-35-170 Chapter 36 of Title 33, any general purpose local government, water or sewer system; or any municipal water or sewer system in any city, town, or village of less than one thousand five hundred population in accordance with the most recent studies conducted by the United States Bureau of the Census."
C. Section 12-6-550(4) of the 1976 Code, as added by Act 76 of 1995, is amended to read:
"(4) nonprofit corporations organized pursuant to Sections 33-35-10 through 33-35-170 Chapter 36 of Title 33 for the purpose of providing water supply and sewerage disposal or a combination of those services;"
D. Section 12-36-2120(12) of the 1976 Code, as last amended by Act 361 of 1992, is amended to read:
"(12) water sold by public utilities, if rates and charges are of the kind determined by the Public Service Commission, or water sold by nonprofit corporations organized pursuant to Sections 33-35-10 to 33-35-170 Chapter 36 to Title 33;"
E. Section 12-37-220(B)(4) of the 1976 Code is amended to read:
"(4) All property of any kind of a nonprofit corporation created for the purpose of providing water supply or sewage disposal, or a combination of such services, organized pursuant to Sections 33-35-10 and 33-35-170 Chapter 36 of Title 33."
SECTION 7. Any charter of a corporation not-for-profit filed with the Secretary of State before the effective date of this act is not repealed or nullified by this act. If any article, sector, or paragraph of an existing charter is inconsistent with a provision of this act, the article, sector, or paragraph is automatically modified to the extent necessary to conform with this act.
SECTION 8. If a company subject to the provisions of this act fails to have a registered agent for service of process on the effective date of this act, the Secretary of State must notify the corporation not-for-profit, which has sixty days to appoint for the record an agent or be subject to a fine of five hundred dollars.
SECTION 9. Title 6 of the 1976 Code is amended by adding:
Section 6-33-10. This chapter may be cited as the 'Tax Increment Financing Act for Counties'.
Section 6-33-20. (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 6-33-30. 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 6-33-40. Obligations secured by the special tax allocation fund set forth in Section 6-33-70 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 6-33-110 against the taxable property included in the area and other revenue as specified in Section 6-33-110 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 6-33-70 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 6-33-50. 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 6-33-60. 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 6-33-70. A county, within five years after the date of adoption of an ordinance providing for approval of a redevelopment plan pursuant to Section 6-33-80, 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 6-33-100(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 6-33-100(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 6-33-75. 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 6-33-80. (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 6-33-80, 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 afterwards, 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 6-33-90. 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 6-33-100. (A) If a county by ordinance approves a redevelopment plan pursuant to Section 6-33-80, the auditor of the county, immediately after adoption of the ordinance pursuant to Section 6-33-80, 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 6-33-80, 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 6-33-110. 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 6-33-120. 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 10. Chapter 37, Title 5 of the 1976 Code is amended to read:
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 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."
SECTION 11. A. The General Assembly finds that:
(1) Many of South Carolina's urban and rural communities face critical social and economic problems arising in part from people living in poverty because of the lack of economic growth, employment, and other opportunities.
(2) The restoration and maintenance of these communities requires increased access to credit and capital for development activities, including investment in businesses, housing, human development, and other activities that promote the long-term economic and social viability of the community.
(3) Access to credit and capital is essential to unleash the untapped entrepreneurial energy of South Carolina's poorest communities and to empower individuals and communities to become self-sufficient.
(4) Community development financial institutions have the proven ability to identify and respond to community needs for capital, credit, and development services in the absence of, or as a complement to, services provided by other lenders.
(5) Community development corporations have a proven ability to identify and respond to community needs and manage community assets for the purpose of community and economic development on a local level.
(6) For the above reasons, it has determined to enact the provisions of this act as being consistent with public policy objectives of our State, including economic growth, higher employment, and community development.
B. Title 34 of the 1976 Code is amended by adding:
Section 34-43-10. (A) There is created a South Carolina Community Economic Development Commission. The commission shall exist for the purpose of certifying entities as community development financial institutions, as defined in Section 34-43-40, and as community development corporations, as defined in Section 34-43-50. The commission also may make grants to community development financial institutions and community development corporations from grant funds made available to it by the General Assembly or from other available funds. The General Assembly may appropriate funds to the commission to be used to make grants to community development financial institutions and community development corporations as authorized in this chapter. The General Assembly also may provide funds in the annual general appropriation act to pay salaries, employee benefits, and administrative expenses of the commission.
(B) In addition to other powers provided for in this chapter, the commission may:
(1) promulgate regulations necessary to carry out its functions;
(2) contract for and accept, for use in carrying out the provisions of this chapter, any grant or contribution of funds from a political subdivision of the State or from another source, and comply, subject to the provisions of this chapter, with the terms and conditions of those contracts; and
(3) do anything necessary or convenient to carry out its powers and functions.
(C) The commission may receive funds from, among other sources, state appropriations and private contributions.
Section 34-43-20. (A) The governing body of the commission consists of the following seven members which must represent the diverse ethnic population of the State:
(1) a chairman, representing a federally-chartered or state-chartered financial institution doing business in this State, who must be appointed by the Governor, with the advice and consent of the Senate;
(2) the Secretary of Commerce, or his designee;
(3) three members from the community economic development field appointed by the Governor, with the advice and consent of the Senate; and
(4) two members representing federally-chartered or state-chartered financial institutions or other business entities doing business in this State, other than the institution represented by the chairman, who must be appointed by the Governor, with the advice and consent of the Senate.
(B) A commission member serves a term of four years and until his successor is appointed and qualifies.
(C) A member who is appointed to fill a vacancy on the commission serves only for the remainder of the unexpired term and until a successor is appointed and qualifies.
(D) The commission ceases to exist on July 1, 2004, unless further authorized by the General Assembly.
Section 34-43-30. (A) Four appointed members of the commission are a quorum. However, the commission may not act on a matter unless at least four members in attendance concur.
(B) The commission determines the times and places of its meetings.
(C) Members of the commission, while serving on business of the commission, shall receive, to the extent funding is available, per diem, mileage, and subsistence as provided by law for members of state boards, committees, and commissions.
(D) The commission, to the extent funding is available, may employ or contract for staff and consultants it considers necessary to assist in carrying out its duties and responsibilities pursuant to this chapter.
(E) In its internal functions, the commission shall keep proper records of its accounts and follow the procedures of this State governing the purchase of office space, supplies, facilities, materials, equipment, and professional services. The commission must be audited by the State Auditor as provided in Chapter 7 of Title 11.
(F) The commission shall make an annual report on its condition and operations to the General Assembly and the Governor, including the information required to be reported by Section 34-43-80.
Section 34-43-40. (A) The commission may certify an entity as a community development financial institution if it meets the definition provided in subsection (B).
(B) For purposes of this section:
(1) 'Community development financial institution' means an organization that:
(a) has a primary mission of promoting community development through the provision of credit, capital, or development services to small businesses including, but not limited to, the provision of capital access programs, microlending, franchise financing, and guaranty performance bonds;
(b) provides service delivery throughout the State;
(c) maintains, through representation on its governing board, accountability to persons in need of the institution's services;
(d) is not an agent or instrumentality of the United States, or of a state or political subdivision of a state or maintains an affiliate relationship with none of them;
(e) maintains a goal of providing a majority of its services to low-income individuals, minorities, females, or rural areas;
(f) provides capital and technical assistance to small and micro businesses;
(g) does not provide credit, capital, or other assistance in an amount greater than two hundred fifty thousand dollars at one time or in one transaction. That dollar amount must be adjusted in the manner provided in Section 37-1-109; and
(h) has been certified or recertified previously as a community development financial institution as provided in this chapter.
(2) 'Low-income' means individuals whose income level falls within the eightieth percentile of the mean income for a family of four within this State.
(3) The term 'invest' includes any advance of funds to a community development financial institution whether by purchase of stock or other equity interest or by charitable contribution.
(C) Banks and financial institutions chartered by the State of South Carolina are authorized to invest in community development financial institutions incorporated under the laws of this State, up to a maximum of ten percent of a chartered bank or financial institution's total capital and surplus.
(D) A federally-chartered or state-chartered financial institution holding company may qualify as a community development financial institution only if the holding company and the subsidiaries and affiliates of the holding company collectively satisfy the requirements of subsection (B).
(E) A community development financial institution is not subject to taxes based upon or measured by income which are levied now or may be levied later by the State.
Section 34-43-50. (A) The commission may certify an entity as a community development corporation if it meets the definition provided in subsection (B).
(B) 'Community development corporation' means a nonprofit corporation that:
(1) is chartered pursuant to Chapter 31, Title 33;
(2) is tax-exempt pursuant to Section 501(c)(3) of the Internal Revenue Code of 1986;
(3) has a primary mission of developing and improving low-income communities and neighborhoods through economic and related development;
(4) has activities and decisions initiated, managed, and controlled by the constituents of those local communities;
(5) has a primary function of developing projects and activities designed to enhance the economic opportunities of the people in the community served, including efforts to enable them to become owners and managers of small businesses and producers of affordable housing and jobs in the community served; and
(6) does not provide credit, capital, or other assistance in an amount greater than twenty-five thousand dollars at any time or in one transaction. The commission must adjust that dollar amount as provided in Section 37-1-109.
(7) is not a nonprofit organization which has the sole purpose of providing housing to neighborhoods or technical assistance to other nonprofit organizations.
(C) The commission shall establish and implement criteria for grants made to community development corporations pursuant to Section 34-43-10. The criteria must require that the applicant has demonstrated a capacity to engage in community development projects and has sufficient organizational structure to ensure proper management. However, if the applicant is created after the effective date of this section, the applicant shall present a strategic plan for community development projects and shall show evidence of developing an organizational structure which ensures proper management.
(D) The commission may provide, or contract with an appropriate entity to provide, technical support to assist community development corporations to be successful in developing their organizational capacity and implementing their projects.
(E) The commission shall make an annual report to the General Assembly regarding grants made pursuant to this section. The report required by this subsection may be included with the report required by Section 34-43-30.
Section 34-43-60. (A) Application for certification must be in writing, under oath and in the form prescribed by the commission, and must contain information as the commission may require, including the names and addresses of the partners, officers, directors or trustees, and those principal owners or members as will provide the basis for investigations and findings contemplated by subsection (B). At the time of making the application, the applicant shall pay to the commission a fee for investigating the application, as prescribed by the commission, which will yield sufficient revenue to defray the commission's costs of investigating the applicant.
(B) Upon the filing of the application and payment of the fees, the commission shall investigate the facts concerning the application and the requirements provided for in either Section 34-43-40 or in Section 34-43-50.
Section 34-43-70. (A) Certification of a community development financial institution or a community development corporation expires two years from the date of certification.
(B) Certification of a community development financial institution or a community development corporation may be renewed for additional two-year periods upon application by the institution or corporation and approval by the commission.
(C) The commission may not renew certification of an institution or corporation absent continuous compliance with the provisions of Section 34-43-40 or Section 34-43-50.
(D) The commission may revoke the certification of an institution or corporation upon a finding that the institution or corporation does not comply with the provisions of Section 34-43-40 or Section 34-43-50.
(E) The commission shall serve a notice of intent not to grant certification, intent not to renew certification, or intent to revoke certification upon the institution or corporation with a brief statement of the reasons alleged. The institution or corporation may request a hearing within thirty days of receiving notice by filing a request for a hearing with the commission. The hearing must be held in accordance with Article 3, Chapter 23, Title 1, the Administrative Procedures Act.
(F) A taxpayer may not claim the tax credit provided for in Section 12-6-3520 unless the institution or corporation in which the investment is made is certified by the commission at the time the investment is made. A taxpayer who invested in good faith in a certified institution or corporation may claim the credit provided in Section 12-6-3520 notwithstanding the fact that the certification is subsequently revoked or not renewed by the commission.
Section 34-43-80. A community development financial institution shall file with the commission, on or before the anniversary date of its certification, an annual report for the preceding calendar year. The report must give information about the financial condition of the institution, and must include balance sheets at the beginning and end of the accounting period, a statement of income and expenses for the period, a reconciliation of surplus with the balance sheets, a schedule of assets used by and useful to the institution to conduct its business, an analysis of charges, size and type of loans, and other activities described in Section 34-43-40(B)(1)(a), and other relevant information in form and detail as prescribed by the commission. The report must be made under oath and be in the form prescribed by the commission. The commission shall make and publish annually an analysis and recapitulation of the reports for inclusion in its annual report to the Governor and General Assembly as provided in Section 34-43-30(F)."
C. Article 25, Chapter 6, Title 12 of the 1976 Code is amended by adding:
"Section 12-6-3520. (A) A taxpayer may claim as a credit against his state income tax, bank tax, or premium tax liability fifty percent of all amounts invested in a community development financial institution, as defined in Section 34-43-40, or in a community development corporation, as defined in Section 34-43-50.
To qualify for this credit the taxpayer must obtain a certificate from the South Carolina Community Economic Development Commission certifying that the entity into which the funds are invested is a community development financial institution within the meaning of Section 34-43-40 or a community development corporation within the meaning of Section 34-43-50 and certifying that the credit taken or available to that taxpayer will not exceed the aggregate fourteen million dollar limitation of all those credits as provided in subsection (B) when added to the credits previously taken or available to other taxpayers making similar investments.
(B) The total amount of credits allowed pursuant to this section may not exceed, in the aggregate, fourteen million dollars for all taxpayers and all taxable years. The total amount of credits allowed for investments in community development financial institutions may not exceed, in the aggregate, ten million dollars for all taxpayers and all taxable years. The total amount of credits allowed for investments in community development corporations may not exceed, in the aggregate, four million dollars for all taxpayers and all taxable years. The credit must be allowed to taxpayers in the order of the time of the making of the qualified investments in community development financial institutions and community development corporations.
The commission shall monitor the investments made by taxpayers in community development financial institutions and community development corporations as permitted by this section and shall perform the functions as provided for in subsection (A).
(C) If the amount of the credit determined under subsection (A) exceeds the taxpayer's state tax liability for the applicable taxable year, the taxpayer may carry over the excess to the immediately succeeding taxable years. However, the credit carryover may not be used for any taxable year that begins on or after ten years from the date of the qualified investment. The amount of the credit carryover from a taxable year must be reduced to the extent that the carryover is used by the taxpayer to obtain a credit pursuant to this chapter for a subsequent taxable year.
(D) Notwithstanding the provisions of subsections (A), (B), and (C), if on April 1, 1999, or as soon after that as the commission is able to determine, the total amount of tax credits which may be claimed by all taxpayers exceeds the total amount of tax credits authorized by this section, the credits must be determined on a pro rata basis. For purposes of this subsection, a community development financial institution or community development corporation for which an investment may be claimed as a tax credit pursuant to this section must report all investments made before April 1, 1999, to the commission by April 1, 1999, which shall inform, as soon as reasonably possible, all community development financial institutions and community development corporations of the total of all investments in all institutions and corporations as of April 1, 1999.
(E) If a qualified investment which is the basis for a credit pursuant to this section is redeemed by a taxpayer within five years of the date it is purchased, the credit provided by this section for the qualified investment is disallowed, and a credit previously claimed and allowed with respect to the redeemed qualified investment must be paid to the Department of Revenue with the appropriate return of the taxpayer covering the period in which the redemption occurred. When payments are made to the Department of Revenue pursuant to this section, the amount collected must be handled in the same manner as if no credit had been allowed.
(F) To receive the credit provided by this section, a taxpayer shall:
(1) claim the credit on the taxpayer's annual state income or premium tax return in the manner prescribed by the Department of Revenue; and
(2) file with the Department of Revenue and with the taxpayer's annual state income or premium tax return a copy of the form, described in subsection (G), issued by the commission as to the qualified investment by the taxpayer, including an undertaking by the taxpayer to report to the Department of Revenue a redemption of the qualified investment.
(G)(1) The commission shall complete forms prescribed by the Department of Revenue, showing as to each qualified investment in a community development financial institution or a community development corporation:
(a) the name, address, and identification number of the taxpayer who purchased a qualified investment; and
(b) the nature of the qualified investment purchased by the taxpayer and the amount paid for it.
(2) These forms must be filed with the Department of Revenue on or before the fifteenth day of the third month following the month in which the qualified investment is purchased. Copies of the forms to be provided to the Department of Revenue must be mailed to the taxpayer on or before the fifteenth day of the second month following the month in which the qualified investment is purchased.
(H) A taxpayer may not claim the tax credit provided in this section unless the community development financial institution or community development corporation in which the investment is made has been certified at the time the investment is made. A taxpayer who invested in good faith in a certified institution or corporation may claim the credit provided in this section, notwithstanding the fact that the certification is subsequently revoked or not renewed by the commission.
(I) An investor in a qualified community development corporation or a community development financial institution may transfer or assign the tax credit provided in this section, except that for purposes of a time period within which an act must occur pursuant to this section, the transfer or assignment must relate back to the time of original investment made by the transferor or assignor.
(J) If the community development financial institution in which the investment is made is a tax-exempt nonprofit corporation, the tax credit provided in this section may not be allowed if the taxpayer claims the investment as a deduction pursuant to Section 170 of the Internal Revenue Code.
(K) The total amount of credits which may be allowed by the Department of Revenue may not exceed two million dollars in a community development corporation for fiscal year 1999-2000 and each fiscal year thereafter until the total aggregate amount of four million dollars is reached. The total amount of credits allowed by the Department of Revenue may not exceed five million five hundred thousand dollars in a community development financial institution for fiscal year 1999-2000 and each fiscal year after that until the total aggregate amount of ten million dollars is reached. A credit which is disallowed because of this subsection may be carried forward as provided in this section."
D. This Section takes effect upon approval of the Governor, except that subsection C applies to tax years beginning after 1998.
SECTION 12. 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 13. A. Section 12-10-50, as last amended by Act 462 of 1996, is further amended to read:
"Section 12-10-50. To qualify for the benefits provided in this chapter, a business must be located within this State and satisfy the following criteria:
(1) it must be primarily engaged in a business of the type identified in Section 12-6-3360;
(2) the business shall provide a benefits package to full-time employees which includes health care;
(3) the business shall enter into a revitalization agreement which is approved by the council, except that no revitalization agreement is required for a qualifying business with respect to Section 12-10-80(D); and,
(4) the council shall determine that the available negotiated incentives are appropriate for the project, and the council shall certify that the total benefits of the project exceed the costs to the public; and that the business otherwise fulfills the requirements of this chapter. No provision of this chapter must be construed to allow the council to negotiate a fee-in-lieu of property taxes agreement or approve job training or retraining."
B. Section 12-10-60 of the 1976 Code, as added by Act 25 of 1995, is amended to read:
"Section 12-10-60. The council may enter into a revitalization agreement with each qualifying business with respect to the project. The terms and provisions of each revitalization agreement must be determined by negotiations between the council and the qualifying business. The decision to enter into a revitalization agreement with a qualifying business is solely within the discretion of the council and a qualifying business does not have a right of appeal from the council's decision. The revitalization agreement must set a date by which the qualifying business shall have completed the project. Within three months of the completion date, the qualifying business shall document the actual costs of the project in a manner acceptable to the council."
C. Section 12-10-100(A) of the 1976 Code, as added by Act 25 of 1995, is amended to read:
"Section 12-10-100(A). The council shall may establish criteria for the determination and selection of qualifying businesses and the approval of revitalization agreements. These criteria must may include and may give greatest weight to the creditworthiness of the business, the number, type, and quality of new jobs to be provided by the project to residents of this State, and the economic viability of the business. The council may include in its criteria requirements relating to the capital costs of, and projected employment to be produced by, projects eligible for benefits under this chapter and requirements relating to the employment of previously unemployed or underemployed persons.
With respect to each business and project, the council shall request the materials and make the inquiries necessary to determine whether the business and its proposed project satisfy the council's announced criteria and to conduct an adequate cost/benefit analysis with respect to the proposed project and the incentives proposed to be granted by the council with respect to the project. After a review of the relevant materials and completion of its inquires and analysis, the council may by resolution of its members designate an applicant business as a qualifying business and authorize the undertaking of its project according to the revitalization agreement. The decision to enter into a revitalization agreement with a qualifying business is solely within the discretion of the council and a qualifying business does not have a right of appeal from the council's decision."
D. Section 12-10-100 of the 1976 Code, as added by Act 25 of 1995, is amended by deleting subsection (E).
SECTION 14. 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 as 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. 1. 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."
2. 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."
3. 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."
4. 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."
5. All liabilities incurred and rights accrued before the effective date of this section are unaffected by the provisions of this section.
6. Upon approval by the Governor, this section applies to a liability incurred or a right accrued on and after that date.
SECTION 15. A. 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."
B. 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."
C. 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."
D. 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."
E. 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."
F. 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."
G. 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."
H. 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)."
I. 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)."
J. 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."
K. 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."
L. 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."
M. 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."
N. 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."
O. 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;"
P. 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."
Q. 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."
R. 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."
S. Sections 12-6-5590, 12-54-35, and 12-54-40 of the 1976 Code are repealed.
T. 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."
U. 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."
V. 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."
W. 1. 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."
2. This section is effective for property tax years beginning after 1998.
X. 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.
Y. This section takes effect upon approval by the Governor; and subsections B, C, and E are effective for property tax years beginning after 1998, subsections A, H, I, J, K, L, M, N, and R are effective for taxable years after 1998, and subsection P is effective July 1, 1999.
SECTION 16. 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 __. 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;"
K. This section takes effect upon approval by the Governor.
SECTION 17. Section 1-11-720(A)(7) of the 1976 Code is amended to read:
"(7) special purpose districts created by act of the General Assembly that provide gas, water, fire, sewer, recreation, or hospital service, or any combination of these services;"
SECTION 18. This act takes effect upon approval by the Governor.
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