S.C. Chamber Set to Drive Infrastructure Debate at State House
January 14, 2013
As the General Assembly returns to Columbia for the first half of a two-year legislative session, the business community is eager to work alongside elected leaders to achieve priorities that increase jobs and economic development. The South Carolina Chamber of Commerce has released the 2013 Competitiveness Agenda, the business community’s annual list of legislative priorities. Business leaders have identified many areas in which the Palmetto State must take immediate action to be No. 1 - first and foremost investing in infrastructure.
A recent South Carolina Department of Transportation (SCDOT) study identified nearly $30 billion in road and bridge needs, but SCDOT’s budget is less than $1.5 billion annually. Nearly one-third of South Carolina’s primary and interstate highways and half of the state’s secondary roads are now in poor or mediocre condition. One out of every five bridges in the state is considered deficient.
Funding for statewide-significant highway projects has not seen a dedicated increase since 1987, a time when there were 1 million fewer South Carolinians and much less economic activity in the state. South Carolina must develop a comprehensive strategy to address infrastructure needs this year. While the private sector can lead in many ways, it cannot be responsible for making decisions to build and maintain roads. This is a core function of government.
With dedicated funding for the port deepening project and the Panama Canal expansion nearing completion, the port is expected to double container volume over the next decade. That means hundreds of thousands of additional trucks on Interstate 26 and other state roadways. South Carolina must dedicate additional resources to roads and bridges this legislative year to prepare for the increased activity.
Moreover, at a time when job creation is paramount, the Association of General Contractors (AGC) released a study estimating that for every $1 billion invested in infrastructure, more than 28,500 jobs are created in construction, manufacturing and other industries. The study also revealed that for every $1 billion invested, the state can expect to add $3.4 billion in GDP.
The South Carolina Chamber and allied organizations are advocating for a statewide strategy to invest $6 billion over the next decade that focuses on major highways that have a significant impact on the flow of commerce: $2.5 billion for expansion of existing highways, $2 billion for replacement of weight restricted and structurally deficient bridges, and $1.5 billion for resurfacing projects in all 46 counties.
During the first week of the legislative session, a number of bills were filed addressing infrastructure. The Chamber looks forward to helping legislators find a dedicated source of funding that adequately invests in roads.
The Chamber understands that given the current anti-tax political environment, the General Assembly must look at financing infrastructure needs through current revenue streams. The Chamber supports many funding mechanisms, but at minimum a three-pronged plan must be implemented this year, including dedicating a portion of new revenue to road and bridge needs along with a portion of the Capital Reserve Fund and transferring the sales tax on vehicles back to infrastructure, a concept championed in previous legislative sessions by House Speaker Bobby Harrell (Charleston).
Annually dedicating just 20 percent of all new revenue and revenue from the Capital Reserve Fund, along with the transfer of the sales tax on vehicles, could finance well over $200 million in infrastructure needs.
If no new revenue is dedicated to infrastructure this legislative session, it is estimated that it will take more than 50 years to complete major projects that are necessary for the economic success of South Carolina today. With other states focused on financing infrastructure to drive economic development, South Carolina policy makers must make infrastructure financing the top competitiveness priority in 2013.