Three Things to Know: May 30th

This week's information compiled by your SC Chamber team includes: 
Lawmakers Approve State Spending Plan Before Leaving Town, Uncertainty Continues as Courts Debate Tariffs, SC Chamber Launches New “Federation” Membership

 1. Lawmakers Approve State Spending Plan Before Leaving Town

Members of the House and Senate returned to Columbia on Wednesday to approve the state’s $14.7 billion spending plan for FY2025-26, and left town with no plans to formally reconvene until next January. As previously reported, this year’s version of the budget contains many notable items like:

• $290 million for additional individual income tax relief, reducing the top rate to 6%. 
• $200 million to the Department of Transportation (SCDOT) for bridge infrastructure projects across the state.  
• $130 million to increase the manufacturing property tax exemption cap enacted in the Comprehensive Tax Cut Act of 2022 to hold the effective manufacturing property tax rate at 6% and ensure small to mid-size manufacturers do not experience a property tax. 
• $112 million to raise teacher salaries and increase starting teacher pay from $47,000 to $48,500. 
• $91 million for technical college scholarships for critical needs jobs through the SC Workforce Industry Needs Scholarship Program (SCWINS).  
• $81 million to the Department of Commerce for industrial site readiness. 
• $15 million for rural water and sewer infrastructure projects. 
• $15 million to the Department of Employment and Workforce (DEW) for the Find Your Future portal.
• $840,000 to the Department of Environmental Services (DES) for energy infrastructure permitting and a proviso requiring decisions on DES permit applications within 90 days. 

The budget also includes funding to raise the in-district expense pay for legislators – increasing the current $1,000 a month in-district pay to $2,500. Governor Henry McMaster has the ability to veto individual line items in the budget and will have five days to do so. The budget will take effect July 1^st.

While the General Assembly will not formally reconvene until January, many ad hoc committees will continue to meet throughout the off-session including the newly formed House Insurance Rate Review Ad Hoc Committee and the House South Carolina Department of Transportation (SCDOT) Modernization Ad Hoc Committee. 

The SCDOT Modernization Ad Hoc Committee, which held its first meeting on Wednesday, has been tasked to “…bring forward real, actionable solutions that modernize how SCDOT operates in order to help our infrastructure keep pace with a growing South Carolina.” Key areas of focus for the committee will include updating SCDOT’s permitting process; speeding up project funding and completion; reducing traffic congestion and expanding road capacity statewide; and sending additional resources to high-growth, high-need areas.  The committee plans to travel the state throughout the summer and fall, holding public hearings to hear concerns from citizens and other stakeholders. The committee will be chaired by House Education Committee Chairlady Shannon Erickson (R-Beaufort) and House Ways and Means Transportation and Regulatory Subcommittee Chairlady Heather Crawford (R-Horry).

The Insurance Rate Review Ad Hoc Committee also met on Wednesday to hear testimony from South Carolina Department of Insurance (DOI) Director Michael Wise which focused on what could be done to reduce insurance costs for customers. 

2. Uncertainty Continues as Courts Debate Tariffs

Earlier this week, the U.S. Court of International Trade, which hears disputes involving international trade and customs laws, struck down many of the tariffs that have been implemented by the Trump administration including the 10% baseline tariffs, the fentanyl-related tariffs on Canada, Mexico and China, and the additional reciprocal tariffs levied on countries with which the U.S. runs trade deficits, most of which are currently paused as trade talks are ongoing.

In a unanimous opinion, the three-judge panel found that the Trump administration exceeded its authority under the International Emergency Economic Powers Act (IEEPA) by imposing sweeping, “worldwide” tariffs. The ruling does not affect other tariffs the administration has or might impose under Section 232 of the Trade Expansion Act of 1962, like those on cars, steel and aluminum. The administration is expected to announce Section 232 tariffs on lumber and semiconductors at some point in the future.

The Trump administration immediately appealed the decision to the U.S. Court of Appeals for the Federal Circuit, which issued an order Thursday afternoon that stayed the trade court's ruling while it considers motions from plaintiffs and defendants (the Trump administration), leaving the tariffs temporarily in place. The Trump administration had previously indicated that it would seek “emergency relief” from the U.S. Supreme Court should the Court of Appeals not issue a temporary pause of the ruling. The Supreme Court will ultimately have to render a final decision on whether the Administration has acted within its authority under the IEEPA.

This is a developing story.

3. SC Chamber Launches New “Federation” Membership

The SC Chamber, in coordination with local chambers of commerce from across the state, has launched a new membership program designed to give small businesses an even larger “seat at the table” at the SC Chamber by extending complimentary membership to small businesses with 10 or fewer employees that are members of a participating local chamber.

The purpose of this new “Federation” is to serve as a statewide grassroots alliance of small businesses and to build support from the small business community for the business agenda at the State House. Federation members will receive a basic membership that includes:

• Year-round representation at the South Carolina State House,
• South Carolina legislative session webinars/updates,
• Member communications,
• Access to partner affiliate programs like BCBS health plans (through your local chamber), Staples, and EssCert; and
• Discounted member rates to attend Chamber events and educational programs.

Local chambers are invited to join the Federation, thereby extending complimentary membership to the SC Chamber to members of their organization. This benefit is only for businesses that are members in good standing with 10 or fewer employees. To date, nine local chambers have joined the Federation. If your chamber is listed here, and you are not currently a member of the SC Chamber, you can sign up to join now through the Federation Membership Application.