Economic Development Archives
UPDATE ON THE BENEFIT BANK IN SOUTH CAROLINA
January 12, 2011
Since the Palmetto Institute led efforts to bring The Benefit Bank program into the Palmetto State, our citizens have captured more than $8.5 million in state and federal work supports. More than 339 sites with over 1,080 trained counselors throughout the State have helped more than 6,450 South Carolina citizens file thousands of applications, including federal and state income tax returns. Other work supports include nutrition, education, health, child care, home energy and tax credit programs.
The Benefit Bank is a free, web-based service that simplifies and centralizes the process of applying for state and federal benefits for low- and moderate-income individuals and families, and has the potential to keep millions, even billions, of dollars in work supports in the State instead of remaining unclaimed. Trained counselors help individuals and families file federal and state taxes and determine their eligibility for federal tax credits, food stamps, and medical benefits. The efforts of the South Carolina Office of Rural Health, BlueCross BlueShield of South Carolina Foundation, and other willing partners have been essential in bringing this much-needed program to South Carolina.
For more information, please visit http://www.thebenefitbank.com/SouthCarolina or contact Sue-Ann Gerald Shannon, Director of Research at the Palmetto Institute, at sshannon@palmettoinstitute.org.
UPDATE ON THE BENEFIT BANK IN SOUTH CAROLINA
August 2, 2010
Since the Palmetto Institute led efforts to bring The Benefit Bank program into the Palmetto State, our citizens have captured more than $2 million in state and federal work supports. As of August 2, 2010, 164 sites in 33 counties with over 500 trained counselors have helped more than 850 South Carolina citizens file over 950 applications, including completion of FAFSA forms for college.
The Benefit Bank recently went "live" in Florence County at the Lake City Library, the first site launched within the Pee Dee region.
The Benefit Bank is a free, web-based service that simplifies and centralizes the process of applying for state and federal benefits for low- and moderate-income individuals and families, and has the potential to keep millions, even billions, of dollars in public funds in the State instead of remaining unclaimed. Trained counselors help individuals and families file federal and state taxes and determine their eligibility for federal tax credits, food stamps, and medical benefits. The BlueCross BlueShield of South Carolina Foundation and the South Carolina Office of Rural Health, along with other willing partners, have been essential in bringing the Benefit Bank to South Carolina.
For more information, please visit http://www.thebenefitbank.com/SouthCarolina or contact Sue-Ann Gerald Shannon, Director of Research at the Palmetto Institute, at sshannon@palmettoinstitute.org.
"South Carolina Can Spur Economic Development through Growing Its Agribusiness Assets"
December 10, 2009
CONTACT: Sue-Ann Gerald Shannon, Director of Research, Palmetto Institute Email: sshannon@palmettoinstitute.org Website:
Link to the Agribusiness "Topline" Report
When we undertook a comprehensive study of South Carolina's agribusiness sector two years ago, we knew agribusiness -- food, forestry, and processing -- was a major economic driver in our State's economy. Our research has confirmed that agribusiness represents more than $30 billion in economic impact on the State and is tied to nearly 200,000 jobs.
The Palmetto Institutes appreciates the substantial assistance provided by stakeholders within the industry, including educators, associations, foresters, farmers, producers, processers, elected officials, government representatives, nonprofits, and many others. Moreover, we would like to particularly acknowledge the invaluable support contributed by the following partners:
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Chernoff Newman
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Central Electric Cooperative
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Clemson University
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dmrkynetic
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Electric Cooperatives of South Carolina
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MarketSearch
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RBC Insurance
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SCANA
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SCLaunch! U.S.
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Department of Agriculture
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Although our research findings were many, as we look ahead, we are focusing on 3 areas to be addressed immediately:
- Awareness. The agribusiness cluster needs an organized campaign to inform both the policymakers and general public of the existing economic strength of agribusiness in South Carolina and its potential to grow even stronger given the appropriate support. Basically, the point must be made that agribusiness is one of the top economic engines in the State and should be treated equal to other economic engines (such as tourism and manufacturing) with respect to incentives and economic development efforts.
- Lead Entity. An "umbrella" group needs to be identified or created to oversee and support the various agribusiness sectors in South Carolina. Creation of this group should not be a consolidation of existing public entities such as Departments of Agriculture or Commerce, but instead a public/private entity that collaborates with existing entities to speak for and strengthen the position of agribusiness. This organization must also be able to assist those working in the areas of farming, food, and forestry on such issues as: Collaboration with Clemson, USDA, and other research entities; Consolidation of buying power; Broader distribution support; and Assistance with insurance and safety requirements, marketing, tax and labor issues, and research and development.
- Marketing. The existing branding and marketing program by the Department of Agriculture has been well received and should be supported and expanded.
We urge you to review the attached report and to join with us in promoting and advancing our tremendous agribusiness economy.
BENEFIT BANK PROMISES OPPORTUNITY FOR UNEMPLOYED
July 20, 2009
The Palmetto Institute is currently working with MDC of North Carolina to explore the feasibility of implementing The Benefit Bank program in South Carolina.
The Benefit Bank began in 2006 as a way to help close the gap between publicly-funded programs and people in need through a web-based system that simplifies and centralizes the process of applying for many state and federal benefits for low - and moderate-income individuals and families. Located in at least six states (Kansas, Pennsylvania, Ohio, Arkansas, Mississippi, and Florida), Ohio alone generated payments totaling $80 million over a period of three years.
Community and faith-based organizations, social service agencies, food pantries, job training programs, and homeless shelters are among the groups using the Benefit Bank to help people file Federal and State Income Taxes and apply for publicly-sponsored programs such as CHIP, Food Stamps, LIHEAP, and more -- at one convenient location and at no cost to the individual. Additional information on this program can be found at www.thebenefitbank.com.
We believe that this program is becoming more necessary in the Palmetto State as a class of people -- known as the "new poor" -- begins to emerge as a result of the declining economy.
UPDATE ON EFFORTS TO ESTABLISH TAX STUDY COMMISSION
June 17, 2009
Senate Bill 12, legislation to create a tax study commission, was passed yesterday by the General Assembly and now goes to Governor Sanford for approval.
The bill establishes the South Carolina Taxation Realignment Commission, in an effort to "conduct a comprehensive study of the state's tax system and submit a report of its recommended changes to further the goal of maintaining and enhancing the state as an optimum competitor in the effort to attract businesses and individuals to locate, live, work and invest in the state." An eleven-member commission will conduct the comprehensive study. A report must be delivered by March 15, 2010 and the commission will dissolve on January 1, 2011.
Legislators are not allowed to serve on the commission, but members will be appointed with one each from the Senate President Pro Tempore, Finance Chairman, Minority and Majority Leader, two each from House Speaker and Ways & Means Committee Chairman, and two from the Governor. The Director of the Department of Revenue will also serve on the commission, ex officio. All members of the commission must have professional experience and will serve without compensation.
Also included in the legislation are provisions to hire professional consultants and staff that would be paid at the discretion of the Senate Operations & Management Committee and the Speaker of the House.
UPDATE ON EFFORTS TO ESTABLISH TAX STUDY COMMISSION
March 10, 2009
For South Carolina to be competitive in the global economy, the fundamental underpinning of its tax structure, both statewide and locally, must meet three basic criteria. It must be competitive; that is, the structure cannot be viewed as one that discourages industries and people from coming to our state, living in our state, expanding their businesses in our state, and investing in our state. It must be adequate. A multitude of studies have indicated that South Carolina must improve the quality of its economic foundations. By that, I mean its educational and workforce quality system, its infrastructure, vibrant and growing communities, and the overall quality of life must be improved. A tax structure must adequately support these foundations or we will find our state becoming less and less competitive. And, finally, a tax structure must be equitable, both horizonitally and vertically. The bottom-line is that our citizens must believe the system is fair. No one segment should have advantages at the expense of others. In two studies commissioned by the Palmetto Institute, experts have told us the best approach to achieve such criteria is to have a broad tax base with the lowest possible tax rates. This is not the case in South Carolina. Over the last few years, we have witnessed a pattern of acceding to tax breaks in an ad hoc manner and the lack of any sound, consistent tax structure policy. Unfortunately, the term "revenue neutral," which is used to describe the basis for certain legislative changes in our tax code does not come close to rising to the criteria of competitive, equitable, and adequate. The consequences of Act 388 are exhibit A on how a so-called revenue neutral amendment can undermine sound, consistent tax structure policy. It also demonstrates why there is a dire need for an independent, professionally-staffed tax study commission as recommended by the Palmetto Institute.
Because of the inflationary increase in the value of residences and other properties, especially on the coast and other resort areas, there was a need to address the dramatically rising property taxes on homes. The problem was there was no intervening, independent group that could have pointed out the consequences of Act 388 to the policymakers as well as the taxpayers. As a result, $250 million annually in sales taxes have been shifted to businesses. The shift also disproportionately shifts school property taxes to businesses and has distorted and nearly crippled the real estate market. Even worse, due to the economic downturn, the sales tax increase to be used to pay for the elimination of residential property taxes for school purposes will be close to $50 million short this fiscal year and close to $100 million short for the fiscal year 09-10. This is not what anyone has in mind when seeking tax changes that are competitive, equitable, and adequate.
An independent, professionally-staffed tax study commission could have pointed out some of these consequences, thereby giving the General Assembly the opportunity to avoid them. Further, and more important, the Palmetto Institute believes such a commission should also be given the initial responsibility for developing comprehensive tax structure reform for consideration by the General Assembly. It is an essential step in the state's need to be competitive in a global economy. A proposed legislative draft incorporating the recommendations of the Palmetto Institute was sent to the members of the General Assembly for consideration. Presently, there are two major bills introduced in the General Assembly, which have responded to the need for an independent tax study commission.
Senate Bill 12, as amended, received third reading by the Senate and is now in the House Ways and Means Committee.
The composition and manner of appointment of the South Carolina Taxation Realignment Commission remained as suggested by the Institute. The commission will be composed of 11 members, none of whom are legislators, who must meet certain professional and academic qualifications. Interestingly enough, an additional requirement was added to provide that anyone not a resident of South Carolina since January 1, 1997, would be ineligible to serve on the commission. The Executive Director's qualifications also remained the same, except that the Senate added an amendment to preclude anyone, since January 1, 1997, employed by the General Assembly, who served as a lobbyist, or who was not a resident of South Carolina.
The commission must develop criteria for assessing the effectiveness of the current tax structure, as well as the likely systemic impact of any proposed changes affecting tax revenue, three (3) months from the date of passage of the act. Not later than March 15, 2010, it must deliver a report and recommendations, including the text of an amendment that effectuates the recommendations relating to the tax structure, to the Chairmen of the Senate Finance and House Ways & Means Committees. The major limitation to the scope of the study is language that excludes from the definition of local taxes those exemptions related to owner-occupied residential property as provided by Act 388.
The BEA would be required to prepare a "revenue report" based upon the commission's recommendations prior to the recommendations being sent to the General Assembly.
The real damage to the Institute's suggested language was the elimination of any "BRAC-like" language that would have required the General Assembly to vote on the commission's recommendations without amendments or at least require a larger majority such as ¾'s to offer an amendment. Under the Senate-passed version, the legislation introduced as a result of the commission's recommendations will be treated like any other piece of legislation and can be amended by a simple majority vote as many times as desired.
The commission would be dissolved January 1, 2015.
House Bill 3415, a bill that proposes to create the S.C. Taxation Realignment Commission, was introduced on February 3, 2009. This commission would be comprised of 17 members, appointed as follows:
- 2 by the Governor
- 2 by the Senate Pres. Pro Tem.
- 2 by the House Speaker
- >2 by the Senate Finance Chmn.
- 2 by the House Ways & Means Chmn.
- 3 Senators, appt'd by Senate Pres. Pro Tem.
- 3 Representatives, appt'd by House Speaker
- DOR Director
The concern with this proposal is that it adds 6 legislators, thereby taking away from the independence of the commission.
The commission would develop the criteria for assessing the current system and the likely impact of proposed changes within 6 months of the effective date of this joint resolution.
The commission would have until December 1, 2009, to deliver its recommendations on just the sales tax exemptions to the Chairmen of the Senate Finance and House Ways and Means Committees. The recommendation must be introduced in both bodies by the Chairmen of the Senate Finance and House Ways and Means Committees, and would take effect January 1, 2011, if approved by joint resolution. Any substantive amendments would require approval by three-fourths majority vote. The problem with just doing the sales tax is it would not meet the test of reviewing the entire tax structure so every taxpayer would be treated fairly.
The commission would have until December 1, 2010, to deliver its recommendations as to the State's tax structure and any other provisions affecting state revenue. The bill specifically includes property taxes and local tax levies, excepting sales tax exemptions. The recommendations must be introduced in both bodies by the Chairmen of the Senate Finance and House Ways and Means Committees.
This commission would sunset on January 1, 2011, absent further authorization.
It is hoped that amendments will be offered in the House and concurred in the Senate that will address the problems with the two existing bills. Then and only then can we turn our attention to real tax reform through the work of an independent tax study commission.
SOUTH CAROLINA NEEDS TAX REFORM TO COMPETE
With declining state revenues and worsening unemployment, the underlying competitiveness of our existing tax structure and the need for comprehensive tax reform has become of utmost importance to the economy, and future, of South Carolina. The passage of Act 388 in 2006 by the General Assembly has brought with it very harmful effects to South Carolina's economy; as a result of Act 388, the burden of new growth in property taxes disproportionately shifted to businesses, increasing costs to existing businesses and serving as a disincentive to prospective companies interested in business in South Carolina. Sales taxes alone are estimated to be $250 million higher in 2008 as a result of Act 388.
By eliminating the school-operating property tax levy on owner-occupied residences and attempting to replace it with a penny sales tax, the act placed the burden on volatile sales taxes which have declined due to the shaky economy, leaving little money to improve our education system. Act 388 also changed the way property is assessed in South Carolina by capping the assessment valuation until the property is sold and basing the property tax valuation on the point of sale price, effectively placing a chill on the real estate market.
The South Carolina budget has already been cut by $1 billion. Recently, the State Budget Director announced that we will have an additional $567 million deficit that will have to be addressed. In hard times, such deep cuts mean that the critical economic foundations such as workforce quality, education, infrastructure, and research and development will be dramatically underfunded. Not only are businesses being disproportionately taxed, but the economic foundations we rely upon to support businesses in South Carolina will not be able to provide the necessary workforce and infrastructure we need.
There is ample reason and compelling research that the Palmetto Institute relies on in its call for an independent, professionally-staffed tax study commission that can provide thoughtful, meaningful research on proposed tax changes by the General Assembly and the impacts that these changes will have on taxpayers and the State's economy. Without this independent tax study commission and the chance it offers for a more competitive tax structure for South Carolina, businesses cannot prosper, individuals and families cannot be assured of a steadily improving quality of life, and South Carolina cannot compete in a global economy.
Please refer to our most recent tax study for more information: ;"Selected Issues in South Carolina's Tax and Education System"
MEMORANDUM
FROM: Darla Moore, Chair of the Board
RE: South Carolina's Future
As pointed out in the study commissioned by the Palmetto Institute, the passage of Act 388 by the General Assembly in 2006 has led to harmful effects which threaten our economic stability:
- Businesses will pay higher taxes -- in sales taxes alone, business taxes will be about $250 million higher in 2008,
- Businesses will be burdened by a disproportionate share of property tax for local education costs,
- Many school districts will see a decrease in their expected expenditures for education, and
- The property tax assessment cap will create economic distortions that will lead to a chilling effect on the real estate market.
School officials across the state have identified flaws in the legislation, which will result in many districts being unable to pay for mandated salaries and maintain required programs. Real estate officials are demanding changes in the assessment cap provisions because such provisions make it much more difficult to sell and buy property.
As others are now demanding changes to the law, I am concerned once again that in addressing the problems, the General Assembly will not consider how such amendments will affect the overall tax structure as well as the economy of the state. This is the very reason to support the creation of an independent, professionally-staffed tax study entity by the General Assembly. Many of the unintended consequences of Act 388 could have been avoided if the proposal had been studied carefully so that their impacts on taxpayers and the state's economy could have been better understood.
Equally important to creating a tax study entity is making sure it is independent, professionally-staffed, and has the support and resources to do its work. If it has all of these elements, not only will the legislators get the benefit of impartial, objective research, but the taxpayers of South Carolina will benefit from a more fair, balanced, competitive tax structure.
I thank you for allowing me to share my thoughts. I hope you join with me in the desire to see the creation of such an independent tax study entity.
Thank you.
P.S. Again, you can review the research on South Carolina's tax structure at www.palmettoinstitute.org.
3rd Annual Agricultural Summit News Coverage
The Post and Courier: "Agricultural Department Plans Non-traditional Media Approach"
http://www.charleston.net/news/2008/nov/22/pushing_state_grown_food62650/
The State: "Improving Agriculture Topic of Summit"
http://www.thestate.com/business/story/598431.html
WIS-TV: "Improving Agiculture Topic of Summit"
http://www.wistv.com/Global/story.asp?s=9391485
The Sun News: "Improving Agriculture Topic of Summit"
http://www.myrtlebeachonline.com/575/story/679459.html
AOL News: "Improving Agriculture Topic of Summit"
http://news.aol.com/story?id=n20081121040209990008
Remarkable Progress Made in Registered Apprenticeship Opportunities
Apprenticeships are necessary for a vibrant, skilled workforce. Almost 80% of jobs require some post-secondary education and training, and more than 60% require on-the-job learning experience. Apprenticeship Carolina™, along with South Carolina's employers, Technical Colleges, and others continue to work together to increase capacity and upgrade skills to meet the State's employment needs.
Since the push to expand apprenticeships began last year, the number of active apprentices has increased from 777 to more than 1,100, with apprentices working in more than 50 registered occupations. Since this past July, 12 new apprenticeship programs have been registered, bringing the state total to 124. Apprenticeships are being used by employers across increasingly diverse industry sectors, such as graphic design, camera operator, and forklift technician, as well as in industries experiencing severe shortages, such as health care and energy.
This integration of on-the-job training and related instruction allows employees to learn the required skills and competencies while working full time in their chosen occupation, thereby raising the skill levels of our workers and increasing their take-home pay, which will ultimately improve our State's competitive position in today's economy.