2018 Legislative Wrap-Up

December 30, 2018

2018 Legislative Wrap-up

The 2018 legislative session is in the books! Here’s the rundown of how all of our conservation priorities fared this Year.

Conservation Bank Re-authorization – H.4727

In the 2017 session, we saw progress on bills to reauthorize the Conservation Bank with both the House and Senate holding subcommittee hearings. The Conservation Bank was created 14 Years ago to safeguard our drinking water, preserve our history and culture, and protect our precious natural resources.

The House and Senate passed vastly different versions of the Conservation Bank budget in 2017. The deed stamp funding source was in jeopardy.

In 2018, H.4727 emerged as the final vehicle for permanently reauthorizing the Conservation Bank, while also maintaining its independence, preserving its competitive grants process, and ensuring its ability to support cost-effective conservation easements. It also implemented several structural reforms to the Board and operations to improve transparency and inter-agency coordination related to conservation efforts. It also allows the Bank to make extraordinary purchases by applying to the Joint Bond Review Committee while the Legislature is out of session.

H.4727 was sponsored by Representatives White, Hardee, Yow, Huggins, Jefferson, Hosey, Anderson, West, Hewitt, Finlay, Ott, Duckworth, Sandifer, Davis, Clary, B. Newton, J.E. Smith, Rutherford, Bernstein, W. Newton, Herbkersman, McCoy, Lowe, Elliott, and S. Rivers. This bill was shepherded through the House by Representatives White, Pitts, Lowe, and others. On February 14, 2018, the House passed H.4727 by a vote of 107-3. Senators Setzler, Leatherman, Campsen, and others saw this bill through the Senate. The nearly unanimous passage of this bill in both the House and Senate demonstrates the support for the State’s continued investment in the protection of public and private lands.

On March 22, 2018, the Senate passed H.4727 by a vote of 38-0.

Conservation Bank Funding 2018-2019 – H.4950

 On June 28, 2018, the General Assembly adopted the Conference Committee’s Report on the General Appropriations Bill thereby finalizing state funding for 2018-19.  In the end, the funding level for the Conservation Bank for awards was set at $7M for the current fiscal Year.  This money comes from recurring funds in the state budget, the General Appropriations Bill.  Language included in H.4727, the Conservation Bank re-authorization bill, now requires the Bank to transfer annually up to $3M to DNR to be used as a match for federally funded grants.  In recent Years, this $3M transfer was directed by the Legislature in several budget provisos, and it is now codified in the new bill making budget provisos in the future unnecessary. With the DNR transfer completed, the Bank now has $4M remaining in this fiscal Year for actual awards from the General Fund.

The General Assembly also approved $1.5M in non-recurring funds for the Conservation Bank in the Capital Reserve Funds Bill (H.4951). Adding the $1.5M in Capital Reserve funds to the $4M left from the General Funds leaves the Bank with a grand total of $5.5M for the FY 18-19 funding cycle (July 1, 2018-June 30, 2019).

Outside of award funding, the Conservation Bank’s request for additional administrative funding was approved by the General Assembly but the Governor issued three vetoes striking (1) $70,000 for an attorney position; (2) $65,000 for a program manager position; and (3) $85,335 in additionally operating expenses.  On October 3, 2018, both the House and the Senate overwhelmingly overrode the Governor’s vetoes and restored this funding to the Bank’s administrative account.

 The bill was ratified on June 29, 2018.

Shoreline Management – H.4683

In 2016, the Conservation Coalition helped to pass historic legislation to balance shoreline development with good coastal management and science. In the fall of 2017, DHEC released new beachfront lines for development, but the rollout process left more to be desired. Coastal homeowners were rightfully frustrated by poor public notice and a lack of transparency. S.927 was introduced by Senator Campsen and others (with a companion bill in the House introduced by Rep. Hewitt, H.4683) as an attempt to respond to that frustration, but it missed the mark – and instead would have damaged sound coastal management policy.

H.4683 began as a potential roll-back of critical protections that were worked out through a consensus-driven, scientific process over the past decade. Through many meetings and compromises, our partners successfully defended the policy of “no seaward movement” of the shoreline that is integral to the effectiveness of the policy. The compromise bill also gives beachfront property owners flexibility in how the most recent lines are set and outlines the public notice process that DHEC must go through for setting future baselines.

The bill was signed into law May 3, 2018.

Energy Reform – H.4375

After construction of nuclear plants at the V.C. Summer facility was abandoned on July 31, 2017, the legislature had an ever-increasing duty to the utility ratepayers and citizens of South Carolina to reform the Base Load Review Act (BLRA) passed in 2007. Under this law, rate-payers front the loans for utility investments and are held responsible for paying the full term of the construction investment loans regardless of success. Then, the utility derives an automatic 10% profit on all investment made. This lack of oversight was granted without so much as a definition of “prudency,” the measure by which the soundness of their investment decisions could be judged.

As a result, the legislature spent much of the session deliberating on legally-acceptable BLRA reform in 2018. Many bills were introduced, but in the end they were largely combined into H.4375. 

H.4375 enacts five important changes:

1. The bill reduces the 18% that SCE&G ratepayers have been paying for the failed V.C. Summer reactors to 3.19% per bill on average. This average is based on an interim rate being set at its 2011 level.

2. The legislation provides appropriate “prudence” and “imprudence” definitions under the Base Load Review Act. It also establishes that utilities must prove “prudence” before the PSC for future rate increases and investments.

3. The policy establishes an independent Consumer Advocate under the Dept. of Consumer Affairs so that ratepayers have a government entity to argue for their interests before the PSC and state appellate courts.

4. The new law changes the mission of the state regulatory agency which oversees issues before the PSC, the Office of Regulatory Staff (ORS), so that its mission is no longer conflicted by being charged with looking out for ratepayers, financial wellbeing of utilities, and economic development. The agency will no longer be responsible for the “financial integrity” of utilities or “economic development and retention and job attraction”. Furthermore, it provides the ORS subpoena power over utilities’ past and future decisions under investigation.

5. This law repeals the Base Load Review Act going forward for any future use whatsoever following V.C. Summer. There will be no more up-front ratepayer financing for power plants in SC under the BLRA. This essentially means no new nuclear or coal-fired power plants will ever be built again in South Carolina.

H.4375 became law as of July 2, 2018, as the House and Senate overrode the Governor’s veto.

Public Utility Consumer Protection Act – H.4425

Rep. James Smith(D-Columbia) introduced H.4425 to set an energy efficiency targets with a focus on low-income customers, moving the Energy Office to the Governor’s Office, and strengthen Integrated Resource Planning (IRP) procedures at the Public Service Commission. The House Judiciary Constitutional Laws Subcommittee passed the bill, but the full House Judiciary Committee sent it back to subcommittee, where it died.

Rep. James Smith then introduced Amendment 36a to the budget, which included the same IRP language. The amendment was adopted by the House 62-40 on May 2, 2018. However, the budget conference committee then eliminated this amendment by Rule 24 due to lack of Germaneness at the end of session.

H.4425 did not emerge from committee in the House, and the effort to attach it to the budget was unsuccessful at the end of session.

Solar (Net Metering Cap Increase) – H.5045

This bill was written to protect utilities from potential lost revenue by sabotaging efforts to continue growing South Carolina’s solar industry. This bill was introduced by Rep. Bill Sandifer (R-Oconee), White (R-Anderson), and Forrester (R-Spartanburg) and fast-tracked through the Labor, Commerce, and Industry subcommittee and the committee the next legislative day with no debate about its job-killing implications or the additional cost that would be passed on to energy ratepayers. The timing was also orchestrated to place it directly before the Solar Jobs Bill (see information on H.4421, below) to pressure solar supporters to seek a compromise.

Solar champions didn’t give up, and Reps. Stavrinakis, Ballentine, Clary, Caskey, Williams, and J.E. Smith rose to challenge the bill. In a series of four votes on H.5045 out of a total of 14 votes on H.5045 and H.4421, the House expressed a strong pro-solar majority. Rep. McCoy made the successful motion to continue the bill, which ended debate on H.5045.

Killing this bill with a continuance vote of 61-39 allowed the House to proceed to debate on H.4421, the Solar Jobs bill.

Solar Jobs – H.4421

The solar jobs bill was introduced to eliminate the net metering cap on residential solar and

allow our state’s solar energy sector to continue to produce thousands of good-paying clean energy jobs, lower power bills, and eliminate payment to utilities for “lost revenue” due to solar growth. This bill was broadly supported by the conservation community, solar industries, and a wide range of other stakeholders.

The bill was introduced by Representatives J.E. Smith (D-Richland), McCoy (R-Charleston), Ott (D-Calhoun), G.M. Smith (R-Sumter), Ballentine (R-Lexington), W. Newton (R-Beaufort), Bales (D-Richland), McEachern (D-Richland), Brown (D-Charleston), Henegan (D-Marlboro), Clary (R-Pickens), Arrington (R-Dorchester), Stavrinakis (D-Charleston), Caskey (R-Lexington), Norrell (D-Lancaster), Bernstein (D-Richland), Knight (D-Colleton), Gilliard (D-Charleston), Funderburk (D-Kershaw), Loftis (R-Greenville), M. Rivers (D-Beaufort), Cobb-Hunter (D-Orangeburg) and King (D-York)

The bill came up on the floor of the House immediately after the defeat of a utility-written solar sabotage bill that was put there to derail it (see immediately above).

As part of series of 10 votes on H.4421 on April 5, 2018, clean energy champions (such as Representatives Stavrinakis, Ballentine, Clary, Caskey, Williams, McCoy, J.E. Smith, Loftis, and W. Newton) worked to secure a 64-33 victory on second reading.

On April 10, however, Rep. Thayer raised a parliamentary inquiry concerning the bill – asking if 2/3 of the House would be needed for passage of the bill because the bill contained property tax exemptions and the SC Constitution requires 2/3 approval of the House and Senate for additional property tax exemptions.  After lengthy discussions with Reps. James Smith, Mandy Powers Norrell, and others, Speaker Lucas ruled that a 2/3 vote would be required for passage. This set the threshold for approval at 82 votes.

Rep. James Smith and other clean energy champions like Peter McCoy, Katie Arrington, Gilda Cobb-Hunter, Russell Ott, Gary Clary, and Mandy Powers Norrell took steps to try and remove the property tax provisions of the bill and reduce the need for an 82 vote supermajority. The only way to remove the offending section was to move the House into a “Committee of the Whole,” a tactic that had not been used in over 30 Years in the SC House. The effort failed by one vote.

With all efforts to fix the bill exhausted, the bill proceeded to third reading with the supermajority vote requirement still in place. While the bill received a majority of votes with 61-44, it did not reach the 82 vote supermajority.

H.4421 was defeated on third reading in the House.

Large-Scale Solar – S.890

This large-scale solar bill was initially introduced by Sen. Tom Davis (R-Beaufort) to improve the Public Utility Regulatory Process Act (PURPA) process that allows independent power producers to tie into the grid. The bill would have ensured that the Public Service Commission (PSC) and the utilities consider the lowest cost options to address energy generation. The utilities have been making it difficult for solar farms to interconnect at a fair market price for a financially-standard length of contract. After making it out of the Judiciary Committee with a favorable report, the bill was recommitted to Judiciary on May 8, 2018.

No Large-Scale Solar language made it into law this session.

Solar Habitat – H.4875

This bill directs DNR to create a standard for vegetative management planning at utility scale solar farms. Rep. Ott introduced the bill which created the Solar Habitat Act. It encourages commercial solar energy sites to follow guidelines established by DNR that recommend the use of native plants and a recommended set of native grasses, creating an ecosystem beneficial to pollinators and birds to combat a decline in both populations. In addition, boosting the number of pollinators increases nearby crop yields. Planting this type of vegetation also minimizes erosion and fertilizer use in the area, increases natural water filtration, and is cheaper to install and maintain for the operator than turf or gravel. Solar developers who wish to participate in the voluntary program would be issued a certification of compliance that the company could use to promote their site as a pollinator and bird-friendly habitat. The bill made it through the House Labor, Commerce, and Industry Committee before being passed by the House. The Senate first referred it to the Judiciary Committee before finally making it out of the Agriculture and Natural Resources Committee. The Senate passed it unanimously on May 9, 2018.

Governor McMaster signed this bill into law May 25, 2018. Several candidate sites are already being prepared for implementation.

Dam Safety Reform – H.3218

In response to the floods of 2015-2016, H.3218 would have updated the dam safety law to give DHEC the tools and data necessary to protect citizens, their property, and the environment. The major causes in dam failures was improper maintenance of the dam and lack of familiarity with contingency plans in case of an emergency by the owner. Dams that failed often had issues with clear ownership, and thus, legal liability. The Yearly Emergency Action Plan proscribed in this bill would indicate which dams lacked a responsible owner, allowing preventative action and clear liability in case of failure.

Speaker Lucas (R-Darlington) and Representatives Hiott (R-Pickens), V.S. Moss (R-Cherokee), Pitts (R-Laurens), West (R-Anderson), and Crosby (R-Charleston) and several House members introduced H.3218. The House Agriculture and Natural Resources Committee worked diligently to study the issue and shepherd the bill through the House. On February 2, 2017, H.3218 passed the House by a vote of 102-1.

H.3218 remained in the Senate Committee on Agriculture and Natural Resources for the rest of session with only one subcommittee hearing. With a failure to come to a consensus, the Senators committed to work over the “off-season” to craft legislation supported by a broad array of stakeholders as well as House and Senate members. With a change in the chairmanship of the Senate Agriculture and Natural Resources Committee, no meaningful work was done to achieve workable legislation for 2019.

The bill died in the Senate Agriculture & Natural Resources Committee.

Anti-Home Rule (Plastic Bags) – H.3529

This bill sought to prohibit communities from adopting local ordinances affecting disposable containers, specifically plastic bags and Styrofoam. The bill was introduced by Bedingfield, Sandifer, Hamilton, Forrester and many others. With several intense debates on the roles of local and state government and the detrimental effects of plastics on our coastal economies, House champions won a very close vote (50-49) on March 7, 2017, to delay consideration of the bill it for a Year by “continuing the bill”.

The bill was again eligible for consideration in the House in 2018. Despite valiant attempts by House champions, special interests succeeded in flipping a number of votes to allow the bill’s passage in the House on February 7, 2018, by a vote of 73-41. House champions who worked to slow, amend, or kill the bill in both terms include Representatives Erickson, W. Newton, McCoy, Brown, Clary, Cobb-Hunter, Cogswell, Herbkersman, McKnight, Ott, J. Smith, Stavrinakis, and Sottile.

The bill then moved to the Senate, where it eventually passed out of the Labor, Commerce, and Industry Committee. The one-Year delay achieved by the 2017 continuance vote allowed the conservation community to build intense grassroots and legislative opposition to the bill.

The bill died on the floor of the Senate in 2018.

Solid Waste Management Act Reform – H.4644

This legislation gives DHEC the ability to respond immediately to landfill emergencies, requires construction and demolition recyclers to quickly process the debris they collect and gives localities zoning authority instead of DHEC.

The bill was introduced by Representatives Dillard (D-Greenville), Anthony (D-Union), Atkinson (D-Marion), Kirby (D-Florence), Henderson-Myers (D-Spartanburg), Martin (R-Newberry), Burns (R-Greenville), Williams (D-Darlington), Yow (R-Chesterfield), W. Newton (R-Beaufort), Hewitt (R-Georgetown), Blackwell (R-Aiken), Forrest (R-Lexington) and Hixon (R-Aiken). It was formed through a consensus-based stakeholder process at DHEC that yielded a broad coalition of support. The House voted 98-1 on March 9, 2018 to pass the bill. The Senate voted on April 25, 2018 to approve the bill.

Governor McMaster then signed it into law on May 3, 2018.

Litter – H.4458

This bill addresses fines and enforcement related to littering. It gives greater discretion to Law Enforcement for litter penalties, increasing possible fines for illegal dumping as well as allowing fines for smaller indiscretions, like cigarette butts. This bill is a great step forward making it easier to enforce state dumping laws.

This popular bill made it out of the House very quickly, but the bill was held up by some political jockeying in the Senate. Ultimately, the Senate agreed with the House Bill, and it was sent to the Governor.

The bill was signed into law May 18, 2018.

The Automatic Stay – S.105 & H.3565

The Automatic Stay is an important pause button that goes into effect when a permit decision is challenged in the Administrative Law Court (ALC), but before the permit is finalized. This stay has paused activities that may have done irreparable harm before the permit is reviewed.

For the sixth Year in a row, passage of bills intended to weaken an important part of the permitting process were introduced at the State House. Unfortunately, S.105 passed out of the Senate Judiciary Committee with an amendment that was meant to improve it; we disagreed. On March 7, 2017, Senator Massey attempted to put S.105 on “special order” on the Senate floor so that it could be debated despite Senator McElveen’s objection. The special order vote failed 25-15 as it needed 2/3 of the Senate to pass.

Frustrated with that failure, Senator Massey, as Chairman of the Rules Committee, used the Rules Committee Special Order slot, which was another way to put a bill on special order over an objection and get around the 2/3 majority rule. The Rules Committee voted 9-7 to put the bill on Special Order, forcing debate on the bill despite objections. On March 8, 2017, after extended debate and adoption of an amendment, the bill passed 26-6. The following changes were made:

• The amendment limits the stay to 90 days and requires a hearing within 30 days.
• The burden of proof was shifted to the public challenger rather than the permittee to show why the stay should be kept in place.
• The case must be dealt with by the Administrative Law Court within 12 months.
• We improved the bill with language stipulating that a case cannot be found moot if the stay is lifted and work on the permit proceeds, giving possible grounds for further litigation.
• An exception was made for hazardous waste permits. Hazardous waste permits will have to follow the “old” version of the automatic stay law.

While we still opposed the bill and did not agree to a compromise, we are glad that it was improved. We are grateful for the help of Senators McElveen, Kimpson, Sheheen, Young, Hutto, Senn, Allen, Fanning, and Scott to improve and/or oppose the bill. Representatives J.E. Smith, Bernstein, King, Norrell, Clary, McEachern, W. Newton, and D. Moss were instrumental in questioning the bill in the House.

The bill was then considered by the House. After a lengthy committee process, the bill made it to the floor of the House where the Senate amendments were preserved and the bill was passed.

The bill was then signed into law by Governor McMaster on March 14, 2018.

Immunity from Nuisance Suits – H.3653 & S.323

For the second session in a row, legislators introduced two companion bills in 2017 that would remove the rights of neighboring landowners to ensure the safe and healthy use of their property if a nearby industry expanded. Supporters of the bill argued, inaccurately, that the bill would only codify nuisance common law and prevent an existing industry from a lawsuit from a new neighbor.

H.3653 (sponsored by Reps. Forrester, Yow, Loftis, Henegan, Spires, Anderson, Burns, V.S. Moss, Crawford, Hamilton, Felder, Norman, Anthony, Chumley, Erickson, Gagnon, Hayes, Henderson, Hosey, Jefferson, S. Rivers, Ryhal, Sandifer, Thayer, Willis, Atkinson, Alexander, West, Hixon, Murphy, Arrington, Bennett and Crosby) flew through the House Labor, Commerce, and Industry (LCI) Committee as they cut off testimony and respectful discussion with concerned citizens (led by Chairman Sandifer and Rep. Forrester).

Unfortunately, after Rep. Clary attempted to improve the House bill with an amendment on the floor, H.3653 passed 78-27 on March 22, 2017. Instead of also taking up H.3653 in Committee in the Senate, Senators bypassed the Committee process and voted to bring the bill up for debate on the Senate floor with a 15-1 vote from the LCI Committee on April 18, 2017. Luckily, Sen. Bright-Matthews, among others, had objections to debate the bill, making a vote more difficult.

S.323(sponsored by Sens. Campbell, Turner, Talley, Bennett, Climer, Nicholson, Cromer, Reese, Grooms, Hembree, Verdin, Massey, Alexander, Williams, Johnson, Gambrell, Sabb, Young, Shealy, Scott, Corbin and Jackson)was discussed at length in the Senate LCI Committee by Subcommittee Chairman Massey, but unfortunately still passed. S.323 now rested on the Senate calendar with an objection from Sen. Bright Matthews.

In the Senate, H.3653 was placed on special order to overcome the objection of Senator Bright-Matthews and others.

Once the bill was up for debate, Senator Sheheen filibustered the bill, aided by Senators Campsen, Davis, Fanning, Hutto, Kimpson, Martin, and Bright-Matthews. Through their efforts, the bill was amended and its impacts greatly reduced, but still put property owners in a weaker position against polluting industrial neighbors.

On January 31, 2018, the Senate passed the amended version of H.3653 by a vote of 29-14. The House agreed with the Senate amendments and sent the bill to the Governor.

H.3653 was signed into law by the Governor on February 12, 2018.

Poultry Industry Expansion – H.3929

H.3929 was introduced by Representatives Hiott (R-Pickens), Pitts (R-Laurens), Kirby (D-Florence), Yow (R-Chesterfield), Sandifer (R-Oconee), Atkinson (D-Marion), and several others.This bill reduces the ability of neighbors and DHEC to address the negative impacts of poultry operations on adjacent lands and natural resources.

The bill was yet another attempt to reduce citizens’ ability to engage in the permitting process and protect their rights to a clean and healthy environment. The bill as proposed established a $5,000 filing fee for appeals of poultry permits, eliminated vegetative buffer requirements, limited the number of citizens with ‘standing’ to bring and appeal, and took away DHEC’s discretion in establishing setbacks from water sources.

After much discussion with stakeholders, the House Ag and Natural Resources Committee, led by Chairman Hiott, removed the $5,000 filing fee for appealing a permit and reinserted the requirements for vegetative buffers.

When the bill came to the floor of the House, Rep. Clary introduced over 100 amendments to kill, delay, or improve the bill. In order to limit the number of amendments introduced and the amount of debate on each amendment, the House moved to “invoke cloture” on May 9, 2017, by a vote of 54-44.

This vote prevented a prolonged floor fight and weakened the ability of Rep. Clary (R-Clemson) to improve the bill. In the end, H.3929 passed the House by a vote of 77-12.

The bill encountered stiff resistance in the Senate and was compromised further on several occasions.

The bill was signed by the Governor March 12, 2018.

Offshore Drilling – H.4307, H.4334, S.712, H.4788, H.4835, H.4887

In the face of a recent Executive Order and ongoing discussion at the federal level about offshore drilling in the Atlantic, Representatives introduced H.4307 in the last week of session in 2017 to stop onshore infrastructure permitting needed for offshore drilling.

Unfortunately, several legislators also decided to introduce legislation to make SC friendlier to offshore drilling. These bills were referred to the Agriculture and Natural Resources Committees in their respective chambers. As a result, the House Ag Committee formed an ad-hoc committee to become familiar with federal offshore drilling regulations and develop a list of suggestions for any potential legislation. Representatives Burns, Chumley, Davis, Dillard, Hewitt, Hixon, Kirby, Moss, and Ott were appointed to serve on the ad hoc committee, with Representative Hixon as the Chair. The legislation below was introduced, but the committee took no further actions.

• H.4307 (Reps. Stavrinakis, Cogswell, Sottile, W. Newton, J.E. Smith, Gilliard, Mack, Bernstein, Brown, Herbkersman and Crosby) would have blocked state agencies from approving the infrastructure needed to pursue offshore oil and gas drilling.
• H.4334 (Reps. Burns, Chumley, and V.S. Moss) would have required state agencies to approve the infrastructure needed to pursue offshore oil and gas drilling.
• S.712 (Sen. Goldfinch) would have place a question on the 2018 primary ballot to ask if SC residents support “good” offshore drilling.
• H.4788, H.4835, H.4887 were filed in the excitement after the debate, but found no other support.

None of the offshore drilling bills moved out of the House or Senate in 2018.