2023 South Carolina Legislative Session Recap  

The 2023 South Carolina Legislature adjourned Sine Die in June, ending the first year of a two-year session. Several important legislative initiatives were adopted that made significant investments in South Carolina’s economy and higher education. Additionally, important legislation impacting economic development is still pending. Here is a review of some of those legislative initiatives.

Budget

The Legislature finalized the state budget last month, and South Carolina Governor Henry McMaster issued the fewest budget vetoes in total revenue amount by any South Carolina governor in over two decades. The Legislature will take up the Governor’s budget vetoes in January 2024 when they return for the 2024 Session. In the budget, State employees who earn less than $50,000 per year will receive a base pay increase of $2,500. State employees earning more than $50,000 annually will receive a five percent increase. The education funding allocations include increasing teachers’ salaries, increased classroom aid, school district capital projects, and literacy education. The minimum salary for teachers will increase to $42,500 and increase each step by $2,500. The Office of Resilience received over $200 million, and $25 million was directed to the Conservation Bank. Additionally, $71 million was allocated to the Rural Infrastructure Authority.  

Economic Development

The Legislature appropriated $1.3 billion for Scout Motors in Blythewood in Richland County. This incentive legislation added to the $2 billion in private Volkswagen investment and will create more than four thousand jobs when the plant is fully built out. The state investment is for a new interstate interchange, as well as other road and utility work and soil stabilization at the site. The General Assembly included funds in the budget for workforce training to help plants like Scout Motors find qualified employment within the community.

Statewide Education and Workforce Development

A top priority of House Speaker Murrell Smith and the Legislature was improving workforce development. The Speaker introduced H.3726, Statewide Education and Workforce Development Act, which would streamline and centralize all workforce development efforts in South Carolina to best prepare workers for current and future workforce needs. The House and Senate approved the bill, and Governor McMaster signed H.3726. The Legislature also addressed workforce readiness by allocating more than $93 million to workforce industry needs in the budget.

Higher Education

The Legislature focused for a fifth year on freezing tuition and increasing the base to cover inflation rates by appropriating more than $124 million to continue the freeze for in-state tuition. The Legislature fully funded LIFE, HOPE, Palmetto Fellows, and Lottery Tuition Assistance Program, increased funding for Needs-Based Grants and Tuition Grants, and also invested in maintenance and infrastructure for colleges, universities, and technical colleges. The Technical Education System received $25 million in recurring funds, plus $149 million in non-recurring dollars and more than $75 million from the Capital Reserve Fund. In his veto message, while the Governor did not veto any of the tuition revenue, he expressed his disagreement with the increase colleges and universities received in recurring revenues for operating budgets. The Governor outlined some new and additional reporting requirements in his executive budget process in November so he can monitor how that new revenue will be spent. 

Land Ownership by Foreign Adversaries

S.576 Alien Land Ownership Bill was passed by the South Carolina Senate in March 2023 and is now in the House Ways and Means Committee. The bill would prohibit a citizen of a foreign adversary or a corporation controlled by a foreign adversary from acquiring any interest in real property in South Carolina. The definition of a foreign adversary would include China. The Senate amended the bill to provide for exceptions for dual citizens and provided grandfathering clauses for existing ownership and expansions under terms approved by the South Carolina Secretary of Commerce and Governor. The definition of a "corporation controlled by a foreign adversary" means a legal entity engaged in commerce that is wholly owned by a foreign adversary, has a foreign adversary as a dominant shareholder, directly or indirectly, is wholly owned by a citizen of a foreign adversary, or has one or a number of citizens of a foreign adversary whose cumulative ownership is as a dominant shareholder. "Dominant shareholder" means the single owner of ten percent or more of a legal entity engaged in commerce's stock, securities, or other indicia of ownership or multiple owners of twenty percent or more of a legal entity engaged in commerce's stock, securities, or other indicia of ownership. S.576 could, if adopted, be an issue for foreign investment in South Carolina.

Conclusion

The 2023 South Carolina Legislative Session was very productive for South Carolina businesses.