McMaster: South Carolina has ‘an opportunity to take bold, transformative actions’

(The Center Square) — South Carolina Gov. Henry McMaster touted the state’s rosy economic position during his state of the state address and called on state lawmakers to bolster the state’s rainy day fund and return money to taxpayers.

“Our booming economy has once again created a record budget surplus, this year totaling over $3.5 billion in unexpected revenue,” McMaster, a Republican, said, according to his prepared remarks.

“Today, we are presented with an opportunity to take bold, transformative actions that will build prosperity for generations to come,” McMaster added. “The foundations of our successes rest on three pillars: Economic strength, education, and our natural environment.”

McMaster called on state lawmakers to set aside an additional $500 million to increase the rainy-day reserve fund minimum balance from 7% to 10%.

Additionally, the governor said that “if future revenues allow,” and based on the state Board of Economic Advisors’ updated revenue forecast in February, the General Assembly should use “additional funds to speed up the income tax cut schedule.”

The governor also wants lawmakers to allocate a one-time $500 million appropriation for the Department of Commerce to allow the agency to “satisfy all outstanding obligations and incentives without borrowing money.” The House recently approved this appropriation, and the governor said he wants the Senate to follow suit.

“An additional one-time appropriation of $200 million will allow the department to identify and secure properties for future mega-site development,” the governor said.

McMaster also highlighted additional transportation and education spending in his executive budget, including a freeze on college tuition for in-state students and increasing teacher salaries by $2,500. The governor also wants to allocate $380 million in remaining American Rescue Plan Act (ARPA) funds to continue water and sewer grants for rural communities.

In his response, state Sen. Ronnie Sabb, D-Greeleyville, said Democrats welcome the opportunity to work with the governor on initiatives like stabilizing college tuition costs. However, he noted that federal funds have helped make many of the state’s investments possible.

“The Governor mentioned many exciting initiatives in his address,” Sabb said, according to his prepared remarks. “Democrats support the plans to improve our state’s roads and bridges, expand sewer and water services, and make broadband accessible to all South Carolinians.

“But let’s be clear – many of these investments are made possible because of the passage of the federal infrastructure bill under President Joe Biden,” Sabb added. “This is an example of our federal and state government working together to accomplish great things that benefit everyone.”

National Federation of Independent Business lauded McMaster’s commitment to passing joint and several liability reform.

“South Carolina’s reputation as one of the best states for small business is being undermined by a civil justice system that leans heavily against defendants including small business owners,” NFIB State Director Ben Homeyer said in a statement.

“We agree with Governor McMaster that small businesses shouldn’t be penalized for someone else’s mistake just because they might have more money,” Homeyer added. “When a small business is sued, it has to spend tens of thousands of dollars to defend itself. Just one frivolous claim can be enough to put a small business out of business, even if the case is eventually thrown out of court.”