COLUMBIA — South Carolina is as close as ever in recent years to raising its near-national low gas tax to pay for road repairs.
But lawmakers and the governor could still keep the money-generating proposal in the garage.
After weeks of sniping at each other, Senate and House lawmakers must work out their differences in the bills they passed during the final three weeks of the session.
Cross-chamber negotiations won't be made any easier by the looming threat of a veto from Gov. Henry McMaster, who continues to oppose any gas tax increase from the current near-17 cents a gallon.
Even getting to this point is a victory for supporters of using a fuel tax hike to pay for fixing 40,000 miles of roadways. The Senate late Wednesday night passed a roads bill that would raise the gas tax for the first time in 30 years — something that eluded the body in past sessions as they resorted to re-routing existing funds and pumping other one-time monies into the state's roadways.
But the Senate altered the bill that passed overwhelmingly in the House in March, likely extending debate between the two chambers in order to reach a consensus.
House Majority Leader Gary Simrill, R-Rock Hill, said he wants any compromise between the two chambers to include the two major components of the original bill: reform and a recurring stream of dependable annual revenue dedicated to roads.
“What I’m going to do is take them and line them up side by side and make sure that two pieces of the puzzle will go together,” Simrill said. “But what we passed in our bill is what needs to be in this other bill.”
The House version of the bill features a 10-cent per gallon gas tax increase over five years (two cents per year), increases in driver's license and vehicle-permitting fees, and changes to how the state's Department of Transportation Commission members are chosen and removed.
In the Senate, however, Democrats and a group of Republicans compromised by bumping up driver-related fees, increasing the gas tax by 12 cents over six years (two cents per year), changing the management structure of the DOT commission in several other ways, and adding a number of alternative tax cuts and rebates to offset the hike at the gas pump.
Both plans would raise around the same amount of money for highway and bridge repairs in South Carolina — roughly $600 million every year once the taxes are fully implemented.
DOT Secretary Christy Hall has told lawmakers she needs around $500 million just to improve road pavement in the state. That doesn't include the estimated $50 million Hall says is needed for upgrades to dangerous rural roads and the roughly $46 million to repair substandard bridges throughout the state.
But the college tuition rebates, earned income tax credits, manufacturing property tax cuts and vehicle maintenance deductions that are all in the Senate proposal could also require hundreds of millions of dollars to be allocated out of the state's reserve and general revenue funds to pay for those offsets.
"The question for the House is, do you want a bill that satisfies the House or do you want a bill that becomes law?" Senate Transportation Committee Chairman Larry Grooms, R-Charleston, said, adding that representatives may have to accept most or all of the Senate's tax deductions.
While Simrill and other House members criticized the Senate's compromise solution because it complicates the House version, they may have a limited number of choices in a conference committee to reach a solution.
If most or all of the Senate's version of the bill doesn't get approved, lawmakers negotiating the bill risk losing a large number of senators. They are opposed to the bill without the alternative tax deductions and their DOT reform efforts, which give the governor the power to remove DOT commissioners whenever he wants.
“If we’re looking at straight revenue, I think we’re going to have a hard time over here to get to 30 (votes),” said Senate Majority Leader Shane Massey, R-Edgefield. “So hopefully they’ll be willing to look at some type of (tax cut) offset to some degree.”
Massey and other Senate Republicans who voted for the gas tax because of last-minute changes could be essential to the bill actually making it into law since McMaster continues to oppose any type of tax increase, even if its completely dedicated to roads.
South Carolina's 16.75-cent per gallon tax is the nation's second lowest, trailing only Alaska, according to data from the trade group American Petroleum Institute.
Brian Symmes, McMaster's spokesman, said Thursday the governor's opposition to the gas tax bill hasn't changed, even with the alternative tax deductions in the Senate.
McMaster wants more dramatic changes that give his office even more authority over transportation planning and spending decisions.
"The Senate does not have the votes to override a veto if it is just a revenue-raising measure," Grooms said. "And I, for one, would not vote for a strictly revenue raising measure."
Meanwhile, business groups that have pushed for additional funding for the state's roadways both this session and in past years are hoping something can be worked out so the bill can get around McMaster's desk.
"Now is the time for the House and Senate to come together and deliver for the people of South Carolina," said Ted Pitts, president of the S.C. Chamber of Commerce. "When it comes to infrastructure, we simply can't afford to wait another year."
Rick Todd, president of the S.C. Trucking Association, which represents roughly 600 corporate members in South Carolina, said the gas tax remains the most equitable way to fund needed infrastructure replacements in the state.
"We salute the Legislature for doing this in a smart and reasonable way, and a cost competitive way, in order to be able to invest in our infrastructure," Todd said.
Anti-tax groups and lawmakers who want to transform the DOT into a full executive agency where the governor has almost exclusive control of state highway planning and funding, still showed opposition.
"There is no debate that South Carolina’s roads need repair," said Phillip Joffrion, regional director for Americans for Prosperity, a conservative advocacy group. "But with a DOT that is still totally unaccountable to the people, we fear that this gas tax increase will be essentially meaningless."