COLUMBIA -- New homes in South Carolina could be built without fire sprinklers if the Legislature agrees to reject recently adopted construction standards. The move could cut about $8,000 in added home construction costs but also could boost home insurance rates across the state.

Legislation to give people the option to install fire sprinklers in new site-built homes is awaiting action in the House and Senate when lawmakers return to session Tuesday. More than a dozen states have thrown aside the mandate while a few states will require sprinklers.

If the state Legislature does nothing, fire sprinklers will have to be installed in new residential properties after Jan. 1, 2011, including single family homes and duplexes. The requirement does not apply to manufactured homes.

Insurance impact?

The state Department of Insurance does not take a position on pending legislation, but Ann Roberson, public information officer for the agency, said rate increases are possible.

If the Legislature votes to waive the sprinkler mandate, homeowners' insurance rates for new construction could increase across the state, including for policyholders in Berkeley, Charleston and Dorchester counties. An estimate on premium increases is not available.

Roberson said only homeowners who move into a new home, or one that has been renovated, are expected to see an increase in homeowner's insurance rates.

If the Legislature changes the fire sprinkler code requirement, it also could cause flood insurance rates to go up in coastal areas, Roberson said. That's because of the complicated system by which some insurance companies, but not all, calculate insurance risk and insurance rates.

The state insurance department projects that policyholders in the city of Charleston, Beaufort County and Rockville could see a 5 percent increase in flood insurance premiums, she said. New flood insurance rates might apply to all homeowners, not just new ones. Still, it remains uncertain what, if any change might occur in insurance premiums.

On the flip side, Roberson said the sprinklers systems are expected to give homeowners a break in insurance rates of up to 15 percent.

Sen. David Thomas, R-Greenville, is worried about the long-term effects on the access and affordability of insurance in the state. Thomas, a longtime champion of fire sprinklers and a candidate for Congress, said the Legislature must evaluate the unintended consequences of the legislation to be sure that passing the legislation doesn't lead to de facto increases for all.

Requirement vs. option

The debate pits home builders against fire safety officials.

South Carolina Fire Marshal John Reich said the state should require fire sprinklers in new homes. The rate of deaths in fires in the state is almost double the national average, and home sprinklers are one way to improve safety dramatically, he said.

The construction standards that mandate the sprinkler systems, adopted by the S.C. Building Codes Council in late February, are minimum standards for protection, Reich said. He is a member of the building council.

"My job is to protect the lives of citizens in South Carolina," Reich said.

The requirement for smoke alarms was met with similar resistance in the 1970s, Reich said.

Mark Nix, executive director of the Home Builders Association of South Carolina, said builders are not opposed to the installation of fire sprinklers but argue that the homeowners deserve the option. He estimates that sprinklers could cost between $4 to $6 a square foot. For a 2,000 square-foot home, that would run $8,000 to $12,000.

Such an increase on the cost of a house would knock an estimated 17,000 to 25,000 families out of the housing markets, Nix said. What's more, he said, insurance rate increases are not a guaranteed consequence of rejecting the new construction standards. Three states opted out of the mandated fire sprinklers last year, but they have not seen a change in rates, according to Nix.

Reich thinks Nix's cost estimate is high. He said sprinklers would be available at $2 to $4 a square foot.

Finding resolution

The bill pending in the Senate also would create a group to study the existing tax credits that were intended to be incentives so more people would install sprinklers. But so far, no county or municipality has offered the incentives, according to Warren Harley, governmental affairs liaison for Municipal Association of South Carolina. He said more flexibility needs to be built into the tax credit incentives to viable options.

The incentives were put in place after the Sofa Super Store fire in 2007 that killed nine Charleston firefighters.

Rep. Chip Limehouse, R-Charleston, said requiring fire sprinklers in homes is inevitable given the safety advantages. But because of the economic situation, it might be best to delay the requirement, he said. In the meantime, the state should focus on improving fire safety in manufactured homes.

"Fire sprinklers in new construction have got to happen; it's just common sense," he said. "It's just that the industry has been hit particularly hard with the recession."