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Financial officer talks Act 388, mandates

Posted: October 22, 2010 1:46 p.m.
Updated: October 25, 2010 5:00 a.m.

The General Assembly is “highly likely” to reduce the local government fund for counties across the state for the third consecutive year during the upcoming legislative session, according to Kershaw County’s top financial officer, Crystal Burr.

“As the state’s general fund levels rise and fall, so does the local government fund,” Burr said during a presentation to county council Oct. 12.

Local governments in South Carolina are funded at a rate of 4.5 percent of the state’s overall general fund. Each county receives individual amounts from the 4.5 percent according to its population.

Burr recently attended the S.C. Association of Counties (SCAC) Revenue, Finance and Economic Steering Committee meeting in Columbia. The meeting was aimed at establishing the association’s policy position for the upcoming legislative session.

Act 388, the 2006 legislation that shifted local education funding from primary homeowners to a statewide one-cent sales tax increase, was one of Burr’s primary topics. The legislation has been criticized by local and state officials in recent years because of the instable revenue from sales tax.

Burr said “abuse of legal residence” and looseness of definition to qualify as a legal resident were matters of concern from county assessors during the meeting. Act 388 is an incentive to qualify for legal residence in the state, since primary homeowners are assessed at 4 percent, while secondary residences are 6 percent, she said.

Burr also said refunds for homeowners who change from 6 percent assessment to 4 percent currently can acquire a retroactive refund for up to two years. The committee is supporting legislation that gives a refund only for the current tax year.

The committee also favors removing a portion of Act 388 that places a 15 percent cap on property reassessment every five years.

In an effort to combat legal residency abuse, Burr said the SCAC committee is promoting legislation that would tighten the requirements to qualify for owner-occupied status by requiring Social Security numbers for residents of the home and better define legally separated or abandoned spouses.

State mandates were also touched on. Burr said there are several areas where the state mandates the county provide a service but doesn’t provide what counties see as adequate funding.

The state’s financial accountability act, which requires annual financial audits of all subdivisions of the state, was another point of concern, Burr said.

This would have allowed the state treasurer to “unilaterally create and implement requirements and rating systems regarding the fiscal health of individual counties,” Burr said. The committee is opposed to allowing the treasurer such a prerogative.

The SCAC is a non-partisan, nonprofit organization that maintains a full-time staff in Columbia. It’s governed by a 29-member Board of Directors, composed of county officials from across South Carolina. SCAC’s mission is to promote legislation that supports efficient administration of local government in the state.

Kershaw County has trimmed approximately $2 million from its budget during the past two years, which has hampered the Kershaw County School District, which requests funding from the county.

The steering committee meets again in November to finalize its positions on legislative matters.

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