The South Carolina General Assembly adjourned on May 10, 2018 completing the two-year session. However, the Assembly will return in late June to complete the state budget as well as deal with issues surrounding the V.C. Summer Nuclear Plant closure and also taxation. Below is a discussion of issues enacted or still pending important to banking.
For a more detailed discussion of bills handled during the 2018 session, click here to view the latest SCBA State Legislative Update. The General Assembly’s website can be found at www.scstatehouse.gov.
Credit Unions – Field of Membership (S337) – Now enacted, S337 codifies an operational instruction the Board of Financial Institutions issued in 2001 that allowed state-chartered credit unions to have a community charter. Federal credit unions can already have a community charter. S337 also contains four other provisions that are already allowed for federal credit unions:
- Credit unions may offer check-cashing and money transmitter services to those in their field of membership:
- Credit unions’ boards are not required to meet in person each month but may meet through email;
- The cap on fixed asset investment was removed; and,
- Credit unions may invest in charitable donation accounts.
The bill still fully protects all measures SCBA fought for, particularly: no greater powers than federal credit unions, full regulatory approval for field of membership expansion and no field of membership expansion through the Internet or ATMs.
Tax Conformity (H5341) – Passed by the House but not considered yet by the Senate. Conformity issues may still be considered when the General Assembly returns June 27th and 28th. Each year South Carolina must pass a bill that conforms SC tax law with the latest IRS rules. This year, due to the federal tax reform, if South Carolina conforms to the federal changes in exemptions and deductions, there will be a $225 million windfall to the state as SC has not adopted rate changes. To correct this, H5341 creates a personal exemption for individual taxpayers and then decouples from a number of federal tax exemptions for businesses. For banking, banks with assets greater than $10 billion would be negatively affected without this decoupling.
Bank Tax Credits – (S1043) –The bill is now in conference committee and can be considered in the extended session. This bill extends for three more years the Abandoned Buildings Revitalization Act that offers tax credits to rehabilitate these buildings. Many banks buy these tax credits for their own lax liability use. The bill also reauthorizes the present CDC and CDFI investment and tax credit program.
Appraisal Management Companies (S279) – Enacted. S279 establishes a licensing and regulation system for AMCs and takes effect immediately.
Property Exempt from Levy in Bankruptcy (H3176 & H3429) – Enacted. H3176 provides a full exemption for funds in an IRA. H3429 establishes a firearm exemption up to $3000 totaling no more than three firearms. H3429 also provides a $50,000 homestead exemption for a surviving spouse’s interest in a residence.
PACE Loans (S261) – Passed by the Senate but not taken up by the House. The bill is now dead. S261 created Property Assessed Clean Energy (PACE) loans for commercial properties that wish to improve their energy systems. The PACE lien would be senior to a mortgage to the extent of any arrearage. The bill included SCBA’s language that requires the bank’s express approval to the lien as well as the loan before any financing can occur. PACE loans could not be made for residential properties and SCBA was opposed to any amendment that would allow residential PACE loans.
For a more detailed discussion of bills handled during the 2018 session check back on the latest SCBA State Legislative Update. Also, the General Assembly’s website can be found at www.scstatehouse.gov.
The SCBA Government Relations team actively monitors and lobbies on all bank-related state legislation throughout the year. Please contact Neil Rashley at (803) 779-0850 or firstname.lastname@example.org if you have any questions on state legislation, regulations or related matters.