Week of March 28, 2011 – April 1, 2011

Contentious Week for the House
Senate Focuses on Tort Reform

Assessable Transfer of Interest

The Senate Finance committee gave a favorable with amendment report to S.647, assessable transfer of interest. Committee staff explained the bill.

Senator Hayes said a similar bill came out last year and did not pass the Senate. He said there was a $52 million price tag for local government. “This basically does away with point of sale. The real estate industry said point of sale is causing an economic problem. This is a tough policy decision because we don’t want to hurt local government,” said Hayes.

He asked the committee to amend the bill to delete the retroactive reach back. The amendment was adopted.
Senator Fair asked if the fiscal impact was spread statewide and Hayes said it was spread out through the cities, counties and school districts.

Senator Land said, “We blame the recession, but we have given tax breaks over the past few years. That has got to factor in. We have underfunded our schools and colleges. It is going to take a toll on us and affect the attractiveness of South Carolina. We seem to be getting ourselves in deeper and deeper. I understand both sides. I just have to come down on the side of counties and cities. People demand the services the counties and cities create. They demand playgrounds and ambulances,” said Land.

Senator Thomas said the bill would promote economic development.

Senator Alexander said he thought it was “a positive to generate activity in the real estate market. I think it is good for us to move forward.”

Hayes expressed doubt the bill would pass.

Senator Jackson said, “There seems to be no integrity in this compromise. I don’t have anything against the realtors but what good is a compromise if two years later you come back. What they fail to say is we can live with it for 12 months so that’s my problem. I will put my name on it or offer a minority report so there is some integrity. Once you reach a compromise, it isn’t always what you want, but good people live with it.”

Senator Elliott said, “Until we get the construction industry going, we aren’t going to get the economy going again.” Senator Bryant wanted the retroactive language back in the bill.

Senator Grooms said, “We need some development in these small counties. If companies can’t turn a profit, they will go to Georgia or North Carolina.” Senator Setzler said the involved parties needed to “get to the table” for compromise.

There is a minority report on the bill placing it on the contested calendar.

Matching Funds

The Senate Finance committee gave a favorable with amendment report to S.312, defining matching funds. Committee staff explained the bill and said the Governor’s office will need $137,600 and two full time employees to implement the legislation.

Senator O’Dell offered a technical amendment dealing with federal funds and grants. His amendment was adopted.

Senator Leventis would like to require agencies to document how much federal money was available to them which was not drawn and how much it would cost the state.

Senator Davis said it seemed like a “heavy burden” to put on agencies but added he would help Leventis with amendment language.

Staff was directed to draft the amendment which was adopted in concept. Leventis said he would still work with Davis on the language.

Courson Point of Personal Privilege

Senator Courson took the Senate floor Tuesday on a point of personal privilege regarding Darla Moore. She told Courson she would not run for a seat created by S.713 should the bill pass. Courson discussed the current higher education funding mechanism and said, “The only way to sustain higher education is through private donations. The current funding system is not sustainable.”

S.431

S.431, a bill regarding liability insurance covering a construction professional, was passed by the Senate this week. The bill was assigned to the House Labor, Commerce and Industry committee.

Senator McConnell took the floor Tuesday to be heard on the bill and said, “In a nutshell, I want to try to explain this in a way y’all can understand. This is tort reform. This is consumer reform. This is insurance reform. The issue is the protection of the people of South Carolina.”

He read an advertisement on liability from 1966. He said the court determined premiums were paid on this based on the fact that they had coverage. He added the Crossman case revokes that and all of insurance companies construe it that way. “To me, the contract is that these contractors thought they had coverage. Premiums charged to people of this state were made on an actuarial basis. The reality is that if we don’t pass this bill, insurance companies will march into the sunset with a bag of cash and people of this state are left with no coverage. It would make a leprechaun blush,” said McConnell.

Senator Larry Martin asked if there have been no disputes since 1966. If not, there would have been no court case. He asked if the rates were determined by the state. McConnell said premiums were set in a certain way since 1966.

Senator Thomas said the ruling “was totally arbitrary on the part of the court.” He said there were no ambiguities in this case. “I can’t believe the court would allow a novel, new attack on the consumer,” said Thomas. He expressed shock that there are sweeping changes that are retroactive to the state’s construction laws. McConnell said, “There will be a big sweep into the coffers of the insurance companies too.”
Senator Land asked if this causes a larger exposure for the consumer. He says that it has really impressed upon him that insurance companies say they cover the “occurrence.” Only one said they did not.

Senator Hutto asked how in a competitive industry like insurance, there could be so much variance on this between 6 companies and not the 1?

McConnell said it was about “constitutionality and truth in advertising and serving the people, not the words of lawyers and contract specialists.”

Senator Rankin took the podium. He said, “Potentially billions of dollars have been extracted by construction companies for premiums that no one will get the benefits of.” He said over the weekend, calls were made to Senators asking them to “not insult the court.” Rehearing on the case is on May 21st.

Land asked if there was equity in the size of exposure for companies who did settle as opposed to those who did not. Rankin said the suit was worth $16.8 million. Land said he is concerned that they are second guessing the Supreme Court so quickly now that the case is being reheard.

The committee amendment was adopted.

Senators Sheheen, Rankin, Massey and Coleman offered an amendment which was adopted. The amendment is to ensure “The insurance policy covers what was contracted.”

Martin said it changes the Supreme Court decision. McConnell said the amendment “protects homeowners across South Carolina. We want to make sure consumers are protected and covered.”

Senator Peeler spoke against the bill. He said the issue should be settled by the Supreme Court. Senator Anderson agreed with Peeler. McConnell said the legislature made law, not the courts.

Born Alive

The House of Representatives passed H.3403, “Born Alive.” Representative Delleney clarified the bill applies only “to a child born in an abortion clinic.”

Representative Cobb-Hunter questioned how hospitals will “recoup the cost of these life saving techniques.” Delleney responded, “I don’t put a price on life.”

Representative James Smith said this was already federal law. Delleney said it was only applicable to federal hospitals and federal healthcare facilities.

Representative Hart asked Delleney if he believed in God and if he believed in the death penalty and how he reconciled his beliefs.

Cobb-Hunter discussed the rights of women.

Delleney said, “The chief end of government is to restrain evil.” He discussed Roe v. Wade.

Representative Harrison raised the point of order that the bill was not about abortion. The point was sustained.
The bill was referred to the Senate Judiciary committee.

Conscientious Objectors

The House of Representatives passed H.3408, healthcare provider conscientious objections, this week. The bill was in debate for over four hours Wednesday.

The bill was amended by the House Judiciary committee to address health insurance coverage for abortions through federally mandated health exchanges.

The committee amendment was adopted. All other amendments were tabled or withdrawn.

Representative Cobb-Hunter spoke at length against the bill and said she wished she could be a “fly on the pearly gates” when they arrived and were denied entry.

Representative Skelton said he believed the bill invalidated at-will employment.

Representative James Smith said, “Every year we chip away at private rights because of our arrogance.”

Representative Boyd Brown said the legislature should be focusing on jobs.

The bill was referred to the Senate Medical Affairs committee.

Texting Bill Stymied

S.225, texting while driving, was debated by the Senate Wednesday without resolution. Senator Grooms offered an amendment going beyond texting to delineate careless driving. Grooms said, “Anything that distracts you would be breaking the law.”

Senator Leatherman said the amendment was “subjective.”

Senator Larry Martin said you had to have evidence and that he sees people driving and reading a book everyday.

Grooms said, “Keep your eyes on the road and your hands on the wheel.”

There was discussion on what could be classified as a distraction. Grooms saw the amendment as an “enhancement to the bill.” Senator Knotts did not agree. The Senate moved on to other issues.

Cleary Point of Personal Privilege

Senator Cleary took the Senate floor Wednesday on a point of personal privilege on his bill S.461, mandatory recycling.

Cleary said that landfills are not a problem in some areas in the state. He said, “In rural areas there is a problem and recycling programs are needed.”

Senator Bryant told Cleary he was against government telling private businesses they have to recycle. “Now the government is telling us what kind of light bulbs we have to use. I am against the heavy hand of government,” said Bryant.

Cleary responded, “This is not a heavy hand. It is a velvet glove.”
S.461 is on the Senate contested calendar. Senators Cleary, Elliott and Rankin have placed their names on the bill.

Other Funds Oversight Committee

The Joint Other Funds Oversight committee carried over for a second time the request by the Department of Health and Environmental Control for the use of $5 million from the cigarette tax.

The concerns expressed by committee members regarded the community partnership grants, the school programs and the church and faith based programs. Representative White said the department needed to find another plan. The committee did approve $850,000 for the smoking cessation line.

Corrections & Probation, Pardon and Parole

The House of Representatives passed H.3267, restructuring the Department of Corrections and the Department of Probation, Pardon and Parole into one agency.

Bill sponsor Representative Sellers explained the committee amendment which was adopted. He said the amendment was technical in nature.

Representatives Rutherford and Hart argued against the bill, saying it would not be a cost savings.

Hart was successful in passing an amendment in having the department provide inmate training designed to help them pass the GED. Representative Howard said the amendment would save state money. All of his other amendments were tabled or withdrawn.

Representative Govan spoke in favor of the bill. Representatives Mack, Rutherford and Howard spoke against the bill. Several members were upset because the only agency with an African-American agency head is the PPP agency.

Representative Lucas was serving as Speaker when Representative Stavrinakis raised a point of order on the behavior of House members during debate. Lucas admonished the members for their behavior.

Howard ended the debate by telling Sellers he was young and making mistakes.

The bill was referred to the Senate Corrections and Penology committee.

Malloy Point of Personal Privilege

Senator Malloy took the Senate floor on a point of personal privilege Thursday on the corrections system.
He said the population has been reduced during the last year and the state was “making progress.”

He applauded the bi-partisan effort to reduce the population.

Tort Reform

Senator Larry Martin explained the major points of H.3375, tort reform, to the Senate members Thursday prior to adjournment.

The bill is on the Senate calendar in interrupted debate status.
He said they came close to working things out in conference committee last year but ran out time. He said the bill addresses punitive damages, the retention of a private attorney, the building code section and the seatbelt section.

The Senate will debate the bill next week.

Knotts Judiciary Subcommittee

Frank Rainwater, State Treasurer’s Office, gave sworn testimony Thursday morning to a Senate Judiciary subcommittee. He did not give the subcommittee any new information regarding the Health and Human Services deficit.

Delbert Singleton, Budget and Control Board, also gave sworn testimony on the agendas of the Budget and Control Board. He said the deficit was on the December meeting but was carried over. He was not able to contribute any new information.

S.434

The House of Representatives gave S.434, provider rates, a second reading Thursday. All attempts to amend the bill failed.

With approximately 40 amendments on the desk, Chairman Cooper called for the question. The responding House vote effectively invoked cloture on the bill. No additional amendments were accepted and current amendment debate was limited to 3 minutes for opponents and 3 minutes for proponents.

Most of the amendments were withdrawn. Several of the amendments were designed to protect the rural hospital system.

Representative Govan spoke against the bill saying it was not business friendly. He said they should recognize the bill does not make sense.

Representative Ott also spoke against the bill. He said he was waving the white flag. “We have moved from good ideas to let’s hit our target no matter what the consequences. We are going down a dangerous path. I say to you, when we give up our right to have honest debate, we are in trouble.”

Representative Skelton spoke in favor of the bill. “Some of us in favor of this legislation have been made out as hard-hearted. That’s not true. We care about these people. No one is going to be denied medical service. All this does is let them share some of the pain others have shared. South Carolina is the only state that prohibits provider adjustments,” said Skelton.