§ 11-41-20 — Increase in general obligation debt limitation.

South Carolina § 11-41-20

• Jurisdiction: South Carolina
• Title 11: PUBLIC FINANCE
• Ch. 41: STATE GENERAL OBLIGATION ECONOMIC DEVELOPMENT BOND ACT

Text

As incident to this chapter, the General Assembly finds: (1) That by Section 4, Act 10 of 1985, the General Assembly ratified an amendment to Section 13(6)(c), Article X of the Constitution of this State, 1895. One amendment in Section 13(6)(c), Article X, limits the issuance of general obligation debt of the State such that maximum annual debt service on all general obligation bonds of the State, excluding highway bonds, state institution bonds, tax anticipation notes, and bond anticipation notes, must not exceed five percent of the general revenues of the State for the fiscal year next preceding, excluding revenues which are authorized to be pledged for state highway bonds and state institution bonds. (2) That Section 13(6)(c), Article X, further provides that the percentage rate of general revenues of the State by which general obligation bond debt service is limited may be reduced to four or increased to seven percent by legislative enactment passed by a two-thirds vote of the total membership of the Senate and a two-thirds vote of the total membership of the House of Representatives. (3) That pursuant to Section 13(6)(c), Article X, the General Assembly, in Act 254 of 2002 and Act 187 of 2004, increased to five and one-half percent the percentage rate of the general revenues of the State by which general obligation bond debt service is limited with the additional debt service capacity available at any time as a consequence of the increase available only for the repayment of general obligation bonds issued to provide infrastructure required for significant economic development projects within the State, including those related to the life sciences industry that create high-paying jobs and meet certain investment criteria. (4) That pursuant to Section 13(6)(c), Article X, the General Assembly, in Act 187 of 2004, increased to six percent the percentage rate of the general revenues of the State by which general obligation bond debt service is limited with the additional debt service capacity available at any time as a consequence of the increase available only for the repayment of general obligation bonds issued to advance economic development and to facilitate and increase research within the State at the research universities. (5) That Section 13(5), Article X, provides that if general obligation debt be authorized by two-thirds of the members of each House of the General Assembly, then there shall be no conditions or restrictions limiting the incurring of such indebtedness except those restrictions and limitations imposed in the authorization to incur such indebtedness, and the provisions of Section 13(3), Article X. (6) That Section 13(5), Article X, provides additional constitutional authority for bonds authorized by this chapter. (7) In order to continue fostering economic development within the State as set out in subsections (3) and (4), it is in the best interest of the State that the General Assembly authorize an additional amount of general obligation debt pursuant to Section 13(5), Article X, with such indebtedness limited to a principal amount of general obligation debt not exceeding one hundred seventy million dollars at any time, provided that no more than a total of one hundred seventy million dollars of proceeds may be used for any one project regardless of available capacity. (8) That in order to support significant economic development projects in this State which will satisfy the investment and new jobs creation criteria set forth in Section 11-41-30(2)(a)(ii), the General Assembly finds that sufficient debt service capacity exists below the original five percent threshold established by Section 13(6)(c), Article X, to allow the issuance of general obligation debt, with such indebtedness limited to a principal amount of general obligation debt not to exceed one hundred twenty million dollars, and that the authorization of this general obligation debt supports a public purpose and is in the best interest of the State.

Legislative History

HISTORY: 2002 Act No. 254, SECTION 1; 2004 Act No. 187, SECTION 3.A; 2009 Act No. 124, SECTION 5.B; 2013 Act No. 13, SECTION 2, eff April 23, 2013. Validity For the validity of (2) of this section, see Pinckney v. Peeler, 862 S.E.2d 906 (S.C. 2021). Editor's Note 2013 Act No. 13, SECTION 1, provides as follows: "SECTION 1. The General Assembly hereby finds, as a fact, that the construction of infrastructure, as defined in, and subject to the terms and conditions of, the State General Obligation Economic Development Bond Act, for use by private parties enhances the recruitment of businesses to the State and the expansion of businesses within the State, facilitates the operation and growth of businesses in the State, and thereby provides significant and substantial direct and indirect benefits to the State and its residents, including employment and other opportunities; that such benefits outweigh the costs of such infrastructure; that for such reasons it is in the best interest of the State to authorize the issuance of economic development bonds as defined in, and subject to the terms and conditions of, the State General Obligation Economic Development Bond Act; and that such economic development bonds, issued for such purpose, serve a public purpose in fostering economic development and increasing employment in the State. The General Assembly further finds, as a fact, that the primary beneficiaries of the issuance of such economic development bonds and the construction of such infrastructure are the State of South Carolina and its residents." Effect of Amendment The 2013 amendment added subsection (8), relating to Section 11-41-30, and made other nonsubstantive changes.