A bill in the South Carolina Senate
that would charge oil companies serving fuel stations in the state a 5 percent
franchise fee to help pay for road work is likely dead.
The bill failed to meet a May 1
deadline to pass the Senate. Now it will take a two-thirds vote by senators in
favor to be considered.
Sponsored by Sen. Scott
Richardson, R-Hilton Head, it would raise $268 million a year for the South
Carolina Department of Transportation, the Beaufort Gazette reported.
Intended as an alternative to raising the state’s fuel
tax on drivers, the 5-percent fee would be charged monthly to companies based
on the amount of fuel sold to fuel stations, with the revenue earmarked for
“It basically has the same effect
as the sales tax,” said Michael Covington, director of governmental affairs for
While the state’s fuel tax is paid
at the pump, the franchise fee would be charged to about 45 oil companies doing
business in the state.
A 2002 review by the
Transportation Department found a $560 million annual shortfall for maintenance
on the state’s roads and $1.3 billion shortage for new construction.
If the bill somehow passes, half
of the money generated through the franchise fee, about $134 million a year,
would go toward repairs, with a primary focus on repaving roads.
The other $134 million would go
toward the state’s larger road improvement projects.
The bill – S101 – also would allow
SCDOT to sell bonds earmarking the franchise fee as a steady revenue source.
Richardson’s proposal would
require road dollars be spread out around the state.