South Carolina bills would raise road funds

By Keith Goble, Land Line state legislative editor | 3/12/2013

A bill that is halfway through the South Carolina statehouse would use revenue from vehicle sales to set up a dedicated funding source for roads and bridges throughout the state.

South Carolina law now routes tax from vehicle sales into the state’s general purpose fund.

The Senate Finance Committee could soon consider a bill to shift about $82 million annually from the general fund and put the money into the state highway fund. House lawmakers already approved H3412 on a 92-5 vote.

“This is the kind of tax reform we need to make our state more competitive and this bill is just one part of the comprehensive tax overhaul the House has been fighting for,” House Speaker Bobby Harrell, R-Charleston, said in a news release.

The infusion of cash into the highway fund would solve a portion of the state’s shortage of money available to upkeep roads and bridges. A task force created by the state Department of Transportation determined that the state needs about $30 billion in new revenue during the next 20 years.

A related effort would increase the fuel tax rate by a dime. However, H3498 includes two and one-half years of income tax refunds for the state’s motorists.

Other proposals to generate revenue for roads include a bill – S139 – to use 5 percent of each year’s new money in the general fund.

Another option before lawmakers would index the state’s fuel tax – allowing for regular increases. Related fees would also be applied to owners of hybrid and electric vehicles.

Initially, a 5-cent-per-gallon increase would be imposed on gas and diesel purchases. H3645 would cap annual increases at 1.5 cents.

The state’s 16.75-cent fuel tax rate has not changed since 1987. It raises about $500 million annually.

Gov. Nikki Haley is opposed to increasing the tax at the pump. Instead, she has called on DOT officials to do a better job of managing money already available to the state.

The governor has offered a one-time funding option that would use $100 million of surplus revenue for transportation.

One more plan calls for borrowing $500 million for local roads. S411 would determine local funding for counties on a formula using population, area and rural roads.

To view other legislative activities of interest for South Carolina, click here.

Editor’s Note: You are welcome to share your thoughts with us about this story. Comments may be sent to

Copyright © OOIDA