SCACS has been working with the legislature, state agencies, and other tobacco stakeholders to statutorily extend a grace period to allow retailers to sell tobacco products that don’t have tobacco stamps affixed to them. The Department of Revenue granted retailers a 90 day grace period that ends on April 1st, 2019. Without legislation extending the timeline, all tobacco products without tax stamps affixed would then be considered contraband.
Governor McMaster & Staff
Attorney General Alan Wilson and Staff
Hartley Powell, Director of Department of Revenue & staff
House Ways & Means Chairman Murrell Smith (R – Sumter)
Senate Labor & Commerce Chairman Thomas Alexander (R-Oconee)
As of February 2, 2019 = A quick update on where we stand with the tobacco stamp extension legislation. See extension language for the joint resolution from the Attorney General’s office that all of the stakeholders have agreed to. (see attached). The Senate version of the Joint Resolution got out of subcommittee with an extra 90 days added by Senator Scott (D-Richland). This would mean that our grace period would be extended until October 1 instead of the original July 1 deadline. The meeting schedule for next week has not posted yet, but we anticipate that the Joint Resolution will be on the docket the next time full finance committee meets.
Regarding our House Joint Resolution, McGuireWoods rep spoke with Ways & Means Chief of Staff Friday afternoon to get the status on the House resolution. He informed him of the date change in the Senate and that our association was going to be supporting the new October 1 timeframe. He said that he would talk with Chairmen, Murrell Smith to find out if they were going to change the date to match the Senate version or keep the original language agreed to by all the parties. McGuireWoods has a call scheduled with him to talk Monday.
As of February 11, 2019 = Joint Resolutions in both the House and Senate came up on 2/7/19 at the exact same time. Both bodies adopted amendments to give tobacco retailers until October 1st to get tax paid, but unstamped cigarettes sold or otherwise disposed of. The House then passed their amended version on 2nd reading and then voted by unanimous consent to give it a 3rd and final reading on 2/8/19. It will head to Senate on Tuesday 2/12/19.
The Senate adjourned debate on their resolution when Senator Malloy from Darlington wanted the weekend to “talk to his folks back home”. The Senate sponsor, Senator Alexander, as well as the Senate Finance Committee staff have been alerted that the House version is headed their way with the hopes that they can act on that version since it will have already passed that one body.
As of February 15, 2019 = S.398, the senate version of the tobacco stamp extension hit a slight bump when Senator Gerald Malloy (D-Darlington) put forward an amendment that would require retailers to conduct inventory on the product and submit a form to the Department of Revenue listing their inventories. The Department of Revenue did not request this amendment and it only seeks to add confusion where none should be. SCACS lobbyists met with Senator Thomas Alexander (R-Oconee) the Senate Bill sponsor regarding the Malloy amendment. In an effort to keep the bill moving in the Senate, Senator Alexander decided not to contest the amendment because there are multiple ways to correct this amendment while keeping in mind we’re working on a April 1 deadline. SCACS lobbyists will work with key allies in the Senate to work off the House version of the bill and to come up with a reasonable solution to Senator Malloy’s inexplicable inventory amendment.
As of February 25, 2019 = McGuireWoods attended a Senate Finance Committee for H. 3849 (cigarette tax stamps) on Tuesday, February 19. The bill was passed out of committee favorably with the Oct 1 deadline in place. Billy Boan spoke with Senator Alexander (R-Oconee) regarding H.3849 strategy. The House bill will be up on the Senate floor this week and the Senate bill has been sent to House Ways & Means Committee – more information to come by end of week.
As of March 1, 2019:
Store Operators will now have until October 1, 2019 to sell all unstamped tobacco products in their stores before they become contraband. Stores will be required to fill out a form listing what unstamped inventory they had as of January 1, 2019.
Joint Resolutions were introduced in the House and Senate that would extend the deadline to sell unstamped tobacco products from the current DOR deadline of April 1st to October 1, 2019. An amendment (attached) was added in the Senate by Senator Malloy (D-Darlington) that requires retailers to list their unstamped inventory on a form created by DOR by March 31st in order to participate in the extension. We will work with DOR to ensure that all of our members receive the form. To clarify, there is no enforcement mechanism in the bill that DOR can harass our members with. We’ve had conversations with Chairman Murrell Smith (R-Sumter) and Senator Thomas Alexander (R-Oconee) and asked them to reach out to DOR to let them know that they just want DOR to collect the form and not try and use this as a mechanism to harass our members. Senator Alexander spoke with us and told us he has already reached out to the department to deliver that message. The House concurred with the Senate’s amendment and it will now be enrolled for ratification and sent to the Governor’s office for his signature. We’ve reached out to the Governor’s office to let them know we are supportive of H.3849 and we would ask that the Governor please sign the bill into law.
Rep. Gary Simrill (R-York) and Rep. Todd Rutherford (D-Richland) pre-filed H.3274 (Tobacco Pre-emption) that would prevent local governments from banning certain tobacco and vaping products. This bill would prevent any local government from banning tobacco/e-cigarette products based on ingredients, flavors and licensing requirements on those products.
Gary Simrill, House Majority Leader (R-York)
Todd Rutherford, House Minority Leader (D-Richland)
SCACS testified in support of this bill at the Ways & Means subcommittee and it received a favorable report unanimously. The bill was then reported out favorably by the full Ways & Means committee. It will likely be taken up in the House as early as next week (Week of February 4th). It will be important that we have SCACS members reach out to their legislators to push them to support this statewide tobacco pre-emption bill.
Status Update as of March 1, 2019:
The House passed H.3274 which prevents local governments from implementing ordinances that would create flavor bans or licensing requirements. The Senate subcommittee recently met on the Senate version of the bill (S.492) but carried it over to hear more testimony on the bill.
There are a number of preemption bills up this year, including auxiliary containers (plastic bags) that look to preempt local government from implementing bans of certain products which are detrimental to the business climate of the state. Tobacco preemption is farther along than other preemption bills and we are optimistic that it has a chance to get to the Governor’s desk. The biggest hurdle for the legislation will be the Senate where it will be difficult to circumvent objections from a few senators.
Status Update as of March 1, 2019:
The Senate took up S.394 in subcommittee but carried it over and it will not see another subcommittee hearing for 3 weeks. This will likely mean that the legislation is unlikely to pass in 2019.
Status Update as of March 1, 2019:
Senate Medical Affairs subcommittee took testimony on S.525 which would eliminate the sunset provisions related to the SUPERB Financial Responsibility Fund and it was unanimously adopted and sent to full committee. We expect there to be little opposition to this bill moving through the Senate.
Rep. Beth Bernstein (D-Richland) introduced 3 bills in the House regarding prevention of youth access to vaping products. The 3 bills were combined into one bill (H.3420). The bill addresses youth vaping prevention at schools, requiring additional measures for online purchases of vaping products, and preventing youth from entering tobacco/e-cigarette shops. SCACS worked with Rep. Beth Bernstein to add additional language to ensure that the legislation would not prevent youth from entering convenience stores.
Rep. Beth Bernstein (D-Richland)
SCACS successfully worked with Rep. Beth Bernstein to ensure that the legislation would not prevent youth from entering convenience stores. The bill was adopted unanimously by the House Judiciary Committee and is scheduled to be taken up in the House chamber next week (Week of February 4th).
The SC Chamber and Republicans are pushing for wholesale tax reform. This would include getting rid of certain exemptions that are currently in statute.
SC Chamber of Commerce
Speaker of the House, Jay Lucas (R-Darlington)
House Ways & Means Chairman Murrell Smith (R – Sumter)
Senate Finance Chairman Hugh Leatherman (R – Florence)
Bills have not been introduced yet, but we are monitoring this because we anticipate that large tax reform could have an impact on SCACS members.
2018 Legislative Issues:
H. 3529 – Auxiliary Containers (Plastic Bag Bill)
On Jan. 10, the S.C. Conservation Coalition held a briefing for legislators where Folly Beach Mayor Tim Goodwin gave an update on the plastic bag legislation from 2017. Mayor Goodwin stated that the bill takes away a town or city’s ability to address local problems with pollution, and violates home rule. The majority of legislators in attendance were senators, who have not yet had the opportunity to hear testimony or take action on the bill. The bill remains on the House floor, after debate was adjourned on the bill on Jan. 10.
S. 831/H. 3777 – Cigarette Tax Stamps
S. 831 classifies cigarettes found at any point within the State without the required stamps contraband goods under certain circumstances, including if the cigarettes are found in the possession of a person offering them for sale or distribution and that person is not the first to receive the untaxed cigarettes in the state, or if the person is offering them for sale at retail within the state. The Senate passed the bill in February, and the House Ways and Means Committee has yet to act on the bill.
S. 575/H. 3664 – Cigarette Surtax
S. 575 revises the weight limitation on cigarettes from 3 pounds or less per one thousand cigarettes to 4.5 pounds or less per one thousand cigarettes. The bill also exempts cigarettes wrapped in tobacco leaf with no filter. The bill was introduced in 2017, and has yet to be taken up by the Senate Finance Committee.
H. 3650 – SC Business License Tax Standardization Act
The Business License Tax Standardization Act amends and standardizes how localities can impose business licenses taxes. It is an effort to ease regulatory burdens on businesses operating in multiple localities. The bill was recommitted to the House Labor, Commerce and Industry Committee in March.
S. 819 – Beverage Container Recycling Act – New Introduction for 2018
The Beverage Container Recycling Act requires a refundable deposit for certain types of beverage containers, and establishes provisions for redemption centers that may be operated by a store. The bill was pre-filed in December 2017 and referred to committee on Jan. 9.
Help SCACS – Make your Voice Heard!
Dear SCACS Member,
Make your voice heard! As a benefit of being a member of the South Carolina Association of Convenience Stores (SCACS), you have asked SCACS to fight for you at the statehouse level and keep you updated on legislative issues that arise.
Well, you have the opportunity to help SCACS, as owners, employees, voters, volunteers and contributors to the communities where you live and work, your voice and opinions are extremely important and influential to SCACS and our grassroot efforts.
SCACS has worked with a company called RAP Index and now has a way to gauge the reach of our collective networks and enable us to effectively plan for the future policy discussions. By understanding our network of relationships with elected officials, we can build advocacy programs that help advance our positions on any number of legislative issues that directly impact you and your business.
Please take a few minutes of your time to take this brief survey below by clicking on the link or button below, because your participation WILLmake a difference for SCACS.
Thank you for your time and support,
Chairman of the Legislative Committee