Commission approves ballot question for new penny tax
Members of the Darlington County Capital Project Sales Tax (CPST) Commission discuss the need for a penny sales tax referendum. Photo by Samantha Lyles
By Samantha Lyles, Staff Writer, slyles@newsandpress.net
The Darlington County Capital Project Sales Tax (CPST) Commission met Monday, April 23 and approved language for a 1-percent sales tax referendum, which could be placed on the ballot for voter approval this November.
Comprised of six members representing County Council and the municipalities of Hartsville, Darlington, Lamar, and Society Hill, the CPST Commission was charged with reviewing and approving the language of a ballot question which could levy a new penny sales tax on retail purchases throughout Darlington County. Proceeds would be used to finance construction of a new county courthouse and – possibly – new administration offices.
Currently, South Carolina’s base sales tax is 6 percent, and Darlington County tacks on a one-percent Local Option Sales Tax (which the county and municipalities use for taxpayer relief), and another one percent for the Darlington County School District (renewed by voter referendum in November of 2016). Adding another penny would bring Darlington County’s de facto sales tax to 9 cents per dollar.
Though their only responsibility was to decide on a how long the CPST would be imposed (minimum of two years, maximum of eight years before requiring extension through another public referendum) Commission members were presented with other information.
The estimated cost of building a new judicial center is $10.75 million, and a new administration building could cost $4.83 million. The cost of tearing down the current courthouse and administration building (constructed in 1965) is estimated at $3.36 million, not including permits and landfill fees. The total cost for all three projects is estimated at $18.94 million.
Using SC Department of Revenue figures for the DCSD penny tax yields from fiscal year 2017 as a model, Darlington County administrator Charles Stewart told the commission that an additional one-percent sales tax could bring up to $5.6 million per year. He advised the commission that any referendum they approved should levy the penny tax for at least four years, ensuring that enough money is raised to cover the projected $20 million cost for building a new judicial center.
Another financing option, a millage increase, would lay the financial burden for the courthouse project solely on property owners. Stewart noted that the penny sales tax option spreads the burden more evenly across the county’s population, and would be somewhat defrayed by purchases made by tourists, which comprises about ten percent of retail sales each year.
Stewart and bond attorney Ben Zeigler of Haynesworth Sinkler Boyd presented the CPST Commission with a draft of a possible ballot question, which read as follows:
“Must a special one percent sales and use tax be imposed in Darlington County for not to exceed 4 years to raise $20,000,000.00 for the acquisition (including, if necessary, the acquisition of real property), constructing, furnishing, and equipping a new Darlington County Judicial Center and Darlington County Administration Building, either as a single facility or two facilities, and either by new construction in whole or in part, or renovation of existing facilities in whole or in part?
And must Darlington County Council be authorized to issue not exceeding $20,000,000.00 principal amount of general obligation bonds of Darlington County, provided that the proceeds of such bonds shall be applied to defray the costs of the foregoing purposes, plus issuance costs, and provided further that in the event the sales and use tax to be imposed as stated herein is inadequate for the payment of such bonds, such bonds shall be payable from an ad valorem tax imposed on all taxable property in Darlington County?”
The CPST Commission voted 5 to 1 to approve this ballot question, with member Ronnie Ward voting against. Ward said that he could not approve the referendum because it did not include language stating that the administration facilities would not be relocated from the county seat in the City of Darlington.
This ballot question will now proceed to Darlington County Council, which must approve three readings before it can be placed on the ballot in November’s general election.
Darlington County Council’s next regular meeting is scheduled for Monday, May 7 at 6 p.m. The meeting will take place in the Fifth Floor courtroom of the Darlington County Courthouse.