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McMaster delivers 1st State of the State address

Staff Report //January 25, 2018//

McMaster delivers 1st State of the State address

Staff Report //January 25, 2018//

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Gov. Henry McMaster delivered his first State of the State address on Wednesday, touting economic advancement in South Carolina in 2017.

He highlighted more than 17,000 jobs coming into the state, along with 120 economic development projects. Those projects have brought in $5 billion in new capital.

Despite South Carolina’s current low unemployment rates, McMaster said more than 60,000 jobs are still available, and that number will only grow. He proposed a new program aimed at preparing students to take over those jobs once they leave school.

“The South Carolina Workforce Partnership will connect businesses with high schools and technical colleges for internships, dual credit and certificate programs,” McMaster said.

He said he plans to focus the program in rural areas of the state.

Rep. James Smith, D-Columbia, gave the rebuttal speech for the Democrats, saying even more should be done when it comes to education.

Smith, who is running against McMaster in the 2018 gubernatorial race, said public education is the most important job of state government. He called for support of teachers, including raising wages to the Southeastern average, a reduction in elementary school class size and school funding equity.

In his executive budget proposal, McMaster proposed cutting income tax by 1% over the next five years. The plan calls for $2.2 billion in tax cuts, including $139 million in the first year. In Wednesday’s address, he reiterated a call to eliminate state income tax on retirement for military and first responders.

McMaster also addressed the energy crisis that is dominating the General Assembly in continued fallout from the abandoned V.C. Summer nuclear reactors in Fairfield County. He said the interest of the ratepayer must come first. Customers must either get their money back or see the reactors they have paid for completed, he said.

He brought up the Office of Regulatory Staff audit that asserted halting the $37 million a month S.C. Electric & Gas receives from customers in V.C. Summer-related costs would not drive parent company SCANA into bankruptcy. McMaster called it irresponsible to allow SCANA or any prospective buyer of the utility to continue collecting such payments from customers.

“Send me a bill that replaces the Base Load Review Act and prevents ratepayers from being charged in the future for the abandoned reactors, and I will sign it,” McMaster said. “Send me a bill that continues to place the financial burden of this corporate failure on South Carolina ratepayers, and I will veto it.”

Virginia-based Dominion Energy has proposed a $14.6 billion deal to acquire SCANA. The merger would refund SCE&G customers some of the money paid for V.C. Summer costs and speed up the schedule for eliminating project-related payments, but Dominion has said repealing the BLRA, which allows for continued recoupment of those costs, and/or requiring retroactive refunds would negate its offer.

State-owned utility Santee Cooper, co-owner with SCE&G of the reactors, is currently $4.3 billion in debt from the project as part of its $8 billion total debt.

McMaster said the only feasible solution he sees is to sell Santee Cooper. He has approached four out-of-state companies about buying the utility, including Florida-based NextEra, North Carolina-based Duke Energy and Georgia-based Southern Company. Dominion was the fourth company in talks but has said it is not interested in acquiring Santee Cooper.

“I have been meeting with several companies which have expressed serious interest in buying Santee Cooper. Some have made proposals. Its value is well-recognized,” McMaster said. “I have informed all of these interested purchasers that the state will not consider any proposal which saddles the customers or taxpayers with Santee Cooper’s debt.”

Smith’s rebuttal called for an independent consumer advocate to protect the interests of ratepayers and address the need for alternative energies.

“We cannot consider energy reform complete if we do not make advancement in solar power and efficiency programs,” Smith said. “We remain more than a decade behind our neighboring states, and our citizens deserve more access to these important, lower-cost alternatives. That is essential to building new economic opportunities in our state.”

On Tuesday, the S.C. House of Representatives passed a bill, part of the six-bill Utility Ratepayers Protection package, that creates a creates a utilities consumer advocate in the office of the attorney general and grants subpoena power to the advocate and the ORS.