South Carolina would set rules for a community investment fund

The Executive Budget Office would administer a separate Community Investment Fund, while the Board of Economic Advisors would decide whether revenue conditions allow money to be placed in it. The fund could support capital improvements, infrastructure, equipment, or real property lasting at least five years for a public purpose. The fund could receive money only after the state fully funds listed legal priorities, including tax reimbursements, reserves, debt service, retirement contributions, and public education minimums. The annual amount could not exceed $24.8 million. No money could be appropriated if certified surplus revenue is zero or negative. The fund would not pay salaries, recurring operating costs, existing debt, or grants or transfers to private people, businesses, or nonprofits. The provisions would first apply to appropriations for fiscal year 2027-2028 if the Governor approves the act.

House and Senate members would certify projects for eligible local governments from district allocations. Eligible entities would be state political subdivisions, including school districts; private companies, nonprofits, colleges, state agencies, and individuals would not qualify. House districts could receive up to $100,000 each, and Senate districts could receive up to $269,565 each, subject to any pro rata reduction caused by partial funding. A certification would have to name the eligible entity, amount, and public purpose and be posted online for at least 30 days before payment. Members could combine allocations for one project only when the location or service area meets the bill's district-boundary rules. Allocations would be divided among counties based on the share of district population in each county, with a limited exception for counties containing less than five percent of a district's population. The district allocation rules would apply when money is available for an eligible fiscal year beginning with fiscal year 2027-2028 appropriations.

Recipients would have to use the money for the certified project and follow public reporting, repayment, and audit rules. The restrictions would cover every project funded through the proposed fund and every eligible entity receiving a payment. Recipients could not redirect or grant the money to private people, businesses, or nonprofits, except through ordinary competitive public contracts for related construction, materials, or equipment. A legislator could not certify a project if the legislator or immediate family had an economic interest in the recipient's funds, except as a general resident and taxpayer. The money could not count toward another state or federal grant's required local match unless the annual budget law expressly allows it. Recipients would have three years after payment to spend or legally commit the money; unused money would return to the fund. The Executive Budget Office would update a searchable public record at least quarterly, RFA would report by January 15 each year, and the three-year spending period would begin when each payment is made.