If the state of South Carolina is late with your income tax refund next year, you might not see as much earned interest when you finally receive your check.
A pair of Senate state budget provisos for fiscal 2010-11 – one of them new – would chop 3 percentage points off any refund interest due taxpayers. The current interest rate is 4 percent, according to the S.C. Department of Revenue.
Last year, $5.3 million in interest was paid on $127 million in late refunds, compared to $4.5 million in interest paid on $104 million in late refunds in 2008, Department of Revenue records show, though it is unclear whether those interest figures factored in the proviso reductions.
Under the new proviso (89.142), the department would reduce the interest rate by 1 percentage point, of which $250,000 would be earmarked for the Joint Citizens and Legislative Committee on Children to “provide the report, research and other operating expenses” as designated by state law.
The 14-member committee – nine of whose members are appointed by the Legislature and governor – has met only twice since it was created two years ago, records reviewed by The Nerve show. And it has not submitted any annual reports, though required by law to do so.
Any remaining revenue generated by the 1-percent reduction would be transferred to the S.C. Department of Juvenile Justice for “mentoring or alternatives to incarceration programs,” under the proviso.
The other state budget proviso (72.17), renewed in both the Senate and House versions of the budget, would reduce the refund interest rate by an additional 2 percentage points, which would be used “exclusively for operations” of the state Guardian ad Litem program in the Governor’s Office. That program provides volunteer representation for children in abuse and neglect court proceedings.
That proviso generated about $2.2 million and $2.6 million in 2008 and 2009, respectively, for the program, according to Department of Revenue figures.
Both provisos may or may not be included in the final state budget being worked out between the Senate and House. The legislative session ends in mid-June.
Under state law, taxpayers who file their income tax returns early or on the final due date are eligible for refund interest if the refunds were not made within 75 days of when the return was filed, or within 75 days of the final due date of the return. For taxpayers who were granted filing extensions, refund interest is owed if the refunds were not made within 75 days of when the refund claim was filed.
Interest also is supposed to be paid on overpayment of property taxes if the refund is not made within 75 days after the county has received notice from the Department of Revenue that the refund is due.
New Layer of Bureaucracy?
The new proviso directing revenue from the 1-percentage-point reduction to the Joint Citizens and Legislative Committee on Children was proposed by Sen. Mike Fair, R-Greenville, the committee chairman. He did not respond to written questions or a phone message last week from The Nerve.
Senate President Pro Tempore Glenn McConnell, R-Charleston, and House Speaker Bobby Harrell, R-Charleston, who each appoint three members to the committee, also did not respond to written questions last week from The Nerve.
Contacted last week, Sen. Darrell Jackson, D-Richland, who was the committee chairman last year, directed questions about the proviso to Fair. But Jackson defended the purpose of the committee, though it hasn’t met in more than a year.
“It serves a valuable need, particularly addressing issues that impact children,” he said.
Under its enabling legislation, the committee, which was created in 2008, is supposed to submit an annual report to the governor, House speaker and Senate president pro tempore. Ben Fox, spokesman for Gov. Mark Sanford, told The Nerve last week that his office has not received any reports.
In minutes from its last meeting in April 2009, Harry Davis, executive director of the Children’s Law Center at the University of South Carolina, said that “until a budget is provided to hire research and support staff” for the committee, the law center would offer the committee “as much assistance as possible.”
Contacted last week, Davis told The Nerve that the committee has held only two meetings and produced no reports because the General Assembly has not allocated any money for support staff.
“In order to do the work, you would need to add staff to do it, and up to this point, there hasn’t been any appropriations,” he said.
Asked if a support staff were necessary for research given the fact that the heads of five state agencies dealing with children’s issues are among the committee’s 14 board members, Davis replied, “Without a doubt, it is a wise investment for the state to put in a little bit of money to examine how all of the money is being spent with regard to children.”
According to the law center’s website, the committee was created to:
- Serve as a clearinghouse for children’s issues.
- Offer “coordination for legislative efforts and policy” for children’s issues.
- Provide research and data to “inform legislative consideration” of children’s issues.
- Promote “coordination and efficiency” of children’s services.
Davis, an attorney, cited a separate state law that says in part, “It shall be the policy of this state to concentrate on the prevention of children’s problems as the most important strategy which can be planned and implemented on behalf of children and their families.”
Davis said the needs of the slightly more than 1 million children in South Carolina are great, noting that:
- 370,000 receive subsidized school meals.
- 250,000 will drop out of school and not graduate.
- 200,000 are classified as living in poverty.
- 90,000 have learning disabilities.
- 20,000 are referred to family courts on delinquency matters.
- 18,000 are the subject of child abuse/neglect investigations by state social workers.
- 5,000 live in foster care.
“You’ve got tens of thousands of children in this state with dire needs,” Davis said. “But you’ve got no orchestra leader.”
Under state law, the 14-member committee is made up of:
- Three senators appointed by McConnell : Fair, Jackson, and Brad Hutto, D-Orangeburg.
- Three representatives appointed by Harrell: Joan Brady, R-Richland; Cathy Harvin, D-Clarendon; and Kit Spires, R-Lexington.
- Three residents appointed by Sanford (There is one vacancy, according to the law center’s website.)
- The state superintendent of education.
- The directors of the S.C. departments of Juvenile Justice, Mental Health, Social Services and Disabilities and Special Needs.
Though it was supposed to begin operating on July 1, 2008, the committee didn’t first meet until Dec. 2, 2009, according to the law center’s website. Its last meeting was on April 22, 2009.
Fair had called the committee’s first meeting of this year for today, according to the law center’s website. But a spokeswoman in his State House office told The Nerve on Friday that it had been cancelled, and that she was not aware of any new meeting date.
Reach Brundrett at (803) 779-5022, ext. 106, or email@example.com.