S 829

South Carolina General Assembly
126th Session, 2025-2026
Bill 829
Indicates Matter Stricken
Indicates New Matter
(Text matches printed bills. Document has been reformatted to meet World Wide Web specifications.)
Indicates Matter Stricken
Indicates New Matter
Committee Report
May 6, 2026
S. 829
Introduced
by Senator Alexander
S. Printed 5/6/26--H.
Read the first time March 24, 2026
________
The committee on House
Judiciary
To whom was referred a Bill (S. 829) to
amend the South Carolina Code of Laws by amending Section 6-25-20, relating to
definitions, so as to provide appropriate definitions; by amending Section
6-25-50, etc., respectfully
Report:
That they have duly and carefully
considered the same, and recommend that the same do pass:
W. NEWTON for Committee.
statement of estimated fiscal impact
Explanation of Fiscal Impact
State Expenditure
This bill revises the process and
information that must be provided in a joint system's filing to the Secretary
of State. This bill also allows commissioners to be appointed by the Governor
as an alternative to appointment by a joint system's governing body, set rules
for qualifications and removal of commissioners, and allows the addition of new
commissioners if a new member is added to the joint system. Further, this bill
allows joint systems to reconstitute themselves and sets forth the procedures
for doing so, while permitting former members to withdraw prior to
reconstitution. This bill specifies that commissions fully appointed by the
Governor may issue bonds with automatic extensions by a majority vote without
separate approval from the governing bodies.
This bill will have no fiscal impact
on the Office of the Governor, the House of Representatives, and the Senate as
each anticipates any additional duties required by this bill can be managed
within the normal course of business.
This bill will have no impact on the
Secretary of State's Office. The agency anticipates the creation of an
application for joint systems and subsequent processing of submitted
applications will be managed with existing staff and resources.
Local Expenditure
This bill revises the process and
information that must be provided in a joint system's filing to the Secretary
of State. This bill also allows commissioners to be appointed by the Governor
as an alternative to appointment by a joint system's governing body, set rules
for qualifications and removal of commissioners, and allows the addition of new
commissioners if a new member is added to the joint system. Further, this bill
allows joint systems to reconstitute themselves and sets forth the procedures
for doing so, while permitting former members to withdraw prior to
reconstitution. This bill specifies that commissions fully appointed by the
Governor may issue bonds with automatic extensions by a majority vote without
separate approval from the governing bodies.
RFA contacted all counties in the
state and MASC to determine the potential expenditure impact this bill may have
for local governments. We received a response from Charleston County, Horry
County, Lancaster County, and MASC. Horry and Lancaster Counties indicate that
the bill will have no expenditure impact. Charleston County anticipates that
this bill may increase expenses by an undetermined amount by allowing
commissioners appointed by the Governor to increase the amount and duration of
debt obligations without oversight from county council. Additionally, MASC
anticipates this bill may have an undetermined impact on municipalities
dependent upon costs incurred due to loss of municipal government oversight of
commissioners' decisions, particularly related to the amount and term of debt
issued by a joint system. MASC also notes municipalities may find it more
difficult and costly to withdraw from a joint system in situations where
capacity rights, long-term contracts, or bond obligations exist.
Frank A. Rainwater, Executive Director
Revenue and Fiscal Affairs Office
_______
A bill
TO AMEND THE SOUTH CAROLINA CODE OF LAWS BY
AMENDING SECTION 6-25-20, RELATING TO DEFINITIONS, SO AS TO PROVIDE APPROPRIATE
DEFINITIONS; BY AMENDING SECTION 6-25-50, RELATING TO APPLICATION FILED WITH
SECRETARY OF STATE, SO AS TO REVISE APPLICATION REQUIREMENTS; BY AMENDING
SECTION 6-25-60, RELATING TO APPOINTMENT OF COMMISSIONERS, SO AS TO PROVIDE FOR
ALTERNATIVE METHODS OF COMMISSIONER APPOINTMENT AND CONDITIONS OF SERVICE AS
COMMISSIONER; BY AMENDING SECTION 6-25-70, RELATING TO CHANGE IN MEMBERSHIP OF
JOINT SYSTEM, SO AS TO PROVIDE PROCEDURES FOR COMMISSIONER APPOINTMENT WHEN A
NEW MEMBER IS ADDED TO A JOINT SYSTEM; BY AMENDING SECTION 6-25-80, RELATING TO
DISSOLUTION OF SYSTEM, SO AS TO PROVIDE PROCEDURES FOR JOINT SYSTEM
RECONSTITUTION AND MEMBER WITHDRAWAL; BY AMENDING SECTION 6-25-110, RELATING TO
AUTHORIZATION TO INCUR DEBT AND ISSUE BONDS, SO AS TO PROVIDE PROCEDURES FOR
BOND ISSUANCE BY A COMMISSION APPOINTED ENTIRELY BY THE GOVERNOR; AND BY
AMENDING SECTION 6-25-128, RELATING TO CONTRACTS BETWEEN AUTHORITY AND JOINT
SYSTEM;  DURATION, SO AS TO PERMIT AUTOMATIC EXTENSION OF CONTRACT PROVISIONS
COMMENSURATE WITH TERMS OF BONDS OR OTHER INDEBTEDNESS.
Be it enacted by the
General Assembly of the State of South Carolina:
SECTION
1.  Section 6-25-20 of the S.C. Code is amended to
read:
    Section
6-25-20. For purposes of this chapter:
    (1)
"Joint Authority Water and Sewer System" or "joint system" means a government
entity organized under this chapter to undertake or acquire a water or sewer
project.
    (2)
"State" means the State of South Carolina.
    (3)
"Project" means a project undertaken by a joint authority water and sewer
system to:
       (a)
impound, produce, treat, transmit, distribute, sell, and service water to a
member, or to an authority that is not a member but who is engaged in providing
water or sewer service, or to any other person or entity if water service is
not otherwise available from any other source when approved by the governing
body of each member;  and
       (b)
collect, transport, process, treat, dispose, and control municipal, domestic,
industrial, or communal waste, flood water, or storm water, whether in fluid,
solid, or composite state, including specifically the control, abatement, or
reduction of pollution for a member, or for an authority that is not a member
and is engaged in waste and wastewater collection, treatment, and disposal, or
to any other person or entity if sewer service is not otherwise available from
any other source when approved by the governing body of each member.
    (4)
"Cost" or "cost of a project" means, but is not limited to, the cost of
acquisition, construction, reconstruction, improvement, enlargement, or
extension of any project, including the cost of studies, plans, specifications,
surveys, and estimates of costs and revenues relating to the project;  the cost
of land, land rights, rights-of-way and easements, water rights, fees, permits,
approvals, licenses, certificates, franchises, and the preparation of
applications for and security for them;  administrative, legal, professional,
engineering, and inspection expenses;  financing fees, expenses, and costs;
working capital;  insurance;  interest on the bonds during the period of
construction and for a reasonable period after construction as may be
determined by the commission of the joint system;  establishment of reserves;
and all other expenditures of the joint system incidental, necessary, or
convenient to the acquisition, construction, reconstruction, improvement,
enlargement, or extension of any project and the placing of the project in
operation.
    (5)
"Governing body" means with respect to an authority;  the board, commission,
council, or other entity charged by law with governing the authority.
    (6)
"Authority" includes:
       (a)
a county or municipality incorporated under the laws of this State;
       (b)
a consolidated political subdivision of this State;
       (c)
a commission of public works;  and
       (d)
an agency or public body created under the laws of this State and authorized by
legislation to be engaged in the sale and service of water for industrial and
domestic purposes, or the collection for treatment of wastewater.
    (7)
"Revenue bonds" and "bonds" mean bonds, notes, certificates, or other
obligations of a joint system issued pursuant to the provisions of this chapter
and include a refinancing or refunding of bonds, notes, certificates, or other
obligations, but which must be paid solely from the revenue or another source
of funds available to a joint system.
    (8)
"Member of a joint system" means an authority that has taken the actions
necessary to form or join the joint system.
    (9)
"Construction note" or "note" means a note of a joint system issued to provide
funding for the creation of a financing pool and the costs associated with it.
    (10)
"Financing agreement" means an agreement entered into by a joint system
organized to create a financing pool and a member of it in connection with the
lending of the proceeds of construction notes or portion thereof by the joint
system to the member so as to provide for the repayment of amounts loaned and
interest on it by the member to the joint system.
    (11)
"Financing pool" means a fund of money, obtained through the issuance of a
construction note of a joint authority water and sewer system, which may be
loaned to the members of it by way of interim financing. A joint system may not
lend more than five percent of the principal amount of a financing pool to a
not-for-profit corporation established pursuant to Chapter 35 of Title 33.
    (12)
"Government" means the United States of America, acting through the United
States Department of Agriculture, or its successor, and the agencies and
divisions of it.
    (13)
"Interim financing" means bond anticipation notes issued pursuant to the
provisions of Sections 11-17-10 to 11-17-120 in anticipation of the issuance of
bonds of an authority to be sold to the government.
    (14) "Legislative delegation" means all
members of the South Carolina Senate and South Carolina House of
Representatives representing any county where a joint system is located.
    (15) "Governor" means the Governor of
the State of South Carolina.
SECTION
2.  Section 6-25-50 of the S.C. Code is amended to
read:
    Section
6-25-50. (A) The governing bodies of
the members of a joint system shall form an agreement specifying the number of
commissioners each member may appoint to a commission
created to govern the joint system pursuant to Section 6-25-60.
    (B)
Two or more commissioners The
proposed members of a joint system shall jointly file
an application with the Secretary of State an application signed by the commissioner of each proposed
member setting forth:
       (1)
the names and number of all proposed members of the joint system, the number of proposed commissioners, and their respective appointed commissioners the method of appointment pursuant to Section 6-25-60(B);
       (2)
a certified copy of a resolution of each member
determining it is in its best interest to participate in the proposed joint
system;:
  (a) the resolution of each member
determining it is in its best interest to participate in the proposed joint
system;  and
  (b) the resolution appointing the
member's commissioner;
       (3)
the desire that the joint system be organized as a public body corporate and
politic under this chapter;
       (4)
the name which is proposed for the joint system;  and
       (5)
the purpose for creation of the joint system.
    The Secretary
of State shall file the application if after examining it and determining that
it complies with the requirements in this section and that the proposed name of
the joint system is not identical with that of any other corporation of the
State or any agency or instrumentality or so nearly similar as to lead to
confusion and uncertainty.
    After the
application has been filed, the Secretary of State shall issue a corporate
certificate that must be filed with the application, and the joint system then
must be constituted a public body corporate and politic under the name proposed
in the application. The corporate certificate shall set forth the names of all voting members and of the name of the
joint system. There also must be stated upon the corporate certificate the
purpose for which it has been created, as set forth in the application. Notice
of the issuance of such corporate certificate must be given to all members of
the joint system by the Secretary of State.
    In any suit,
action, or proceeding involving the validity or enforcement of, or relating to,
contract of a joint system, the joint system in the absence of establishing
fraud shall be conclusively considered to have been established in accordance
with the provisions of this chapter upon proof of the issuance of the
certificate by the Secretary of State. A copy of the certificate, duly
certified by the Secretary of State, is admissible in evidence in any suit,
action, or proceeding and is conclusive proof of the filing and contents.
SECTION
3.  Section 6-25-60 of the S.C. Code is amended to
read:
    Section
6-25-60. (A) The management and
control of a joint system is vested in a commission that may consist of no
fewer than five members and no more than eleven members. A
commissioner has one vote and may have additional votes as a majority of the
members of the joint system determines. Notwithstanding the provisions of this
subsection requiring the commission managing a joint system to have no fewer
than five members and no more than eleven members, a joint system in existence
on this section's effective date and having fewer than five members or more
than eleven members on this section's effective date may continue to maintain
the number of members serving on this section's effective date and may add
additional members as its commissioners determine.
    (B) As contemplated by the initial
application to the Secretary of State, commissioners serving on the commission
may be appointed under one of the following procedures:
       (1) The governing body of each
voting member of a joint system shall appoint a
commissioner one or more commissioners, pursuant to Section 6-25-50(A), to serve as a
commissioner of the joint system. A commissioner has one
vote and may have additional votes as a majority of the members of the joint
system determines. A commissioner serves at the pleasure of the
governing body by which he was appointed. A commissioner, before entering upon
his duties, shall take and subscribe to an oath before a person authorized by
law to administer oaths to execute the duties of his office faithfully and
impartially, and a record of each oath must be filed with the governing body of
the appointing authority.
    Notwithstanding the
provisions of this subsection requiring the commission managing a joint system
to have no fewer than five members and no more than eleven members, a joint
system in existence on this section's effective date and having fewer than five
members or more than eleven members on this section's effective date may
continue to maintain the number of members serving on the section's effective
date and may add additional members as its commissioners determine.
       In the event there is an even number of members of a
joint system, the project contract, bylaws, or other similar agreement for the
joint system may authorize one additional member of the commission; such
additional commissioner shall be recommended by the legislative delegation from
each county where the joint system is located, and upon receipt of such
recommendation, such additional commissioner shall be appointed by the
Governor. Any gubernatorial appointment shall be for a term of four years and
shall serve until a duly appointed successor is appointed and qualified. Any
commissioner appointed by the Governor hereunder must reside within a household
receiving utility services from the joint system or a member of the joint
system. Any vacancy of such member must be filled for the remainder of the
unexpired term in the same manner as the original appointment. If a new member
of a joint system is added under the provisions hereof such that there becomes
an odd number of members of a joint system, any gubernatorial appointed
commissioner shall be deemed to automatically vacate his position as a
commissioner as of the date of the admission of such new member of a joint
system and their respective appointment of a new commissioner.
       (2) The commissioners may be appointed
by the Governor in accordance with the following procedures:
  (a) The Governor, based upon the
recommendation of the legislative delegation from each county that the joint
system operates, shall appoint each commissioner. Each appointed commissioner
must reside within a household receiving utility services from the joint system
or a member of the joint system. In making such appointments, there shall be at
least one commissioner appointed by the Governor from the service area of each
member of the joint system.
  (b) Excepting the initial appointments
as necessary to create a staggered commission term which may be two or four
years, respectively, each commissioner must be appointed and serve for a term
of four years and until his successor is appointed and qualified, provided that
the terms of the commissioners must be staggered such that approximately
one-half of the total members appointed by the Governor must be appointed or
reappointed every two years. A vacancy must be filled for the remainder of the
unexpired term in the manner of the original appointment. Respecting the
initial commission appointed herein, the minority portion of the staggered
membership, representing those authorities with the lowest number of customers
of the joint system, shall serve for an initial two-year term.
    (B)(C) The commissioners of the joint system shall annually,
or biennially, if provided in the bylaws of the joint system, elect, with each
commissioner having one vote, one of the commissioners as chairman, another as
vice chairman, and other persons who may, but need not be commissioners, as
treasurer, secretary and, if desired, assistant secretary. The office of
treasurer may be held by the secretary or assistant secretary. The commission
may also appoint such additional officers as it deems necessary. The secretary
or assistant secretary of the joint system shall keep a record of the
proceedings of the joint system, and the secretary must be the custodian of all
books, records, documents, and papers filed with the joint system, the minute
book or journal of the joint system, and its official seal.
    (C)(D) A majority of the commissioners of the joint system
shall constitute a quorum. A vacancy on the commission of the joint system
shall not impair the right of a quorum to exercise all rights and perform all
the duties of a joint system. Any action taken by the joint system under the
provisions of this chapter may be authorized by resolution at any regular or
special meeting held pursuant to notice in accordance with bylaws of the joint
system, and each resolution shall take effect immediately and need not be
published or posted. Except as is otherwise provided in this chapter or in the
bylaws of the joint system, a majority of the votes which the commissioners
present are entitled to cast, with a quorum present, shall be necessary and
sufficient to take any action or to pass any resolution. No commissioner of a
joint system shall receive any compensation solely for the performance of
duties as a commissioner, but each commissioner may be paid per diem, mileage,
and subsistence expenses, as provided by law for state boards, committees, and
commissions, incurred while engaged in the performance of such duties.
    (E) All commissioners shall hold the
qualifications of an elector.
    (F) Commissioners appointed under
subsection (B)(2) may not be an officer or employee of a member of a joint
system, and no commissioner shall be permitted to serve on an ex officio basis.
Separately, for commissioners appointed under subsection (B)(1), the members of
the joint system may include a restriction in the project contract, bylaws, or
other agreement for the joint system that no commissioner may be an officer or
employee of a member of a joint system, and no commissioner shall be permitted
to serve on an ex officio basis.
    (G) Any commissioner appointed hereunder
shall be deemed to forfeit his respective position if such person: (1) lacks,
at any time during his term of office, any qualifications for the office
prescribed by general law and the Constitution; or (2) is convicted of any
crime, other than civil infractions or misdemeanors for which no imprisonment
is imposed.
SECTION
4.  Section 6-25-70 of the S.C. Code is amended to
read:
    Section
6-25-70. (A) After the creation of a
joint system, any other authority may become a member of
the joint system upon:
       (1)
adoption of a resolution or ordinance by the governing body complying with the
requirements of Section 6-25-40 including publication of notice;
       (2)
submission of an application to the joint system;  and
       (3)
approval of the application by resolution of the governing body of each member
of the joint system except in the case of a joint system organized for the
purpose of creating a financing pool, in which case the application must be
approved by resolution of the commission.
    (B)
A member may withdraw from a joint system by resolution or ordinance of its
governing body. A contractual right acquired or contractual obligation incurred
by a member while it was a member remains in full force and effect after the
member's withdrawal.
    (C)
Notice of a change in membership must be filed in the Office of the Secretary
of State. No change is final until this filing occurs. The filing is not
required if a joint system is organized only for the purpose of creating a
financing pool.
    (D) If a new member of the joint system
is added hereunder, the approval documentation required under subsection (A)(3)
shall determine whether any new commissioners shall be added to the commission
as necessary to support such new member of the joint system. If a new
commissioner is added, either by the members of the joint system or the
Governor, as applicable, each such commissioner shall be appointed immediately.
SECTION
5.  Section 6-25-80 of the S.C. Code is amended to
read:
    Section
6-25-80. Whenever the commission of a joint system
and the governing body of each of its members shall by resolution or ordinance
determine that the purposes for which the joint system was formed have been
substantially fulfilled and that all bonds issued and all other obligations
incurred by the joint system have been fully paid or satisfied, the commission
and members may declare the joint system to be dissolved. On the effective date
of the resolution or ordinance, the title to all funds and other income and property
owned by the joint system at the time of dissolution must be disbursed to the
voting members of the joint system according to its bylaws.
    In the discretion of the members of a joint system for
the proper and efficient operation of any joint system, an existing joint
system may be reconstituted by following the procedures for the creation of a
new joint system, mutatis mutandis. In the event of a reconstitution, any
former member may elect to withdraw from the joint system prior to the
effective date of the reconstitution by submitting a petition to the joint
system, which shall be filed with the new application under Section 6-25-50. No
withdrawal for reconstitution shall be permitted unless and until either (i)
all contractual rights and obligations, including bond payment obligations, of
the withdrawing member have been fulfilled to the satisfaction of the remaining
members, as certified in a resolution or ordinance of the remaining members
filed with the application; or (ii) the withdrawing member remains obligated on
any contract right or obligation as contemplated in Section 6-25-70(B). Upon
any reconstitution withdrawal, the withdrawing member's capacity rights in the
project shall immediately terminate.
SECTION
6.  Section 6-25-110 of the S.C. Code is amended to
read:
    Section
6-25-110.  A joint system may incur debt for any of its purposes and may issue
bonds pledging to the payment as to both principal and interest the revenues,
or any portion, derived or to be derived from all or any of its projects and
any additions and betterments or extensions or contributions or advances from
its members or other sources of funds available to it. A joint system may not
undertake a project required to be financed, in whole or in part, with the
proceeds of bonds without the approval of the governing bodies of each member
which is obligated or to be obligated under any contract for the payment of
amounts to be pledged as security therefore and a favorable vote of two-thirds
of all commissioners. Any project may be preauthorized,
preapproved, or otherwise permitted under the terms of the project contract for
the joint system, and such authority, approval, or permission shall constitute
all necessary approval of the respective governing bodies of each member herein.
Notwithstanding the foregoing, when a commission is appointed under Section
6-25-60(B)(2), no separate approval of the governing bodies of each member
shall be required for the issuance of any bonds, and such bonds shall be
authorized and approved by a simple majority of the commissioners. A
joint system formed only for the purpose of creating a financing pool may issue
notes in anticipation of the issuance of bonds by its members to the
government.
SECTION
7.  Section 6-25-128 of the S.C. Code is amended to
read:
    Section
6-25-128.  An authority may contract to buy from the
joint system water required for its present or future requirements, including
the capacity and output, or a portion or share of one or more specified
projects.  An authority also may contract for the collection or treatment of
wastewater, including present or future capacity, or a portion or share of
another project. The creation of a joint system is an alternative method
whereby an authority may obtain the benefits and assume the responsibilities of
ownership in a project, so a contract may provide that the authority forming
the contract is obligated to make a payment required by the contract whether or
not a project is completed, operable, or operating notwithstanding the
suspension, interruption, interference, reduction, or curtailment of the output
of a project or the water contracted for, and that the payments under the
contract are not subject to reduction, whether by offset or otherwise, and are
not conditioned upon the performance or nonperformance of the joint system or
any other member of the joint system under the contract or any other
instrument. A contract with respect to the sale or purchase of capacity or
output, or a portion or share of them, of a project entered into between a
joint system and its member authorities also may provide that if an authority
or authorities default in the payment of its or their obligations with respect
to the purchase of the capacity or output, or a portion or share of them, in
that event the remaining member authorities which are purchasing capacity and
output under the contract are required to accept and pay for and are entitled
proportionately to and may use or otherwise dispose of the capacity or output
which was to be purchased by the defaulting authority.
    A contract
concerning the sale or purchase of capacity and output from a project may
extend for a period not exceeding fifty years from the date of the contract and
may be renewable and extended upon terms as the parties may agree for not
exceeding an additional fifty years;  and the execution and effectiveness is
not subject to any authorizations or approvals by the State or any agency,
commission, or instrumentality or political subdivision of them. The contract may further provide that bonds or other indebtedness
of the joint system may exceed the term of an initial or existing contract
between or among the joint system and the respective members of the joint
system, and in such event the contract, or at least the payment obligations of
each member, shall be automatically extended to a period commensurate with the
term of the bonds or other indebtedness.
    Payments by
an authority under a contract for the purchase of capacity and output from a
joint system may be made from the revenues derived from the ownership and
operation of the water system of the authority or from such other sources of
funds as may be available, including any amounts received as payments in lieu
of taxes. An authority may not pledge its full faith, credit, and taxing power
to secure its obligations to the joint system or the bonds of the joint system.
An authority is obligated to fix, charge, and collect rents, rates, fees, and
charges for water or sewer services, facilities, and commodities sold,
furnished, or supplied through its water or sewer system sufficient to provide
revenues adequate to meet its obligations under any contract and to pay any and
all other amounts payable from or constituting a charge and lien upon the
revenues, including amounts sufficient to pay the principal of and interest on
general obligation bonds, if any, heretofore or hereafter issued by the
authority for purposes related to its water or sewer system.
    An authority
that is a member of a joint system may furnish the joint system with money
derived from the ownership and operation of its water or sewer system or
facilities and provide the joint system with personnel, equipment, and
property, both real and personal, and from any other sources legally available
to it for such purposes. An authority also may provide services to a joint
system.
    A member of a
joint system may contract for, advance, or contribute funds derived from the
ownership and operation of its water or sewer system or facilities or from
another legal source to a joint system as agreed upon by the joint system and
the member, and the joint system shall repay the advances or contributions from
the proceeds of bonds, operating revenue, or other funds of the joint system,
together with interest as agreed upon by the member and the joint system.
SECTION 8.  This act takes effect upon approval
by the Governor.
----XX----
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