Option to Renew Penny Sales Tax
OVERVIEW:
On November 4, 2008, voters in Horry County (the “County”) approved the Education Capital Improvement Sales and Use Sales Tax (the “Sales Tax”) to fund capital improvements for public schools and the county’s two institutions of higher education. Horry County Schools (the “School District”) received 80% of the revenue. Coastal Carolina University received 13.3% of the revenue and Horry-Georgetown Technical College received 6.7% of the revenue. If the reimposition of the 1% sales tax is approved by the voters, those percentages of the revenues shared will be the same.
The 1% sales tax reduced the millage levied on behalf of the school district for debt service from 28 mills to 10 mills, provided a revenue stream to help pay for growth, and allowed for more collaboration for educational programs among Horry County Schools, Coastal Carolina University, and Horry-Georgetown Technical College.
Learn more about the Penny Sales Tax for Horry County Schools: https://www.horrycountyschools.net/penny
Learn more about the Penny Sales Tax for Horry Georgetown Technical College: https://www.hgtc.edu/about_hgtc/administrativedepartments/purchasingandprocurement/planning-design/penny-tax.html
As of June 2022, over $953.6 million has been collected from the 1% sales tax, which sunsets in March 2024.
The Horry County Board of Education has ordered a referendum to be held on November 8, 2022, to reimpose the 1% sales tax for an additional 15 years. The question will be at the end of the ballot under the heading "LOCAL QUESTION."
NEW CONSTRUCTION:
HTC Student Recreation and Convocation Center (The HTC Center)
Completed in 2012, this 159,293-square-foot facility is the home of Chanticleer men's and women's basketball, and volleyball, as well as the University's student recreation center. Additionally, commencement ceremonies and convocations are held in the HTC Student Recreation and Convocation Center, which accommodates more than 3,600 attendees. The facility contains a full student recreation center that includes a climbing wall, fitness floor, group exercise studios, indoor walking track, and outdoor center. The campus bookstore, the Chanticleer Store, is also located in The HTC Center. A portion of this facility was funded by Penny Sales Tax.
Brittain Hall
49,146-square-foot academic building completed in 2012 that includes 15 classrooms, 109 faculty/staff offices along with conference rooms and support spaces, and a 1,700-square-foot food service space. This facility was partially funded by Penny Sales Tax.
Central Energy Plant
7,200-square-foot plant completed in 2013 and made up of a cooling tower, water-cooled chillers and cooling pumps. All of the buildings supported by the plant receive their air conditioning via an underground chilled water distribution system. The system is controlled in each building with automated controls and uses the existing natural gas systems to heat all of the buildings on its matrix. This setup allows for a more efficient system, housed in a smaller area.
Science Annex II
This 71,150-square-foot annex to the R. Cathcart Smith Science Center was completed in 2016. The annex consists of 40 faculty offices, eight teaching labs for biology and marine science, four 60-seat classrooms, two 45-seat classrooms, and one ecology teaching lab and six small labs for ecology research. This facility was partially funded by Penny Sales Tax.
Academic Classroom Building II
52,954-square-foot academic facility completed in 2017. It provides 16 classrooms/labs, three study rooms for students, multiple open collaborative spaces for students, and offices for more than 100 faculty and staff from various disciplines.
Thompson Library
65,860-square-foot academic building containing classrooms, offices, a computer lab, makerspace, virtual reality and visualization labs, designated space for academic tutoring, and an area designated for food service. An open, two-story learning commons will occupy the center of the complex, and provide open seating and grouped seating for study and team collaboration. The Thompson Library is scheduled to be complete in August 2024 and will be funded primarily by Penny Sales Tax.
ACQUISITIONS:
Hackler Golf Course
This par-72 course was acquired in 2010 and is the Grand Strand's only university-affiliated course. With its 18 beautifully carved holes, it is home to CCU's PGA Golf Management program, one of only 18 university programs accredited by the PGA of America.
Human Resources Building
This 5,753-square-foot administrative building was purchased in 2011 and houses Human Resources and Equal Opportunity.
Student Health Center
Acquired in 2012, this 7,884-square-foot medical facility provides primary care as well as prevention and education services. Counseling Services is also located in the Student Health Center and provides individual, couples, and/or group experiential, cultural, and evidence-based psychotherapy to students.
Atlantic Hall
18,422-square-foot administrative building purchased in 2012 containing office space for Procurement Services and Central Receiving as well as a considerable amount of warehouse space.
Coastal Science Center
This 69,435-square-foot academic building was purchased in 2012 and provides classroom space, labs and faculty office space. The Academic Testing Center is also located in this facility. Acquisition also included 10.62 acres of property.
FAQs Related to CCU
What is the Educational Capital Improvements Sales and Use Sales Tax Act (the “Sales Tax Act”)?
The Sales Tax Act became law on June 12, 2008, to provide an additional option for funding capital projects of South Carolina school districts with certain restrictions. The Sales Tax Act authorizes the school district and other qualifying South Carolina school districts to impose the sales tax if approved by the voters. The 1% sales tax has been imposed in several other qualifying South Carolina school districts.
How did Coastal Carolina University fund capital projects before the imposition of the 1% sales tax was approved by the voters in 2008?
In absence of the Penny Sales Tax, the University bonded debt in order to build facilities, which would ulitmately increase the cost of education for students.
How would the renewal of the 1% sales tax work?
If approved by voters, the current amount of the sales tax will not change.
How long would the renewal of the 1% sales tax last?
If approved by voters, the 1% sales tax would be effective for 15 years (until 2039) to cover CCU's future capital needs. Those needs include additions and renovations to existing facilities, as well as, construction of new facilities.
How would the 1% sales tax be used?
- It would be used to fund capital needs as specifically identified in the referendum ballot question approved by the voters.
- Revenue from the 1% sales tax would support construction of new facilities, renovations, and debt service. It also would address the facility needs of Horry County Schools and Horry-Georgetown Technical College.
- Revenue from the sales tax cannot be used to fund the general operations of Horry County Schools, Coastal Carolina University or Horry-Georgetown Technical College for items such as salaries, instructional materials, supplies, or other day-to-day costs.
Can the 1% sales tax be spent to hire staff or used for other operational costs?
No. Additional personnel or other operating costs can only be funded with tuition or additional state funding. The 1% sales tax can only be used for capital projects and debt service.
How much money would the 1% sales tax generate?
Based on historical collections, the penny sales tax is expected to generate more than $1.9 billion dollars ($1,938,448,129) over a 15-year period. This number assumes a four percent annual increase in sales tax collections. Coastal Carolina University will receive 13.3 percent, or $257,813,601. Horry County Schools will receive 80 percent while Horry-Georgetown Technical College will receive 6.7 percent of the total.
Will the 1% sales tax be sufficient to fund the projects?
CCU believes the funds available to it from the 1% sales tax will largely cover its future capital needs. The projections for the revenue from the 1% sales tax have been based on extremely conservative assumptions.
How much does/will the 1% sales tax currently cost me?
A typical family in Horry County pays an additional $99 a year in sales taxes. This amount is based on IRS sales tax tables for a typical household with the county's median annual income of $51,570.
What options would CCU have if voters do not reauthorize the 1% sales tax?
Without the Penny Sales Tax, the University would have to bond debt in order to build facilities, which could ultimately increase the cost of education for our students.
Is the 1% sales tax different from property tax?
Yes. Property taxes are assessed based on the value of the property you own, while sales taxes are generated from the purchase of goods and certain services. The renewal of the 1% sales tax will allow non-property owners, as well as those traveling to the county who shop or make purchases, to help share the burden of funding local school projects and construction costs.
What are some examples of day-to-day purchases that would be exempt from the sales tax? What are some examples of non-exempt items?
Some purchases would be exempt from the sales tax, meaning that the sales tax would not be collected. Unprepared foods are exempt from the sales tax. The sales tax would not be collected on food intended to be eaten at home, including snacks, beverages, cold items such as salads and sandwiches, and seeds or plants intended to grow food.
Some items would not be exempt. The sales tax would apply and be collected on purchases like paper products, soap, pet food, alcoholic beverages, ready-to-drink beverages, ready-to-eat hot foods, foods designed to be heated in stores, prepared hot or cold foods to be eaten in or near stores, vitamins, and certain medicines (any medication exempt from state sales and use taxes would also be exempt from the local sales tax).
There are other items that would be exempt (not sales taxed). If interested, please see Sections 12-36-2110, 12-36-2120, and 12-36-2130 of the Code of Laws of South Carolina 1976, as amended.
How will taxpayers know that the 1% sales tax revenues will only be used as intended?
Pursuant to the Sales Tax Act, the revenue generated from the 1% sales tax can only be used for the purposes set forth in the referendum ballot question.
All revenue generated from the 1% sales tax will be deposited in a fund separate from all other funds of the University. All expenditures of those funds for new construction, improvements and debt service will be monitored and accounted for regarding each project.
External auditors perform annual audits on the University's financial statements and will include an audit of the sales tax fund.
A copy of the Coastal Carolina University Annual Comprehensive Financial Report (ACFR) is posted on the University's website (www.coastal.edu/financeadministration/reports) upon completion of each annual audit.
