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Senate finance committee advances amendment to let airlines join fee‑in‑lieu deals, exempts part of aircraft value
Summary
The committee approved a verbal amendment to SB 436 that exempts 36.8421% of airline fair-market aircraft value (cutting the assessment ratio from 9.5% to 6%) and allows airlines to be included in statewide fee‑in‑lieu agreements; the amendment’s sunset was shortened by consent from 2028 to 2027.
Mister Hawkins, the committee’s chief of staff, told senators that SB 436 would change how the state taxes commercial aircraft and directed all revenue to the aeronautics grant program. “This bill deals with airline property taxes. It is the only statewide property tax assessed by the state of South Carolina,” he said.
The bill’s core change would exempt 36.8421% of the fair-market value of airline companies’ aircraft, effectively lowering the assessment ratio from 9.5% to 6%. The measure also would define how time on the ground is calculated for tax purposes — each landing equals 30 minutes and each overnight or maintenance day equals two hours.
Sponsors and staff described a subcommittee amendment that replaces the original language to permit commercial carriers to be included in fee‑in‑lieu (FILO) agreements approved by the Coordinating Council on Economic Development. Supporters said the change lets the statewide tax be treated similarly to county-level FILO arrangements in targeted economic-development deals. The sponsor emphasized the bill targets major carriers: “This bill here deals with commercial aircraft…so it doesn't…have any effect on your Cessnas or even private jets.”
Committee members pressed how the change might affect in‑state maintenance jobs and state revenue. One senator noted comparable tax reductions for boats had led to more vehicles returning to the state; staff and other members said SB 436 is aimed at attracting investment tied to maintenance hangars or aviation training at commercially situated airports.
Members also discussed the fiscal note attached to the original bill and whether the subcommittee amendment required an updated fiscal impact. Staff said any fiscal impact from FILO agreements would depend on specific projects approved by the coordinating council. Senators agreed, by unanimous consent, to shorten a proposed sunset from 2028 to 2027 as a verbal amendment. With no objection, the chair moved the bill as amended to the next committee step.
Next steps: The committee moved SB 436 as amended for further processing; an updated fiscal analysis would follow if and when coordinating-council agreements are proposed.
