Who Pays for the Boom?
New Census numbers show South Carolina is the nation’s fastest-growing state, adding almost 80,000 new residents between July 2024 and July 2025.
Growth was fueled, the Census added, “by a sizable net domestic migration increase of 66,622 … the increase of 1.5% was the highest of any state.”
But while some may be elated with fresh tax dollars they expect from just about enough people to populate another city the size of Greenville (70,720 people in 2020), think a little more deeply: If as a state we had to pay for a whole new city about the size of Rock Hill (74,372 people), how much would it cost to build everything that those new people in that new city would need – in one year? Billions. And next year, billions more for another city that size, if growth trends continue.
or a state that has miserably underinvested for generations in physical and human capital, adding more people is further thinning services to everyone – unless the state morphs away from a lingering plantation economy and starts spending real money to pay for better roads, schools, health care. Not only would improving infrastructure benefit newcomers and make the state more attractive, it would help lift longtime citizens out of endemic poverty, hunger and disease by reseeding the state’s economy with the fuel of capital and human investment.
That means investing more for roads and bridges, such as the
$1.1 billion that outgoing Republican Gov. Henry McMaster has called for.
That means more for education, such as paying new teachers more, which the
governor also called for in Wednesday’s State of the State address.
But beyond using surplus state tax dollars for these lofty goals, the state
needs to stop cutting income taxes for rich folks and generate more money to
pay to prop up rural hospitals to improve health care. It needs even more
money for roads and public infrastructure. It should steer new funding
into public colleges, technical colleges, job training and more. In
short, it needs to invest in South Carolina’s people.
McMaster, a fan of income tax cuts, alluded to investment needed for growth challenges in future years: “If left unaddressed, we will face future problems with water and sewer access, traffic congestion, road and bridge repair, demand for electric power generation, public safety, school overcrowding and health care availability and everything else,” he said.
“Therefore, I submit to you that the time has come — and reality requires — that we seriously assess whether our state’s infrastructure and government services will be able to catch up if this unrestrained out-of-state population growth continues at this rate.”
For the past 50 years, South Carolina economic development
has focused on luring big manufacturing companies and their jobs here.
The state has done remarkably well by nabbing companies like BMW in Spartanburg
to Boeing in Charleston. But the job whales are fewer and further between
– and their demands can cause problems, such as the $150 million in
overruns for environmental mitigation
the state is being asked to pay for in the Midlands because of its promises to
Scout Motors.
Now is the time for the state to focus on helping small businesses, which fuel
way more jobs than the whales. We’ve long called for the state to have a
cabinet-level office to help small businesses, matched by a budget that can
actually do something. (For example, if the state gave $500,000 grants to
300 targeted small businesses, it’s a pretty good bet that they would create
more jobs than the 5,200 jobs coming from the $7 billion investment at two
Scout Motors locations.)
In his speech, McMaster said the state’s best days are ahead. We
agree. But to get there, state lawmakers need to focus on the future part
of McMaster’s message and do something active – people investment – instead of
just waiting passively for more people to show up with their retirement savings
and senior tax rates.
Andy Brack is editor and publisher of the Charleston City Paper and Statehouse Report. Have a comment? Send to: feedback@statehousereport.com.
Published in coordination with StatehouseReport.com with assistance from the S.C. Institute for Independent Journalism.