SOUTH CAROLINA REVENUE AND FISCAL AFFAIRS OFFICE
S
TATEMENT OF ESTIMATED FISCAL IMPACT
WWW.RFA.SC.GOV • (803)734-3793
This fiscal impact statement is produced in compliance with the South Carolina Code of Laws and House and Senate rules. The focus of
the analysis is on governmental expenditure and revenue impacts and may not provide a comprehensive summary of the legislation.
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H. 3497
Fiscal Impact Summary
This bill, as amended, provides that a captive insurance company may apply to the director of the
Department of Insurance (DOI) for a license to provide insurance, including without limitation,
liquor liability insurance. However, it may not issue eroding or declining insurance coverage in
which the occurrence or aggregate limits are reduced by costs or expenses arising from the
insurance company’s duty to defend a claim. The bill, as amended, also provides that a person
licensed or permitted to sell alcoholic beverages for on‑premises consumption may qualify for a
liquor liability risk mitigation program to lower the required liability insurance amount if the
person and the entity for which the person obtains the license or permit satisfy certain operating
conditions, including having all employees who are employed as an alcohol server or a manager
on the permitted or licensed premises complete an alcohol server training program.
This bill, as amended, also provides for the establishment and implementation of an alcohol
server training program. The bill, as amended, authorizes the Department of Revenue (DOR), in
collaboration with the Department of Alcohol and Other Drug Abuse Services (DAODAS) and
the State Law Enforcement Division (SLED), to approve the alcohol server training programs
offered by providers and provides guidance regarding the curricula. The bill, as amended, also
requires the provider of a program authorized by DOR to pay a fee, in an amount to be
determined by the department, not to exceed $500 per year, to be deposited into the Responsible
Alcohol Server Training Fund to assist with the costs associated with the implementation and
enforcement of the provisions of the bill. DOR is also required to issue and renew alcohol server
certificates for all qualifying applicants free of charge. The bill, as amended, also removes
conduct involving the use, sale, or possession of alcohol from the list of behaviors to which
Section 15-38-15 of the Uniform Contribution Among Tortfeasors Act does not apply.
Additionally, this bill, as amended, modifies existing provisions related to driving under the
influence (DUI) offenses to allow for additional fines or terms of imprisonment in certain
circumstances and requires a defendant to participate in a DUI victim impact panel. The bill, as
amended, also creates a new felony offense for second degree DUI that results in moderate
bodily injury; requires a person convicted of felony DUI, second degree, to install an Ignition
Interlock Device (IID) for one year; and increases the amount of time a person’s driver’s license,
permit, or nonresident operating privilege may be suspended or denied for a DUI violation.
Bill Number: H. 3497 Amended by House Judiciary Constitutional Laws
Subcommittee on Februar
y 26, 2025
Subject: Liquor Liability
Requestor: House Judiciary
RFA Analyst(s): Bryant
Impact Date: March 4, 2025
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H. 3497
This bill, as amended, will have no expenditure impact on DOI. The department indicates that it
can manage the provisions of the bill with existing appropriations.
DOR indicates the need to hire 4.0 additional FTEs (one supervisor and three staff) at a cost of
$300,000 per year beginning in FY 2025-26 for salary and fringe benefits to administer the
provisions of the bill, as amended. DOR also indicates that the department will need to make
system updates and form changes to implement and manage the alcohol server training program.
The expenditure impact of this bill on DAODAS is pending, contingent upon a response.
This bill, as amended, will have no expenditure impact on SLED. The agency indicates that it
can manage the provisions of the bill with existing staff and appropriations.
This bill may increase the caseload of the Administrative Law Court (ALC). ALC reports that
due to a lack of historical data, the Court cannot adequately estimate the increase in the number
of contested case hearings that may arise. ALC anticipates that the initial impact of the bill on the
Court’s caseload will likely be minimal and can be managed with existing resources. However,
ALC reports that if there is a significant increase in the number of contested case hearings, the
Court will require a General Fund appropriations increase.
This bill, as amended, will have no expenditure impact on the Department of Motor Vehicles
(DMV). The department indicates that the required changes can be accomplished by assigning
duties among existing staff and using existing equipment and supplies.
This bill, as amended, will have no expenditure impact for the Department of Public Safety
(DPS), as it requires the department to perform activities that will be conducted within the
normal course of agency business.
This bill may result in an increase in the number of circuit court cases and potentially the number
of incarcerations, which may increase the workload of the court system and the Commission of
Indigent Defense, the Commission on Prosecution Coordination, the Department of Corrections
(Corrections), and the Department of Probation, Parole, and Pardon Services (PPP). However,
PPP does not anticipate that there will be a significant increase in the number of participants in
the IID program. The potential increase in expenses for each agency will depend upon the
increase in the number of cases and number of incarcerations. These agencies indicate that if this
bill, as amended, results in a significant increase in the workload, then an increase in General
Fund appropriations may be requested. For information, according to corrections in FY 2023-24,
the annual total cost per inmate was $40,429, of which $36,553 was state funded.
This bill, as amended, may increase Other Funds revenue (Responsible Alcohol Server Training
Fund) of DOR by at least $4,500 per year beginning in FY 2025-26 due to fees collected from
approved alcohol server training program providers. The overall amount of this increase in Other
Funds revenue will depend upon the amount of the fee charged to program providers, the number
of providers approved by the department, and the number of providers that are exempt from
paying the provider fee.
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H. 3497
This bill, as amended, may also increase Other Funds revenue of ALC due to an increase in
filing fees collected in court. Currently, a request for a contested case hearing regarding an
alcoholic beverage license violation must be accompanied by a non-refundable filing fee of
$150. However, the amount of the increase will depend upon the number of requests for a
contested case hearing filed with the Court. Due to a lack of historical data, the overall Other
Funds revenue impact from filing fees for a contested case hearing is, therefore, undetermined.
The bill, as amended, creates a new second degree felony offense for driving under the influence
resulting in moderate bodily injury to another person, which is punishable by a fine of not less
than $2,500 nor more than $5,000 and imprisonment for up to ten years. Pursuant to Section 56-
5-2945(D), $100 of each fine will be placed into a special restricted account to be used by DPS
for the Highway Patrol. Currently, penalties are in place for a DUI that results in great bodily
injury or death, and DPS receives $100 of each of those fines. However, DPS anticipates that the
designation of a felony offense that results in moderate bodily injury to another person may
increase the number of fines, thus increasing Other Funds for the agency. As DPS does not
currently track what would qualify for moderate bodily injury, the amount of the increase is
undetermined.
The Revenue and Fiscal Affairs Office (RFA) anticipates this bill may impact the caseload in
magistrate or municipal court. However, we anticipate any impact to the caseload can be
managed within existing funds for the local court. Additionally, RFA anticipates that this bill
may impact local expenditures due to a potential impact in the local jail population resulting
from the newly created felony offense and modified sentencing for existing offenses. However,
as the number of such offenses that might occur in a given year is unknown, the potential impact
to the local jail population and local expenditure are undetermined.
As this bill, as amended, creates a new offense, this may result in an increase of General Fund,
Other Funds, and local fine revenue. However, as the number of such offenses and the resulting
fines and fees that might occur in a given year are unknown, the revenue impact is undetermined.
Explanation of Fiscal Impact
Amended by House Judiciary Constitutional Laws Subcommittee on February 26, 2025
State Expenditure
This bill, as amended, provides that a captive insurance company may apply to the director of
DOI for a license to provide insurance, including without limitation, liquor liability insurance.
However, it may not issue eroding or declining insurance coverage in which the occurrence or
aggregate limits are reduced by costs or expenses arising from the insurance company’s duty to
defend a claim. The bill, as amended, also provides that certain entities licensed or permitted to
sell alcoholic beverages for on‑premises consumption may qualify for a liquor liability risk
mitigation program to lower the required liability insurance amount. An entity may qualify for
the program if all employees who are employed as an alcohol server or a manager on the
permitted or licensed premises complete responsible alcohol server training and obtain an
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H. 3497
alcohol server certificate. The business may also qualify for reduced liability insurance if certain
operating conditions, such as stopping alcohol sales earlier, are met.
This bill, as amended, also provides for the establishment and implementation of an alcohol
server training program. DOR, in collaboration with DAODAS and SLED, is authorized to
approve alcohol server training programs offered by providers. A provider may appeal a denial
pursuant to Section 61-2-260 and the South Carolina Administrative Procedures Act. The
provider must provide alcohol server training programs to all applicable individuals free of
charge, and the curricula of each program must include certain subjects as specified in the bill.
Online training programs must also satisfy certain criteria. DOR, in collaboration with DAODAS
and SLED, may suspend or revoke the authorization of a provider that the department determines
has violated the provisions of the bill.
This bill, as amended, also requires the provider of a program authorized by DOR to pay a fee, in
an amount to be determined by the department, not to exceed $500 per year, to be deposited into
the Responsible Alcohol Server Training Fund to assist with the costs associated with
implementation and enforcement of the provisions of the bill. State agency providers are exempt
from payment. Each year, DOR, with the assistance of SLED, must make a report of all income
and expenditures made from the fund the previous year. A copy of the report must be given to
the Governor, the Speaker of the House of Representatives, and the President of the Senate,
posted on the websites of DOR and SLED, and recorded in the journals of each body of the
General Assembly at the beginning of each legislative year. The bill, as amended, also requires
DOR to issue and renew alcohol server certificates to each applicant who completes an approved
program or a recertification program. Alcohol server certificates are valid for a period of five
years from the date the certificate is issued.
As a requirement for application or renewal of a permit or license for on-premises consumption,
a permittee or licensee for on-premises consumption seeking to qualify for the liquor liability
risk mitigation program must submit to DOR proof that the permittee or licensee, if applicable,
and each manager and alcohol server employed by the permittee or licensee during the upcoming
or prior permit or license period have or have held valid alcohol server certificates at all times
that alcoholic beverages were sold, served, or dispensed. DOR and SLED are responsible for
enforcing the provisions of this bill. DOR is also responsible for bringing administrative actions
for violations of the provisions of the bill or related regulations, and those actions shall proceed
according to the provisions of Section 61-2-260 and the South Carolina Administrative
Procedures Act.
This bill, as amended, also modifies the existing first offense penalties for a DUI to allow both
fines and terms of imprisonment to be assessed for a conviction. If the DUI offense causes a
collision which is determined to be a result of the convicted person committing an act forbidden
by the law or neglecting a duty imposed by law in the driving of a motor vehicle, the court may
impose an additional sentence of a fine of not more than $400 or an additional period of
imprisonment of not more than 30 days. In lieu of the 30 day imprisonment, the court may
provide for 48 hours of public service employment. This additional sentence may be imposed by
the magistrate or municipal court for any offense for which the court would otherwise have
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H. 3497
jurisdiction. The defendant must also participate in a DUI victim impact panel, the cost of which
may not exceed $75. The bill, as amended, also creates a new second degree felony offense for
driving under the influence resulting in moderate bodily injury to another person, which is
punishable by a fine of not less than $2,500 nor more than $5,000 and imprisonment for up to ten
years. An individual convicted for a second degree felony DUI must install an IID for one year.
Lastly, the bill, as amended, increases the amount of time a person’s driver’s license, permit, or
nonresident operating privilege may be suspended or denied for DUI violations.
Department of Insurance. This bill, as amended, will have no expenditure impact on DOI. The
department indicates that it can manage the provisions of the bill with existing appropriations.
Department of Revenue. DOR indicates the need to hire 4.0 additional FTEs (one supervisor
and three staff) at a cost of $300,000 per year beginning in FY 2025-26 for salary and fringe
benefits to administer the provisions of the bill, as amended. DOR also indicates that the
department will need to make system updates and form changes to implement and manage the
alcohol server training program.
Department of Alcohol and Other Drug Abuse Services. The expenditure impact of this bill
on DAODAS is pending, contingent upon a response.
State Law Enforcement Division. This bill, as amended, will have no expenditure impact on
SLED. The agency indicates that it can manage the provisions of the bill with existing staff and
appropriations.
Administrative Law Court. ALC reports that this bill, as amended, may increase the caseload
of the Court. However, due to a lack of historical data, the Court cannot adequately estimate the
increase in the number of contested case hearings that may arise under the program. ALC
anticipates that a minimal number of additional cases can be managed with existing
appropriations. However, ALC reports that if there is a significant increase in the number of
contested case hearings, the Court will require a General Fund appropriations increase.
Department of Motor Vehicles. This bill, as amended, will have no expenditure impact on
DMV. The department indicates that the required changes can be accomplished by assigning
duties among existing staff and using existing equipment and supplies.
Department of Public Safety. This bill, as amended, will have no expenditure impact for DPS,
as it requires the department to perform activities that will be conducted within the normal
course of agency business.
This bill may result in an increase in the number of circuit court cases and potentially the number
of incarcerations, which may increase the workload of the court system and the Commission of
Indigent Defense, the Commission on Prosecution Coordination, Corrections, and PPP.
However, PPP does not anticipate that there will be a significant increase in the number of
participants in the IID program. The potential increase in expenses for each agency will depend
upon the increase in the number of cases and number of incarcerations. These agencies indicate
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H. 3497
that if this bill, as amended, results in a significant increase in the workload, then an increase in
General Fund appropriations may be requested. For information, according to corrections in FY
2023-24, the annual total cost per inmate was $40,429, of which $36,553 was state funded.
State Revenue
This bill, as amended, allows DOR to charge providers of alcohol server training programs an
annual fee not to exceed $500. We assume that DOR will charge the full $500 fee for all
providers except state agencies, which are exempt from the provider fee. Based upon information
published by DOR, there are currently ten approved providers for alcohol server training
programs, with only one provider, DAODAS, being a state agency. In addition, DAODAS
developed an alcohol server education curriculum know as PREP, which is delivered through
county providers. It is unclear whether county providers will be subject to the provider fee.
DAODAS previously indicated that the PREP curriculum is delivered through county providers.
If the county providers are exempt from paying the $500 provider fee, this section of the bill will
increase Other Funds revenue by $4,500 annually beginning in FY 2025-26 for the nine private
sector providers. The overall amount of this increase in Other Funds revenue will depend upon
the amount of the fee charged to program providers, the number of providers approved by the
department, as well as the number of providers that are exempt from paying the provider fee.
This bill, as amended, may also increase ALC Other Funds revenue due to an increase in filing
fees collected in court. Currently, a request for a contested case hearing regarding an alcoholic
beverage license violation must be accompanied by a non-refundable filing fee of $150.
However, the amount of the increase will depend upon the number of requests for a contested
case hearing filed with the Court. Due to a lack of historical data, the overall Other Funds
revenue impact from filing fees for a contested case hearing is, therefore, undetermined.
The bill, as amended, creates a new second degree felony offense for driving under the influence
resulting in moderate bodily injury to another person, which is punishable by a fine of not less
than $2,500 nor more than $5,000 and imprisonment for up to ten years. Pursuant to Section 56-
5-2945(D), $100 of each fine will be placed into a special restricted account to be used by DPS
for the Highway Patrol. Currently, penalties are in place for a DUI that results in great bodily
injury or death, and DPS receives $100 of each of those fines. However, DPS anticipates that the
designation of a felony offense that results in moderate bodily injury to another person may
increase the number of fines, thus increasing Other Funds for the agency. As DPS does not
currently track what would qualify for moderate bodily injury, the amount of the increase is
undetermined.
This bill may result in an increase in the fines and fees collected in court. Court fines and fees are
distributed to the General Fund, Other Funds, and local funds. Therefore, RFA anticipates this
bill may result in an undetermined impact to General Fund and Other Funds revenue due to the
increase in fines and fees collections in court.
Local Expenditure
RFA anticipates this bill may impact the caseload in magistrate or municipal court. However, we
anticipate any impact to the caseload can be managed within existing funds for the local court.
__________________________________
Frank A. Rainwater, Executive Director
DISCLAIMER: THIS FISCAL IMPACT STATEMENT REPRESENTS THE OPINION AND INTERPRETATION OF THE
AGENCY OFFICIAL WHO APPROVED AND SIGNED THIS DOCUMENT. IT IS PROVIDED AS INFORMATION TO
THE GENERAL ASSEMBLY AND IS NOT TO BE CONSIDERED AS AN EXPRESSION OF LEGISLATIVE INTENT.
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H. 3497
Additionally, RFA anticipates that this bill may impact local expenditures due to a potential
impact in the local jail population resulting from the newly created felony offense and modified
sentencing for existing offenses. However, as the number of such offenses that might occur in a
given year is unknown, the potential impact to the local jail population and local expenditure are
undetermined.
Local Revenue
This bill may result in an increase in the fines and fees collected in court. Court fines and fees are
distributed to the General Fund, Other Funds, and local funds. Therefore, RFA anticipates this
bill may result in an undetermined impact to local revenue due to the increase in fines and fees
collections in court.