A bill

TO AMEND THE SOUTH CAROLINA CODE OF LAWS BY ADDING SECTION 6-1-2100 SO AS TO PROVIDE DEFINITIONS RELATED TO LODGING MARKETPLACES; BY ADDING SECTION 6-1-2110 SO AS TO PROHIBIT A GOVERNING BODY FROM PROHIBITING SHORT-TERM RENTALS EXCEPT UNDER CERTAIN CIRCUMSTANCES; BY AMENDING SECTION 6-1-510, RELATING TO DEFINITIONS CONCERNING LOCAL ACCOMMODATIONS TAXES, SO AS TO INCLUDE OPERATORS OF LODGING MARKETPLACES IN THE DEFINITION OF LOCAL ACCOMMODATIONS TAX; BY AMENDING SECTION 6-1-520, RELATING TO THE IMPOSITION OF LOCAL ACCOMMODATIONS TAX, SO AS TO PROVIDE THAT LOCAL GOVERNING BODIES IMPOSING A LOCAL ACCOMMODATIONS TAX MUST NOTIFY THE DEPARTMENT OF REVENUE AND THE STATE TREASURER; BY AMENDING SECTION 6-1-570, RELATING TO REMITTING TAX TO A LOCAL GOVERNING BODY, SO AS TO PROVIDE THAT LOCAL ACCOMMODATIONS TAXES MUST BE COLLECTED, REMITTED, AND ADMINISTERED IN THE SAME MANNER AS IN SECTION 12-36-920; BY AMENDING SECTION 6-1-620, RELATING TO DEFINITIONS RELATED TO THE BEACH PRESERVATION ACT, SO AS TO INCLUDE RENTALS FACILITATED BY A LODGING MARKETPLACE IN THE DEFINITION OF BEACH PRESERVATION FEE; BY AMENDING SECTION 6-1-630, RELATING TO BEACH PRESERVATION FEES, SO AS TO PROVIDE THAT THE LOCAL GOVERNING BODY ISSUING A TAX PURSUANT TO THIS SECTION MUST NOTIFY THE DEPARTMENT OF REVENUE AND THE STATE TREASURER; BY AMENDING SECTION 6-1-650, RELATING TO NOTICE OF DROPPED RENTAL PROPERTY, SO AS TO EXEMPT LODGING MARKETPLACES; BY AMENDING SECTION 5-7-30, RELATING TO POWERS CONFERRED UPON MUNICIPALITIES, SO AS TO PROVIDE THAT ANY TAXES IMPOSED UPON LODGING ACCOMMODATIONS BE COLLECTED AND ADMINISTERED BY THE DEPARTMENT OF REVENUE IN THE SAME MANNER AS IN SECTION 12-36-920; BY AMENDING SECTION 12-36-70, RELATING TO THE DEFINITION OF "RETAILER" AND "SELLER", SO AS TO PROVIDE THAT A PERSON OPERATING AS A LODGING MARKETPLACE BE CONSIDERED A "RETAILER" OR "SELLER"; BY ADDING SECTION 12-36-72 SO AS TO PROVIDE A DEFINITION FOR A LODGING MARKETPLACE; BY AMENDING SECTION 12-36-920, RELATING TO THE TAX ON ACCOMMODATIONS FOR TRANSIENTS, SO AS TO PROVIDE THAT TRANSACTIONS BY LODGING MARKETPLACES ARE SUBJECT TO THE SEVEN PERCENT SALES TAX; AND BY REPEALING SECTION 12-36-922 RELATING TO ACCOMMODATIONS TAX RETURN INFORMATION.

Be it enacted by the General Assembly of the State of South Carolina:

SECTION 1.  Chapter 1, Title 6 of the S.C. Code is amended by adding:

    Article 10

    Lodging Marketplaces

    Section 6-1-2100.  For purposes of this article:

    (1) "Effectively prohibit" means the local governing body acts or fails to act in a manner that results in the property owner, lodging operator, or tenant being prevented from using the owner's property as a short-term rental unit after reasonable compliance with generally applicable laws.

    (2) "Local governing body" means the governing body of a city, municipality, county, or other political subdivision of this State that has authority to enact a zoning ordinance, resolution, regulation, rule, or other requirement of any type regarding land use in its jurisdiction.

    (3) "Lodging marketplace" means a person or entity that:

       (a) provides for consideration, regardless of whether the consideration is deducted as a fee from the transaction, an online application, software, website, system, or other medium, through which short term rentals in this state are advertised or offered to the public as available; and

       (b) directly or indirectly provides or maintains a platform for goods or services by providing a payment system that facilitates a transaction between two platform users.

    (4) "Lodging accommodations" means any dwelling unit, room, campground space, lodging, or sleeping accommodation furnished to transient guests for consideration.

    (5) "Lodging operator" means a person who rents to an occupant any lodging accommodation offered through a lodging marketplace.

    (6) "Lodging transaction" means a charge to an occupant by a lodging operator for the occupancy of any lodging accommodation.

    (7) "Unaffiliated third party" means a person who is not owned or controlled, directly or indirectly, by the same interests.

    (8) "Short-term rental" means any single-family house, dwelling unit, room, or any unit or group of units in a condominium, cooperative or timeshare, or home that is offered for a fee and for less than thirty consecutive days. Short-term rentals do not include a unit that is used for any nonresidential use, including retail, restaurant, banquet space, event center, or another similar use.

    Section 6-1-2110.  (A) A local governing body shall not prohibit or effectively prohibit short-term rentals within its jurisdictional boundaries.

    (B) A local governing body may not:

       (1) restrict the use of or regulate short-term rentals based on their classification, use, frequency, or duration; or

       (2) enact or enforce a law, ordinance, regulation, or plan that regulates or prohibits short-term rentals unless the law, ordinance, regulation, or plan is enacted to:

       (1) protect the public's health and safety, including rules and regulations related to residential fire and building codes, health and sanitation, transportation or traffic control, noise levels, solid or hazardous waste and pollution control, and designation of an emergency point of contact, if the local governing body demonstrates that the rule or regulation is for the primary purpose of protecting the public's health and safety, provided that enforcement would not expressly or effectively prohibit or limit the use of a property as a short-term rental, and provided that the regulation is enforced by the local governing body in the same manner as for similar properties that are not short-term rentals;

       (2) require the registration of a short-term rental with the local governing body prior to the commencement of operations. Local governing bodies may impose a fine for failure to register under the registration program; or

       (3) limit or prohibit the use of short-term rentals for the purposes of housing sex offenders, operating or maintaining a structured, sober-living home, selling illegal drugs, liquor control, or pornography, obscenity, nude or topless dancing, and other adult-oriented businesses.

    (C) The local governing body shall not:

       (1) regulate the operation of a lodging marketplace; or

       (2) require a lodging marketplace to provide personally identifiable information of users without an administrative subpoena or court order.

    (D) This section does not apply to private entities or homeowners' associations.

SECTION 2.  Section 6-1-510 of the S.C. Code is amended to read:

    Section 6-1-510. As used in this article:

    (1) "Local accommodations tax" means a tax on the gross proceeds derived from the rental or charges for accommodations furnished to transients as provided in Section 12-36-920(A) and which is imposed on every person engaged or continuing within the jurisdiction of the imposing local governmental body in the business of furnishing accommodations to transients for consideration., including persons operating as a lodging marketplace as defined in Section 12-36-72.

    (2) "Local governing body" means the governing body of a county or municipality.

    (3) "Positive majority" means a vote for adoption by the majority of the members of the entire governing body, whether present or not.  However, if there is a vacancy in the membership of the governing body, a positive majority vote of the entire governing body as constituted on the date of the final vote on the imposition is required.

    (4) "Workforce housing" means residential housing for rent or sale that is reasonably and appropriately priced for rent or sale to a person or family whose income falls within thirty percent and one hundred twenty percent of the median income for the local area, with adjustments for household size, according to the latest figures available from the United States Department of Housing and Urban Development (HUD).

SECTION 3.  Section 6-1-520 of the S.C. Code is amended to read:

    Section 6-1-520. (A) A local governing body may impose, by ordinance, a local accommodations tax, not to exceed three percent.  However, an ordinance imposing the local accommodations tax must be adopted by a positive majority vote.  The governing body of a county may not impose a local accommodations tax in excess of one and one-half percent within the boundaries of a municipality without the consent, by resolution, of the appropriate municipal governing body.

    (B) A local governing body that imposes a local accommodations tax shall notify the Department of Revenue and the State Treasurer through delivery of a certified copy of the ordinance adopted by the local governing body imposing the tax at least sixty days prior to the effective date of the ordinance.

    (C) All proceeds from a local accommodations tax must be kept in a separate fund segregated from the imposing entity's general fund.  All interest generated by the local accommodations tax fund must be credited to the local accommodations tax fund.

SECTION 4.  Section 6-1-570 of the S.C. Code is amended to read:

    Section 6-1-570. The tax provided for in this article must be collected, remitted, and administered in the same manner as the tax imposed by Section 12-36-920. to the local governing body on a monthly basis when the estimated amount of average tax is more than fifty dollars a month, on a quarterly basis when the estimated amount of average tax is