Hunter Howard, President of the South Carolina State Chamber of Commerce

MidlandsBiz:
How has the role of the State Chamber evolved over the past decade? 
 
Hunter Howard:
We changed our vision three years ago to reflect the evolving dynamics of the economy here in South Carolina.  Before that change, we promoted the state as a place that was cheap to do business.  Now, we promote South Carolina as a state where we add value to businesses that operate here. 
 
Today, our role is to ensure that South Carolina is a great place in which to do business.  Secondly, we work to create the environment to position the state for growth.  That includes making sure that the state invests research, infrastructure, and education that will pay dividends down the road.
 
MidlandsBiz:
How has this changing economy affected the makeup of your membership?
 
Hunter Howard:
With the shift away from textiles manufacturing and the significant growth in the small business service and also other sectors, the State Chamber had to find a way to engage a broader base of businesses.  We have reached out to sectors like tourism that traditionally had not been involved with us.
 
As for membership, we started to understand that if you are going to be effective in the legislature, you not only have to have a unified message, but also a lot of committed people delivering that message. 
 
In partnership with local chambers, we now offer a free electronic membership to smaller companies with fewer than 10 employees. It has increased our numbers from about 2,500 to around 8,000 in about an 18 month period of time.  It has been a challenge for the State Chamber in terms of customer service, but it gives us a much stronger voice at the legislature.
 
When you see things changing, you need to get with the times – quickly. 
 
MidlandsBiz:
How has the Agenda of the State Chamber evolved? 
 
Hunter Howard:
Our overall goal is to increase per capita income – personal wealth – for all South Carolinians by increasing productivity and positioning the state for global competition.  To achieve this goal, we have strongly supported initiatives such as increasing funding for the Endowed Chairs, Innovation Centers, as well as incentives for investing in hydrogen.  A few years back, we would not have thought of investing in these areas.   
 
We have come out in support of tax increases for infrastructure, something that a couple of years back we would never have done. 
 
We include issues of importance to tourism because of the critical role of this industry to the economy of South Carolina.
 
MidlandsBiz:
What is it going to take to get South Carolina up to par in terms of per capita income with the rest of the country?
 
Hunter Howard:
To build a globally competitive climate by investing in workforce development and infrastructure, having a good business climate, and promoting a research-based, entrepreneurial economy.
 
To stimulate innovation, we need to highlight individuals who have done creative things.  We need to create a rock star image for those people who are doing some interesting things and who will impact South Carolina’s future economy.
 
MidlandsBiz:
How well is South Carolina doing at adapting to the global, knowledge-based economy?
 
Hunter Howard:
Last week, we published a report called Break Away South Carolina that attempts to answer just that question by seeing how South Carolina measures up in six critical areas.
 
We are holding our own in terms of workforce development.  We dropped in terms of business costs mainly because of high worker’s compensation costs.  Last year, through a major reform package we improved our worker’s comp climate but it is going to take a while to work its way through the system before we start to see any visible effects on rates. 
 
The one area where we have made significant improvement is in innovation, dynamism and entrepreneurial activity.  What we are seeing is a connecting of the dots in terms of an overall strategy of how to position ourselves to compete in the knowledge-based economy.  Through the research created from the Endowed Chairs program, innovation centers, seed capital tax incentives  we are making significant progress.
 
We are still not where we need to be, but if we continue the path for another five or six years, we are going to see some spectacular results.
 
MidlandsBiz:
Do you have any naysayers when it comes to this strategy of promoting the knowledge-based economy?
 
Hunter Howard:
ICAR was easy and everybody rallied around it, but with hydrogen fuel cells, we hear some critics say that it’s too late in the game.  Some people also doubt that we can attract the high level research people, but time and again we are proving the skeptics wrong.  
 
We have the best collaborative effort between the three research universities that I have seen in all my years here in South Carolina.  They are all working together, but they are finding their niche areas. 
 
We have the horse power here; we just need to stay the course. 
 
MidlandsBiz:
How does the State measure up in terms of infrastructure investment?
 
Hunter Howard:
Recently, $70 million was transferred from the general fund to improve roads, which is great.  However, the need is actually four times that amount.  Right now one in four bridges are substandard or obsolete.  Unfortunately, it appears as though it will take a bridge collapse to get people’s attention.
 
Our secondary roads are deteriorating – if we don’t spend the money now, we are just going to have to spend more down the road.  Our maintenance schedule has gone from 20 years to 70 years.
 
Expansion of the port in Charleston is another infrastructure area that has been at the top of our priority list.  Three years ago, we approved three berths at the naval base, but these investments will only carry us to 2017 before we are at capacity again.  We must also move forward with the development of a site in Jasper County on the Savannah River. Our port has to anticipate the needs of the economy for the next 20 – 30 years.  If carriers don’t see that you will able to service their needs long-term, then they are going to move to another place.  
 
MidlandsBiz:
What is the latest brouhaha over immigration policy that is being pushed forward in the General Assembly?
 
Hunter Howard:
Last year we took the position that the immigration issue could not be solved within South Carolina, that we needed a long-term solution, and that the federal government needed to address the issue in a comprehensive manner.  But Congress failed to act, and with this being an election year, they are unlikely to do anything.  At the local level we are starting to see cities and counties begin to take action into their own hands and frankly, that is a nightmare scenario for businesses that do business across the State. 
 
If employers can have a straightforward process to verify their employees – we are all for it. Businesses alone cannot solve this issue and we must be sensitive to the regulatory burden that we place on our companie
s especially if that burden is greater than our neighboring states.
 
MidlandsBiz:
You strongly disagree with the new property tax legislation? 
 
Hunter Howard:
We were opposed to it from the beginning; we told the legislators that if we were going to provide relief it should not be on the backs of the business community.  To business we have made a bad property tax system worse by shifting the burden to them and to the tax policy of our state we have moved from a stable tax source of revenue (property tax) to the most volatile source of revenue (sales tax) .
 
The bill that was passed is a potential train wreck for business, and for schools.  Our manufacturing assessment ratio is the highest in the country, and our commercial is 7th highest, and now you take individuals off the tax role, but leave businesses on…
 
Legislators are now seeing the unintended consequences of their action and how this bill would impact our economic future.  The problem is we have seen the good (people have received their property tax rebate checks); we haven’t seen the bad (businesses leaving the state, not growing in this state, not coming to this state because of the high taxes, or closing doors because of high taxes) which should happen over the next couple of years.
 
MidlandsBiz:
Are they going to address the issue in this year’s session?
 
Hunter Howard:
No, it’s an election year.
 
MidlandsBiz:
Going forward, what are you trying to do at the State Chamber level to rectify this problem?
 
Hunter Howard:
Here’ our role as we see it:
 
1. Raise awareness of the problem through studies.
2. Push for a cap on property taxes of business property like exists for other residential property.
3. Promote a comprehensive look at the tax system. 
 
We are forming ad hoc committees to look at the tax system so we can get something done in the following year when it’s not an election year.
 
MidlandsBiz:
How will this shift in tax strategy affect education funding?
 
Hunter Howard:
Well, that’s another big question mark.
 
Dr. Rex is doing a comprehensive study of school funding and is exploring the possibility of a statewide funding system.
 
MidlandsBiz:
What are you most proud of during your years as the head of the State Chamber?
 
Hunter Howard:
Years ago, we used to be very reactive when it came to the General Assembly.  They would propose legislation and we would say either it was good or bad.  Now we are more proactive with what we would like to see accomplished in the legislature and we work with our local chambers to carry the message to legislators back home. Very few states in the country have the relationship with local Chambers that we have. That is critical to getting legislators to listen to our concerns.
 
Our biggest challenge is our biggest strength.  With all the businesses in all the industries across the State, it is a challenge to develop a broad-based agenda that we can all agree on. But once that is done it is a powerful unified voice speaking to the General Assembly.  That’s why we do grass roots meetings all across South Carolina in August and September in order to get a pulse of what needs to be done to move this great state forward.  The only way that you are going to get people and businesses to engage on the back end is to engage them on the front end. 
 
We also provide them with one of the most sophisticated ways to allow businesses to participate directly in the process by facilitating electronic communications with their legislator.
 
MidlandsBiz:
Does that work at getting a legislator to change his mind?
 
Hunter Howard:
Well I suppose it depends on the legislator and the individual.  Some may take their phone off the hook or don’t read their email, but most listen. I served in the House for 8 years, and as a rule of thumb, if you get 8 or 10 calls from your constituents, that’s a crisis.
 
MidlandsBiz:
What leader or mentor has influenced you as a business leader?
 
Hunter Howard:
Carroll Campbell, who I replaced in the State House, was the best when it came to developing an economic vision of the future for this state and implementing that vision on a nonpartisan basis.  We were in different political parties at the time, but we were the best of friends and worked closely together.  Between 1986 and 1992, I served in his administration at the Department of Revenue and accompanied him on most of his trade mission trips. When we met with business leaders in other countries he did a magnificent job laying out what our state had to offer and then making sure that we followed up on our commitments. 
 
MidlandsBiz:
What book would you recommend to our readers?
 
Hunter Howard:
I just read a great book called Half Time by an author named Bob Buford.  He talks about how people need to consider, at a point in their life, how to move from success to significance.  I am currently going through this kind of an assessment period in my life and asking the question of what I need to be doing to give back to achieve a broader sense of significance in my life. 
 
MidlandsBiz:
What are your hobbies?
 
Hunter Howard:
I enjoy buying old things and turning them into something fresher and more valuable.  And I have always had a knack for finances.  As I think beyond my time here at the South Carolina Chamber, I would like to achieve some sense of significance by combining those talents.