Frequently Asked Questions

Q: What is the Capital Project Sales Tax?

A: The Capital Project Sales Tax (CPST) is a 1% local sales and use tax used to fund specific capital projects, (i.e. roads, bridges, and intersection improvements).

 

Q: Who will pay the tax?

A: Anyone purchasing goods in Lexington County will help fund the road work. A significant portion of the money will come from people who live outside Lexington County. People from other places who visit, work, or purchase goods and services in Lexington County will help to contribute money to road improvements through the tax.

 

Q: What purchases are EXEMPT from the Capital Project Sales Tax?

A: Purchases that are exempt from the CPST include but are not limited to: unprepared foods (groceries), gasoline, and prescriptions. You can find more information about the CPST under the South Carolina Code of Laws at https://www.scstatehouse.gov/code/t04c010.php and at the South Carolina Department of Revenue at https://dor.sc.gov/tax/capital-project.

 

Q: How much money will be collected by the CPST? How long will it be in effect?

A: The SC Dept. of Revenue has estimated that $731 million will be collected by the CPST over the eight years it is in effect. If passed by the citizens of Lexington County at the November election, the CPST would go into effect May 1, 2028, and end April 30, 2036.

 

Q: What happens if the $731 million is collected before the CPST expires? Will the tax end early?

A: The CPST is projected to collect $731 million in the eight years it is in effect, however, that amount could change based on consumer spending during that time frame. The CPST could collect more or less than the projected $731 million – either way the CPST will be in effect for eight years if passed by Lexington County voters.

 

Q: What happens if the tax does not pass?

A: Without reliable funding, the County’s road condition will not be sustained. Lexington County will be unable to deliver projects to improve pavement condition, roadway safety, street capacity, or traffic flow.

 

Q: I thought we already have a tax in place to improve roads. Isn’t the gas tax supposed to be used for that?

A: In 2017, the State of South Carolina legislature approved an increase in the gas tax in the amount of $0.12/gallon. The purpose of this gas tax was to increase funding for the repair of the interstate and bridge system with the State’s roadway network. Counties only receive a small percentage of the gas tax, and that money needs to be spent according to State law.

In short, the state gas tax primarily prioritizes SCDOT interstates and bridges, not County-maintained roads and other infrastructure.

 

Q: How many other counties in South Carolina have a CPST or Penny Tax?

A: All counties that border Lexington County have a CPST except for Richland County, which has a Transportation Tax that is funded for road improvements. Of the 46 counties in South Carolina, 28 have some form of CPST or Transportation Tax. For a detailed listing of each county, click here: https://dor.sc.gov/tax-index/sales-and-use/Sales%20Notices/ST500.pdf#search=tax%20designation

 

Q: If this tax is approved by voters in November, how long will it take to start seeing work being done on the roads?

A: If the CPST is passed in November 2027, the CPST funds will start being collected in May 2028. Projects can begin dependent upon each entity/municipality that manages the projects. Disbursement of the collected funds from the SC Department of Revenue is expected in October 2028.

 

 

Q: Who is responsible for managing the projects? Who is making sure the money from the CPST is being used properly?

A: The managing agency (county, municipality etc.) is responsible for managing their own projects in the priority order that was approved by the CPST Commission and listed in the referendum question.

 

Q: Are these funds from the CPST just for Lexington County roads, or will municipalities also be included?

A: The funds from the CPST can be used on state, county and municipal roads located within the County of Lexington. The funds must be spent on specific projects listed in the referendum question.

 

Q: Why are we doing a CPST instead of a transportation tax if the CPST is being used for roads only?

A: Lexington County is not eligible for a transportation tax because there cannot be a transportation tax and a local tax enacted by the General Assembly. Lexington County already has a local school tax in place, so by law, Lexington County cannot enact a transportation tax.

 

Q: Why do we need to add another tax to pay for our roads improvements? Why can’t we use federal funds for these projects?

A: Federal funds are administered through the SCDOT. Counties only receive a small portion of the federal funds as a majority of the funds will be used by SCDOT for major interstates and other State-maintained infrastructure projects.

 

Q: What happens to the funds in eight years if a project is not finished?

A: Funds from the CPST will be collected until April 30, 2036. After the CPST expires, the collected funds will continue to be used for unfinished projects.

 

Q: Why are we doing a CPST instead of a transportation tax if the CPST is being used for roads only?

A: Lexington County is not eligible for a transportation tax because there cannot be a transportation tax and a local tax enacted by the General Assembly. Lexington County already has a local school tax in place, so by law, Lexington County cannot enact a transportation tax.

 

Q: Why do we need to add another tax to pay for our roads improvements? Why can’t we use federal funds for these projects?

A: Federal funds are administered through the SCDOT. Counties only receive a small portion of the federal funds as a majority of the funds will be used by SCDOT for major interstates and other State-maintained infrastructure projects. 

 

Q: What happens to the funds in eight years if a project is not finished?

A: Funds from the CPST will be collected until April 30, 2031. After the CPST expires, the collected funds will continue to be used for unfinished projects.