SC lawmakers advanced pro-consumer reforms, but ignored one that matters most locally
- Guest Columnist Rick Osbon
- Jun 20
- 3 min read
As the 2025 legislative session concludes, South Carolina lawmakers can point to meaningful progress on consumer choice and freedom issues, working to advance long-awaited income tax cuts and passing tort reform that will benefit residents statewide.
But amid these victories, the Legislature failed to act on a commonsense measure that would empower South Carolinians at the most local level: the South Carolina Financial Freedom Act.
At its core, this bill is about extending those same principles — choice, competition, and fiscal responsibility — to local governments’ management of taxpayer dollars.
Just as individuals should have more freedom in how they save, invest, and spend, so should the cities, counties, and school districts that serve them daily.
And that’s exactly what the Financial Freedom Act seeks to accomplish.
Though H.3221/S.60 was not passed this year, the Palmetto Public Deposits Coalition (PPDC) reflects on this session as one of significant momentum in our effort to give local governments greater flexibility and financial choice.
The Financial Freedom Act, championed by Rep. Nathan Ballentine and Sen. Sean Bennett, steadily gained ground, attracting new bill sponsors, receiving a Senate Banking and Insurance subcommittee hearing, and raising broad awareness about a policy change that would give public entities more tools to deliver better outcomes for taxpayers.
The bill would do one simple thing: allow public entities to deposit taxpayer dollars in credit unions.
These institutions already serve millions of South Carolinians with mortgages, car loans, and small business financing.
Enabling local governments to use them would create healthy financial competition, expand access to local banking options, and allow the free market to deliver better interest rates, stronger returns, and smarter stewardship of public funds.
That need for competition is especially urgent when you consider where public money is currently going.
As much as 78% of all deposits in South Carolina last year were put into banks headquartered in another state.
That means the vast majority of South Carolinians’ dollars — often taxpayer funds — are managed by institutions with no stake in our local economies. By contrast, credit unions are locally governed and mission-driven, with a proven track record of reinvesting in the communities they serve.
Earlier this year, I had the opportunity to speak directly to members of the Senate Banking and Insurance subcommittee about the practical impact of this change.
I shared my perspective not only as chairman of the coalition, but also as the former mayor of Aiken and former president of the Municipal Association of South Carolina.
My message was simple: too many communities are locked into limited banking choices, even as branches continue to close across the state.
In fact, bank closures remain a growing concern.
TD Bank recently announced the shuttering of branches in Columbia and Greer — part of a national trend that saw over 140 net bank branch closures in the first quarter of 2025 alone.
When public entities are barred from banking with credit unions, they’re often forced to do business with institutions outside their communities — ones that may not reinvest locally or offer the best value for taxpayer dollars.
As Greg Habib, mayor of Goose Creek, wrote earlier this year, “Financial convenience for local governments isn’t just a banking issue — it’s a community issue.”
Habib’s words reflect what many local government leaders experience: the inability to choose the best local financial partner often leaves public funds managed from afar, rather than reinvested back into our own communities where those dollars originated.
That’s why the Palmetto Public Deposits Coalition has spent the past year engaging stakeholders, legislators, and the public to make the case for this reform.
As we prepare for the 2026 legislative session, we’re expanding that effort, working closely with the Municipal Association of South Carolina and the South Carolina Association of Counties to educate their members about the real financial benefits this policy could unlock.
From taxpayer savings to improved access and responsiveness, the case for action grows stronger every day.
This is not about picking winners and losers. It’s about fairness, competition, and allowing local governments to choose the best financial partners for their communities.
South Carolina’s financial system should reflect those values because strong local institutions build strong local economies.
There’s still time. With continued public support and growing legislative interest, the Financial Freedom Act can be part of South Carolina’s path forward.
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