The state House of Representatives overwhelmingly passed a bill Wednesday to deregulate the state's three research universities and free them from the Commission on Higher Education.
The bill, which was approved by an 84-10 vote, calls for the creation of the South Carolina Research Oversight Council to coordinate the missions of the University of South Carolina, Clemson University and the Medical University of South Carolina.
The board, which would be made up largely of trustees from the schools, would steer the schools' research efforts and focus on statewide economic development.
The legislation also gives the schools access to $140 million in state bond money for special research projects and allows them to more easily enter into partnerships with private businesses.
"If we give them the ability through these tools to enhance their research capacity, we'll have a huge impact on economic development in this state," said House Ways and Means chairman Bobby Harrell, R-Charleston, one of the bill's chief sponsors.
State business leaders and the research institutions lobbied legislators for months to allow them to leave the CHE, arguing that the agency is bogged down in regulatory red tape.
USC spokesman Russ McKinney said the Wednesday's vote was a "strong step" toward greater economic development in the state.
"We're obviously pleased and the vote shows the concept had strong backing," he said.
The House vote was bad news for the beleaguered CHE.
The Senate is expected to consider two bills that would essentially dissolve the agency by spinning off the state's technical colleges and the rest of the state's four-year institutions. Those bills could be considered as early as next week.
Some House members questioned whether pulling the three schools out of the CHE, which coordinates the state's 33 higher education institutions, would be a step backwards.
"What prevents the fox from guarding the proverbial hen house," asked House Education chairman Ronny Townsend, R-Anderson. "If the schools don't perform, what do we have as a check and balance?"
Several legislators tried in vain to stop the bill by proposing amendments to instead form a single more powerful governing board of regents for all of the state's colleges and universities, an idea supported by Gov. Mark Sanford, and to create a blue-ribbon commission to look at higher-education governance.
Rep. Gilda Cobb-Hunter, D-Orangeburg, supported the bill but said the state needs to focus on all its colleges and universities, not just the three research schools.
"I wanted this (bill) to generate a discussion about overall higher education governance and that hasn't happened, so I'm disappointed," she said.