S.C. Code Ann. § 31-1-630
Reduction of rentals
Operative Text
If in any calendar or fiscal year the gross receipts of any company formed hereunder should exceed the payments or charges specified in Section 31-1-620, the sums necessary to pay dividends, interest accrued or unpaid on any stock or income debentures and the authorized transfer to surplus, the balance shall, unless the board of directors with the approval of the director shall deem such balance too small for the purpose, be applied to the reduction of rentals.
Under S.C. Code Ann. § 31-1-630, when a housing company formed under this chapter generates gross receipts in a given year that exceed its required payments—such as those specified in § 31-1-620, dividends, accrued interest on stock or income debentures, and authorized surplus transfers—any remaining balance must generally be used to reduce the rentals charged to residents. The only exception is when the board of directors, with the approval of the director, determines that the remaining balance is too small to make a meaningful reduction. This provision is designed to ensure that financial surpluses benefit tenants through lower rents rather than accumulating indefinitely within the company.
Plain English — not legal advice.
Property owners and managers operating companies formed under South Carolina's housing statutes should be aware that § 31-1-630 establishes a mandatory process for handling year-end financial surpluses. Compliant operators typically track gross receipts against all required payments and charges, document board decisions regarding surplus balances, and obtain director approval before concluding that a balance is too small to apply toward rental reductions. Maintaining clear financial records and formal board resolutions helps demonstrate adherence to this provision's requirements.
General guidance for property managers — not legal advice for your specific situation. Consult an attorney for advice on your case.
Section 31-1-630 of the South Carolina Code gives tenants in qualifying housing companies a financial interest in how annual surpluses are handled—specifically, a right to benefit from rental reductions when the company's receipts exceed its required expenditures. Tenants who believe a surplus has not been properly applied to reduce rents may wish to review the company's publicly available financial records or board decisions, and can consider reaching out to a tenant-rights organization for guidance on how this provision applies. Consulting with a local housing attorney or advocacy group can help clarify what documentation to request and what avenues may be available under § 31-1-630.
General guidance for tenants — not legal advice for your specific situation. Consult a tenant-rights organization or attorney for advice on your case.
Generated October 16, 2026 — auto-generated, not yet human-reviewed. See /transparency for methodology.
Effective Timeline
References In
Rules and statutes that cite this regulation