For the South, OBBB is a mirror and a pressure test

By Andy Beck
Smart Brevity™ count: 6.5 mins…1684 words

👋 Welcome to Big South Insights, the biweekly dispatch from Ohio River South.

The One Big Beautiful Bill is a mix of permanent tax cuts, federal belt-tightening, and shifts in DC’s domestic policy posture on everything from entitlements to energy — and it’s being hailed as one of the most sweeping legislative packages in decades.

But for Southern states, the bill’s passage doesn’t just represent a federal victory—it triggers a complex realignment that governors, legislators, businesses, and nonprofits must now navigate on their own terms.

Energy: The bill phases out the 30% residential solar tax credit by the end of 2025 and trims incentives for large-scale renewable projects—measures that hit the South directly. Georgia, North Carolina, and South Carolina had become national leaders in solar deployment, as contractors and developers built business models around tax credits.

• Now, many of them are pausing hiring and rethinking expansion plans. The momentum that once defined the Southeast’s clean energy boom is slowing—just as demand is beginning to spike.

Healthcare: The bill carves out nearly $1 trillion from Medicaid over the next ten years and imposes new work requirements for many recipients. For big states with strong safety nets, the blow may be softened.

• But places like Mississippi, Alabama, and Louisiana—where rural hospitals operate on razor-thin margins and Medicaid supports both care and jobs—the changes could be destabilizing. Clinics and nonprofits are already bracing for a spike in unmet need, while state agencies scramble to adjust.

Taxes: This wasn’t just a rollback. It also locks in permanent tax cuts: lower rates, enhanced deductions, and a new exemption for tipped wages. For working families and small businesses across the South, that’s meaningful. For many Republican lawmakers, it’s the heart of the bill.

• But the trade-off is real: according to the Congressional Budget Office, the bill will add over $3 trillion to the national debt in the next decade. For a region that values fiscal responsibility, that’s a tough pill to swallow.

Not surprisingly, the bill caused tension, even within Republican ranks. In the South, some conservative lawmakers celebrated the tax relief, while others worried aloud about what comes next—about how to balance short-term wins with long-term consequences.

And that’s really the story here. OBBB isn’t just a piece of federal legislation. It’s a mirror—and a pressure test. It reveals how far Southern states have come in asserting their independence and how much further they’re willing to go.

Already, we’re seeing new state-level incentives, pending lawsuits, and policy recalibrations in response. Whether it’s tax code revisions, healthcare backstops, or energy planning, the South is preparing for a post-OBBB world on its own terms.

The bill may be beautiful. But as ever, beauty is in the eye of the beholder.

Florida restricts foreign funding for nonprofits

On July 1, 2025, Florida’s SB 700 took effect, banning nonprofits from accepting donations from “foreign countries of concern” and requiring them to attest to not soliciting such funds via a state “Honest Services Registry.”

South Carolina expands public deposits to include credit unions

In June 2025, South Carolina lawmakers advanced S. 60—the Financial Freedom Act—through the Senate Banking & Insurance subcommittee. This crucial step will allow municipal governments, school districts, and other local entities to deposit public funds in federally insured credit unions, introducing competition to traditionally bank-dominated public finance.

Federal SBA opens public comment on SBIC reforms

On July 7, 2025, the SBA released proposed amendments to the Small Business Investment Company (SBIC) program regulations, modernizing licensing rules for Early-Stage SBICs, adjusting debenture frameworks, and focusing on critical-technology investments. Public comments are open through early September.

Federal Treasury halts BOI enforcement under CTA

In March, the U.S. Treasury (FinCEN) announced it was suspending enforcement of Beneficial Ownership Information (BOI) reporting penalties under the Corporate Transparency Act (CTA) and proposed only applying the rules to foreign-reporting companies—easing compliance concerns for U.S. nonprofits and businesses.

Federal Labor Dept. issues updated Davis–Bacon guidance (2025 webinars)

In June 2025, the DOL announced webinars and guidance materials to support contractors under its expanded Davis–Bacon prevailing‑wage updates—applicable to clean energy and infrastructure projects and reflecting regulatory changes finalized in 2023.

Florida House overrides DeSantis veto on property-tax cut measure → Politico

• In late June 2025, the Florida House narrowly overrode a gubernatorial veto of a property-tax reduction package passed earlier in the session. This triggered extended floor debate, as lawmakers argued whether the cuts—mainly benefiting homeowners in moderate-value brackets—supported families or unduly constrained local revenue.
• The override passed 78–42 after three hours of heated discussion.

South Carolina halts legislative pay raise as Supreme Court reviews lawsuit → AP News

• Amid intense floor debate in late June, South Carolina’s Supreme Court issued a preliminary injunction suspending the planned $18,000 annual “in‑district compensation” increase—raising monthly payments from $1,000 to $2,500 for each legislator—that was inserted in the FY 2025–26 budget. Republican Sen. Wes Climer, alongside retired educator Carol Herring, sued on June 9, arguing the raise violated the state constitution by increasing per diem during lawmakers’ terms.
• The court ruled that lawmakers will not receive any in‑district pay for at least two months while briefs are reviewed, with a decision expected after September.

Texas House passes dozens of business and community bills during marathon floor session → KVUE

• In a whirlwind session last month, the Texas House approved more than 20 bills affecting library content, school nutrition, HOV lane eligibility, and other public services after extended floor debates.
• Noteworthy legislation includes new restrictions on sexually explicit materials in public libraries, mandates around additives in school lunches to promote healthier eating, and updates to transportation rules governing who may use HOV lanes. The activity wrapped up a marathon cycle of amendments and policymaking ahead of the state’s June 2 adjournment.

What Trump’s ‘Big Beautiful Bill’ means for your taxes, health care and energy
→ Washington Post

States race to shield hospitals from GOP Medicaid cuts
→ Stateline/PEW

Georgia regulators approve power rate freeze through 2028
→ AP News

Florida Governor signs slimmed-down $115B budget with $1.3B tax cuts
→ AP News

Alabama implements new THC regulations, bans smokable hemp
→ Axios

Georgia laws on hunting, IDs and schools took effect on July 1
→ Axios

Arkansas legislators advance Advanced Nuclear Reactor Feasibility Study
→ Arkansas Advocate

Georgia PSC primary: Echols renomination; Waites and Hubbard head to runoff in District 3
→ AP News

Upcoming Events

July 13–15 — Southern Business Deans Summer Workshop — Chattanooga, TN

July 19–23 — Southern Legislative Conference — Birmingham, AL

August 7–9 — Netroots Nation 2025 — New Orleans, LA

August 12 — Bloomberg “Business Value of AI” — Atlanta, GA

✅ Still in Session

Florida | Budget implementation underway – Gov. DeSantis signed the $115.1 billion FY 2025–26 budget featuring $2.25 billion in tax cuts, emergency reserve boosts, hurricane-related exemptions, and changes to school-choice provisions. Implementation continues, with veto overrides and funding timelines active into mid‑July.

North Carolina

• 2025 Biennial Session (Jan 8–Jul 31) still in motion.
• On June 20, Gov. Stein vetoed bills on permitless carry and expanded immigration detention; the legislature lacks needed majority to override, but debates continue. Climate repeal bills are also advancing in the Senate this month.

South Carolina | Though sine die was May 8, both chambers remain in recess—not dissolved—enabling reconvening for veto overrides or budget adjustments up to January 12, 2026.

By July 24 – FERC proposal to streamline natural-gas project approvals opens feedback window → Federal Register

• On July 1, 2025, the Federal Energy Regulatory Commission (FERC) issued a notice proposing to remove restrictions that prevent pipeline and storage construction from proceeding while rehearing requests are still pending under the Natural Gas Act. The move aims to “remove impediments to the construction of needed energy infrastructure,” according to FERC, and signals a shift toward faster permitting of natural gas facilities—an energy source critical to many Southern states.
• The deadline for public comments is July 24, 2025, setting this month as a pivotal moment for stakeholders across the South to shape the proposal.

By July 15 – FDA extends comment period on front-of-package nutrition rule → Federal Register

The Food and Drug Administration (FDA) announced a 60-day extension on its proposed front-of-package nutrition labeling rule—meaning stakeholders now have until July 15, 2025, to submit comments. The rule aims to provide consumers with easy-to-understand nutrition summaries (low, medium, high) for saturated fat, sodium, and added sugars on packaged foods. The extension opens room for industry, health nonprofits, and Southern producers to influence labeling requirements—making this month a key window for public input.

June 30 – Education Department freezes $6.8 B in K‑12 grants for policy review → Politico

• The U.S. Department of Education announced it is pausing $6.8 billion in federal K‑12 education grants, including funds for after-school programs, summer learning, teacher training, and migrant education. The decision—revealed in a June 30 directive—impacts 33 states and more than a dozen grant categories. Officials say the freeze is part of a broader policy alignment review under the Trump administration’s push to redirect education spending toward “core instruction.”
• Unless resolved quickly, the freeze threatens to disrupt services just as districts finalize staffing and programming for the new school year. State education departments have until late July to resubmit grant plans that align with new federal guidance.

June 27 – Supreme Court limits “nationwide injunctions” in Trump v. CASA → Reuters

The U.S. Supreme Court ruled 6–3 in Trump v. CASA, curbing lower courts’ power to issue sweeping nationwide injunctions against executive actions unless the plaintiff alone is adversely affected. The decision diminishes the ability of district judges to broadly block federal policies—such as Trump’s directive on birthright citizenship—unless explicitly warranted.

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