S.C. governor, lawmakers to discuss education funding this week

Inequity in rural, urban areas was top issue among Democratic predecessors

jself@thestate.comJanuary 27, 2013 

At a press conference held at the State House in January 2013, Governor Nikki Haley announced the creation of a nonpartisan committee to work on ethics reform. She was surrounded in support by some of the members appointed to that committee including attorney John Simmons.

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  • Changing how S.C. pays for its schools Some recent proposals to change S.C. K-12 education funding include: The S.C. Jobs, Education and Tax Act of 2013 Not yet introduced as legislation, the proposal – by the S.C. School Boards Association, S.C. Association of School Administrators and the S.C. Association of School Business Officials – would: • Impose a statewide millage rate to be used to calculate property taxes, eliminating rates that vary from district to district. The change would create a “level playing field” to attract businesses, supporters say. • Consolidate about 70 funding sources for K-12 education into 12. • Increase the base amount the state uses to determine how much school districts receive in total state funding. • Allow school districts to tax up to 8 percent of all non-owner-occupied properties, up from the current rate of 6 percent, and, if voters approve, expand the tax base to include owner-occupied residences, currently exempt from paying school-operating taxes. ‘Backpacking’ An idea endorsed by then-Gov. Mark Sanford in 2008, “backpacking” would tie education money to students instead of programs or school districts. Supporters say it would give districts more flexibility in how to they spend money. School choice Bills aimed at giving parents more options in the education of their children have taken different forms. “Open enrollment” would allow students to attend public schools outside their districts, clearing the way for students to transfer out of failing public schools and attend higher achieving public schools. The idea was supported by former S.C. education chief Jim Rex. Last year, an open-enrollment bill failed in the state Senate. Bills that would give parents tax breaks if they send their children to private school appear frequently in the state House and Senate. Last year, for the first time, a tax-credit bill passed the S.C. House. However, it failed in the state Senate. State Sen. Larry Grooms, R-Berkeley, introduced another tax-credit proposal last week.

— South Carolina’s Republican governor will start a bipartisan conversation Wednesday about reforming the state’s much-disputed method of paying for K-12 education – a move that has some across the political aisle optimistic about the potential for real reforms.

When Gov. Nikki Haley sits down for breakfast with state Senate and House leaders of both parties, she does not plan to dictate an agenda.

Asked for specific policy proposals she will bring to the table, Haley said, “I can have my ideas. But if my ideas are not something they are going to be willing to accept, then I’m not going to waste time pushing them on them.”

For the governor, the interest in discussing ideas – rather than dictating what must be done, as she often did during her first two years in office – represents a new approach.

Among those invited to the breakfast discussion that Haley initiated are Senate Pro Tempore John Courson, R-Richland, and state Sen. Nikki Setzler, D-Lexington. Like Haley, the senators say they have no preconceived plans for Wednesday’s breakfast beyond having a discussion.

Setzler said Haley wants to focus on a topic that she raised in her State of the State address earlier this month, “the inequity of funding in the rural portions of the state.”

“I’m looking to hear where she wants to go from that standpoint,” he added.

State Sen. John Matthews, D-Orangeburg, who also will attend Wednesday’s meeting, said he would not have expected the gesture from the often partisan governor three months ago and commended her for starting the conversation.

Haley’s new approach may be the result of lessons learned during her first two years in office, when the sometimes combative governor often found herself at odds with lawmakers.

During her State of the State address, Haley pledged to commit the next two years to addressing the volatile topic of funding public education, taking up the mantle of her Democratic predecessors who used education reform as an election-winning issue.

Gov. Mark Sanford, a mentor to Haley and proponent of limited government, seldom focused on K-12 public education, instead pushing to give parents tax credits if they send their children to private school and other “school choice” reforms.

Haley too included a reference to those divisive tax credits in her State of the State address but only in passing.

In almost 1,000 words on education, Haley included just more than 70 on school choice, saying it is something that “should have happened a long time ago.” But then she moved on quickly, saying while choice is “one way, a truly important way” to improve education, “we have to do other things as well.”

Haley later told The State the debate over school choice is no less important than the one about how to improve public schools, adding, “I don’t see any reason why both these conversations can’t occur at the same time.”

Toward a strong work force

In her State of the State address, Haley noted she grew up in rural Bamberg, attending school in a “brick box,” where she and her fellow students “didn’t know what we didn’t have.”

But, she added, “I know what it’s like in Bamberg and in many other rural and poorer areas of our state.”

The challenge in fixing that disparity, she said, is in finding a way to lift up poor, failing schools while protecting successful schools in “economically vibrant” parts of the state. School districts including Lexington County, where her children attend public school, benefit from strong tax bases, putting poorer areas at a disadvantage, Haley said.

“The tax base in those rural, challenged areas is never going to be the tax base in the urban, (developed) areas,” she said last week. But addressing the issue of disparity is important to the state’s economy, Haley added, because public schools are critical to developing successful workers.

Matthews, a member of a Senate subcommittee on K-12 education, agrees.

“The business community recognizes that we cannot continue economic development in this state if they don’t have a work force,” he said.

Matthews said the state suffers from a widening “wealth gap” that must be addressed or “you’ll always have that inequity that exists between the (school) districts.”

Equity an ongoing question

The question of whether schools are funded fairly is nothing new, as critics of Haley’s call to begin a conversation on educational disparity point out.

The S.C. Supreme Court is mulling a 20-year-old lawsuit brought by some of the state’s poorest school districts, contending they cannot provide a “minimally adequate” education with the money they now get from the state.

A ruling from the state’s highest court could change the way the state allocates money to school districts, pre-empting Haley’s discussion of disparity or making it more urgent for the governor and lawmakers to propose a solution.

Currently, school districts get money from a number of different pots, including state and federal dollars and local property taxes.

The state’s Education Finance Act of 1977 was enacted, in part, to create some equity in how school districts are funded. Under the law, the state uses a formula that considers each district’s ability to raise revenue through local property taxes to determine how much state money to give each school system. The formula aims at helping poorer school districts that need more state help.

But some districts struggle to raise enough money through property taxes on their own, especially after recent changes in the state’s tax code, which shifted the burden of paying for school operating costs away from homeowners onto commercial, industrial and personal property, which many rural districts have little of.

Districts also have some flexibility in raising taxes and spending money. But the end result is a statewide K-12 system where revenues vary widely from district to district.

Haley said her initial goals for Wednesday’s conversation are to find out whether dollars spent on K-12 education are following students into the classroom and what successful schools are doing in the classroom that others are not.

Asked when she would like to see legislation introduced, Haley said, “Obviously, yesterday, but I’m smart enough to know that things don’t move quickly.

“What I care more about is if we’re going to do this, let’s do it right.”

Reach Self at (803)771-8658

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