6,000 more SC students could get lottery scholarships

About 6,000 more S.C. high school students could be eligible for S.C. lottery scholarships because the state recently moved to a 10-point grading scale.

Eventually, that could cost S.C. taxpayers up to $50 million a year.

However, some lawmakers are balking at the cost, saying any extra money spent on education should go to the state’s poor, rural schools — not college students.

The new grading scale — an “A” now is a grade from 90 to 100 and a “B” from 80 to 89, when an “A” formerly was a grade from 93 to 100 and a “B” was 85 to 92 — means 6,000 more students will eligible for the LIFE and Hope scholarships, according to the S.C. Commission on Higher Education estimates.

Another 300 students now will qualify for larger Palmetto Fellows scholarships, worth from $6,700 to $10,000 a year. Previously, they would have qualified only for the Life Scholarship, worth $5,000 to $7,500 a year.

Unless lawmakers make the scholarships more difficult to qualify for, the changes initially will cost the state about $15 million but could rise to $50 million a year.

S.C. taxpayers already subsidize lottery scholarships.

During the past six years, S.C. taxpayers paid $460.7 million of the cost of lottery scholarships. The lottery paid the other $985.3 million.

Taxpayers subsidize the scholarships, promised when South Carolina passed a lottery, because the lottery only has made enough money to pay the full cost of the educational awards during one year since its 2002 founding.

However, some lawmakers are balking at the idea of more state budget money going into lottery scholarships. They note the Legislature has not yet funded a response to S.C. Supreme Court ruling ordering the state to spend more on its poor, rural schools.

More scholarships would cost the state

Chief House budget writer Brian White, R-Anderson, says the state is “allowing more people to have access to scholarships by lowering the grading scale.”

Lowering that scale means B- students — scoring from 80 to 84 — now qualify for the $5,000-a-year Life scholarship, for example.

But that also will cost more money.

Unless lawmakers make the scholarships more difficult to qualify for, the change initially will cost $14.5 million for the 6,333 students that would be eligible for a scholarship for the first time or for an increased award.

After four years of expanded scholarships, the cost would be about $50 million a year.

The S.C. Department of Education will work with the Commission on Higher Education on possible changes to the qualifications for the scholarships and take any recommendations to the General Assembly in January, said S.C. schools Superintendent Molly Spearman.

“The change to a 10-point grading scale not only puts our students on a level playing field with their peers in other states but also gives South Carolina a great opportunity to look at the requirements for our merit-based scholarship programs, whose current requirements have been in place since the inception of the Education Lottery,” said Spearman said.

Georgia and North Carolina long have used the 10-point scale. That put S.C. students at a disadvantage when competing for scholarships with students from those states since an “A” was tougher to earn in the Palmetto State.

“Any time we can open up the opportunities for our citizens to be able to get scholarships and further their education, I think that’s a good thing,” said White, chairman of the House Ways and Means Committee.

Subsidizing scholarships

Not every legislator shares that sentiment, however.

For years, state general fund dollars —made up largely of state sales and income taxes — have subsidized the scholarships because the lottery’s profits have not been big enough to cover all of their costs.

For example, in 2015-16, the state budget paid for $45 million for college scholarships while the lottery paid $219 million. (This fiscal year, which started July 1, was the first time the lottery could pay fully for lottery scholarships because of its increased sales due to large Powerball jackpots.)

At a House budget panel meeting Monday, lawmakers discussed subsidizing the scholarships further — with more state tax dollars — because of the change in the grading scale.

Democratic state Rep. Gilda Cobb-Hunter of Orangeburg wanted none of it.

“I am incensed that we are talking about putting dollars in (scholarships) ... and we have yet to honor the commitment that we owe to the Abbeville plaintiffs,” Cobb-Hunter said, referring to the poor, rural school systems that sued the state in 1993.

“It is ludicrous for us to sit here talking about making whole people who get (state scholarships).”

When, she asked, would state budget-writers get serious about responding to the Abbeville case.

White said Wednesday that the Legislature has tried to help poor schools by spending more on K-12 education, including paying for new reading initiatives and expanding 4-year-old kindergarten.

This story was originally published September 21, 2016 at 6:10 PM.