Costly corporate tax breaks are taking away money to improve South Carolina’s schools

When I was in graduate school I worked for an economic development group that recruited companies to the metro Atlanta area. And time and again when executives would visit, this question would be among the first they’d ask:

“How good are the schools?”

It was very clear to me then that the quality of schools matters a great deal when it comes to attracting investment and jobs.

I’m now back in my native South Carolina where I am an educator and advocate for public education. And I am concerned about the subpar, uneven quality of our state’s public schools.; U.S. News and World Report, for example, ranks South Carolina’s schools No. 43 among the 50 states.

The state’s “Corridor of Shame.” a nickname given to a string of rural, impoverished and poor-performing school districts along South Carolina’s Interstate 95 corridor, serves as a stark reminder that much work needs to be done to improve our national standing in education.

This region of the state, with flat farmland and remnants of industries that have relocated overseas, needs to attract jobs — and it also needs employers who want to invest in our future. But by disinvesting in their school systems many South Carolina counties are undermining their ability to compete.

To revitalize these economies we need to invest in traditional public schools — yet this need to improve the quality of our public education system is too often ignored by state political leadership.

We have growth in some areas. And when jobs grow, people move in — and that means more families with school-age children. But then we abate the companies’ taxes, which puts stress on the tax base we need to keep our schools modern and healthy.

A severe problem

Until now we did not know how severe this disinvestment has become.

Under state law counties award massive economic subsidies and tax incentives — even though school districts lose the most revenue. Last year these corporate tax breaks cost South Carolina public schools $423 million, an astonishing increase of $99 million from FY 2017.

This fact was revealed recently by Good Jobs First — a nonprofit think tank — along with the South Carolina Education Association; they found that millions in property tax abatements have been granted to companies like Boeing, BMW, Volvo, Amazon and dozens of other businesses operating in the state.

The biggest aggregate losers were Berkeley County ($54 million) and Greenville County ($41 million); meanwhile, poorer counties such as Orangeburg, Dorchester, Calhoun, Greenwood and Barnwell lost more than $2,000 per pupil.

A new approach

That’s why groups that are committed to supporting public education in South Carolina — including the South Carolina Education Association and the Lowcountry’s Quality Education Project — are working with allies to change how economic development is executed in South Carolina.

We need to change the rules concerning tax abatements for major companies operating in our state.

The state Legislature can act by:

▪ Taking the school portion of tax abatements off the table.

▪ Giving school boards a say in whether their money is given away — a power that state law now delegates to county elected officials.

▪ Requiring counties to disclose the costs and benefits of every company’s tax-break deal, including actual jobs created and wages paid.

South Carolina can’t grow if we let newly arriving companies impoverish our schools.

Great schools and good jobs go hand in hand.

Kendall Deas is a political science professor specializing in education policy and law in the College of Charleston’s Department of Political Science and Honors College.