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Published: Friday, Sep. 03, 2010 / Updated: Thursday, Sep. 02, 2010 10:33 AM

Is there a better way to pay for schools? Group hopes to find out

Wes Hayes leads S.C. lawmakers in looking to reform system

After two years of cuts in state money, York County education leaders hope a group of lawmakers can find a way to reform how South Carolina pays for schools.

State Sen. Wes Hayes, a Rock Hill Republican, is leading a newly formed committee of eight state senators - five Republicans, three Democrats - who aim to draft a bill by January for the General Assembly to consider.

The group, which met for the first time Tuesday, is just getting started. Hayes said he plans to soon hold a forum to get public input.

The committee is gathering as educators across the state fret over public schools' future.

To manage budget shortfalls in the past two years, districts have laid off employees, trimmed salaries and slashed programs. In addition, South Carolina recently lost out on more than $440 million in federal money for education - $143 million in stimulus money and $300 million in the Obama administration's Race to the Top competition.

School officials say reform is needed.

"I'm delighted that they're looking at it," Fort Mill school board chairman Patrick White said. "The school community has been up in arms for several years, but with the cuts in the budget and classroom, more stakeholders are taking notice."

The way South Carolina pays for K-12 schools dates back to 1977, when the Education Finance Act was passed. It included a formula that crunches state revenue, student enrollment and districts' tax bases.

But in the three decades since, tax laws have been tweaked and changed, throwing the formula out of whack.

"It needs to be studied and modernized," Clover schools Superintendent Marc Sosne said. "I'm pleased that the Senate is looking at it."

The passage of a 2007 law, known as Act 388, was a tipping point.

It exempted owner-occupied homes from property taxes that pay for school operations. In place of the property tax revenue, the law added a penny on the dollar to the state sales tax, which was supposed to make up the difference.

It didn't. The economy spiraled into a recession and fast-growing school districts, including those in York County, say they've lost out.

"We're hearing from all over state, there needs to be changes," Hayes said.

But Hayes expects his committee must "work around Act 388." There's little "political will" across the state to overturn the law, which has been touted as property tax relief for residents.

One option, Hayes said, might be to tailor money to districts' needs. For instance, fast-growing districts could get extra dollars to keep up with the influx of students. Also, students from low-income backgrounds could bring more money than more affluent students.

Area school officials have suggestions for the committee.

"There are like 50 or 60 different line items from the state, and they say that's all you can spend here," Sosne said. "That really boxes us in."

Those items should be consolidated so educators have more leeway in how they spend, Sosne said.

White and York schools Superintendent Vernon Prosser agree.

"We spend a lot of time and effort and money on keeping different pots of money split," White said.

"One size doesn't fit all," Prosser said. "If I'm in a high-poverty area, I may need more for 4-year-old programs than in other, more affluent areas."

Prosser thinks the committee should consider how education has changed in 33 years and include money for technology, such as computerized tests that measure student progress, abilities and weaknesses.

There's one top priority, Rock Hill schools executive director of finance Elaine Bilton said.

"The main hope is that they can find a way to add more revenue."