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Full issue, June 12: Education underfunding, budget reform

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STATEHOUSE REPORT | Issue 14.24 | June 12, 2015

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EMPTY: This old house in the southern part of Florence County is an example of so many farmhouses across the South that are no longer in use, writes Kingstree photographer Linda W. Brown.  “From its size, one can imagine that it was once home to a large farm family,” she writes. More: Center for a Better South.
NEWS

By Bill Davis, senior editor

JUNE 12, 2015 — Alan Richard wants to be prouder of his home state. But it’s hard for the man who grew up in Piedmont and went on to cover an education beat for several state newspapers and has since moved on to national publications from his current perch in Washington, D.C.

Richard is one of the principal authors of a new report released jointly by two national education watchdogs. The report claims massive inequities in public schools nationally and displays the problem as a growing civil rights issue.

The report, “Cheating our Future: How decades of disinvestment by states continues to jeopardize equal education opportunity,” like many of its kind, calls for generally more money and a bigger chunk spent on kids in struggling economic strata.

A permanent underclass

Richard said the truth of the matter is that South Carolina, much like the rest of the country, has already created a permanent underclass in its education system.

“The question is if we are willing to dig ourselves out of it,” he says.

The report does have some bright spots for South Carolina, placing it 26th nationally when it comes to funding equity between poorer and richer community school districts. This is thanks, in part, to existing poverty-weighting in the state’s education funding formulas.

The poverty-weighting is more complicated and less robust than the plan another Piedmont native, former House Ways and Means chairman Dan Cooper, put forward before leaving the chamber a few years ago.

Funding challenges

But the new report shows the state consistently below national averages in per-pupil funding. More good news on this front may come next week, as the state House and the Senate will reconvene next week in a special session to deal with the state’s annual budget. Budget packages in both chambers include more per-pupil funding than in most years past, but still allocates about $500 per student below what state law requires.

South Carolina also somewhat dodges one of the main criticisms of the report, that a U.S. Supreme Court ruling from the 1970s that allows for funding of public K-12 school districts to come from millage, or property taxes.

The criticism points out that it becomes much more easier for wealthier communities across the nation to fund their schools than poorer communities. South Carolina, by contrast, through Act 388, shifted the burden off owner-occupied homes and onto an extra statewide 1-cent sales tax.

Unfortunately for South Carolina, this also increased the burden on commercial property taxation, which was not exempted when Act 388 was enacted in the lead-up to the Great Recession, further hampering tax collections for education.

“If you live in Charleston, its suburbs, or one of the thriving areas of our state surrounding Columbia, Charlotte, Greenville and Spartanburg, economic times are looking up,” says Richard. “There are really sizable rural and urban areas of South Carolina that are not seeing that.”

For example, Richard says that one rural district has only one Advanced Placement class, delivered by a teacher it shares with another district, and the course is in French. By contrast, a friend’s kid attending school in the Lexington 1 school district recently told Richard she can take dozens of AP courses, with textbooks on school-provided iPads, and that she was preparing for a Socratic seminar that week.

Silence on report, but some general movement

Former Dillon School student Ty'Sheoma Bethea, (L) who wrote a letter about the condition of her school to President Obama, stands with Rural Development South Carolina State Director Vernita Dore next to a drawing of a new school building funded with Recovery Act loan and grant funds provided through USDA. (2010 photo by USDA.  More.)
Former Dillon School student Ty’Sheoma Bethea, (L) who wrote a letter about the condition of her school to President Obama, stands with Rural Development South Carolina State Director Vernita Dore next to a drawing of a new school building funded with Recovery Act loan and grant funds provided through USDA. (2010 photo by USDA. More.)

So far, the silence in response to the report in South Carolina has been deafening. While everyone from the Washington Post to Huffington Post has weighed in, no statewide media in South Carolina has covered the report.

The silence echoes in the Statehouse, where several legislators groused without attribution that this reports delivers another “throw more money at the problem” education solution.

Richard says he doesn’t purport to have “the” answer, but that more needs to be done in South Carolina.

He applauds the additional $20 million Gov. Nikki Haley fought to include for rural school districts in last year’s budget, but said a bigger, more comprehensive approach is needed.

In addition to the $29 million the legislature included in last year’s budget process to hire more reading teachers, which was also pushed by Haley, an additional $5 million will likely be included once again this year for the same purpose.

House Speaker Jay Lucas (R-Hartsville) is trying to help. In January, he convened a special House education task force to review funding and policies. Comprised of legislators, stakeholders, and educational professionals, the task force was soon amended to include plaintiffs in the state’s ongoing Abbeville education equity lawsuit that has been dragging on for 21 years without a ruling from the state’s Supreme Court.

“Every child deserves the opportunity to receive an exceptional education that paves the way for tremendous opportunity and lifelong success,” Lucas said at the time.

“Effective education reform requires more than just suggestions from administrators; it demands valuable input from our job creators who seek to hire trained and proficient employees,” Lucas said. “All available avenues should be explored to guarantee our students receive a workforce-ready education that prepares each child for the 21st century.”

Other states have similar problems

South Carolina is far from the only state bedeviled by this issue. An education funding fight, in part, has reportedly led Kansas Gov. Sam Brownback (R) to recently threaten defunding that state’s judicial branch.

Echoing former S.C. Gov. and U.S. Secretary of Education Dick Riley’s words, Richard says South Carolina faces a “generational opportunity” to improve education, get rid of “educational ghettos,” and move the state forward.

“Many people in South Carolina understand that the economy will grow faster, crime will be less of a problem, and fewer people will be on public assistance” if the state adroitly addresses its school funding inequities, says Richard.

“Take away the morality, that it’s just not right to treat people differently in these communities, it makes perfect economic sense. But it has to be more than window dressing.

Bill Davis is senior editor of Statehouse Report.

COMMENTARY

State needs to deal with budget reform

By Andy Brack, editor and publisher

JUNE 12, 2015 — State governments suffer from a disease similar to traditional Wall Street investment: a focus on the near term.

00_icon_brackSouth Carolina, despite its AAA credit rating, isn’t any different in this regard. Politicians, by their very nature, focus on the short term. They have to, in one sense, because they face voters every two or four years. So to get reelected, they either have to do something quickly — in the short term — or do little, which perpetuates a broken structure.

What’s needed, according to a new report from former Federal Reserve Chairman Paul Volcker’s, is more of the kind of long-term approach favored by investors like Warren Buffett. If state governments really look at the long term, they’ll get off of the budgetary hamster wheel of moving from one shortfall to the next crisis.

“The continued fiscal stress is tempting states to continue, and even intensify, budgeting and accounting practices that obscure their true financial position, shift current costs onto future generations, and push off the need to make hard choices on spending priorities and revenue practices,” Volcker wrote in the introduction to a Volcker Alliance report released this week that looked at state budgeting practices.

A federal sign commemorating the Eisenhower Interstate System -- a huge national infrastructure investment -- from July 1993.  Photo from fhwa.dot.gov
A federal sign commemorating the Eisenhower Interstate System — a huge national infrastructure investment — from July 1993. Photo from fhwa.dot.gov

Ignoring the long term by favoring the short term has devastating impacts. In South Carolina, look no further than three gloomy examples:

  • Roads. Our roads and bridges need $40 billion over the next 25 years to make improvements and deal with deferred maintenance from the last 25 years. Failure to deal with it will hurt businesses because they won’t be able to move goods from Point A to Point B as easily. Legislators know all about the problem. But this session, despite pledges to do something big, they failed miserably.
  • Higher education. South Carolina has the highest tuition rates at public colleges and universities in the Southeast. Why? Because the state cut off billions of dollars in support over the last 20 years, causing colleges to raise tuition — particularly on out-of-state students — to deal with escalating costs. By failing to fund higher education adequately, infrastructure is decaying and parents pay higher costs.
  • K-12 education. Funding for public schools has been stabbed in the back over the last seven years because state lawmakers didn’t follow state law to fund education at established per-pupil levels. Instead, they underfunded schools by more than $3 billion, robbing students of resources because they weren’t willing to acknowledge education as the best investment in the state’s future.

The news might get worse because of how credit rating agencies view the short-term budget strategy of kicking the can of big problems down the road. What they worry about, one state official told us, is that not keeping up with big-ticket items, such as roads and buildings, will lead to a real big problem that will require a real big and costly fix — all at one time. And that, they believe, makes a state’s finances riskier, despite all of the rainy-day funds in the world.

Volcker’s report notes, “When budgets are balanced using accounting and other short-term and obscure fixes, the long-term consequences require a continual search for plugs to fill gaps in future budget cycles. The never-ending sense of fiscal crisis leads to stop-and-go funding of vital programs and stifles the need for serious discussions about policy practices.”

While Volcker’s report makes several budget reform recommendations, such as not using non-recurring dollars to pay for recurring costs, let’s go a step further. How about a new state Commission on the Future to develop meaningful and real budgeting reforms that focus on long-term recommendations and solutions for the state’s needs?

Such an effort should go beyond the 2010 Taxation and Realignment Commission mandate on figuring out tax reform. Such a new commission, comprised of former and current legislators and smart money managers, should draft meaningful legislation to reshape the structure of state budgeting and then lobby state leaders to get the job done (and not end up collecting dust on a library shelf).

Failing to deal with long-term problems year after year saddles future generations with obligations that we should pay now. There ain’t no free lunch and there never will be, despite the rosy goggles worn today by most state legislators.

Andy Brack is editor and publisher of Statehouse Report. Send feedback to: feedback@statehousereport.com.

IN THE SPOTLIGHT

S.C. Senate Democratic Caucus

sendems125The public spiritedness of our underwriters allows us to bring Statehouse Report to you at no cost. This week’s spotlighted underwriter is the S.C. Senate Democratic Caucus. Organized almost 25 years ago, the Caucus has played an important role in many of the historic issues facing our state. As a vibrant minority party in the Senate, its role is to represent our constituents and present viable alternatives on critical issues. The S.C. Senate Democratic Caucus remains a unique place for this to occur in our policy process.

FEEDBACK

Another way to comment

EDITOR’S NOTE: While we don’t have any letters to share this week, we do want to give a tip of the hat to the more than 100 readers who liked us over the last few days on Facebook.

We’re trying to grow our presence on social media. If you want to give us a like too, click the button below to head on over to our Facebook page. By joining our Facebook community, you can share thoughts on individual news articles and columns that we post.

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The old-fashioned way: Send us a letter. We love hearing from our readers and encourage you to share your opinions. Letters to the editor are published weekly. We reserve the right to edit for length and clarity. We generally publish all comments about South Carolina politics or policy issues, unless they are libelous or unnecessarily inflammatory. One submission is allowed per month. Submission of a comment grants permission to us to reprint. Comments are limited to 250 words or less. Please include your name and contact information.

SCORECARD

From big payoff to pettiness and DHEC’s dumbness

Thumbs up

00_icon_scorecardBig payoff. State officials rightly patted themselves on the backs this week for paying off a $1 billion unemployment debt about five months early, which saved taxpayers $13 million in interest costs. The state’s unemployment agency had to take on the debt during the recent Great Recession to write unemployment checks as joblessness climbed. More.

In the middle

Body cameras. Perhaps there will be more accountability for police in risky situations now that Gov. Nikki Haley has signed a bill into law to help local governments purchase body cameras for patrol officers. Prediction: Some bad behavior will remain. Why? Cameras can be turned off.

Abortions. The number of abortions in South Carolina is down 11.7 percent over the last five years, mirroring a national trend, according to a nationwide study. Note to culture warriors: the number would go down even more if you would provide more sex education and birth control (free condoms?) to high school students instead of waging dumb battles like the 20-week abortion ban, which would impact only a few births a year. More.

Thumbs down

Pettiness. A big thumbs down to some S.C. Republican women for removing the name of Walter Scott, the unarmed North Charleston man slain by a police officer caught on a video that led to a national outrage, from a body camera bill originally bearing his name. Their reasoning: He was behind in child-support payments. Really? The man’s dead. You could have made your point in some other way that wouldn’t have made you dishonor him and make you look like pure jerks. More.

Dumb DHEC. We’ve said it before and we’ll say it again. Thumbs down to the state Department of Health and Environmental Control for approving seismic testing for oil and natural gas exploration off the South Carolina coast. Listen to the dozen of coastal cities that say this is a dumb idea. More.

Road funding. Because state legislators didn’t deal with road funding this year, some county roads may face real threats. Get the job done. More.

NUMBER

$28,100,000,000

00_icon_numberThat’s how much it would cost to rebuild 112,000 homes in the Charleston area that could be damaged from storm surge after a direct hit of a major hurricane, according to a new report. If the entire coast of the state took a hit, the cost would be a whopping $70.4 billion, according to the CoreLogic coast. Lesson: Cool out on the building along the coast (Hear that, folks at Capt. Sam’s Spit near Kiawah Island, where a couple of pieces of heavy machinery fell into the ocean because of the fragile landscape?) More.

QUOTE

Remembering Gresham Barrett

00_icon_quote“The best performer from the Republican side has been Gresham Barrett, who used to represent western South Carolina. Mr. Barrett, a catcher, lettered in baseball at the Citadel and had three hits in five plate appearances in congressional games — making him about equivalent to one of Babe Ruth’s great-but-not-greatest seasons, 1923. The problem is that Mr. Barrett, who is now the stewardship director at NewSpring Church in Anderson, S.C., hasn’t played since 2010.”

— Jeremy Bowers in The New York Times in a sports story about the annual GOP-Democratic baseball game in Washington, D.C. On Thursday night, congressional Democrats won their seventh consecutive victory over the Republicans and now lead the series 39-38-1. More.

S.C. ENCYCLOPEDIA

Phosphate in South Carolina

S.C. Encyclopedia | The South Carolina phosphate mining industry began after the Civil War and dominated world production in the 1880s. Mining began in late 1867 on plantations near Charleston after the gentlemen-scientists Francis S. Holmes and St. Julien Ravenel and the chemists N. A. Pratt and C. U. Shepard discovered that local “stinking stones” contained unusually high amounts of bone phosphate of lime (BPL). Agricultural chemists had recently discovered that high-BPL phosphate rock was ideal for modern fertilizers, and South Carolina had the largest supply in the Southeast. Holmes and Pratt established the Charleston Mining and Manufacturing Company (CMMC) and quickly bought mining rights to several Ashley River plantations. Although CMMC would remain the largest land-mining company, many local firms competed. Entrepreneurs such as C. C. Pinckney, Jr., C. H. Drayton, and Williams Middleton mined phosphate from their own plantations.

An etching on S.C. phosphate mining from an 1880 issue of Frank Leslie’s Popular Monthly magazine.
An etching on S.C. phosphate mining from an 1880 issue of Frank Leslie’s Popular Monthly magazine.

In 1870 the legislature began granting river-mining rights to companies that each paid a royalty of one dollar per ton. Many of the early companies proved unprofitable, including a firm founded by the Reconstruction-era politicians Timothy Hurley and Franklin J. Moses, Jr., and the black leaders Robert B. Elliott, Alonzo J. Ransier, and Robert Smalls. As other companies joined the industry, mining spread to the Ashley, Stono, Edisto, Coosaw, Morgan, and Broad Rivers. By the mid-1870s the Coosaw Mining Company emerged as the dominant river miner. Controlled by the Adger family of Charleston, Coosaw mined the state’s best territory and shipped its rock to Europe, where “Carolina river rock” enjoyed an excellent reputation.

Most miners were young black males in their twenties or thirties. Dissatisfied with the work habits of the former slaves, mine owners imported Italians and Germans and tried convict labor but were unsuccessful in displacing the freedmen’s labor monopoly. Freed people in Charleston, Colleton, and Beaufort Counties incorporated mining into a two-day system that included sharecropping, farming their own land, hunting, fishing, and odd jobs. By 1880 more than sixteen hundred men mined the land, which paid well (about $1.75 per day) but was grueling work. Ankle-deep in mud and under the hot sun, freedmen with shovels and picks excavated several feet of overburden before reaching the twelve-inch phosphate layer. Miners pushed the rock in trams toward the river, where others dried the rock in the sun or on burning timber before shipping it to Charleston or beyond. Only in the 1890s would steam shovels and locomotives ease burdens. Although river-mining freedmen initially dove for, or collected, rocks at low tide, most worked on floating dredges or river flats. At least 1,000 miners dredged the rivers in the early 1880s. By 1892 the number of land and river miners had reached 5,242.

Phosphate mining helped to jump-start, and remained an integral part of, the lowcountry fertilizer industry. Ravenel and others established the Wando Fertilizer Company in 1867, while Pratt and Christopher G. Memminger began what became the Etiwan Phosphate Company a year later. CMMC supplied Etiwan with rock, while Wando and Boston-based Pacific Guano Company mined rock and manufactured fertilizers. During the 1870s phosphate-driven fertilizer mills crowded out farmers on the Charleston Neck, and fertilizer production increased rapidly. Hundreds of men were employed in Beaufort and Charleston, and many new firms emerged as demand for fertilizer soared among southern farmers in the 1880s. By the 1890s Charleston had displaced Baltimore as the nation’s largest fertilizer-producing city. From 1869 to the 1940s South Carolina was one of the top five fertilizer-producing states in the nation.

South Carolina’s phosphate industry was the world leader until the 1890s, when bad politics, bad luck, and bad weather brought on a rapid decline. Although the river industry contributed over $2,805,000 to the treasury between 1870 and 1892, Governor Benjamin Tillman—no friend of the Charleston elite—sought greater income from, and control over, the state’s largest producer, the Coosaw Mining Company. The ensuing “war” reached the U.S. Supreme Court and caused Coosaw to suspend mining from 1891 to 1892. While Coosaw was in court, Florida’s higher-BPL river and land rock gained a foothold in the international phosphate market. The 1893 hurricane crippled South Carolina’s river-mining industry, and Florida displaced the Palmetto State as the nation’s top producer the following year.

The three blows sent South Carolina’s phosphate industry into a steep decline, with its national market share falling from ninety-five percent in 1889 to twenty-two percent in 1900 and seven percent in 1910. River mining ended in 1909, followed by land mining in 1925. While the economic impact of the industry diminished, its environmental legacy was still felt. A farmer’s 1881 lawsuit concerning Etiwan’s sulfuric acid fumes foreshadowed the phosphate fertilizer industry’s “legacy of contamination.” At the dawning of the twenty-first century, officials of the federal Environmental Protection Agency (EPA) described the Charleston Neck as “one of the most concentrated areas of contamination in the nation,” and former fertilizer mill locations emerged as EPA Superfund candidates.

– Excerpted from the entry by Shepherd W. McKinley. To read more about this or 2,000 other entries about South Carolina, check out The South Carolina Encyclopedia by USC Press. (Information used by permission.)

CREDITS
Editor and Publisher: Andy Brack
Senior Editor: Bill Davis
Contributing Photographers: Michael Kaynard, Linda W. Brown
Phone: 843.670.3996
© 2002 – 2015, Statehouse Report LLC. Statehouse Report is published every Friday by Statehouse Report LLC, PO Box 22261, Charleston, SC 29413.
Excerpts from The South Carolina Encyclopedia are published with permission and copyrighted 2006 by the Humanities Council SC. Excerpts were edited by Walter Edgar and published by the University of South Carolina Press. Statehouse Report has partnered with USC Press to provide readers with this interesting weekly historical excerpt about the state. Republication is not allowed. For additional information about Statehouse Report, including information on underwriting, go to https://www.statehousereport.com/.
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