A group of state senators began a series of meetings Tuesday to consider all of the state’s public education funding. One focus of the Select Committee on K-12 Funding will be Act 388, a controversial bill passed by state lawmakers in 2006 which removed school operating taxes from owner-occupied homes and replaced them with an additional one-cent sales tax.
The new committee is chaired by York County Republican Wes Hayes. He says it looks like Act 388 is here to stay. Various lawmakers have promised to replace the bill. Others say the state’s entire tax structure needs to be redone.
Hayes says the Education Finance Act, or EFA, dates back to 1977.
Lawmakers voted to temporarily give school districts more flexibility so that they can better spend the limited resources they have. Senator Hayes says one thing his committee may do is make that flexibility permanent.
Beaufort County Republican Senator Tom Davis also serves on the committee. He supports Act 388, but says he also wants to see property taxes reduced on second homes and commercial property.
One way you could fund that is through a sales tax, or look at getting rid of some of the 115 sales tax exemptions in South Carolina. They result in about $2 billion in tax breaks a year. And a lot of them don’t have any usefulness any more.
Another focus of the education funding committee will be South Carolina’s Education Finance Act. Enacted in 1977, it stipulates that 30 percent of the funding for public schools comes from the six counties that produce the most tax revenue.
Republican Senator Tom Davis of Beaufort County serves on the committee. He explains that, according to the funding formula, those counties with a high assessed tax base get little if any of their tax money back. He says that’s in conflict with Act 388, passed in 2006, that removed school operating taxes from owner-occupied homes and replaced them with an additional one-cent sales tax.
The problem is, under the law passed in 2006, a large part of that assessed tax base can’t be used by local governments to pay for schools. Act 388 says you can’t tax primary residences. So on the one hand you’ve got a formula that allocates dollars based on a county’s assessed property values, and on the other hand you’re telling a county it can’t tax that property. It’s really a conflict in the two statues.
Senator Davis says last year Beaufort County contributed $140 million in education funding and got nothing back.