A bill that would allow Florence School District Four to issue up to $2.5 million in bonds is only a procedural vote away from the governor’s desk after passing the House Wednesday.
However, Governor Nikki Haley says she plans to veto the legislation, arguing in a letter to lawmakers that borrowing money to fund the day-to-day costs of the school would be fiscally reckless.
We should not fund short-term operational costs with long-term debt backed by taxpayers…Such financing schemes have led to disastrous consequences in other states like California.
School districts traditionally only raise bonds for new construction.
But supporters say the district of roughly 700 students, which covers the town of Timmonsville, risks financial ruin without the bailout.
Sen. John Land (D-Clarendon) is behind the effort. He says he is not fond of the solution either, but believes there is no other choice.
This is the only way I know to get them out (of debt). There (are) no funds on the state level, through the Department of Education or anywhere else, that will be given to them to get them out of the mess that they’re in financially.
However, two Florence County legislators say there is another way and they are furious that it’s not being considered.
Two weeks ago, Rep. Kris Crawford (R-Florence) and Rep. Phillip Lowe (R-Florence) supported a compromise that would have allowed the bonds only after voters approved them in a referendum. It also required the district to combine some of its administrative functions with nearby Florence District One—a much larger, better-performing district.
Lowe said that was rejected by Democrats, however.
The plan was to have administrative functions combined under an agreement by both (school) boards and leaving both boards intact. That failed to come back from the Senate. At this point, it’s about an obligation bond only with no referendum and (we) do not support that.
Due to a quirk in legislative rules, only the members who represent Florence County can vote on the bonds. That gives Democrats a majority in both the House (3-2) and Senate (3-1) on the issue, leaving an unusual situation where Republicans are in the minority on a bill (although Sen. Hugh Leatherman [R-Florence] did vote to remove the referendum requirement).
However, Haley’s veto would stand if Crawford and Lowe support her.
Land said he wanted to see the two districts merge, but maintained that was a local issue.
It’s like a marriage; you’ve got to have two willing partners. (District One), I don’t think is willing to take Four in with a debt.
Florence County District Four currently sits about $1.3 million in the red, due to mismanagement, funding cuts, and the end of stimulus money after this year. Land said its problems were exacerbated when the school did not properly withhold taxes owed to the state and federal government.
Lowe said the district’s “open-door” policy on transfers also led to its current situation. He said the district lost about 300 students who transferred out, but officials did not take that into account when planning on state funding (which is determined by a per-pupil formula).
He called the bonds a short-sighted solution.
The bond would be only a temporary Band-Aid. They’d be in the same boat next year. And, with the additional debt, Florence District One would have even less desire to bring them in.
The school district is hardly the only one such a situation, although it may be in the worst financial shape. Legislators have already approved similar bond proposals for school districts in Charleston, Colleton, Hampton, and Jasper counties. However, the Florence proposal has been receiving the most attention due to the infighting among the county’s legislators.
Last year, the Legislature also overrode three vetoes by then-Governor Mark Sanford on bonds for districts in Orangeburg, Sumter, and York counties. However, they upheld a veto for the Georgetown County School District. At the time, GCSD only wanted the power to issue the bonds in an emergency and was able to balance its budget without them.
Lowe worried Florence District Four stood a “50-50” chance of “total failure” if it did not get approval, but continued to say simply raising bonds was not the answer.
The only option that makes sense is a plan that causes some sort of consolidation (with District One), whether it’s administrative or full consolidation, instead of just giving them some money for operations.