New law gives schools' budgets flexibility

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South Carolina provides about $1 billion of education funding through a complex system of more than 75 different spending categories — with funds previously restricted to those categories. A new state law will free districts from those restrictions and allow them to transfer that money, and lottery money, to teacher salaries, instructional programs and essential operating needs.

"I'm not sure we could have operated without it," said Mendel Stewart, superintendent of the Pickens County School District. "We would have been in trouble."

School funding experts have said this year is the worst year for school budgets since the Great Depression, and many districts already have prepared to lay off teachers.

The Greenville County School District said it is facing nearly $30 million in cuts, and Superintendent Bill Harner said he did not know how the district could come up with that money without cutting teacher jobs.

Pickens County is facing a $5 million deficit for next year, according to Stewart.

The bill signed by Gov. Mark Sanford Friday only applies to the rest of this school year, but there is similar wording in the budget the state House passed last week, according to Scott Price, general counsel for the South Carolina School Boards Association.

"This bill should have gone out weeks ago," Price said. "These districts need help."

Districts across the state said it is too early to know which programs they would cut to divert money.

"It provides a big challenge when funds are earmarked for programs that are different from district priorities," Harner said.

When the bill was first introduced, there was a section that would have allowed school districts to furlough teachers to save money. That section was written into a new bill, which is in a House committee.

Three years of midyear budget cuts have slashed school funding. It peaked in 2000-2001 at $2,002 a student and dropped to $1,881, then to $1,775. Proposed funding for next year is $1,644 a student.

Sanford has encouraged lawmakers to look at education funding reform.

"Anything we can do to get more dollars down to the classroom is going to be absolutely critical in our effort to bring about changes that will improve public education," he said. "I commend the General Assembly for recognizing that in the face of the budget crisis we're currently up against, and I'd encourage them to take another step forward by passing fundamental, long-term education funding reform."

A spokesman for state Superintendent of Education Inez Tenenbaum said she agrees with Sanford's call for a reassessment of school funding. Three dozen poor school districts sued the state nearly a decade ago, calling for change. That suit is going to trial this summer.

The governor in his State of the State address urged the General Assembly to pass legislation that would "send the same dollars in a much more simplified system using six different categories of block grants."

Districts have expressed concern with the block-grant system, but welcomed the temporary freedoms so they can keep teachers employed.