Charleston Superintendent Nancy McGinley painted a pretty bleak picture when she prepped a handful of parents and educators at a preliminary budget hearing in late March. Calling the dire financial circumstances “a perfect storm,” McGinley said after-school and early education programs would go unfunded. An effort to cut classroom sizes would have to wait. And so it came as a surprise three months later when the district’s budget included an ambitious multi-million dollar “modernization” campaign — complete with new computers and other hardware as well as updated media center materials.

This effort in providing district-wide high tech resources was made possible because the district’s capital costs (those brick-and-mortar expenses that involve building and furnishing a school — not populating it) have yet to be subjected to the meddling hand of the South Carolina Legislature. The district is sacrificing other programs due to a state-mandated spending cap on things like teachers and training, but capital initiatives have an expandable pool of cash. And the district is taking advantage of whatever resource it can.

“Sometimes in the midst of a difficult situation, you can come up with something that’s creative and has a lasting impact,” McGinley says.

The modernization initiative will include replacing classroom computers and other efforts to put 21st century tools in each school, like installing touch-sensitive interactive Smartboards districtwide that can provide things like virtual field trips or virtual dissection.

“Now things can be brought into the classroom that can engage students in a way that we can’t with chalk and talk,” McGinley says.

While it’s easy to laud progress, it’s hard not to notice what’s missing in the district’s budget, particularly for struggling underperforming schools. The district had proposed extended school years for some schools, keeping kids in the classroom for a few more weeks into the summer; expanding the district’s early childhood program, which faces mounting waiting lists in the areas that need it most, like North Charleston; and providing other services like longer school days and tutoring for at-risk students — but funding these programs exceeds the district’s maximum allowance from the state.

“We know that this kind of intense instruction can produce results, yet we are constrained in doing that.” McGinley says. “That’s frustrating for us as education practitioners because you know what the remedy is.”


The state’s decades-old funding formula was set up in the early ’80s to use tax money from wealthier counties to help pay the tab in poor or rural districts. As these resources were sent off to other districts, taxpayers in Charleston were expected to make up those lost dollars, typically through increased property taxes. Even now, there is some logic to the formula — districts that receive state aid still have to charge their taxpayers more per capita than Charleston County does.

It was with the best of intentions that the legislature began monkeying around with taxpayer funding in 2007. Applying a newly minted one cent sales tax to school operating costs cut most homeowner tax bills by more than half. But, with the same brush, the Statehouse put districts like Charleston in a corner, capping budget increases.

Only allowing for inflation and population growth, the legislature left districts to their own devices. If they were seeking out innovative new teaching methods, it would have to be replaced dollar for dollar in the budget, or the district would have to find the money somewhere other than public dollars. While any district is going to struggle with this ceiling, the bleeding was worse for Charleston because of the more than $10 million in state aid that was already missing due to the funding formula.

In the past two years, Senate leader Glenn McConnell and other local legislators had found the extra money to fill those coffers, but this year’s tight budget left only $3 million. While the district is filling the void with one-time funds from the sale of unused property, there’s no promise that even

$3 million will be available next year.

House Speaker Bobby Harrell is expecting a report from a House committee on education financing reform this fall, says spokesman Greg Foster. But they’ll need to find more than just Charleston’s $10 million to make it work. As it stands, well over half of South Carolina’s schools benefit from the existing funding formula, making it impossible to redistribute the state’s education dollars without increasing the pot it comes from. Anybody leaving the table with less than they got the year before is going to balk at potential changes.

But other districts not yet affected by the state’s formula are starting to recognize that they’ll face the same fate down the road. Districts in both Berkeley and Dorchester counties have groaned about the tight budget year and how things need to change in the state.

Recognizing it will have to work under the assumption that the state just isn’t going to be there for help, at least not for another two years, Charleston is looking for creative ways to address the funding crunch. The district is applying for national grants and developing business and community partnerships that might be able to defray some costs. While these types of programs have been in existence for awhile, McGinley says the tight budget year has spurred the district to dig harder and deeper for these alternative resources. This includes partnerships like an arts roundtable, a group of Charleston arts professionals helping to bring the arts back to schools districtwide.

“We also must do a better job of attracting corporate donations and competitive grants,” McGinley says, noting past efforts have largely been limited to federal and state grants. “But the long term sustainability must come from public dollars.”

Parents can also expect comprehensive proposals in early 2009 to reduce costs. Items on the table include modestly increasing class sizes and closing and consolidating schools, possibly creating more K-12 and K-8 programs.

“These are big picture discussions we need to have,” says Michael Bobby, the district’s finance chief.

The district also used creative accounting to open up money to maintain existing programs. Recognizing there were district costs in the operating budget that could be considered a capital expense (like computer loans and maintenance crews responsible for light construction projects), Bobby shifted those expenses to the capital budget not affected by the state cap.

“Part of it is philosophical; part of it is practical,” he says. The costs are technically capital expenses, and the breathing room in the operating budget provides more than $1.5 million for other programs. While this opened up money for staffing and other curriculum needs, the debt service fund is still partially funded through homeowner property taxes­ — meaning that, once again, the state’s responsibility has returned to you, the taxpayer.