The Orangeburg County School district will be allowed to increase its tax rate beyond what the law typically allows under a bill that was signed by Gov. Henry McMaster on Wednesday.
The law will allow the district to increase its operational millage by 28 mills for the 2021-2022 school year.
“Everyone worked well together to try to have the least amount of impact on the taxpayers as we could and to make sure the district has what it needs,” said Rep. Russell Ott, D-St. Matthews.
School officials asked for the law after realizing officials miscalculated the tax rate when the county’s three school districts were combined into one.
The law also allows the school board to close a school without public input if the school is in need of significant repair and poses a health and safety hazard to students and staff.
Lawmakers say the millage increase is needed to help the district overcome its budget shortfall. In September 2020, it was revealed the district had an $8.7 million revenue shortfall due to the miscalculation in tax rates.
The district's operational millage rate for the current fiscal year is 191 mills. The legislation will allow the school board to raise the district’s operational millage to 219 mills for the 2021-2022 school year.
The 28-mill increase in operational millage will not apply to primary residences.
It will apply to second homes or rental property, which will see taxes increase by $168 on a $100,000 home.
The increase will also apply to vehicles. Taxes on a vehicle valued at $25,000 will increase by $42.
A 28-mill increase will bring the district an additional $5.6 million a year.
The bill was introduced in the Senate by Sens. Vernon Stephens, D-Bowman, and Brad Hutto, D-Orangeburg. The S.C. Senate approved the bill and sent it to the House on Feb. 16.
The House amended the bill April 8 and sent it back to the Senate, which approved the changes.
The initial Senate version of the bill allowed increases beyond what the law originally allowed.
Ott placed an amendment that would allow 2-mill increase plus inflation, rather than the proposed 3-mill increase plus inflation in the Senate bill.
The Senate accepted the amendments.
In addition to the millage increase, the district may receive some money from the state to help with its deficit.
Last year, the district asked to be included in Proviso 1.88, which was implemented in 2018 to give school districts an incentive to consolidate.
The district has requested about $11 million to help offset consolidation costs.
Rep. Gilda Cobb-Hunter, D-Orangeburg, confirmed the school district would be in line to benefit from state money set aside for school districts that have consolidated, but said the amount will be better understood when the budget process is complete.
The school board is required to set a budget before July 1 and to notify the county auditor and treasurer about the millage required to operate for the next school year by Sept. 2. The board is required to hold a public hearing prior to its final approval of the budget.
The new law would allow the district's board of trustees to close a school deemed to be "an imminent threat to the health or safety of students or staff" if "the needed upgrades and repairs to maintain a school are economically unfeasible."
The law states if these two conditions exist for a school or building within the district that the board would be able to take actions to close it without going through public hearings or a public referendum.
School district officials are not yet willing to say if any school is in danger of immediately closing.
A comprehensive districtwide facilities and demography study is underway. School officials say the study will detail estimated costs of necessary repairs to all school facilities, as well as attendance trends and future projections for student enrollment across the county.
The initial Senate version of the bill also said a school could be closed due to underutilization. That stipulation was removed by the House due to concerns it was too open ended.
The bill does retain original consolidation language that no school can be closed, outside of the two conditions being met, without three public hearings and a public referendum.