COLUMBIA — The U.S. Department of Education says $144 million of federal bailout money meant for South Carolina’s public schools will be doled out to the other 49 states, the District of Columbia and Puerto Rico. State leaders replied the state doesn’t need the money, which represents a federal intrusion into state education.
The federal agency sent a letter last week to Republican Gov. Nikki Haley and Superintendent Mick Zais, notifying them South Carolina’s money will go elsewhere if the state doesn’t apply for it by Monday. South Carolina is the only state not to receive its share of $10 billion passed by Congress last August specifically for teaching jobs in the last and current school year.
“These resources have assisted local schools and communities across the country in hiring and retaining vital teachers and educators in the classroom to support ongoing teaching and learning,” agency director Ann Whalen wrote Zais in the letter dated Aug. 5. “We hope that teachers and students in South Carolina will be able to benefit from these funds, as well.”
In response, Zais said state and federal officials have known since September that South Carolina did not qualify for the money because of state cuts to colleges. Even if it did, Zais said, he wouldn’t seek the money, noting he opposed bailouts as a candidate last year and his position hasn’t changed.
“I regret that your agency wasted taxpayers’ resources to inform the state again about something it and USDE already knew,” Zais wrote Whalen on Tuesday. “Instead, your letter appears as another attempt to inject Washington politics into South Carolina’s affairs.”
“The solution to our education challenges is not a federal bailout,” said her spokesman, Rob Godfrey.
Whalen’s letter was meant as a last notice to the state on the timeline, said Liz Utrup, a spokeswoman for the federal agency. The money needs to be reallocated now so schools can spend it by the law’s September 2012 deadline, she said.
The law bars a state from spending more than 2 percent of its allocation on administration. The rest must go directly to schools.
“It makes me sick to my stomach to think that $144 million is going to other students in other states. This is money going directly back to the taxpayers of South Carolina, and we’re turning it down to go to other states,” said Molly Spearman, executive director of the South Carolina Association of School Administrators. “Instead of Lexington, S.C., it’ll go to Lexington, Ky.”
State legislators had followed requirements of the 2009 federal stimulus law that said states’ combined spending on public K-12 schools and colleges couldn’t decrease as a share of the state’s budget. But a new provision passed for the so-called “Ed Jobs” program last August — months after legislators adopted the state budget — said the state couldn’t decrease spending on either.
“Since the State does not qualify, it cannot apply for these funds and it would take an act of Congress to do otherwise,” Zais wrote.
Texas also faced problems qualifying for its $830 million share, but that state’s Republican delegation worked to remove a Texas-specific provision requiring the state to use the money to supplement, not supplant, education funding. A federal budget deal passed in April to avoid a government shutdown deleted that provision and allowed the money to flow to that state.
In December, a spokesman for Sen. Lindsey Graham said he would explore ways to fix the problem, while a spokesman for Sen. Jim DeMint said he consistently opposes federal bailouts.
On Tuesday, Graham spokesman Kevin Bishop said the senator “usually defers to the wishes of the state in these matters.”
Zais suggested that the federal agency put the money back in the treasury “and take the first step in curing Washington’s addiction to spending.”
Students’ “future is not brightened by saddling them with the outrageous credit card bill that awaits them at graduation, courtesy of the federal government,” Zais wrote in his response. “By now, it should be obvious to Washington that South Carolinians and the American people are fed up with deficit spending.”
But Utrup said Congress passed the program last year specifically to save education jobs.
“If South Carolina fails to apply for their share then it’s the department’s responsibility to make the funds available to states that can put these critical dollars to use and send teachers back to work this fall,” she said.
U.S. Rep. Jim Clyburn, the state’s only Democrat in Congress, accused Zais of holding students hostage by rejecting federal money for schools.
“I think there should be an outcry here in South Carolina about that,” he said Tuesday. “I’m a bit surprised that there isn’t more of an outcry.”
Zais and Haley have previously refused to seek federal education money.
In May, the federal agency announced that South Carolina and eight other finalists for federal grants in the Race to the Top competition could apply for $200 million in grants ranging from $10 million to $50 million each. The agency also announced $500 million for a third round of Race to the Top funding specifically for preschool programs.
But Zais immediately issued a statement that he would not seek the money, saying the state’s schools need less federal intrusion to succeed, not more. He reiterated that two weeks later, when the state Board of Education asked him to reconsider his refusal. Haley’s appointee on the board said the request is moot, because Haley will not sign any application for the federal grants.