Changes on the way for special-needs scholarship

Aidan Clark works on a math paper with his teacher Erik Fossdal at Trident Academy in Mount Pleasant in this February 2014 file photo. Trident Academy is one of several private schools where families have used a publicly subsidized scholarship to pay for tuition in recent years.

With a last-minute tweak to the state budget in June, lawmakers changed the funding and application process for a scholarship that allows parents to send children with special educational needs to certain private schools.

State leaders say the same amount of funding will likely be available to families as in previous years, and the new budget proviso gives priority to families who previously received scholarships under the old system. But with fundraising for the new scholarship fund just beginning in the past week, it remains to be seen how much money will be on the table when schools open their doors in August.

Since 2013, South Carolina has subsidized tens of millions of dollars in private school scholarships for families who would otherwise be unable to afford specialized private schooling for their children. The state did this by offering a dollar-for-dollar tax credit to people who donate to a handful of private scholarship funding organizations, or SFOs.

The big change for 2016: South Carolina is scrapping the private funding organizations, bringing the program under the watch of the S.C. Department of Revenue and a newly appointed five-member board. The change comes after the Department of Revenue audited one of the SFOs, Palmetto Kids First, and found that the group might be showing favoritism to donor families when awarding scholarships. Organizers of the fund disputed the claims.

Betsy Fanning is interim head of school at Trident Academy in Mount Pleasant, which specializes in the Orton-Gillingham method of teaching for students with dyslexia and ADHD. With annual tuition costs of more than $28,000, many families at the school have depended on the Palmetto Kids First scholarship to help pay for schooling.

“We had several families who were concerned, and I just said, ‘Hold on, let’s wait and see,’ ” Fanning said. “When the (budget) proviso did come out, I was pleased to see the only material change was that there’s only one SFO now.”

Fanning was appointed about a week ago to the board in charge of the newly created Educational Credit for Exceptional Needs Children. She said Wednesday that the board had not yet met. She said she was impressed by how quickly the Department of Revenue created a website for donors and applicants to the scholarship fund.

This year’s budget proviso will provide tax credits for up to $10 million in donations to the scholarship fund, plus $2 million in tax credits for parents or guardians who are paying for their own children’s tuition. (Last year’s budget proviso capped tax credits for general donations at $8 million.) Fundraising for the new scholarship program started on Wednesday, and by Thursday afternoon, the fund had received about $2 million in donations, according to Department of Revenue spokeswoman Ashley Thomas.

“We have been on a crusade, on a mission, to make sure these children get what was intended for them,” Thomas said.

Still, some parents who depended on scholarships under the old system were worried when they heard about last-minute changes coming over the summer. Ellen Wilson, whose 8-year-old son Trey has qualified for the Palmetto Kids First scholarship to attend Trident Academy in previous years, said the news was “certainly a little bit of a surprise” for parents like her.

Wilson said she has not yet filled out the new scholarship application, but she hopes the process is as straightforward as in previous years. When it comes to funding, she said she was disappointed to hear that lawmakers had not increased the tax credit cap further to provide more scholarship funding to students in need. In past years, demand for scholarships has outstripped the amount of money available.

“You hate to think that it might make the difference in being able to get an education that deals with dyslexia because they’re not able to get the scholarship money,” Wilson said.

Lawmakers will have to reassess the program in 2017 since it is not permanently funded under state law and must be paid for through a new budget proviso every year. Because of this, Thomas said the future of the scholarship fund remains unclear.

“Because the proviso has to be approved every year, you aren’t guaranteed from one year to the next that the money is there or that this program will exist,” Thomas said.

To donate to the scholarship fund or to apply for a scholarship, go to exceptionalsc.org.