H 4561 General Bill, By Townsend, Allison, H. Brown, Cato, Cooper, P.B. Harris, 
Harrison, Haskins, R.J. Herdklotz, M.F. Jaskwhich, Rhoad, Sharpe, Vaughn, 
Walker, Wilkins, D.A. Wright and Young-Brickell
 A Bill to enact the "South Carolina Children's Education Endowment Act of
 1996" including provisions to amend Title 59, Code of Laws of South Carolina,
 1976, relating to education, by adding Chapter 142 so as to provide for a
 South Carolina Need-Based Grants Program where qualifying undergraduate
 students in a public or private institution of higher learning in this State
 may receive State Need-Based Grants for tuition and fees at these institutions
 and to provide for the terms, conditions, and procedures for these grants; to
 amend Chapter 143, Title 59 of the 1976 Code, relating to the Educational
 Assistance Endowment Fund, so as to change the name of the Fund to the
 Children's Education Endowment Fund, delete the authority to accumulate monies
 in the Fund, and to require that beginning with the 1996-97 fiscal year,
 monies in the Fund must be distributed quarterly; to amend Title 59, relating
 to education, by adding Chapter 144 so as to provide for a Public School
 Facilities Assistance Program which establishes the manner in which funds
 available from the Children's Education Endowment Fund shall be used to
 construct and renovate public school facilities; to amend Section 59-104-20,
 relating to the Palmetto Fellows Scholarship Program, so as to delete the
 requirement that the institution in which the student is enrolled shall
 provide one-half of the scholarship, to provide for the amount of funding
 which shall be provided for students at private institutions of higher
 learning in this State under the Need-Based Grants Program established by
 Chapter 142 above and under the Palmetto Fellow Scholarship Program
 established by Section 59-104-20 above; and to amend Act 145 of 1995, relating
 to the 1995-96 General Appropriations Act, so as to revise the manner in which
 funds of the Children's Education Endowment Fund are distributed for fiscal
 year 1995-96.

   02/07/96  House  Introduced and read first time HJ-9
   02/07/96  House  Referred to Committee on Education and Public
                     Works HJ-10

A BILL

TO ENACT THE "SOUTH CAROLINA CHILDREN'S EDUCATION ENDOWMENT ACT OF 1996" INCLUDING PROVISIONS TO AMEND TITLE 59, CODE OF LAWS OF SOUTH CAROLINA, 1976, RELATING TO EDUCATION, BY ADDING CHAPTER 142 SO AS TO PROVIDE FOR A SOUTH CAROLINA NEED-BASED GRANTS PROGRAM WHERE QUALIFYING UNDERGRADUATE STUDENTS IN A PUBLIC OR PRIVATE INSTITUTION OF HIGHER LEARNING IN THIS STATE MAY RECEIVE STATE NEED-BASED GRANTS FOR TUITION AND FEES AT THESE INSTITUTIONS AND TO PROVIDE FOR THE TERMS, CONDITIONS, AND PROCEDURES FOR THESE GRANTS; TO AMEND CHAPTER 143, TITLE 59 OF THE 1976 CODE, RELATING TO THE EDUCATIONAL ASSISTANCE ENDOWMENT FUND, SO AS TO CHANGE THE NAME OF THE FUND TO THE CHILDREN'S EDUCATION ENDOWMENT FUND, DELETE THE AUTHORITY TO ACCUMULATE MONIES IN THE FUND, AND TO REQUIRE THAT BEGINNING WITH THE 1996-97 FISCAL YEAR, MONIES IN THE FUND MUST BE DISTRIBUTED QUARTERLY; TO AMEND TITLE 59, RELATING TO EDUCATION, BY ADDING CHAPTER 144 SO AS TO PROVIDE FOR A PUBLIC SCHOOL FACILITIES ASSISTANCE PROGRAM WHICH ESTABLISHES THE MANNER IN WHICH FUNDS AVAILABLE FROM THE CHILDREN'S EDUCATION ENDOWMENT FUND SHALL BE USED TO CONSTRUCT AND RENOVATE PUBLIC SCHOOL FACILITIES; TO AMEND SECTION 59-104-20, RELATING TO THE PALMETTO FELLOWS SCHOLARSHIP PROGRAM, SO AS TO DELETE THE REQUIREMENT THAT THE INSTITUTION IN WHICH THE STUDENT IS ENROLLED SHALL PROVIDE ONE-HALF OF THE SCHOLARSHIP, TO PROVIDE FOR THE AMOUNT OF FUNDING WHICH SHALL BE PROVIDED FOR STUDENTS AT PRIVATE INSTITUTIONS OF HIGHER LEARNING IN THIS STATE UNDER THE NEED-BASED GRANTS PROGRAM ESTABLISHED BY CHAPTER 142 ABOVE AND UNDER THE PALMETTO FELLOWS SCHOLARSHIP PROGRAM ESTABLISHED BY SECTION 59-104-20 ABOVE; AND TO AMEND ACT 145 OF 1995, RELATING TO THE 1995-96 GENERAL APPROPRIATIONS ACT, SO AS TO REVISE THE MANNER IN WHICH FUNDS OF THE CHILDREN'S EDUCATION ENDOWMENT FUND ARE DISTRIBUTED FOR FISCAL YEAR 1995-96.

Be it enacted by the General Assembly of the State of South Carolina:

SECTION 1. This act is known and may be cited as the "South Carolina Children's Education Endowment Act of 1996."

SECTION 2. Title 59 of the 1976 Code is amended by adding:

Section 59-142-10. (A) The State shall fund a need-based grant for a student who enrolls as an undergraduate in a public institution of higher learning in this State who applies for the need-based grant and who meets the following qualifications:

(1) meets domicile requirements as defined in Section 59-112-20 with the additional requirement of at least twelve consecutive months of residency in the State of South Carolina immediately preceding enrollment;

(2) is accepted by and enrolled or registered in a state public institution of higher learning as an undergraduate, full-time student;

(3) is of good moral character and has never been convicted of a felony; and

(4) is found to be in financial need according to federal Title IV regulations.

(B) To maintain continued state need-based grants, once enrolled a student shall:

(1) complete a minimum of twenty-four semester hours an academic year and make satisfactory academic progress toward a degree as determined by the institution;

(2) have no criminal record;

(3) be eligible for the need-based grants for a maximum of four academic years of two semesters.

Section 59-142-20. Consistent with this section, the Commission on Higher Education shall promulgate regulations necessary to administer the need-based grants program in accordance with the Administrative Procedures Act. The need-based grants program shall be administered at the campus level.

Pursuant to Section 59-103-165, the commission shall incorporate information pertaining to the need-based grant program in the information packets concerning post-secondary education for eighth grade students and their parents or guardians.

Section 59-142-30. Assessment of need shall be determined only after all other sources of grant funding, including institutional, state, and federal sources, have been exhausted.

Section 59-142-40. The provisions of this chapter apply to eligible students beginning in the 1996-97 academic year. Funds shall be allocated in a given year to institutions based on the percentage of the state full-time enrollment enrolled at the institutions in the preceding year. Funds shall be awarded to eligible students according to the financial need of the student.

Section 59-142-50. For the purposes of this chapter, an eligible public institution of higher learning means a `public institution of higher learning' as defined in Section 59-103-5.

Section 59-142-60. It shall be unlawful for any person to obtain, attempt to obtain, expend, or attempt to expend any need-based grant provided by this chapter for any purpose other than in payment of or reimbursement for the cost of tuition and fees to the student to whom such grant has been awarded at the institution the student is authorized to attend under the grant.

Section 59-142-70. Students at private institutions of higher learning in this State whose major campus and headquarters are located in South Carolina also are eligible for a need-based grants in the manner provided by law."

SECTION 3. Chapter 143 of Title 59 of the 1976 Code, as added by Section 82, Part II of Act 145 of 1995, is amended to read:

"CHAPTER 143

Section 59-143-10. There is hereby established the South Carolina Educational Assistance Children's Education Endowment Fund. The revenue received pursuant to Section 48-48-140(C) must be deposited by the State Treasurer in a fund separate and distinct from the state general fund entitled the `Educational Assistance Children's Education Endowment Fund'. All interest or income earned by the fund shall be retained in the fund and used for its stated purposes which are to provide funding for Public School Facilities Assistance and Higher Education Scholarship Grants. It is the intent of the General Assembly that in creating this endowment that its funds be managed so as to establish and fund these programs permanently. Upon receipt of monies transferred to the Endowment Fund by the State Treasurer, thirty percent of these monies must be allocated to Higher Education Scholarship Grants and seventy percent must be allocated to Public School Facility Assistance. Earnings on each allocation shall accumulate for the benefit of that particular program. For purposes of the allocation to Higher Education Scholarship Grants, the The Budget and Control Board shall distribute monies from each allocation quarterly beginning with fiscal year 1996-97 based on actual receipts and earnings for the prior quarter of that allocation. release a minimum of ten million dollars annually beginning with the 1996-97 fiscal year.

Section 59-143-20. The board in its discretion may accumulate the principal and income of each program's funds, may disburse a portion or all of each program's annual or accumulated principal or income, and may for purposes of Public School Facilities Assistance cause to be issued revenue bonds as provided by law the debt service on which may be paid from that program's funds. All principal and income of each program's funds may be carried forward from fiscal year to fiscal year and used for that program's purposes."

SECTION 4. Title 59 of the 1976 Code is amended by adding:

Section 59-144-10. Funds available from the Children's Education Endowment Fund, as established in Chapter 143 of this title, must be used for public school facilities assistance as provided in this chapter.

Section 59-144-20. For the benefit of the people of the State and the increase of their commerce, welfare, and prosperity, it is essential that the school districts of this State be assisted in obtaining adequate school facilities to assist youth in achieving the required levels of learning. It is the purpose of this chapter to provide a measure of assistance to the school districts of this State in securing the facilities and structures which are needed to accomplish the goals and purposes of public education, all to the public benefit and good, to the extent and manner provided in this chapter.

Section 59-144-30. Funds made available through this chapter must be used for permanent school instructional facilities and fixed equipment including the costs for construction, improvement, enlargement, or renovation of public school facilities. The district may use its allocation for payment of debt service provided that the debt service relates to school facilities as defined herein. As used in this chapter, `school facilities' only includes facilities necessary for instructional and related purposes including, but not limited to, classrooms, libraries, media centers, laboratories, cafeterias, physical education spaces, related interior and exterior facilities, and the conduit, wiring, and powering of hardware installations for classroom computers or for area network systems. `School facilities' does not include unimproved real property, centralized district administration facilities, or other facilities, including those normally identified with interscholastic sports activities.

Section 59-144-100. (A) Funds made available under this chapter must be allocated annually to the school districts as follows:

(1) sixty percent of the funds allocated annually to the several school districts for facilities' needs must be allocated on a per pupil basis using the weighted pupil units of each district for the preceding year;

(2) thirty percent must be allocated according to the preceding year's Education Finance Act (EFA) formula;

(3) ten percent of the funds allocated annually to the several school districts for facilities' needs must be distributed based on a standardized assessment of the districts' needs for facilities using a uniform estimate of costs as established in Section 59-144-120. Individual district allotments must be based on the district facilities' need relative to the state total facilities' need. For the first year's allotment, however, the school districts' facilities' needs must be defined as the amount of needs reported in the 1994 Department of Education Facilities Report. For the first two years of the program, district allotments must be adjusted for an overstatement or an understatement of need. As the uniform assessment of needs and the standardized cost allowances are implemented and as district facilities' needs are verified, subsequent district allotments must be adjusted to correct for an overstatement of needs in any previous year;

(4) a district's annual allotment must be the sum of the three amounts calculated as provided in this subsection. Funds from a district's allotment shall be made available as needed once approval is received from the State Board of Education pursuant to Chapter 23 of this title.

(B) The Department of Juvenile Justice shall be allocated funds annually for facilities' needs on a per pupil basis using the weighted pupil units for one hundred percent of its allocation. A district that participates in a multi-district career center shall distribute to the center a portion of the district's allocation under this chapter on a per pupil basis based on the percentage of time its students spend at the c areer center.

Section 59-144-110. The State Board of Education shall establish and appoint a twenty-member advisory committee to assist in developing guidelines, regulations, and standards pursuant to this chapter. The State Superintendent of Education shall recommend members for the advisory committee which shall include individuals with backgrounds in the following areas:

(a) capital improvements financing;

(b) building construction;

(c) school building design;

(d) district finances;

(e) district administration;

(f) local boards of trustees;

(g) classroom instruction; and

(h) educational facilities requirements at the primary, elementary, middl e, and high school levels.

Members of the committee shall receive mileage, subsistence, and per diem as provided by law for members of state boards, committees, and commissions to be paid from public school facilities assistance funds. The members of the advisory committee shall serve at the pleasure of the State Board of Education.

Section 59-144-120. The State Board of Education responsibilities in regard to this chapter include:

(1) adopting policies, guidelines, and standards for a comprehensive school facility survey with annual updates to be undertaken by every district. The survey shall include a description of all existing school facilities and a list of needed renovations, modifications, and new construction projects. The Department of Education shall provide consultation and technical assistance with regard to the survey. The survey must be filed with the Department of Education and may be revised by the district following established guidelines. No school district which has not assisted with and complied with this survey is eligible to receive allocations under this chapter. This comprehensive survey shall serve as the basis for a uniform statewide school facilities inventory and data base on building conditions and maintenance management. To this end, the Department of Education shall review district surveys to ensure compl ete and uniform reporting;

(2) adopting policies, guidelines, and regulations for district five-year comprehensive school facilities' improvement plans with annual updates. Local school district facilities construction plans shall include, but are not limited to, a list of construction projects currently eligible for funding under this chapter, school facilities projected as needed five years in the future, and proposed new construction, alterations, and renovations as appropriate for instructional programs to be listed in priority order;

(3) developing policies, guidelines, and standards for a uniform assessment of facilities' needs and standardized cost allowances for estimating the cost in meeting these needs in order to provide for a systematic reporting of each district's needs to be used in calculating the allotment of funds under Section 59-144-100. Facilities' needs include, but are not limited to, facility need capacity and condition, space requirements, program standards, and pupil growth. Costs allowances shall be developed to include such measures as costs per square foot, costs per pupil, or costs per teaching unit with such costs adjusted annually to reflect changes in the cost of labor and materials. These standards and cost allowances are to be used only for providing a uniform reporting of districts' needs for formula allotment purposes and are not intended to limit district options in determining the most appropriate manner in which to meet individual district needs;

(4) developing policies and guidelines for school districts to notify the State Board of Education of the anticipated times of expenditures from district allotments;

(5) adopting policies, standards, and regulations to ensure the accuracy of district reporting required under this chapter and the use of funds disbursed under this chapter.

Section 59-144-130. Every three years by December first beginning with the year 1998, the State Board of Education shall report to the General Assembly the projected five-year school facilities' improvement requirements reported by the school districts, the needs identified since the last report, and those previously identified needs addressed since the last report.

Section 59-144-140. The Department of Education's responsibilities shall include:

(1) providing staffing assistance to the State Board of Education and the advisory committee in the development of policies, guidelines, standards, and regulations implementing this chapter;

(2) providing technical assistance to school districts in completing the comprehensive school facilities' survey and annual updates and assisting districts in developing their five-year comprehensive school facilities' improvement plans;

(3) ensuring compliance with state standards and requirements, inspecting construction projects for education facilities, and approving completed construction pursuant to Chapter 23 of this title for projects financed in whole or in part with funds allocated under this chapter. To assist with the inspection of construction projects, the State Board of Education may designate selected local units of administration which have staff qualified to conduct the inspections to act on behalf of the Department of Education; and

(4) reviewing each district's school facility surveys, funding applications, and financial reports to ensure compliance with the inten t of this chapter.

Section 59-144-150. To qualify for funds under this chapter, each school district shall meet the conditions and qualifications provided for in this chapter. Funds must be withheld from districts when inappropriate reporting of facilities' needs is found or when inappropriate use of funds is documented.

Section 59-144-160. To accomplish the statewide uniform facilities' inventory and data base and to assist districts with the comprehensive facilities' improvement plans, two hundred thousand dollars shall be released to the Department of Education from public school facilities assistance funds for each of the first three years after the effective date of this chapter including the year this chapter is enacted. The department may carry forward these funds for use for the same purpose in subsequent years.

Section 59-144-170. By December 1, 1998, the State Board of Education shall recommend to the General Assembly changes to be made to this chapter regarding program objectives, appropriate funding levels, and funding allotment formulas."

SECTION 5. Section 59-104-20 of the 1976 Code, as added by Act 629 of 1988, is amended to read:

"Section 59-104-20. The Palmetto Fellows Scholarship Program is established to foster scholarship among the state's post-secondary students and retain outstanding South Carolina high school graduates in the State through awards based on scholarship and achievement. Measures must be taken to ensure equitable minority participation in this program. Recipients of these scholarships are designated Palmetto Fellows. Each Palmetto Fellow shall receive a scholarship in an amount designated by the Commission on Higher Education, half to be provided by the postsecondary institution at which he is enrolled. The commission shall promulgate regulations and establish procedures to administer the program and request annual state appropriations for the program."

SECTION 6. Notwithstanding any other provision of law, the amount of funding under the South Carolina Need-based Grants program established pursuant to Chapter 142 of Title 59 of the 1976 Code, and under the Palmetto Fellows scholarship program established pursuant to Section 59-104-20 of the 1976 Code, allocated to students attending private institutions of higher learning in this State whose major campus and headquarters are located in South Carolina shall be equivalent to the percentage of the private institutions' share of the total undergraduate full-time equivalent (FTE) enrollment of all public and private higher education institutions in South Carolina, based on the previous year's data.

SECTION 7. Paragraph 72.71 of Part IB of Act 145 of 1995 is amended to read:

"72.71. (GP Educational Assistance Children's Education Endowment Fund)

Notwithstanding provisions contained within this act, for this fiscal year only, the revenue credited to the Educational Assistance Children's Education Endowment Fund pursuant to Section 48-47-175(C) shall be used as follows: $7,000,000 for University of Charleston -- Acquisition of Adjoining Property, $4,000,000 for Greenville Higher Education Consortium, $5,400,000 for Archives and History -- History Center, $600,000 for the School for the Deaf and Blind -- Maintenance and Equipment, and $185,000 for Wil Lou Gray Opportunity School -- Building Maintenance with the remaining funds to be distributed on a seventy percent-thirty percent basis to Public School Facilities Assistance and Higher Educational Scholarship Grants, respectively; however no less than $39,400,000 shall go to Scholarship Grants."

SECTION 8. This act takes effect upon approval by the Governor.