Could South Carolina districts carry unused Public Choice Innovation Schools grants into 2008–09?

Plain-English summary

The State Superintendent asked whether districts could carry unused Public Choice Innovation Schools grant money from the 2007–08 fiscal year into 2008–09. The Attorney General concluded in 2008 that they could not. The legislature had not renewed the program and had removed a proposed provision expressly permitting the carryover.

The AG acknowledged a general budget provision allowing school districts to carry forward some unspent funds for the same purpose. It nevertheless read the program’s removal and the rejection of a program-specific carryover as evidence that this particular grant money was not eligible. Its conclusion was confined to the appropriations and legislative history then under review.

Currency note

This opinion was issued in 2008. Subsequent statutory amendments, court decisions, or later AG opinions may have changed the analysis. Treat this page as historical context, not current legal advice. Verify current law before relying on any specific rule, deadline, or remedy mentioned here.

Common questions

Q: Could recipients keep unused innovation school grant funds for the next fiscal year? A: The AG said no for the 2007–08 funds at issue. It found no specific carryover authorization after the legislature removed the program from the 2008–09 budget.

Q: Did the general school-district carryover rule change the result? A: The opinion considered that argument but concluded the program’s discontinuation and removal of a proposed specific carryover showed a contrary legislative intent.

Q: Did the original grant plan contemplate multiple years? A: Yes. The 2007 program language contemplated multiple years of support, but the AG said the later appropriations decision controlled whether unused funds could be carried forward.

Background and statutory framework

The superintendent described the deletion of the program from the current budget. The AG compared the annual-funds rule, the general school-district carryover provision, and the failed program-specific proposal. It concluded that recipients were not entitled to carry forward unspent program appropriations.

Citations and references

Authorities: The opinion discussed South Carolina Code section 2-7-75 and the 2008–09 appropriations provisos governing school-district carryovers.

Source

• Landing page: https://www.scag.gov/opinions/opinions-archive/september-8-2008-1/
• Original PDF: https://www.scag.gov/wp-content/uploads/2011/05/rex-j-os-8627-9-8-08-public-choice-innovation-schools-carry-forward-provision.pdf

Original opinion text

H ENRY M CM ASTER
ATl'ORNH GliNERAL

September 8. 2008

The Ho norable J irn Rex
Superintendent of Education
1429 Senate Street
Columbia, South Carolina 2920 I
Dear Superintendent Rex:
We understand from your letter you desire an opini on of this Offi ce as to "whether school districts that were recipients of funding under the Public Choice Innovation Schools {PCJS) grant program in 2007-08 (funded through proviso IA.69) .. . may carry forwa rd those fund s to the current schoo l year. " You informed us that "[t]he proviso that authorized that program was deleted from the cmTent budget." Law/ Analysis

According to the information provided with your request, as part of the 2007 appropriations act (the "Act"), the Legislature estab li shed a grant program allowing the S tate Board of Education to fund Public Choice Innovation Schools in South Carolina. 2007 S.C. Acts 751. The Act allows "public and private partnerships" to participate in the program and specifi es that ''partnerships" include "an educational management organi zation, a private corporatio11.. an institution of higher education. a consortium of pub Iic schools districts and/or a contractual relationship between a private entity and a public schoo l district." Id. Tbe proviso contemplates that the grant is"for a minimum of fi ve years with the first year of funding for planning and equipping purposes and the remaining years of supplemental funding for operation of the innovation school." Id. The first year of funding is set at $100,000 per school with the possibiJity of receiving up to $400,000 in additional grant funds. Id. Funding decreases in the subsequent years. Id . Although the 2007 proviso indi cates that the grant program will continue for several years, we understand from your letter that the Legislature did not approp1iatc funds for the program in its 2008 appropriations act. You provided evidence that while the Senate removed the proviso providing funding fo r the progrnm from the appropri ations act, it added a proviso stating that
·'[u]nexpcnded Public School Choice Innovation Schools grant funds from the prior fi scal year shall he carried forvvard and remain in the program.'' However, you informed us that this provi sion was removed during the conference committee meeting.

REM1Jt;R1· C. D1:Nr-:1s B u1LDJNG

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Posr Off1CE Box 11549 •

CoLt.:MBtA. SC 29:!11 -1549

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Tl:.Ll:.PHONE 803-734-3970

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FAC5JMILI:. 803-253-6283

The Honorable Jim Rex
Page 2
September 8, 2008
According to section 2-7-75 of the South Carolina Code (2005): "All state funds appropriated shall be used and all federal and other funds may be used for the operation of state agencies and institutions for the fiscal year for which they are appropriated or made available for use." Based on this provision, along with section 11-9-80 of the South Carolina Code (1986), establishing South Carolina's fiscal year, in a 1991 opinion, we concluded that appropriations made in one year cannot be used to reimburse an agency for an expenditure in a previous year. Op. S.C. Atty. Gen., August 27, 1991. See also, Op. S.C. Atty. Gen., January 18, 1983. Thus, South Carolina follows the general rule that "money appropriated for a particular purpose, which remains unexpended and not contractually obligated at the expiration of the appropriation legislation, lapses .... " 63C Am. Jur. 2d. Public Funds§ 46. See also, Hilton Const. Co., Inc. v. Rockdale County Bd. of Ed., 266 S.E.2d 157 (Ga. 1980). However, we recognize the Legislature's ability to allow for the carryover of appropriations from one year to the next. See Ops. S.C. Atty. Gen., July 1, 1983 (allowing the Calhoun County School District to spend appropriations made in 1982 for fiscal year 1982-1983 in fiscal year 19831984 because of provision in the 1982 law specifically allowing unexpended funds to be carried over to the next fiscal year); January 29, 1980 (determining that a current year expenditure to correct a prior year's error is not allowed without specific authorization from the Legislature). But, the Legislature must specifically provide for such a carryover. Id. In our research, we did not uncover a provision in the 2008 appropriations act allowing the carry forward of funds appropriated for the 2007-2008 fiscal year under the program. Furthermore, the legislative history you provided indicates the Legislature did not intend to allow funds appropriated under the program in fiscal year 2007-2008 to be carried forward. As you conveyed in your letter, when the Senate deleted the proviso for Public Choice Innovation Schools from the budget, it added the following provision: "Unexpended Public School Choice Innovation Schools grant funds from the prior fiscal year shall be carried forward and remain in the program." However, you state "[ d]uring conference committee that statement was removed and the House version was adopted, simply removing the program with no mention of carry-forward ability." Thus, the final version of the appropriations act does not make reference to the ability to carry program funds forward. Accordingly, the fact that the Legislature did not include the carry forward provision indicates it did not intend for such a carry forward to apply.

Finding no specific provision allowing for the carry forward of funds under the program, you ask whether or not the general carry-forward provision found in proviso lA.44 of the 2008-2009 appropriations act allows school districts receiving funds from the program to carry forward unexpended funds from the 2007 appropriation over to fiscal year 2008-2009. Proviso 1A.44 states, in pertinent part: "School districts and special schools may carry forward unexpended funds from the prior fiscal year into the current fiscal year to be used for the same purpose." Initially, we see no reason why this provision would not apply to school districts who received funds under the program. However, applying this provision to funds received pursuant to the program raises questions as to whether or not the Legislature intended for this provision to allow school districts receiving funds in fiscal year 2007-2008 to carry those funds forward to fiscal year 2008-2009.

The Honorable Jim Rex
Page 3
September 8, 2008
The cardinal rule of statutory construction is to ascertain and effectuate the intent of the Legislature. All rules of statutory construction are subservient to the one that the legislative intent must prevail if it can be reasonably discovered in the language used, and that language must be construed in light of the intended purpose of the statute. Sonoco Prod. Co. v. South Carolina Dep't of Revenue, 662 S.E.2d 599, 602 (2008) (citations and quotations omitted). By not funding the program at all in fiscal year 2008-2009, the Legislature chose to discontinue the program, at least for that fiscal year. Because the Legislature sought to discontinue the program, we believe without specifically stating that funds previously appropriated may be carried forward, the Legislature sought to suspend the program's operation. See Op. S.C. Atty. Gen., June 30, 1986 (finding the Legislature's failure to fund a statutory mandate for the reduction in the pupil-teacher ratio made the statute inoperable). Moreover, as explained above, the Senate, as evidenced by legislative history, considered allowing for a carry forward, but ultimately removed this proviso from the appropriations act. Thus, the legislative history strongly supports the conclusion that the Legislature intended not to allow a carryover. Accordingly, while one could read the general carry over provision contained in Proviso I A.44 as allowing a school district receiving funds under the program in fiscal year 2007-2008 to carry such funds over to fiscal year 2008-2009, the actions of the Legislature belie that conclusion, and we do not believe the Legislature intended to allow such a carry forward. Conclusion Based on our analysis above, we are of the opinion that school districts receiving funds under the program are not entitled to carry forward unexpended appropriations. Very truly yours, Henry McMaster Attorney General

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M. Milling
Assistant Attorney General

REVIEWED AND APPROVED BY:

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Robert D. Cook
Deputy Attorney General