Get answers to 1-Cent
The November 4th election is a mere five days away, and all registered voters will have the opportunity to vote on the One-Cent Sales Tax. The tax will be used for Aiken County new school construction and renovations to existing schools.
The Aiken Chamber Board of Directors, Aiken Board of Realtors, and Economic Development Partnership have endorsed the passage of this tax and believe it is a key component to Aiken County’s future prosperity.
Frequently Asked Questions
How would the Educational Capital Sales and Use Tax work?
• If approved by voters, an additional 1% (a "penny") in sales tax would be collected and utilized to address facility needs.
• 1% of $1 = 1 Penny
• If approved, taxpayers would pay an additional penny on every dollar of an item's purchase price
How does the district fund capital projects now?
• On an annual basis, the State Constitution allows governmental entities to issue bonds to fund capital projects (construction of new schools and improvements to existing schools).
• These bonds are limited to 8% of the Aiken County tax base.
What is the Educational Capital Sales and Use Tax or "Penny" Tax?
• An amendment (S.940 Section 40-10-470) to the Codes of Laws of SC, 1976, related to the Educational Capital Improvement Sales and Use Tax. The change allows the Aiken County School District, and other districts, to impose the tax if approved by voters.
How would the Educational Capital Sales and Use Tax work?
• If approved by voters, an additional 1% in sales tax would be collected and utilized to address K-12 facility needs.
How long would the Education Capital Sales and Use Tax last?
• No one wants to have taxes in place longer than necessary to get the job done. The Education Capital Sales and Use tax will be sun-set within ten years.
What are some examples of my day-to-day purchases that are exempt from the Educational Capital Sales and Use Tax? What are some examples of non-exempt items?
• Some purchases are exempt from the Penny Tax meaning that no tax would be collected. Unprepared foods, food intended to be eaten at home (including snacks, beverages, cold items such as salads and sandwiches, and seeds or plants intended to grow food) are exempt from the tax.
• Some items are not exempt from the Penny Tax. The tax would apply and be collected on purchases of non-exempt items such as paper products, soap, pet food, alcoholic beverages, ready-to-drink beverages, ready-to-eat hot foods, foods designed to be heated in the store, prepared hot or cold foods to be eaten in or near a store, vitamins, and certain medicines (any medication exempt from State Sales and Use Tax would also be exempt from the local tax).
How can the Educational Capital Sales and Use Tax be used?
• It would be used to address facility needs identified by the Board of Education and approved by voters as part of the sales tax referendum.
• Taxes would support new facility construction and renovations to existing schools. The Penny Sales Tax would also provide property tax relief (see below).
• At least 10% of the sales tax collected must be used to provide a credit (reduction) in existing property tax millage against existing debt service millage (i.e., for property tax relief).
• Revenue from this tax could not be used to fund general operations of the district for items such as salaries, instructional materials, supplies, or other day-to-day costs.
What is millage?
• Millage refers to the property tax rate.
• The District has property tax operating millage to support a portion of its general operations (teacher salaries, textbooks, busses, etc.). However, this property tax millage is not applicable to a homeowner’s primary residence.
• The District has debt service property tax millage used to pay principal and interest on the general obligation debt that the District issues to fund facility construction, additions, improvements and cyclic maintenance. This property tax millage is applicable to all properties and is presently the District's only source of funding for facility needs.
What assurances do taxpayers have that the sales tax revenue will be used as intended?
• Revenue generated from the sales tax and the related expenditures (cost of new construction and improvements to existing schools) will be accounted for in a fund separate from other district money.
• External auditors perform annual audits on the District's financial statements.
How do I know that the district is a good steward of public funds?
• Aiken County Public Schools spends the largest percentage of its funds on instruction. It is among the top three districts in the state for spending less on administration and overhead costs and more on instruction.
• Aiken County Public Schools spends fewer dollars per pupil on non-instructional expenses (operating costs, legal costs, district office staff salaries and benefits) than all but one other school district in South Carolina.
• The budget process is transparent. Budget information is posted on the website and updated throughout the year. There are several public input sessions at regular Board meetings, plus a Special Called Board Meeting specific to public input on the budget.
• The District has consecutively received The Certificate of Achievement for Excellence I Financial Reporting, a prestigious national award experts proclaim "demonstrates a constructive spirit of full disclosure to clearly communicate its financial story."
• The district has an AA credit rating.
How will the tax affect me as a homeowner? As a business owner?
• Homeowners do not pay school operating millage on their primary residence.
• Homeowners do pay debt service millage on their primary residence.
• With at least 10% of the tax collection being used as a tax credit on debt service millage, homeowners would pay taxes at a lower rate.
• Homeowners would also benefit from the tax credit on any other taxed properties that they own.
• Business owners would benefit from the 10% tax credit on debt service millage and would pay taxes at a lower amount.
What capital improvements have been made to Aiken County Public Schools recently?
• Despite limited funding, the District is committed to continuous improvements of its schools. Construction, renovation and maintenance projects are based on need and over the last _ years have included: A.L. Corbett Middle addition/new construction, Oakwood-Windsor Elementary addition, Chukker Creek Elementary addition, Millbrook Elementary addition, Byrd Elementary new school, South Aiken partial HVAC, Jackson Middle new cafeteria, Silver Bluff partial HVAC, Aiken High new classroom wing and Ridge Spring Monetta Middle/High School new addition (complete Fall 2014).
• The new one cent funds accelerate the planned construction of North Augusta High additions and Aiken High additions.
Why do construction costs seem to be higher in South Carolina and in Aiken County?
• A number of factors affect the cost of construction and renovations. Factors may include:
1 New construction versus building around an existing facility.
2 Aiken County Public Schools has a standard in terms of HVAC systems in its schools to ensure that the air children breathe is as clean and allergen free as possible. The overall cost and warranty length on such systems are difficult to compare to that of other districts. (10 year versus 30 year)
3 State specific requirements and inspections.
4 Furniture, fixture and equipment costs (or FFE) are built into the projected cost of construction projects for the Aiken County Public School District. Other School Districts often keep these costs separate.
5 Seismic requirements (Aiken is in Earthquake Region D).
Can the new funds be used to enhance school landscaping?
• No, the funds cannot be used to enhance school landscaping. The dollars raised through the 1 cent sales tax funds will be dedicated to address the prioritized construction and renovations of existing schools.
Can the new funds be used to enhance employee salaries?
• No. Again, the 1 cent sales tax funds can only be used to address prioritized construction and renovations for our public schools. Teachers benefit indirectly to the 1 cent tax by receiving renovated and updated spaces to work and teach.
Based on the monies generated through homeowner property taxes alone (currently the district's only source of funding for capital improvements), it's estimated that it will take three decades to generate the funding needed to support improvements to North Augusta High School and Aiken High School, two schools with the greatest need in terms of updates, expansions and renovations, and many more to address the needs in schools throughout the county.
Instead of all school construction and maintenance costs being supported by homeowners from property taxes alone, the proposed referendum would allow funding for capital improvements in schools to be generated from Aiken County residents and non-residents who would pay an additional penny in sales tax on most purchases.
The Penny Sales Tax referendum would allow the responsibility of updating Aiken County's Public Schools to be shared among Aiken and North Augusta's homeowners, renters and tourists and would result in an estimated increase in available spending of $125 million over the next 10 years.