The loan program created in 1984 provides a maximum of $20,000 toward a student’s college degree in education – up to $2,500 yearly for college freshmen and sophomores, and up to $5,000 for juniors, seniors and graduate students. The amount is forgiven within five years of teaching in a needy school or a hard-to-fill subject – sooner if both definitions apply. Students must pay the money back, with interest, if they don’t do so after graduation.
Last school year, the state Student Loan Corp. doled out nearly $4.7 million in loans, averaging $4,182 each, to 1,114 education majors. The program used money from repaid loans to add to the Legislature’s $4 million allotment, which hasn’t changed since 2009-10.
More than 300 applicants were denied loans because of a lack of funding. An additional $1.3 million would have covered all eligible applicants.
The House’s budget plan for 2012-13 put no additional money into the program. The Senate’s plan will be debated in May.
Nearly two-thirds of all public schools are deemed in critical need. Under state law, schools meet that definition if at least 70 percent of their students live in poverty, teacher turnover averages at least 20 percent, or their state report card scores are in the bottom two tiers. Of the 785 schools in critical need last school year, 669 qualified based solely on the poverty rate.
The committee recommends legislators increase the poverty threshold to 80 percent of students qualifying for free- or reduced-price meals. That helps focus the program on schools most in need, said Melanie Barton, the committee’s executive director.
Rep. Joe Neal, a committee member, said he supports targeting schools most at risk, but he worries about the consequences.
“Schools failing most dramatically in the state are also those with high levels of poverty. Those schools tend not to do well, even though there are some exceptions,” Neal, D-Hopkins, said after the meeting. “My only concern is what will that do to the marginal schools? Do we deprive them of that resource?”
The overall number of applicants has plummeted 56 percent in the three school years since 2008. Officials speculate that fewer students could be choosing a career in education following the Great Recession and resulting budget cuts, which led to thousands of teacher layoffs across the state.
A third recommendation from the committee is to put a state agency in charge of the program, which can set goals, communicate with colleges and market the program to students. Many students simply don’t know the option exists, Barton said.
That could improve the program’s diversity, she said.
Last school year, 77 percent of applicants were women and 80 percent were white. The number of loan recipients attending South Carolina’s historically black colleges continues to decline, to just nine at South Carolina State, down from 42 students at that school and three others in 2007-08.
A diverse teaching force plays a role in motivating some students, Neal said.
“They need to see teachers who look like them,” he said. “Clearly if we’re going to have a teaching force that reflects South Carolina, we need a loan program that enables people from different groups in this state, particularly minorities, to actually do so.”
The default rate on the program – those who didn’t teach and didn’t pay back the money – has been 1 percent. Last school year, more than 6,500 teachers employed in South Carolina’s public schools were loan recipients, according to the report.