Court Strikes Down South Carolina School Voucher Program

In many states, the challenge of creating a school voucher program is a constitutional requirement that public tax dollar are designated only for public schools. South Carolina’s legislature thought they had found a workaround; today the State Supreme Court said no.

The 3-2 decision came as a surprise. But the basis for the “relief granted in part” was straightforward.

The petitioners in the case make the claim that the voucher program violates Article XI, Section 4 of the South Carolina Constitution:

No money shall be paid from public funds nor shall the credit of the State or any of its political subdivisions be used for the direct benefit of any religious or other private educational institution.

The language is exceptionally direct and clear, but legislators thought they had created a workaround in the form of the Education Scholarship Trust Fund. The premise, seen in many taxpayer funded voucher programs in other states, is that once the money passes into the hands of a third party, it somehow sheds its public nature. As the ruling puts it:

Respondents’ primary argument is that the funds start out as public funds but lose their public character once the Treasurer places the funds in the ESTF.

The court is unconvinced that the ESTF is a true trust. And the court points out that even if it is a trust, the nature of a trust is that the trustee holds legal title to the estate, and in this case, the trustee is the state. The court notes that “this is not the first time we have encountered an attempt to deploy a trust to avoid constitutional limits on the use of public funds” and cites O’Brien v. S. C. ORBIT.

Read the full article here.