WILLIAMSTON — As school districts throughout South Carolina have received much less money from the state than they anticipated, many districts are resorting to raising the local property taxes.

Anderson School District One has reviewed a budget that calls for about $700,000 more in property taxes than last year, which means businesses, rental properties and vehicles will bear the additional burden. A change in state law three years ago removed much of the burden from owner-occupied homes, as the state sales tax increased by a penny.

The millage rate would increase by 6.9, or 6.2 percent. By state law, school districts are limited on how much they can raise taxes. A letter from the S.C. Budget and Control Board told Anderson One Superintendent Wayne Fowler that the district could raise taxes up to 6.2 percent, based on the consumer price index and growth.

Fowler said all four of the other school districts in Anderson County have raised property taxes.

During a budget work session last week, Anderson One trustee Wendy Tucker suggested that the board consider not raising property taxes, saying that she worried whether some of the small business owners would be able to handle another load, especially in a tough economy.

“I’d really like to seriously throw out there that we not raise taxes this year,” said Tucker, who has unsuccessfully tried to avoid property tax increases in the past.

But Anderson One Finance Director Steve Uldrick warned that the school district has already reduced its fund balance by about $2 million this year, and another two years of dipping into its fund balance could have serious consequences.

Drawing too much money from the fund balance could also hurt the district’s bond rating, Uldrick said.

“The companies that rate us, Moody’s and Standard and Poor’s, they look at our financial state, and they also look at our fund balance,” Uldrick said. “They’re very concerned about us dipping in our fund balance this year. They also want to know what we’re going to do to restore it. If your fund balance decreases, and you have no way to means to get it back up, it will adversely affect your rating for the next bond sale.”

Fowler added that the district needs to be prepared for when the new Powdersville High School opens in 2011. Operating costs will increase, since the district will also have to pay for the utilities of a brand new, 184,000 square foot high school. Meanwhile, operating costs will also increase throughout the district because of two new field houses and because other schools are adding classrooms.

“Two years from now, when y’all have more expenditures than y’all have ever had before, because of the operational costs and the new students coming in, if you lose a bunch of that money and it’s not replenished by revenue coming in this state, you’re going to have a double whammy here,” Fowler said. “You’re going to be opening a new facility at the same time money goes away.”

But Tucker said the district doesn’t necessarily have to cut the fund balance, pointing out that the district is looking at a much better budget before they discovered they would be received about $2 million in federal stimulus funds.

“It doesn’t all have to come from the fund balance. We could adjust our budget,” she said. “I hate to restore cuts, but it would still be much better than the budget that we were looking at. That is an option.”

The board has not yet voted on the budget, although they have reviewed a proposed budget during a work session last week.

If the board approves of the approved budget, a property assessed at $50,000 will be paying $20.70 a year more for school operations, Fowler said.