By MARK SANFORD
Guest columnist

One can certainly grow the economy by growing government, but this administration’s view is that it’s far better grown by the private sector. Given the recent back and forth on the endowed chairs program, and the importance of limiting the growth of government as a tool in growing the economy, I write to lay out the administration’s position on endowed chairs.

Capped at $200 million, the endowed chairs program was passed four years ago, and we are currently $20 million from reaching its cap. The bill that created it also created a review board that called for the program’s review every five years. Unfortunately, a bill passed by the House waived the cap, and budget writers committed $30 million — without yet gaining the insights an independent third-party review will bring next year.

So if we simply funded endowed chairs with another $20 million and did not rush this forward, we could both continue the program and also gain the insights of a third-party review. While there are some clear merits to the program, we think this more deliberate approach makes sense for the following reasons:

The requirements in using this money are being watered down. For example, the original legislation required cash on hand to be eligible for the state match — then it went to cash within 18 months, then two six-month extensions were added on top of that. The same is true in the original requirement that all moneys go to the actual endowed chair — they are now allowed to go for equipment for the chair. “In-kind” contributions are now eligible for the state match, and in fact, a microscope valued at $1.5 million was recently used as the match for state dollars. If you tried to sell it on eBay, would you really get $1.5 million? We think that sticking to the original requirements of the law is key to ensuring meritorious research gets funded.

Second, in some cases the “investments” contemplated in research chairs have devolved to the “build it and they will come” approach. What if they don’t? The endowed chairs program is closely linked to the Research University Infrastructure Act because in essence the chairs program hires the professor while the bond act builds the space where he or she will work. The bond act has grown very soft in its requirements. Clemson used city of North Charleston land that was deeded from the state a few months before as its match to draw down state dollars.

Leaving aside the question of how much economic development comes in restoring Confederate-era submarines, we think effectively matching state dollars with state dollars defies the spirit of the original legislation. The same thing has happened at Innovista in Columbia wherein the city of Columbia and Richland County contributed a parking garage each to serve as an “in-kind” match.

Third, it doesn’t seem the hard questions about waste in the program are getting asked. For example, a PR firm in Columbia has been hired to, in essence, help ask for yet more state funding and support. Is it really worth the $750,000 contract — and does this not fall into the category of using state money to lobby for yet more state money? Similarly, at Innovista, though construction has been delayed, costs are up about $10 million — and tenants and private buildings have not materialized — the private developer has still been paid handsomely.

Fourth, if endowed chairs is about economic development, why don’t we require quantifiable job creation numbers and rates of return as we do in the rest of our economic development effort? For instance, about $200 million has gone into the International Center for Automotive Research, three quarters of which are public — not private — dollars, and if we required a 10 percent return, wouldn’t it be good to quantify if, and where, we were getting $20 million of return each year?

And finally, is it really the year to discard the $200 million cap when we have other profound needs in higher ed that we know produce a quantifiable rate of return? We are on our way to having real problems in funding lottery scholarships. They have grown from $38 million to $254 million in funding from 1998 to 2008, but since 2005 alone lottery revenue has fallen by $82 million. If we stay on this course, how are we going to fund scholarships going forward?

Wouldn’t it be wise to take that difference of $10 million and allocate it to scholarships this year? This is especially the case given that the House budget proposal now has about $200 million in borrowings from some governmental programs to pay for others.

I think the answer to these questions is yes, and if you agree, I’d ask you call your senators and ask them to modify the House’s bill on endowed chairs.

Gov. Sanford’s Web site is www.scgovernor.com.

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