The Cherokee County School Board borrowed nearly $3 million Monday evening from a district building program fund to avoid a tax increase in the coming year's $62 million budget.

School trustees voted unanimously to transfer $2.9 million in one cent sales tax money into the budget for the 2009-2010 school year. The money comes from extra sales tax revenue collected to make payments on a school building program approved in a 1994 voter referendum. The school construction bonds are scheduled to be paid off in 2017.

The district is required to have at least 18 months in one cent sales tax revenue on hand for bond payments. District figures show the district will have $1 million left in the sales tax revenue account following the budget transfer.

"The one cent sales tax saved our bones this year," school trustee Donnie Lee Smith said. "The real question is what is going to happen two years from now when the sales tax revenue and federal stimulus money is gone. This is when the rubber meets the road."

Cherokee County School Finance Director Ben Childs estimated the district would have needed a 29 mill tax increase to balance the new budget without the one cent sales tax. One mill will generate $95,062 in the budget.

The school district was looking at a tax increase after district staff cuts and employee transfers were made to deal with a $4 million budget deficit, Childs said. State budget cuts over the past year led to the deficit.

"The state property tax law allows us to use excess one cent sales tax revenue to offset a millage increase when the school district has a budget deficit," Childs said.

Salaries account for 85 percent of the expenses in the new school budget that takes effect July 1. The only pay increase in the budget is a staterequired pay raise for teachers who have less than 22 years experience.

The school district is not replacing teachers who leave this school year.

Instead, Cherokee County School Superintendent Dr. Bill James said the district will involuntarily transfer 35 teachers to fill vacancies at other county schools.

"There was not a lot to cut in the budget," Superintendent Dr. Bill James said. "We have flexed every dime we can legally flex in this budget plan. If we don't move the staff to where the kids are, we can't balance this budget."