Richland One to appeal ‘fiscal watch’ designation

COLUMBIA, S.C. (WIS) - Richland School District One will appeal the South Carolina Department of Education’s decision to place the district under “fiscal watch.”

According to a letter from State Superintendent of Education Molly Spearman, a recent audit of district spending found “significant deficiencies” in district spending practices and a lack of oversight with its purchase-card program.

RELATED STORY: Richland One put on ‘fiscal watch’ by S.C. Department of Education

The audit spans from March 28 to August 27, 2022.

Richland One’s board voted to challenge the designation at its board meeting on Tuesday night, but not all board members were in agreement.

Richland One Board Chairwoman Cheryl Harris said she voted for the appeal after a careful review of the audit’s findings and based on the opinions of the district’s external and internal auditor.

Board member Robert Lominack, one of the two board members to vote against the appeal, said he believes the decision by the board is an acknowledgment that Richland One is not taking the State Department of Education’s findings seriously enough.

“That wasn’t an easy vote,” Lominack said. “I absolutely understand the impulse to want to appeal a decision that is a negative one, and really a black mark for the district so I do understand that impulse. But as board members, I think we’ve got to do something other than defend the district at all costs, and there are costs here.”

There are five criteria for a fiscal watch under South Carolina state law.

They include: if the State Department of Education finds unacceptable spending practices after reviewing a district’s annual audit, if a district submits its annual audit more than 60 days after the deadline, if there’s any law enforcement investigation into a district, if an outside auditing firm finds a district’s financial records unauditable and if the department identifies “significant deficiencies, material weaknesses, direct and material legal noncompliance” in district spending.

On Tuesday night, Richland One’s internal auditor Kelvin Washington acknowledged that the fifth item could put the district on fiscal watch, but said he did not believe the state’s findings amounted to that scale.

“I don’t think that the audit that they put forth rises to that level,” he said.

Several community members voiced their concerns at the board meeting, with one calling the designation an embarrassment for the district.

“The P-card misuse, not exactly rampant, but is worrisome,” George Crouch said. “And this is not the first time the mishandling of purchases and the purchasing process has received criticism and scrutiny from the state.”

Richard Moore, who recently ran unsuccessfully for a seat on the Richland One school board, said the district’s response to the State Department of Education’s letter distressed him.

“Official warnings are not issued over insignificant issues and even if the district does not see it as significant, the oversight agency does,” he said.

WIS asked Lominack how the board plans to improve the district’s image, regardless of how the appeal process plays out.

“I think by just acknowledging when we mess up,” he said. “I mean because listen, this is a big district, there are a lot of moving parts, we are going to mess up. But we have to acknowledge it and then say what we’re going to do to fix it and then do it. And then show that we’ve done it to really show by actions that we’re going to take things like this seriously.”

Harris said the district is working to strengthen and tighten its oversight of P-card usage.

Richland One’s board is in the process of completing its appeal letter to send to the State Department of Education, Harris added. As of Thursday evening, the department had not received notification from the district on its intent to appeal.

After an appeal is filed, the State Board of Education must then hold a hearing on the appeal within 30 days.

The State Board of Education will meet next on January 17.

If the appeal is denied, Richland One would face more scrutiny from the State Department of Education for at least the next fiscal year.

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