COLUMBIA – Richland Two financial leaders blamed the recent Inspector General’s investigation on why the school district is over 60 days tardy in submitting its annual audit.
Intense questioning from board members during a Tuesday night work session suggested breakdowns in communication compounded the problem.
“I’ve worked in industries all my life and you just didn’t miss deadlines,” said Richland Two trustee Joe Trapp. “If we lose funding here, that could be a real problem for our budget.”
On Jan. 10, Richland Two received a letter from S.C. Superintendent of Education Molly Spearman that said the state still hadn’t received the district’s audit, which was due December 1, 2022.
Per state law, districts are allotted a 30-day grace period after the deadline. Penalties typically follow after the 60-day mark.
Possible sanctions range from being placed on a fiscal watch list to the withholding of state and/or federal funds. In extreme cases, the state could take over a non-compliant district.
Dr. Harry Miley, chief financial officer, said the district has sent financial statements to its private auditing firm. Once the firm completes the audit, it’ll be presented to board trustees and sent to the state. He hoped that process would last only a few days.
Miley said time spent working with Inspector General investigators detracted from the district’s ability to prepare the audit.
“If the IG report had been February to May, it wouldn’t have affected our audit. If the IG had been here from November to April, it wouldn’t have affected our audit,” Miley said. “He was here July, August, September and October. Those are the months that we close out all accounts and do the audit. It was timing.”
Miley’s explanation triggered a flotilla of questions from board members.
“Why was the board not made aware that we could not meet this deadline? This is a deadline that could put us in the news, on fiscal watch,” trustee Monica Scott said.
Miley said board members were briefed in board documents from the November 2022 meeting. He said staffing shortages also impacted the audit, noting he didn’t think it would be over 60 days late.
“Did you ask for an extension?” Scott asked.
“We didn’t think we would need one,” Miley said. “We had a 30-day grace period. We thought we would make it. We didn’t.”
Trustee Lashonda McFadden later read an excerpt from November board documents, which said the district’s business services division is “playing catch-up” as a result of the IG investigation, but the document from which she read didn’t mention the audit would be late.
“Playing catch-up doesn’t mean ‘not going to meet the deadline,’” Scott said.
Board chair Lindsay Agostini voiced concerns about lack of communication.
“My biggest concern is I heard we were given an extension by the state department [of education],” Agostini said. “[We received] a nice letter from Molly Spearman telling us all the consequences we would face if we didn’t meet the 60-day deadline.”
“Extension is the wrong word. I may have misspoken with staff,” Miley responded. “We get the 30-day grace period. There’s the 60-day limit but there’s no extension. If I used that in public I apologize.”
Agostini also pointed out that neither finance staff nor former Superintendent Dr. Baron Davis informed the board about the late audit.
It wasn’t until receiving the Jan.10 letter that Agostini said she learned the audit was still not submitted. Davis resigned nine days later.
Agostini also said Interim superintendent Nancy Gregory was never informed about the late audit. She was appointed January 19.
“I never heard anything, not from the former superintendent and not from your department,” Agostini told Miley. “We’ve got a good chance of being told in the next day or two that we’re under fiscal watch now.”
Reminder: who was the Richland 2 superintendent at the time? Oh, that guy. Why didn’t he, the “big guy”, inform the Board? Did he hope they’d never find out?
The cabal wanted the IG to come in and do his work. He did. Dr. Miley and his staff did a yeoman’s job in responding to the priority requests of the IG. If the three “dysfunctional” remaining members weren’t so busy trying to disrupt the entire District, they would have read the board docs. Nancy Gregory would not have been able to do anything anyhow. Does she work in finance? You people got your board and interim superintendent and there have only been crises ever since. Proceed!