South Carolina School District: No Fraud Detected in Mismanagement, Overspending

This article was originally published in SC Daily Gazette.

COLUMBIA — A Laurens County school district spent nearly $1 million more than it should have on expenses like food, travel and gift cards over the past four years, according to a report from the state Office of Inspector General.

The investigation into Laurens County School District 55, which includes schools in the city of Laurens, did not uncover anything criminal or fraudulent. However, the district did waste as much as $973,000 on unnecessary expenses, often originating from questionable record-keeping and policy loopholes, according to the report.

Legislators who represent the district of 5,100 students asked for the investigation in December, after the school board raised concerns about the district’s speech language pathologist program.

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Once inspectors started reviewing four years’ worth of records, they discovered outdated policies and lenient enforcement that put the district at risk of potential fraud, according to the report.

That was the bad news, said Rep. John McCravy, R-Greenwood, a member of the Laurens County delegation.

The good news was that the report concluded employees had not been stealing or otherwise intentionally misusing taxpayer dollars, he said.

“Nothing dishonest was done,” McCravy told the SC Daily Gazette on Friday.

The problem was more about the district’s culture, particularly under the most recent superintendent, the report found.

During interviews, officials often told investigators that “this is the way we’ve always done it,” despite the fact that former employees said that was not the case. That sort of laissez-faire attitude opened the door to extra spending that could have gone to better use, investigators wrote.

“Tone at the top matters,” the report reads.

Superintendent Ameca Thomas headed the district during the years investigators examined. She resigned in January without publicly giving a reason, following months of dysfunction among board members, according to the Greenwood Index-Journal.

Last week, the district board appointed co-interim Superintendent Jody Pendland to the position permanently.

The report called for the state Department of Education to audit the district and recommended the district update its policies to prevent the possibility of someone taking advantage of outdated rules.

District officials plan to implement those suggestions, according to a statement signed by Pendland and co-interim Superintendent Rhett Harris.

The findings gave “a road map for the District’s leadership team and the Board to improve its delivery of a quality education,” the statement reads.

Superintendent Ellen Weaver has received the report, a department spokesperson confirmed Thursday.

“She looks forward to working on any remediation needed with the school district,” spokesperson Laura Bayne said in an email.

Overspending

Stanley stainless steel tumblers, steak dinners and electronic picture frames were among expenses charged to an account intended for student meals, the investigation found.

In the Laurens County district, where 78% of students live in poverty, the federal government pays to cover the cost of student meals, as well as the labor and maintenance needed to support them.

That includes one free meal for cafeteria workers per shift, according to state rules.

But Laurens County staff used $12,600 to pay for birthday meals and end-of-year dinners at sit-down restaurants including Saskatoon Steaks Fish and Wild Game in Greenville and the Arizona Handcrafted Fare and Drink Company in Simpsonville, the investigation found.

Staff members spent another $8,500 on gift cards and giveaways, investigators found.

Keeping up with the rules about what is and isn’t covered by federal programs like that one can be difficult, McCravy said.

In some cases, the report pointed out, employees interviewed did not seem to know or understand the district’s financial policies, leading them to misuse money without realizing it.

“There’s so much officials have to comply with, it’s an incredible task,” McCravy said.

Other problems came from a lack of policies on how to use district money and lax enforcement of policies that did exist, according to the report.

For instance, the district reimbursed employees for over $36,000 worth of expenses that did not follow district policy, such as trips taken without the proper approvals. In some cases, the district did not provide the forms employees were supposed to fill out before taking a trip, adding to the confusion.

“With rare exception, anything received by the Finance Department was reimbursed to the employee without question or ensuring compliance” with the district’s policies, the report reads.

District policies require a traveling teacher or staff member to try to find the cheapest hotel room possible within reason, such as booking in a block at a discounted rate for a conference. But employees either didn’t know about that policy or ignored it, according to the report.

Kingston Plantation Resort, in particular, was a favorite among teachers traveling to Myrtle Beach for professional development conferences. Often, the beachfront condos were their first choice, and the district spent a total of $45,500 there over the course of two years.

Officials using purchasing cards, also known as p-cards, also ignored the district’s reporting policies. During the investigation period, they charged over $46,000 to the district cards without getting the correct approvals or providing documentation, the investigation found.

The district p-card policies were part of the problem, as they were murky.

For example, the policy says nothing about gift cards. The district spent $47,000 on gift cards in four years, despite repeated warnings from the district’s chief financial officer not to do so.

Much of that came from a program known as “Spirit of 55,” in which one teacher and one staff member each month received a $55 gift card. The former superintendent also liked to give higher-ups $50 gift cards as birthday presents.

Investigators also found “a general culture and expectation of providing food at meetings,” adding up to more than $201,700 over four years for staff meals.

One official acknowledged the district spent more than its policies might allow on food but told auditors that “culture drives everything,” and offering meals during meetings rewarded hard-working teachers and administrators.

State Inspector General Brian Lamkin called the spending excessive. Auditors suggested the district tighten up its policies and enforcement, as well as trim costs that aren’t needed.

“We need to be careful with taxpayer money,” McCravy said.

Contract workers

Between July 2020 and January 2024, the district “failed to execute basic contract management,” according to the report, paying more than $531,000 to three vendors without official contracts.

Contracts are in place to protect the district, giving officials a baseline for services and payment rates they can use to make sure the company is doing the work the district is paying for, the investigator wrote.

“The execution of a contract enables the District to establish agreed upon terms for service and ensures the prescribed terms are met before payment is made to the vendor,” the report reads.

Without them, the inspector general’s office could not determine whether the money was spent appropriately, so the report deemed it wasteful.

Even in the case of established contracts, the district spent more than it should have, the report found.

For instance, officials hired a speech language pathologist assistant in October 2022 at a rate of $55 per hour, according to the contract the district signed. For the next seven months, however, the district paid the assistant $75 per hour.

That extra $20 per hour added up to $11,105, which the report suggested the district should try to get back.

Officials also included contract workers in district-wide bonuses, even though school board members intended the money only for teachers and other workers employed directly by the district, board members told investigators.

Altogether, contract workers received more than $63,400 in bonuses not required in their contracts between 2020 and 2024.

Uncertified teachers

Investigators found that an uncertified speech therapist had been teaching at the district, using a speech pathology license registered to someone with a similar name and another person’s teaching certificate.

Once the district’s special education director realized the speech therapist did not have the state-required license, the employee was barred from the district’s campuses. The contractor responsible for hiring the worker with fake credentials fired the person and reimbursed the district for that worker’s time in classrooms, according to the report.

The contractor should have checked that the person was legitimately licensed, and the district handled the problem correctly, the report found.

What it did not handle correctly were the teachers it knew to be uncertified for the grade level or subject area they were teaching, according to the report.

Under state law, a district is required to notify a parent if their child is being taught for four weeks or longer by a teacher without the proper certifications.

The Laurens County district had 103 instances of teachers without correct certifications teaching between 2020 and 2024. Officials sent out only 15 letters to parents in that time. The human resources department told principals to send out the letters but did not follow up to make sure they did, according to the report.

After the inspector general’s office pointed this out to district officials, they sent out letters for this school year’s uncertified teachers in April, a month before classes ended.

The district also failed to report uncertified teachers to the state. Instead, it partnered them with certified teachers, who officials then reported as the primary teachers in a classroom, even if they were not.

Administrative staff told auditors they thought they were not allowed to report uncertified teachers. The inspector general’s office suggested they follow state regulations in the future to “avoid the appearance of circumventing state and federal requirements regarding the disclosure of teaching assignments of uncertified teachers,” the report reads.

Once the district adopts the changes laid out in the report, it will be able to improve those problems, McCravy said.

“This will benefit the district in the long run,” McCravy said.

SC Daily Gazette is part of States Newsroom, a nonprofit news network supported by grants and a coalition of donors as a 501c(3) public charity. SC Daily Gazette maintains editorial independence. Contact Editor Seanna Adcox for questions: info@scdailygazette.com. Follow SC Daily Gazette on Facebook and Twitter.