State of South Carolina declares fiscal emergency in Sumter School district

COLUMBIA, S.C. (WOLO) – State Superintendent of Education Molly Spearman has declared a fiscal emergency in the Sumter School District due to non-compliance with the district’s financial recovery plan and possibility of further fiscal decline.

“Decisions that put the financial stability of a school district at risk and put the education of students and tax dollars of the public in jeopardy cannot be tolerated,” said State Superintendent of Education Molly Spearman.

On March 19, 2018, the Sumter School District was placed on fiscal caution for failure to meet the Fiscal Year 2016-17 minimum general reserve fund balance.

The district was placed under fiscal watch in 2017 after an investigation by the State Law Enforcement Division (SLED) as well as audit irregularities in the district’s use of funds under the Child Early Reading Development and Education Program (CERDEP) were discovered.

The district publicly declared a deficit during 2016-17 school year.

On February 14, 2019, the Sumter School Board took action to schedule the reopening of Mayewood Middle for the 2019-2020 school year.

The district closed the school last year, consolidating it with R.E. Davis Elementary School and forming the new R.E. Davis College Preparatory Academy. The prior financial issues experienced by the district caused concerns when consideration is given to the cost of reopening and maintaining two schools.

These unexpected costs may lead to the district having to declare a second financial deficit, which could result in a state of emergency being declared.

Superintendent Spearman sent a letter to the School Board requesting that it submit an updated financial plan that includes the cost and impact of reopening the school and addressing an outstanding Individuals with Disabilities Education Act maintenance of effort finding.

The Department received a response from the District on February 19, 2019 with the proposed financial plan. However, the plan failed to indicate the district would be able to reach a sustainable replenishment of the required minimum general reserve fund balance.

The fiscal practices legislation requires that the State Superintendent declare a fiscal emergency in five situation:

* Failure to submit an acceptable fiscal caution recovery plan
* Failure to comply with a fiscal caution recovery plan
* Risk of debt default
* Three fiscal years of fiscal watch or caution
* Necessary to correct fiscal problems

As part of the fiscal emergency, the State Superintendent may recommend to the State Board of Education(SBE) that the state take over the district’s financial operations for the remainder of the fiscal year and upon approval maintain financial operations until the district is released from fiscal emergency.

The Sumter Board may appeal to the State Board of Education within ten days. The State Board of Education must hold a hearing on the appeal within thirty days after the filing of the appeal.

The district may only be released if the Department determines that corrective actions have been or are being successfully implemented and this cannot occur within the fiscal year in which the declaration was made.