SC declares fiscal emergency in Sumter School District, could take over its money

S.C. schools Superintendent Molly Spearman declared a fiscal emergency in the Sumter School District Wednesday, saying the school system is not complying with a plan to fix its troubled finances and faced the possibility of further money woes.

According to a news release, the Department of Education “will provide technical assistance in implementing proposals and make recommendations” to the school system.

The Education Department could take over the district’s finances if its recommendations are not followed, department spokesman Ryan Brown said.

“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,” Spearman said in statement. “The Sumter School Board made a conscientious effort last year to fix the financial crossroads that it found itself in, but recent decision making by the board has undermined that effort.”

The Sumter school system’s finances have been troubled for years.

After SLED discovered “irregularities in the district’s use of funds under the Child Early Reading Development and Education Program,” it was placed under fiscal watch in 2017, according to the Education Department.

On March 19, 2018, the district was “placed on fiscal caution” for failing to maintain “minimum” budget reserves, the Education Department said.

Under state law, the district is required to have about $12 million in reserve funding, or savings, Brown said. That reserve dropped to about $100,000 two years ago. However, school district officials had worked to replenish the fund.

On Feb. 14, Spearman asked the Sumter School Board for an updated fiscal plan regarding its plans to re-open Mayewood Middle School for the 2019-20 school year, according to the news release. Mayewood has been closed this school year.

The Education Department said the Sumter School District offered a plan on Feb. 19, but it did not show how it would replenish “the required minimum general reserve fund balance.”

The district, too, must repay about $700,000 to the state for improperly utilizing federal money that had been earmarked for special education services, Brown said. “This is one case where the law is very clear what has to be done.”

Sumter School Board chairman Ralph W. Canty Sr. called Spearman’s declaration “unfortunate” but pledged to work with the superintendent and Education Department “to ensure this status can be cleared as quickly as possible.”

The Sumter Board had 10 days to appeal the state’s decision to the State Board of Education and 60 days to submit a recovery plan to the Education Department.

Canty said he stands behind the school board’s decision to reopen Mayewood Middle, which had been consolidated with R.E. Davis Elementary to form a new college preparatory academy. The move was laid out in the district’s original financial recovery plan.

“The board felt like the consolidation of the two schools had not worked to the benefit of the students and felt the need to revisit the earlier plan,” Canty said, adding board members think the consolidation caused too much crowding.

“At this point, my word to the parents of the Sumter School District is ... this is a temporary condition,” he said. “We will continue to strive to ensure that our district performs well academically and fiscally. ... And, hopefully, there can be some reconciliation between us and the state.”