Education

Midlands school boards get thousands in gifts from companies seeking district dollars

When he became superintendent of Richland 2 school district and, later, of Lexington-Richland 5, Stephen Hefner was an outlier. As an introvert who didn’t golf and didn’t drink, he said he turned down dinner invitations from companies wanting to do business with the districts. His hesitancy was in part because of his personality, but also a question of perception, Hefner said.

“Someone might think I’m making my decisions based on who is entertaining me,” he said. “So I didn’t participate, really, at all.”

But Hefner said he was perceived as “maybe radically moralistic” and opting out of social events was damaging his relationships with school board members — his bosses. So he dipped a toe in.

Hefner attended the meals but ordered just enough so his meal wouldn’t cost more than $25 (anything of higher value would need to be reported to the state ethics commission). He sent companies checks after-the-fact to pay them back, he said.

Eventually, however, Hefner slipped into a practice school boards and superintendents across South Carolina have partaken in for years: accepting gifts from the architecture firms and construction companies that have a strong interest in receiving multimillion-dollar school district contracts.

An analysis by The State shows that school board members and superintendents in seven Midlands school districts have accepted hundreds of gifts, worth tens of thousands of dollars, from these companies from 2012 to 2018. Still, the true number of gifts school officials accepted could be higher, because several school board members missed ethics filings and there is no way to check that all statements of economic interests are accurate.

Among the findings: Officials in Lexington County’s largest districts — Lexington 1 and Lexington-Richland 5 — accepted more gifts than all of the other districts combined. But Richland 1 and Richland 2, the other two main Midlands districts, reported few gifts, despite their large student populations and expansion plans.

The companies that doled out the most gifts and treated school boards most consistently were often awarded contracts for multimillion-dollar projects in the same time period, according to documents reviewed by The State.

The school officials often received food ranging from boxes of “appreciation pecans,” chocolates and popcorn to lunches and dinners that cost up to $75. These meals typically were offered at conferences held by the South Carolina School Boards Association, according to school officials interviewed by The State.

The South Carolina School Boards Association is a nonprofit organization that provides training and resources for school boards, and pushes for legislation to support public education.

School board members and superintendents are required by state law to attend an annual training and are offered incentives by the “boardsmanship institute” to attend as many conferences as possible. The more conferences and trainings a board member attends, the more points he or she earns in the program.

But school board members and superintendents also accepted sports tickets, baked hams, rounds of golf and more from companies seeking to curry favor with the people who decide how billions of tax dollars are spent.

Altogether, the Midlands districts reported accepting more than $32,000 in gifts between 2012 and 2018 from big-name construction companies, architecture firms and law firms seeking to start or continue doing business with them.

School officials say the gifts and particularly the meals help them bond with one another and get to know contractors who could work with the district.

Others, like government watchdog John Crangle, see the practice as inherently corrupt.

“They’re trying to buy influence and they’re not doing it to be nice,” he said. “If they were doing it to be nice, they would give the money to the Boy Scouts and Girl Scouts.”

In South Carolina, there’s no limit on the number of gifts school board members can receive or from whom. Local elected officials must report any gift valued at $25 or more annually to the South Carolina Ethics Commission, a board appointed by legislators and the governor to oversee compliance with state ethics laws.

“What the law wants is disclosure. It’s about transparency,” said Cathy Hazelwood, deputy state superintendent of education and former general counsel for the ethics commission.

Helping to keep the contractor-school board relationships alive are annual meetups at state school board conferences, millions of dollars in contracts awarded by districts and state ethics laws that often don’t classify the gifts as lobbying activity.

Lexington 1

Board members and superintendents in Lexington 1, the largest school district in Lexington County, raked in $15,668.63 worth of gifts during the past six years. The district includes the Lexington, Gilbert, Pelion and Red Bank areas.

The current board chair, Cynthia Smith, outpaced all other board members and both superintendents who served Lexington 1 in those years. Smith reported more gifts than any other school official in the two counties. Her statements of economic interests indicate that she accepted 110 gifts, worth $3,070, between 2012 and 2018.

The filings show dozens of dinners, several lunches and yearly gifts of pecans, dessert and candy. Smith also accepted a pair of $60 tickets from Jumper Carter Sease architects in 2015 and six $12 tickets from the law firm Childs & Halligan over three years. She said she could not remember what events the tickets were for but “they would generally be in support of some educational entity or program.”

Lexington 1 Superintendent Gregory Little also received tickets to unknown events (Little would not respond to questions about specific items): $210 in tickets from Jumper Carter Sease architects in 2016, $40 tickets from LS3P the same year and $75 tickets from Jumper Carter Sease in 2017.

Vice chair Anne Marie Green also reported accepting an $80 ticket to a Clemson University football game in 2017. Jumper Carter Sease’s principal architect, Todd Sease, offered Green the ticket after she mentioned to friends that she needed one more ticket to attend a game with her husband and children, she said. Her son was considering attending the university at the time.

“That’s Todd being a friend, saying, ‘I know you need a ticket. Here’s a ticket,’” Green said.

Green’s daughter used the extra ticket, she said. Sease could not be reached for comment.

Public officials are not required to give details, such as locations or dates, about gifts on their statements of economic interests. They are only required to list the type of contribution, the donor, and the value of the item.

Smith, in an emailed statement, called The State’s calculation of the gifts she accepted incorrect. She said she often listed the same meal multiple times because it was co-hosted by several companies.

“Many of the dinners are sponsored by two or more firms or vendors,” Smith wrote in the email. “In those cases, I have claimed a dinner/meal from each entity, even though it was one meal total.”

If the number of gifts Smith reported was cut in half — to 55 gifts — to account for the double-listing, she would still have one of the highest totals for the time period, both in her district and in Lexington and Richland counties.

Smith has served on the Lexington 1 board for nearly two decades, and is a past president of the South Carolina School Boards Association. She said the latter position required her to attend many functions sponsored by various companies during the period The State reviewed, also inflating her totals.

As chair of Lexington 1’s board, she has attended three state school boards association conferences a year and the National School Boards Association Advocacy Institute in Washington, D.C., each spring, she said.

Smith won’t take meal per diems or reimbursements from the district “under any circumstances,” she said, because she believes it to be unnecessary spending of taxpayer dollars. But travel, mileage and lodging are paid for by taxpayers.

Little listed the second highest number of vendor gifts on his filings — 60 gifts, worth $2,750. Little, unlike board members, who are unpaid, earns a salary of $209,482 annually. He became superintendent in 2016.

In addition to pecans and dinners, he also listed various high-end hams — worth between $50 and $100 — on filings over his three years at Lexington 1. Since becoming superintendent, Little has received at least $310 worth of ham from several architecture firms, according to his filings. He would not clarify if these were shared with the entire district office or were just for him.

He said that while he does not handpick companies that work for the district, he considers it an important part of his job to be familiar with the companies Lexington 1 employs.

“I do believe that as the CEO for a large organization that it is imperative that I have a relationship with companies and organizations that do work with our district,” Little wrote in an emailed statement. ”I have found that these relationships make the work more effective and efficient when both parties know what is important to the other.”

The State reached out to all current school board members, several superintendents and several former school board members in the Midlands at least twice, via email or phone call. Of the 53 active school board members and superintendents, 28 did not respond. The State also called or emailed companies that were most often listed as contributors on school officials’ ethics filings.

Lexington-Richland 5

Lexington-Richland 5’s board and superintendents accepted $13,355 in gifts between 2012 and 2018. The school district, which includes parts of Richland and Lexington counties, has not taken on as many ambitious building projects as Lexington 1 (with its $365 million building plan), but it has the second largest budget in Lexington County.

The State did not include in its tally the gifts school districts gave to their own board members or superintendents.

In Lexington-Richland 5, as in Lexington 1, board officers and a superintendent ranked among the top five in most gifts accepted and highest dollar value, according to ethics filings.

Earlier this year, Lexington-Richland 5 froze enrollment at two elementary schools and is building a new elementary school in the Chapin area to accommodate a student population that has been growing for decades, according to the district.

Former secretary and vice chair Ellen Baumgardner listed 46 gifts, worth $2,280, between 2012 and 2018, when she lost her seat. She declined to comment on the record about the $50 to $75 dinners she reported having at school board conferences through the years.

Chair Robert Gantt reported just one less gift, 45, worth $2,055. He said the entire board is invited to attend meals paid for by companies, and the dinners help board members get to know each other.

“They are a courteous promotion and effort to get to know people. That is how our board perceives them. They do not influence decisions or contracts,” he wrote in an email to The State.

Gantt is a past president of the South Carolina School Boards Association.

Other board members who spoke to The State echoed Gantt, saying the dinners were a greater benefit to boards than they were to the companies treating them.

Board member Jan Hammond and former board member Jondy Loveless both said that when they were elected and learned of the gift relationships with vendors, they thought that was how business was conducted. They went along with it, although they were hesitant, they said.

“I was new and the senior board members have been on the board for a long, long time. I didn’t question anything because I thought, ‘They know what they’re doing,’” Loveless said.

Hammond accepted 28 gifts worth about $1,500 — the fifth highest total in her district since 2012, according to The State’s review. She said she thinks other board members’ reported totals should have been higher, more in line with her filings.

Loveless, in her time on the board between 2012 and 2016, reported being treated to $1,185 in gifts (24 individual gifts). She said she is a proponent of setting a limit on the number of gifts board members accept from vendors.

Her husband, Ken, was elected to the Lexington-Richland 5 board in November 2018. He was far less ambiguous about his attitude toward informal contractor-board relations.

In addition to refusing a $9,800 salary from the district, Ken Loveless said he does not accept any gifts. He wants to avoid “anything that gives the impression of impropriety.”

“I just detest that kind of thing. I don’t think it’s fair,” he said. “I don’t have to have a fancy meal to bond with somebody.”

Lexington-Richland 5 includes the Irmo, Dutch Fork and Chapin areas.

Richland 1 and 2

Richland 1 recently completed a large-scale renovation plan for athletics facilities across the district and Richland 2 voters approved a $468 million building plan for the district in November 2018. Yet school board members in both districts reported few builders and architects courting them with gifts for those major contracts.

Richland 1, with its $337.5 million budget for 2019-2020, reported just $291.83 in gifts. And Richland 2, its coffers lined with $301 million this fiscal year, reported $543.50 in gifts since 2012.

In Richland 1, all board members interviewed said they did not accept gifts from companies or if they did attend a dinner, they paid for their own meal. The district includes downtown Columbia, Lower Richland, Eau Claire and the St. Andrews area.

Board member Beatrice King said she could only recall one dinner the board attended at a school boards association conference, though the board is invited to meals with vendors often.

Because she has family in Hilton Head and Charleston, King said she typically eats dinner with them when at conferences.

“I don’t think school board members ought to get gifts from vendors,” she said.

On King’s statement of economic interest, the largest gift she reported since 2012 was worth $110.83. It was a helicopter ride from Dominion Carolina Gas after the October 2015 floods that inundated parts of the Midlands. She said other board members also accepted the offer to get an aerial view of the affected areas, but no other Midlands school officials reported the ride.

King said she “pursued” Dominion for two weeks afterward to know the exact cost of the helicopter ride.

Other Richland 1 school board members said they infrequently or never were invited out by vendors. Lila Anna Sauls said the most she may get is a mug from a school or a small container of hand sanitizer from the Palmetto Teachers Association, but no more.

“Maybe I’m not important enough, I don’t know, but I have never been approached by a vendor to give me something or take me out or anything,” she said.

Richland 1 chair Jamie Devine (who is secretary and treasurer for the state school boards association), vice chair Aaron Bishop and parliamentarian Cheryl Harris all told The State it is their personal preference to decline gifts from companies. None condemned the practice.

Harris said her main job is not to meet with companies that will build the district’s schools but to find ways to move students to the next level. Dining with architects and contractors just isn’t a priority, she said.

“That’s one thing less I have to worry about,” she said.

Richland 1 board members, like all district employees, receive $35 per day for in-state conferences to account for meal expenses. They also receive a salary of $9,600 a year, or $320 per meeting for up to 30 meetings.

Richland 2 also pays its board members $9,600 a year, though the chair, James Manning, is paid $12,000 per year. All Richland 2 board members participate in the South Carolina State Retirement Plan.

School board member Lindsay Agostini said she primarily attends lunches and dinners paid for by interested companies and firms because she likes to meet representatives from other school districts.

“They generally don’t just invite one school district,” she said. “They invite many.”

When she dines with vendors, Agostini said she keeps track of prices from the menu or searches for the menu online after the meal. She said she is not “overwhelmed with opportunities” to be treated by companies, and that the few meals she does attend don’t affect her decision-making.

“The invitation to one dinner a year, for me, that’s not going to have any bearing on how I vote,” she said.

Richland 2 is in the northeast area of Richland County, including Pontiac and Blythewood.

The structure of public reporting to the South Carolina Ethics Commission is based on an honor system, with little other than complaints or random audits to verify the accuracy of filings. That means it is nearly impossible to know if school board members who report very few gifts are being honest.

“You don’t know if you have a lower incidence of freebies or a lower incidence of reporting,” said Crangle, who is also employed by the South Carolina Progressive Network.

From the districts with the fewest reported gifts — Lexington 2, Lexington 3, Lexington 4 and Richland 2 — just four school board members or superintendents responded to The State’s interview requests.

Hazelwood, the former ethics commission attorney, said it is highly unusual for a school official to have accepted zero gifts.

“There’s no way,” she said. “There’s no way that in the course of a year, you didn’t accept a gift that had to be disclosed.”

Under South Carolina’s ethics system, complaints made against elected officials are shielded from public view until the commission finds probable cause.

So although seven Midlands school board members appeared to be missing ethics filings between 2013 and 2019, just one has been publicly admonished for it: former Richland 2 board chair Amelia McKie.

McKie was fined more than $50,000 for failing to submit required filings to the ethics commission. She ran for reelection and kept her spot on the Richland 2 board in November 2018 despite the outstanding reports.

At the February 2020 South Carolina School Boards Association conference, McKie will moderate a discussion on “understanding school finance,” according to a program on the association’s website. McKie could not be reached for comment.

BEHIND OUR REPORTING

Why did we report this story?

School districts in Richland and Lexington County control the flow of more than $1.2 billion in taxpayer dollars each year. The school boards that run them are elected to make important decisions — about school construction, student discipline, district policies and more — that impact thousands of students.

But school board members and superintendents are also in positions of power that attract thousands of gifts each year from companies trying to win big contracts (and lots of taxpayer dollars). We set out to analyze that relationship, and how gifts could hinder or bolster school officials’ ability to make fiscally responsible decisions.

Procurement and potential conflict of interest

Several board members and other school officials interviewed by The State said the South Carolina procurement code has controls built-in to protect against bias.

On the school district level, selection committees can be made up of a handful of school board members, usually appointed by the board chair or superintendent, as well as several people from the district’s administration, such as the chief financial officer.

When a school district solicits bids for a project, these committees vet each of the applicants and make recommendations to the school board.

Companies present their proposals before the committees and each committee member scores the companies. Applicants are graded on a scale, based on factors that include the company’s level of experience and its ability to deliver projects on time.

According to Lexington 1’s chief operations officer Jeff Salters, companies that have never worked in the district receive more points for that, creating fair competition that is welcoming to newcomers.

“It’s an extremely tedious process to go through those proposals and evaluate them and there’s a rubric that we used,” said Green, the board vice chair. “At the end of it, I was even more convinced at the quality of the review that is done to make sure we are getting the very best value and very best product for our schools.”

According to Green, Salters and Smith, the procurement process has a proven record of success and is free from outside influence. Green says getting to know vendors in an informal setting, such as at a meal, allows board members to examine the character of potential contractors.

“It’s important to know the people that you’re giving millions of taxpayer dollars to,” she said. “They’re not just some faceless entity that is doing work behind closed doors.”

To guard against the appearance of wrongdoing, Green and Smith said the board will only accept gifts and invitations from companies the district is already working with.

Some board members in Lexington-Richland 5 said the district follows a similar guideline, and restricts the flow of invitations to current vendors. Ethics laws do not require boards to forgo gifts from companies they have not worked with.

But critics say that strict policy creates a culture of exclusivity and “sweetheart deals” with the same handful of contractors — the more intimately the board gets to know vendors, the better that company’s chances when it presents to selection committees.

“That’s kind of a monopoly,” said Sen. Katrina Shealy, whose district includes a large part of Lexington 1. “If they accept something from one person they should accept it from everybody.”

Lawmakers accept gifts, and are frequently brought lunch by various organizations, but they are barred from taking gifts directly from lobbyists. But Shealy said that when it comes to decisionmaking, she tries to be balanced. If she meets with someone to discuss an issue she will be voting on, she makes it a point to meet with someone with opposite views, as well.

In Lexington 1, the company that gave the most gifts between 2012 and 2018 was also awarded the most contracts and placed in charge of the most projects. Jumper Carter Sease architects treated Lexington 1 school board members to $4,656.95 in gifts and got eight contracts for 12 projects since 2012. Those projects included renovations at schools and the district office, but also included construction of six schools.

Jumper Carter Sease could not be reached for comment. Smith said the company was awarded multiple contracts during those six years because it designed a prototype school, which can be replicated.

“It is a very economical way to build schools,” she wrote in an email.

In the corporate world, the gifts are considered a business expense, according to JHS Architecture partner Butch Barnhart.

“They do good work and they’re just doing their marketing part of it,” he said.

Lexington 1 has been on a building spree for years, and is in the process of standing up five additional schools to keep up with the hundreds of new students who enroll in the district each year.

Some other large donors, such as construction company M.B. Kahn, and architecture firms LS3P Associates and Quackenbush Architects, also got contracts for large projects from Lexington 1 and Lexington-Richland 5, the two districts The State requested contracts from.

However, other companies, such as architecture and design firm Stevens & Wilkinson and construction company Cumming, which spent thousands on treating school officials, received no contracts between 2012 and 2018, according to district records.

Though it might not be unethical by law, the hundreds of gifts from contractors could fall into what Sen. Greg Hembree calls “soft corruption,” he said.

Hembree, a Republican from Horry County who chairs the Senate Education Committee, said it might be worthwhile for lawmakers or individual districts to consider cracking down on the practice.

“It’s not like you’re paying money to somebody and it’s this direct quid pro quo,” he said. “It just creeps in on you a little bit.”

Although all elected officials must abide by the same ethics laws, state lawmakers are barred from accepting anything of value from lobbyists since an FBI corruption probe wiped out a tenth of the Legislature in the 1990s.

School officials, on the other hand, can wine and dine endlessly with representatives from construction and architecture companies, who are not legally considered lobbyists simply because they pay out for a business interest.

That legal leniency for local government officials could start to change under a reform bill Hembree has been working on.

The Senate bill would require local school boards to draft, prepare and adopt their own code of ethics, which some already have. The bill would also give school boards more power to punish those who don’t comply with the rules, according to Hembree. Right now, school boards have the ability to censure a member, but they don’t have real enforcement authority, he said.

“If we’re ever going to change the arc of this thing, that’s where it’s going to have to be,” he said.

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Hefner, the former Richland 2 and Lexington-Richland 5 superintendent, said he expects to fly under the radar more at his new job. He came out of retirement in May to serve as interim superintendent of Lexington 3 school district.

In November 2018, Lexington 3 voters rejected a $90 million building plan that would have replaced Batesburg-Leesville High School and renovated Batesburg-Leesville Primary School. The district maintains its need for improved facilities.

“Coming to a smaller district with not a lot of huge projects going on — and this is a wonderful, wonderful place — people aren’t giving you as many invitations,” he said.

Correction, 9:23 a.m.: A previous version of this article misstated when the South Carolina Ethics Commission makes complaints public. They are made public once the commission finds probable cause.

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Isabella Cueto is a bilingual multimedia journalist covering Lexington County, one of the fastest-growing areas of South Carolina. She previously worked as a reporter for the Medill Justice Project and WLRN, South Florida’s NPR station. She is a graduate of the University of Miami, where she studied journalism and theatre arts.
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