SC district failed to follow its own policy, risking lost revenue and legal issues
Richland School District 1 has repeatedly failed to follow its own policies for renting school facilities to outside groups, according to an internal audit, which has opened the district up to lost revenue, potential legal risks and inconsistent oversight.
While reviewing of the Eau Claire High School student activity fund, the Richland 1 internal auditor identified the problems. While the issues uncovered were at one school, the audit concluded that compliance problems appeared to be districtwide.
District policy requires principals, or their designees, to maintain contact with outside organizations renting school facilities and ensure an administrator is on duty during events. And those renting the space must carry proper insurance to protect the district from liability. Rental deposits are supposed to be paid to Facility Services.
A Richland 1 spokesperson did not comment on the audit.
However, auditors noted that the district’s procedures have not kept pace with changes in practice. In recent years, Richland 1 shifted to a centralized online reservation system using a scheduling software, but district policy was never updated to reflect that change.
But compliance has been a problem for more than a decade, the audit noted. From 2010 to 2023, the office issued multiple reports outlining financial and legal risks tied to facility rentals.
The audit identified three instances in 2024 where outside groups paid Eau Claire High School directly to use athletic facilities, and bypassed rental contracts, insurance requirements and the rental software system entirely.
Those unauthorized payments included $2,900 from Columbia College Track Club on Aug. 24, $1,500 from AAU Basketball on Aug. 26 and $500 from Hoopology on Oct. 15. of that year. None of the required processes were followed, and the revenue was not properly accounted for. Rental revenue had not been reported to the district from July 2024 through November 2024.
Eau Claire officials told auditors they were unaware of the new software system.
The district’s rental coordinator said she knows that schools and outside groups routinely bypass the rental system, citing a lack of accountability and limited authority to enforce compliance. She told the district’s internal auditor that she receives rental checks from the system, but no reports to reconcile payments, and that there is no summary data on renters, fee classifications or nonprofit status.
The report warned that inconsistent rental practices expose the district to lost revenue, legal liability and potential issues with custodial pay and facility readiness.
The audit outlined several steps the district could take to improve compliance, including updating written procedures to reflect current practice, aligning the rental software system with policy requirements, requiring monthly reports from the vendor and providing training for principals. It also recommends stronger monitoring from Facilities Management.
Facilities Services has drafted a policy revision and added a link to the rental system software to its new webpage. It also plans to continue providing training at leadership conferences and monthly meetings with school administrators.
