The former superintendent under whose watch the Sumter School District overspent its budget by $6.2 million two years ago and who now serves on the school board of trustees publicly said involvement by business and community leaders on the …
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The former superintendent under whose watch the Sumter School District overspent its budget by $6.2 million two years ago and who now serves on the school board of trustees publicly said involvement by business and community leaders on the district's advisory Finance Committee should be eliminated.
Frank Baker made that recommendation to Sumter School Board Policy Committee Chairman the Rev. Daryl McGhaney. McGhaney, who chaired the school board when the district's financial crisis was discovered in a December 2016 audit, shared it with fellow committee members late Tuesday afternoon as they reviewed board committees' proposed charters for the first time.
With a five-member turnover to the nine-member school board in the November midterm election, new trustees recently requested detailed definitions listing clear roles of three existing board committees, which include Finance, Facilities and Policy.
Board Chairman the Rev. Ralph Canty prepared the proposed charters in the last month with the assistance of district administration and presented them to the full board last week at its regular public meeting. Those drafts called for community member and board member participation on all three committees.
Currently, only the Finance Committee includes existing community members, and new trustees Baker, an at-large member representing the entire county and who serves as the board's vice chairman, and Brian Alston, who represents Area 1, expressed concerns with grandfathering in those committee members, who include private-business owners Bobby Anderson, Ben Griffith and Greg Thompson and community leader Patty Wilson.
Last week, Alston recommended those public members come before the full board for vetting and approval now to continue to serve on the committee. Trustees Johnny Hilton, Sherril Ray and Shawn Ragin also are on the committee.
Baker's recommendation Tuesday called for the public to only serve on a newly created Citizens Advisory Committee, which was recently recommended by McGhaney and is still in the formation stages. In the draft Canty and district administration also prepared, he proposed the committee meet twice a year and be an informational session for the public.
On Tuesday, Policy Committee members suggested the new committee meet quarterly.
All recommendations for committees are simply on the table at this time and will eventually need two readings by the full board and a majority of board members' approval before becoming official policy, McGhaney said.
To explain his reasoning, Baker told McGhaney - who relayed to the committee - that "the board would then be in line with county council because it doesn't have the public serving on those committees. However, we're also talking about a Citizens Advisory Committee."
When Ragin asked why Baker made the recommendation to remove public input from the committees, McGhaney said Baker didn't explain.
"That was just a recommendation," McGhaney said. "We're just taking input at this time since this is our first Policy Committee meeting, but we will have to take whatever comes out of this committee to the full board at some time."
On Wednesday, Baker shared through Canty, who, as chairman, relayed the message to The Sumter Item, that he has concerns about the public being a part of executive sessions behind closed doors with board committees.
When Baker was superintendent, he routinely met with all Finance Committee members in executive session.
How did we get here?
A lack of proper financial controls in-house contributed to the district overspending its budget by $6.2 million in fiscal year 2016 - information that was not released until the official audit report in December of that year. Baker was the superintendent at the time.
The overspending that year depleted the district's ending general fund balance, as of June 30, 2016, to $106,449 - a critically low level, according to the district's auditor at the time, Robin Poston.
Baker operated the district in 2015 and 2016 without a credentialed chief financial officer. During those years, the district's finance department only produced quarterly financial statements, and the advisory Finance Committee also met quarterly.
Baker accepted responsibility for what was revealed in the audit, and the full board hired a financial consultant in January 2017 to work with administration and help guide the district out of the crisis. After implementing an emergency financial plan, the district ended fiscal 2017 with a net income of $779,230.
Baker hired a full-time CFO in June 2017 when the consultant finished his work.
In July 2017, the state Department of Education placed the district on a "fiscal watch." In the fallout from the crisis, Baker and the board mutually agreed to part ways, and he retired.
Under Interim Superintendent Debbie Hamm, the district raised its fund balance to $8.6 million at the end of fiscal 2018. In initial estimates, CFO Jennifer Miller projects that number will be about $10.7 million at the end of fiscal 2019.
Under a state law implemented a couple years ago, the district must have one month's operational expenditures - roughly $12 million - in its fund balance by June 30, 2020.
The finance department now produces monthly financial reports and meets monthly with the Finance Committee. The district's budget this year is $131.1 million.
'If that's the will of the board, that's one thing'
Finance Committee member Greg Thompson, who owns Thompson Construction Group, said Wednesday he is disappointed by Baker's recommendation but not surprised.
"Frank Baker doesn't want anybody on the Finance Committee who understands a multi-million budget that's over a $100 million," Thompson said.
He said the committee urged Baker and McGhaney at the beginning of the 2016 fiscal year, as superintendent and board chair, to revisit the budget before finalizing it because the committee thought it would create a significant deficit.
Baker and McGhaney did not take heed, Thompson said.
"Frank Baker's comment in Finance was, 'I'll spend less money,' and we know that was not the case," he said.
Thompson said he thinks Baker has convinced other trustees to get the private-business leaders off the committee since he came on in November.
"If that's the will of the board, that's one thing," Thompson said, "but somebody needs to hold this board accountable. They don't want anybody knowing the finances better than they do."
Thompson said none of the trustees have the experience to understand the complexities of supervising a $100 million-plus budget - including Baker, given his track record.
"And that's evidenced by the motion they've made recently to reopen a school [Mayewood Middle] that was closed before we even get out of our financial situation. We're still below our 30-day fund balance requirement by the state."
Mayewood and F.J. DeLaine Elementary School closed after last school year, a vote made by the board due to what it said was low enrollment and a way to save money. This board took a step back from that vote last month after The Sumter Item and state Press Association pointed out the motion was not on the agenda and, therefore, an illegal vote according to state Freedom of Information Act laws.
Canty also said he is disappointed but not surprised by Baker's recommendation. He said he "totally disagrees with that position" to remove public input and oversight from the Finance Committee.
"The district does not really belong to the board," Canty said. "The district belongs to the people of Sumter County. And it's my opinion the more the public is involved, the more they will sense their ownership."
Formally spelling out public participation on the committees and the official charters is still in its early stages, McGhaney said.
With a loaded agenda already for Monday's regularly scheduled board meeting, any initial discussion with the full board likely will not happen until its Feb. 25 work session.
The Policy Committee plans to meet again before then to better organize the recommendations and amendments to the committee charters. When the committee eventually presents the charters to the full board, it will identify key issues, and the full board will vote on the direction it will take on each of the isolated issues.
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