Editorial: Legislature should help SC cities, counties figure out why books don't balance (2024)

For true crime enthusiasts the world over, Hampton County, South Carolina, has become synonymous with Alex Murdaugh. That’s a heavy burden for anyplace to bear, but as The Post and Courier’s Thad Moore reminds us, the county has a lot of problems beyond that.

Its big governmental problem is at least $4.6 million in restricted funds that county officials admitted in 2022 they haven’t been able to account for. They’ve said for years they want to find out what happened but don’t have the expertise to figure it out themselves, don’t have the money to hire a forensic auditor and haven’t been able to find anyone in state government whose job allows them to help because, as Mr. Moore reports, they learned that state law largely insulates local governments from such scrutiny.

It’s against that backdrop that the S.C. Senate voted last month to require the state auditor and inspector general to hire a company to conduct that forensic audit of both the county and the Hampton County School District.

Ironically, Mr. Moore reports, that vote came the same day the Hampton County Council voted to go forward with its own audit— although it's unclear where it's getting the money, and watchdogs complained that there were more questions than answers about what the county is up to. So that probably should be part of what the state looks into as well, because voters need answers they've been seeking for years.

What made Hampton County's mystery statewide news wasn’t so much the missing money as the revelation that state government— which is so quick to tell local governments what they can and can’t do and what they must and mustn’t do— provides practically noassistance to local governments that self-report problems they don’t know how to fix.

So what’s even more important than proviso 117.196 itself is that the unanimous Senate vote represents the Legislature’s first acknowledgement that it has a role to play in helping local governments obey the laws it passes.

To be clear, we’re not talking about how much discretion local governments should have about how they raise or spend tax money or, frankly, about anything else.

We’re talking about helping to ensure that city and county officials don’t exceed the authority they have, that they use that authority within the confines of the law and that when something goes wrong— whether through criminality or incompetence— the state will help them set things right.

Yes, voters always have the option of kicking out local elected officials who exceed their authority or simply do a lousy job. But that doesn’t necessarily fix the problems, particularly in small governments that can’t afford the expertise to fix things.

Besides, voters also have the option of kicking out the governor or the state treasurer or the comptroller general or anybody else on our too-long list of statewide elected officials, and that has never stopped the Legislature from providing oversight of those officials’ work and ordering investigations and audits when things don’t seem right.

Look no further than the Senate Finance subcommittee’s investigation last year into then-Comptroller General Richard Eckstrom’s decade-long effort to conceal what grew to a $3.5 billion overstatement of the state’s assets.

Actually, do look a bit further than that: Look at that same panel’s investigation this year into the failure of Treasurer Curtis Loftis to tell lawmakers about $1.8 billion whose source and purpose no one seems to know.

Look at this investigation because what happened in the state treasury is eerily similar to what happened in Hampton County, although fortunately in reverse. In Hampton County, $4.6 million in restricted sales tax funds came into county coffers and somehow wound up in the wrong bank account. As a result, it paid for salaries and other routine operating costs instead of paying for recreation facilities and firefighter expenses, as it was supposed to do.

Today, many legislatorsand legislative candidates are campaigning on a promise to repeat that error on a $1.8 billion scale, by spending the state money that Mr. Loftis somehow failed to get into the correct bank account. All of this digression is to say that the Hampton County mess should underscore the folly of spending the mysterious $1.8 billion.

The state budget bill includes $4 million to hire forensic auditors to get to the bottom of the state’s $1.8 billion mystery. Last week, the House unanimously added a nearly identical version of the Senate's Hampton County proviso to its version of the budget; negotiators just need to make sure one of those versions stays in the final bill, so we can get to the bottom of Hampton County’s much smaller mystery.

But lawmakers also need to realize that this is a stopgap measure to deal with one discrete problem we know about. They need to come back next year and assign a state entity to help local governments that need help figuring out how public money was misspent when there’s no evidence that it involved criminal activities. That entity should regularly or randomly audit local government spending— or at least be on call when those governments find their books unbalanced because of sloppiness, laziness or incompetence.

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