Schools act as money funnels
Lawmakers channel nearly $2M in 3 years
The Post and Courier
The Post and Courier
David Mack
South Carolina legislators are using some of the state's public universities as funnels, quietly channeling nearly $2 million in tax dollars to their favorite charities during the past three years, a Post and Courier investigation found.
Some legislators sent this money to nonprofit groups with which they have direct ties. For instance, state Rep. David Mack, D-North Charleston, has sent $700,000 through South Carolina State University to a Columbia-based nonprofit organization where he works and receives money.
But it was far from an isolated case. The newspaper's analysis found that legislators funneled money through most of the state's major public institutions of higher learning.
The practice raises questions about conflicts of interest and how legislators distribute public money.
"It looks like a way to camouflage money to do something they can't do or don't want to do directly, something that might be politically embarrassing," said John Crangle, director of the government watchdog group Common Cause South Carolina.
Here's how it works: State legislators take money from the state budget and tuck it into universities' state appropriations — sometimes without the schools' prior knowledge. The universities then hand over that money to the charities.
The Post and Courier requested information, under the South Carolina Freedom of Information Act, from seven of the state's largest public universities about money legislators had them pass through their budgets to charity groups over the past five years. Legislators went through all of the schools except the College of Charleston and The Citadel to funnel tax dollars.
State politicians for years have used budget mechanisms to send tax dollars to pet projects. But the amounts tend to be higher for money funneled through universities.
In Mack's case, he sent $300,000 to S.C. State in the 2006-07 school year and asked the university to send the money to a Columbia-based nonprofit organization called the Palmetto Center for Advocacy. The center conducts health education programs statewide, especially obesity prevention programs.
Mack sent the group another $400,000 through S.C. State in the 2007-08 school year.
Anastasia Shaw, deputy director for Palmetto Center for Advocacy, said the $700,000 from the state is the only money the group has brought in so far. But, she said, the center is "looking to diversify funding."
According to the group's Web site, Mack is employed as its "outreach director." In a telephone interview, Mack said he now does consulting work for the group and previously was the organization's interim director. He also said he is paid for all of his work with the center but declined to say how much.
By law, nonprofits must allow the public to view tax forms, which include salaries of directors. But the center is relatively new, so its tax records are not yet publicly available.
When asked why he chose to send the money through the university instead of going through the state's competitive grants program, Mack said, "We just chose that way."
S.C. State benefited from the arrangement, Mack said, because Palmetto Center for Advocacy organized some health education programs on the university's campus.
Another legislator who used S.C. State as a funnel was Sen. John Matthews, D-Bowman. Matthews sent $150,000 in the 2006-07 school year and $200,000 in the 2007-08 school year through the university to the Lower Orangeburg-Upper Dorchester Community Development Corp.
Matthews said the program mostly helps low-income people in the high-poverty region prepare for and land jobs.
According to the group's Web site, Matthews is a non-voting member of the organization's board of directors. His wife, Geraldine Matthews, is the board's vice chairwoman and serves on the board's personnel, finance and overview and assessment committees.
Matthews said Wednesday that neither he nor his wife are compensated for their work with the organization. He also said that he gave up his role as a voting member of the board when he brought state money to the organization.
The program was launched with a private grant, Matthews said, but the money ran out. He's temporarily helping it stay afloat with state funds, he said.
Matthews said he was "just following tradition" by passing money through a state institution to a nonprofit group.
Matthews also passed $150,000 through S.C. State in the 2006-07 school year for a "historical analysis study on African-American community wealth creation." The project is looking at impediments for blacks in the areas of education and economic development and will provide "a comprehensive analysis of the Interstate 95 corridor," which basically runs along the state's poverty belt, he said.
The university sent $50,000 of the $150,000 for that project to DESA, a Columbia-based management consulting firm, to complete a portion of the project, Matthews said.
DESA President Diane Sumpter said her company will conduct focus groups and gather information that will be used to make videos to help low-income parents become more involved in their children's education.
Matthews said the other $100,000 will be dispersed at S.C. State to complete the rest of the report.
Joe Pearman, assistant vice president of business and finance and vice president of financial affairs and management information systems at S.C. State, said so far, none of the $100,000 has been spent, and only $19,000 has been committed for salaries.
Evelyn Fields, who is chairwoman of the university's Department of Education and in charge of the project, said the money will be used to gather baseline research data to develop a program for culturally relevant teaching for children in poverty.
At the University of South Carolina, legislators funneled $225,000 to the Epilepsy Foundation of South Carolina over the past three years, said Russ McKinney, director of communications for the university.
Barbara Comar Brothers, executive director of the Epilepsy Foundation, said she doesn't know which legislators are involved in her organization receiving the money. But, she said, representatives from the foundation met with staffers from the House Ways and Means Committee to request the funds.
The foundation used the money for a program that trains state employees to better deal with people with epilepsy in emergency situations, Brothers said.
The university also passed $100,000 to EngenuitySC for the National Hydrogen Association Convention, McKinney said. The university, he said, has no record of specific legislators involved in such transactions.
Kyle Michel, a lobbyist for EngenuitySC, said the money will be used to promote South Carolina, especially the Columbia region, as "a place for hydrogen fuel cell economic development" during the 2009 convention.
Neil McLean, executive director for the group, said the money came from the Legislature but no specific legislator.
Sen. Nikki G. Setzler, D-West Columbia, and Rep. Joan Brady, R-Columbia, are members of EngenuitySC's board of trustees, he said.
Legislators also used other schools as funnels, including Clemson, Winthrop and Francis Marion universities. None of the legislators involved in those transactions were employed by the organizations to which they passed money, nor were they members of the groups' boards of directors.
--Sen. Harvey Peeler, R-Gaffney, sent $115,000 in the 2007-08 school year through Winthrop to the Lake Wylie Chamber of Commerce to expand the Lake Wylie Small Business Center.
Chamber President Susan Bromfield said the money allows the group to provide a place for small-business owners to get a solid start. She said Peeler has no connection to the chamber other than being the state senator who represents the area.
Peeler did not return calls seeking comment.
--Sen. John Hawkins, R-Spartanburg, sent $100,000 in the 2007-08 school year through Clemson to the Spartanburg Humane Society. Hawkins has no connection to the group other than being the state senator who represents the area, he said. He also said he would have been willing to use the state's competitive grant program or any other funding mechanism, "but this worked."
--Frances Marion University has funneled $187,294 to the Mount Pleasant-based Palmetto Project over the last three school years, and nearly $300,000 has been passed through the university over the past five years. John Kispert, vice president for business affairs for the university, said he is unaware of the name of the legislator associated with the money.
--Kispert said the university receives correspondence about the money from Palmetto Project Executive Director Steve Skardon. Skardon said the money has been coming from the Legislature for years, but not from a specific lawmaker. He said the money has been used for the Omega Project.
According to the group's Web site, that project "offers intensive training to those communities looking to improve the quality of public dialogue and personal trust among citizens of diverse racial and cultural backgrounds."
Skardon said the Palmetto Project doesn't include current public officials on its board or staff because of the potential for conflicts of interest.
Reach Diane Knich at 937-5491 or dknich@postandcourier.com.
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Comments
UrGatorbait (anonymous) says...
Shocking
I see some used that money to actually help the communities they represent and a couple don't where that money went and to it went to some to line their pockets and buy influence I'm sure.
June 1, 2008 at 12:53 a.m. ( permalink | suggest removal )
karmann (anonymous) says...
And yet they keep wanting to raise taxes. Just one more reason for re-structuring our government. How about a flat tax? How about actual consequences for those to misuse the tax payers money and trust? Yet we in South Carolina gave our government a blank check when we voted in the state lottery. There was nothing that stated, by law, that the legislators had to use it for education. By the way, what percentage of the "Education Lottery" is used for actual education? Anyone know?
June 1, 2008 at 5:03 a.m. ( permalink | suggest removal )
ForPnC (anonymous) says...
My list of who I'm not voting for is getting longer and longer. I'll be wondering why I'm awake on polling day.
Hey, ole David Mackie, little BOY - You just made that list. No vote for you from me.
Wait until I point others towards this article. It's called the MAFIA. We've elected the MAFIA.
June 1, 2008 at 5:30 a.m. ( permalink | suggest removal )
Perspective (anonymous) says...
Dang crooks!!!!
Get 'em P & C!
I like the newspaper turning up the heat on things that we are all sick of....crooked politicians, parking cheats, etc.
How about the vast number of people riding around in school district vehicles all the time? Their are tons of them. Who are these people and what warrants them a vehicle? Also, why is it so common to see several male school district employees together doing whatever ... not at a school? Are they headed to change a lightbulb or something? How many does it take? Why does so much of my tax money go to support a FAILING school system? Get 'em P&C, I wanna know.
June 1, 2008 at 6:37 a.m. ( permalink | suggest removal )
volsfan (anonymous) says...
Not sure if anyone watches Fox News but the program last night "Porked.." showed our congressmen and women in Washington doing very similar things but the money was not going to non-profits. http://www.foxnews.com/story/0,2933,3...
June 1, 2008 at 7:28 a.m. ( permalink | suggest removal )
hbdanbo (anonymous) says...
This was happening in my state as well. New Jersey Senator Wayne Bryant was sending "grants" to the Univ. of Medicine and Dentistry of NJ,in return, he received a nice no-show job. The NJ Attorney General's office did nothing about it. He's now under indictment for federal corruption charges. Maybe some US attorney in Columbia can do you the same favor.
June 1, 2008 at 8:12 a.m. ( permalink | suggest removal )
moonpie (anonymous) says...
Unfreaking believable. Vote them out! Spending OUR TAX DOLLARS LIKE ITS FREE MONEY!
June 1, 2008 at 8:20 a.m. ( permalink | suggest removal )
gencon1 (anonymous) says...
It's not their money to give. This is unbelievable!
Put them in jail!
June 1, 2008 at 8:31 a.m. ( permalink | suggest removal )
griff895 (anonymous) says...
Don't y'all understand? We ignorant wage earners just aren't smart enough to understand the importance of funding these programs. After busting our butts at our job (some with TWO jobs) just to make ends meet and try to provide for our families, we are too tired to "DO THE RIGHT THING", so our wonderfully intelligent elected officials are forced to slyly take more of our hard-earned money and put it in really worthwhile programs that we would surely support if we were just smart enough to "DO THE RIGHT THING"!
And if they should get some little reward for being so much smarter than the rest of us, so be it.
The polls open at 7am in November!!!.
June 1, 2008 at 8:52 a.m. ( permalink | suggest removal )
RTC (anonymous) says...
This burns me up.
This is nothing more than money laundering that is trying to be passed off as legal. I don't care where it goes, it is not their money to spend as they see fit.
There should be a major uprising over this, and all politicians involved should be imprisoned.
June 1, 2008 at 9 a.m. ( permalink | suggest removal )
JC (anonymous) says...
Sounds like fraud to me, and if it isn't against the law - IT NEEDS TO BE!!! But, since most politicians are in it for themselves, I'm doubt if they would ever vote against them being able to give money to themselves.
June 1, 2008 at 10:16 a.m. ( permalink | suggest removal )
zoomru (anonymous) says...
Whoa.... Lets take a good look here. Not only are the Legilators Crooked and Un-ethical but the Post & Courier isn't so clean if you have a memory!!
Think about what has just run in the news lately...Both the Citadel and C of C have been crying about
needing FUNDS or their funds are being CUT! The Post and COurier has been holding this information until the
right time. You can't fool me EDITORS. GET BUSY !!!
Presidents of Universities ....yes YOU GENERAL! Get Busy and learn some salesmanship and marketing techniques
instead of begging at City and County Council or looking to Columbia or Washington DC.
Charities and NON-profits...I suggest you get some clarity and start posting ALL information on your website for
transparency. That Info includes... all info... on all individuals that even breathe within a 5 mile radius of your "charity"!
That's right ....Family members, out-of-state PROPERTY with address and google coordinates.
Legislators.... I AM COMING AFTER YOU !!!
Business Owners ....CEOs start reviewing WHO is doing WHAT and where these board member golf buddies are GOLFING and WHO they are fishing with OFFSHORE to have quiet conversations with.
We nee to return a LOT of morality to our government.
June 1, 2008 at 10:21 a.m. ( permalink | suggest removal )
delsiefulton (anonymous) says...
We hear about these things (politicians funneling monies via of universities to charities they and/or their family members hold key positions in, monies via various agencies/schools to award the politicians children, grandchildren, nieces/nephews scholarships,even though their grades were avg, or below avg., etc... ). We depend on, or hope and believe that someone else is doing something about it. Then it just dies out and they keep right on "dirty dealing" and misleading the people into believeing that it was all a mistake. They are laughing all the way to the bank at how easy we make it for them to get rich and/or richer off of our money.
WE must hold our elected officials accountable. WE must vote them out when they do wrong. WE must force them to give us our money and put it where it is needed by the people and not for them and their family members only. WE must make them see that they are not above the law. We have allowed the system to pat them on the back when they get a DUI, embezzle tax dollars for personal use, use drugs, etc... They are no better than anyone else, yet we allow them to get away with murder (?) for lack of a better term.
The P&C has investigated and disclosed information that makes us more informed voters. They have done their part. It is now time for us to do ours. I challenge you to use the information, vote these crooks (shady incumbents) out of office.
There is too much to be done, that needs to be done, that could have been done! We, the people have the power to make changes. Please, do not vote for someone that has proven themselves to be crooked and dealing under the table. It will not make sense to vote them back in, unless you believe that we are doing better now than we were ten/fifteen years ago-we are not.
The legislators make a big deal about cost of living raises each year. It is very clear, as to why our elected officials in Columbia do not want state employees to get raises. They need the money to go home, into their bank accounts. People, we have to wake up! They have misled themselves into believing that they have power. I am going to the polls to vote as many of the "dirty under the table", "don't care about the people" incumbents out of office, as I possibly can. Please join me. Let's show them POWER!
June 1, 2008 at 12:19 p.m. ( permalink | suggest removal )
scienceguy (anonymous) says...
Check out:http://www.charleston.net/news/2008/may/27/porkwatchnet42350/#comments.
Note the connections between this group, Ray Nash, Mike Rose, Christian Exodus, the Council for Consrvative Citizens, Arthur Bryngelson, the LoS, and Chip Campsen.
As far as the C of C is concerned, Shirley Hinson left the Legislature and headed directly to a high-paying job at the school for which she is decidedly unqualified. In the meantime, her ex-husband is living openly with his girl friend in Berkeley County where he serves on the School Board while teaching in Drochester County at schools that are teaching abstinence only to the kids.
June 1, 2008 at 3:02 p.m. ( permalink | suggest removal )
lillycollette (anonymous) says...
.
June 1, 2008 at 4:59 p.m. ( permalink | suggest removal )
ginj (anonymous) says...
If ever there was a reason for term limits, this type of activity screams for it. Anyone doing this shows no respect the people of this state. Difficult as this my sound, NO GOVERNMENT ENTITY has any business donating our tax dollars to ANY Charitable organization. If the organization is worth donating to I will pull the money out of my own pocket, not you.
June 1, 2008 at 6:36 p.m. ( permalink | suggest removal )
KidYendor (anonymous) says...
David Mack needs to resign from office quickly.
June 1, 2008 at 8:54 p.m. ( permalink | suggest removal )
AngryTaxpayer (anonymous) says...
Are you kidding me?? It sure is nice of Rep. David Mack to funnel $700,000 to a 'charity' that is paying him... Basically he - and these other asses - are stealing our tax money to line their own pockets. 1) He should be arrested for stealing our tax dollars and 2) If these elected jerks want to donate money to charities they can donate it out of THEIR pockets - and not screw the citizens of this state. The state has enough financial problems without these asses stealing money from the state budget to fund their little pet charities. If they think its such a great idea, why didnt they do it in the open??? Why did they hide it by giving the money to a school and have the school divert the money to the charity.
Obviously, with at least one (Rep. David Mack, D-North Charleston) of these 'charity donations', there is a conflict of interest. If its not illegal what he did - it should be. Just proves that the statehouse is full of nothing but crooks and criminals.
I'm sick of all this 'vote for me, Ive been in the statehouse for 20 years, I know how to get stuff done' crap. Hell, they haven't done anything for us since theyve been in office (other than waste our tax dollars) - I say vote out ALL of the incumbents. Put new people in office - it cant be any worse. Maybe we can get a few ETHICAL people in office...
June 2, 2008 at 12:08 a.m. ( permalink | suggest removal )
ForPnC (anonymous) says...
Just remember all of this when you vote!
June 2, 2008 at 4:09 a.m. ( permalink | suggest removal )
Tammie (anonymous) says...
I heard about this on the radio this morning on my way to work. Like ForPnC said, just keep things like these in your mind when you go to vote. WE have the power to change things.
June 2, 2008 at 8:58 a.m. ( permalink | suggest removal )
Lowcountry_Bulldawg (anonymous) says...
Palmetto Center for Advocacy:
1)How long have you existed? No mention on your site.
2)How long has Reverend Margie Gallman been your chair?
3)How is it that with 19 upcoming events and an abudance of past events, is it possible that the ONLY funding you have recieved thus far is from our state legislature?
4) Who is directly responsible for seeking and generating donations for your non-profit?
5) David Mack, as a Representative of my community , I feel the need to know how much compensation you have received rom this group.
It is time for this thieves to be held accountable for these back room dealings and underhanded politics. If Representative Mack feels it is not my business to know where my tax dollars are going and not to have him come clean on all his secretive ties then I will not give him my vote!
David Mack
Randy Scott
LC Knight
Am I leaving anyone off?
June 2, 2008 at 10:02 a.m. ( permalink | suggest removal )
CHRISJIII (anonymous) says...
Money laudering is supposed to be illegal. How come the state legislators can get away with it? Sounds like it's time for the federal gov't to come in and look at S.C. again. This time let's wait until a new administration is in place. The present one is too corrupt in itself.
June 2, 2008 at 10:53 a.m. ( permalink | suggest removal )
eyfigueroa (anonymous) says...
I see many of you complaining, and I seriously hope that you take this vehemence to the polls and get rid of these "old tyme politicians".
It's sickening to read this. I am voting for change this fall.
June 2, 2008 at 11:55 a.m. ( permalink | suggest removal )
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