York County lawmakers split over Winthrop audit request

York County legislators are divided over whether South Carolina auditors should launch a thorough review of Winthrop University’s finances.

State Rep. John King, D-Rock Hill, is leading an effort to ask the Legislative Audit Council to look into the university’s spending. He told The Herald this week he’s concerned about Winthrop using its reserve money for some expenses.

But school officials say Winthrop isn’t using reserve or savings money to balance its budget year-to-year. Acting President Debra Boyd said Thursday that reserve money has been used in the past to pay for specific needs. The money was not used for day-to-day expenses such as salaries.

She added that, last year, Winthrop brought in more revenue than was expected, resulting in about $200,000 being added to the reserve fund.

Besides King, at least one other local lawmaker thinks an audit at Winthrop is a good idea.

Recent experiences with S.C. State University – a public college that is nearly $17 million in debt and whose academic accreditation is on the line – has been a “wake-up call” for lawmakers to pay closer attention to university budgets, said Rep. Ralph Norman, R-Rock Hill.

“Not knowing the numbers is not an option,” Norman said.

Next month, the Legislative Audit Council board will consider requests for audits at three public colleges: S.C. State, Winthrop, and the University of South Carolina.

Norman says other public universities in the state should expect similar scrutiny. “It all boils down to accountability ... It’s a whole new day.”

While state audits at universities are good tools to consider, the time and financial burdens that such reviews can present to schools should be considered, says S.C. Rep. Tommy Pope, R-York. Pope once served on Winthrop’s Board of Trustees.

A legislative audit, Pope said, is often a lengthy process, sometimes taking years from the time such a review is approved to when findings are published.

Still, a financial audit at Winthrop, he said, could be valuable as a new president enters later this year. It could present an opportunity for Dan Mahony, who was chosen last month to be Winthrop’s 11th president, to get a good grasp on the university’s financial health, he said.

Pope added that he believes Winthrop’s leaders and trustees have done a good job managing the university and its finances, especially in charting a plan to grow enrollment over the next few years. He also noted Winthrop’s physical growth, from improving older buildings on campus to adding state-of-the-art facilities.

One of Winthrop’s most vocal supporters and a Winthrop graduate, state Rep. Gary Simrill, R-Rock Hill, says he doesn’t see the need for a legislative audit at the university.

While, “sunshine is always the best disinfectant,” Simrill said, he hasn’t seen an issue at Winthrop that would warrant such a large-scale review by state auditors. The Legislative Audit Council performs a vital role for South Carolina in ensuring that state agencies operate efficiently and within the bounds of the law, Simrill said.

Concerns and questions that need immediate responses, Simrill said, should be hashed out between lawmakers and university trustees. He prefers that process, he said, adding that he’s routinely sought out dialogue with trustees and Winthrop officials when he’s heard concerns from constituents.

Another House member, Rep. Raye Felder, R-Fort Mill, agreed with Simrill, saying she’s not heard any information that would suggest Winthrop should undergo a state audit. Felder is a Winthrop graduate.

State Sen. Wes Hayes, R-Rock Hill, said he isn’t sure whether the Legislative Audit Council board will feel the need to launch a review at Winthrop. Already, he said, state auditors have more requests for audits than they can perform.

Hayes said he isn’t “intimately familiar” with Winthrop’s budget but said an audit of its finances shouldn’t pose a problem if the university has been run properly.

Felder, Simrill, Pope, Hayes, and Norman all said they were not asked by King to sign a letter last month asking for a state audit at Winthrop. King and six other members of the Legislative Black Caucus signed the letter, which was dated March 9.

King met with Boyd and Winthrop board Chairwoman Kathy Bigham this week and said the conversation was positive. As a legislator, he said, he’s felt out of the loop when Winthrop – which sits in his district – has made budget requests and other presentations to state lawmakers.

Now, King said, he believes the communication channels are more open but he and others who sent the letter asking for a state audit at Winthrop do not plan to drop the request.

If other lawmakers want similar audits performed at other public colleges, King said, he would add his name to those requests, too. King added that he would like to see such audits be customary for every school every 10 years. Winthrop’s last audit was conducted in the mid-1990s.

Boyd and other Winthrop officials say they’ll answer any questions lawmakers have about university spending and that the campus will cooperate fully if the Legislative Audit Council board approves a financial review this month.

Winthrop’s reserve fund, Boyd said, has been stable over recent years. Records show that over the past few years, Winthrop’s reserve fund has fluctuated less than 3 percent. The university’s reserve fund, however, is down from nearly $20 million in 2009.

University officials say Winthrop’s reserves have been used to help keep the school competitive and flexible to meet students’ needs. Using reserves to pay for strategic initiatives and necessary one-time expenses, Boyd said, does not mean the school has operated at a deficit.

Last year, Boyd introduced a campus-wide 10 percent budget “freeze,” which allowed university leaders to review spending and decide whether some money could be reallocated to pay for strategic goals, such as growing the size of the student body.

The effect of that freeze, Boyd said, is not yet known but will be determined closer to June, when trustees vote on Winthrop’s budget.

Boyd also said it’s too soon to say whether Winthrop will use any reserve money this year but that university leaders are trying to avoid doing so. If any money is needed, she said, it will be for targeted uses and investments in growing the university.

Winthrop, she said, “will continue to remain on solid financial ground.”

This story was originally published April 2, 2015 at 9:24 PM with the headline "York County lawmakers split over Winthrop audit request."