Questions Raised About Taxpayer Support for High School League

February 19, 2013

Investigative Reports

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Football on MoneyEvery time there’s a high school playoff game in the Palmetto State, the South Carolina High School League likely is seeing dollar signs.

That’s because most of its income is generated from ticket sales at playoff games. Last fiscal year, which ended June 30, the nonprofit organization raked in $953,602 in gate receipts, which represented nearly 71 percent of its total revenue of $1,343,530, according to its federal tax return for the year.

The nonprofit, a self-described voluntary organization made up of 207 public and private high schools and nearly 200 middle schools throughout the state, also received more than $94,000 in membership fees last fiscal year, federal tax records show.

Annual membership fees, which depend on the size of the school, start at $200, according to the organization’s constitution. Failure to make timely payments can result in a $50 late fine.

Last fiscal year’s total revenue jumped by more than $146,000, or 12 percent, over the previous fiscal year; net assets last fiscal year totaled about $2.6 million, a yearly increase of about 5 percent, records show.

Exactly how many tax dollars are funneled to the High School League is unknown, though some state lawmakers say the organization gets plenty of taxpayer support.

The league these days is in the gun sights of several state lawmakers, who contend that the nearly 100-year-old organization has abused its power when it comes to determining whether high school teams can participate in playoffs.

What one lawmaker didn’t know until contacted last week by The Nerve was how much top league staffers are making.

The organization’s top-paid administrator, Commissioner Jerome Singleton, received a salary of $148,580 last fiscal year, according to federal tax records. The other four highest-paid executives of the organization earned salaries ranging from $70,004 to $91,800, records show.

“From the size of the organization, I don’t agree with that salary,” Rep. Garry Smith, R-Greenville, toldThe Nerve.

Smith is the co-sponsor of a bill (H. 3131) that would give the state superintendent of education the final say on appeals from the High School League. The legislation was referred to the House Education and Public Works Committee; Smith is not a member of that committee.

Singleton declined to discuss specifics on salaries when contacted by The Nerve, instructing a reporter to file a request for those records through the state Freedom of Information Act.

Singleton said there are nine employees in his office, adding that his office is the smallest of its kind in the Southeast region though it serves one of the largest student populations.

A House Education subcommittee earlier this month approved an amended bill (H. 3229) that would transfer the functions of the league to a newly created “Division of Interscholastic Athletics” within the S.C. Department of Education. The Nerve first reported on the legislation last week.

“They’re (the league) getting government funds. Their fees are paid with state taxpayer dollars – (as well as) their incomes, their pension, their health care,” said Rep. Andy Patrick, R-Beaufort and a subcommittee member, told The Nerve’s for its earlier story. “I think it’s silly that they aren’t held accountable.”

Two similar Senate bills (S. 128 and S. 161) are before the Senate Education Committee.

Creating a separate division within the Education Department to govern high school sports would cost state taxpayers $514,400 annually with the addition of six full-time positions, according to an Office of State Budget analysis of H. 3229. The High School League’s total expenses last fiscal year were $1,223,308, including $781,747 in salaries and benefits, federal tax records show.

According to its High School League’s constitution, its purpose is to “formulate and maintain policies that will safeguard the educational values of interscholastic competition” and to “cultivate high ideals of sportsmanship.”

But the league has come under fire recently due to what many consider severe judgments involving student athletes. In a particularly contentious ruling, the league disqualified the Goose Creek High School football team from the playoffs for allowing what the organization described as an ineligible student to join the team.

“I think they’ve made some very bad decisions in the past couple of years,” said Rep. Joe Daning, R-Berkeley and a co-sponsor of H. 3229, when contacted by The Nerve last week. “We’ve given them the opportunity to change the rules and nothing has changed. For the sake of the kids, I don’t see another alternative.”

Smith said he holds no bone of contention concerning the Goose Creek High School ruling or the league’s other unpopular judgments. Rather, he said he believes that having an athletics division within the Department of Education would be more efficient.

“It’s a small agency (the High School League) that requires a great deal of support,” said Smith. “I think it would be more efficient in a bigger department.”

Elaborating, Smith explained: “The Department of Education already has staff in place – financing, human resources, legal staff. The High School League has to have their own human resources staff, legal staff, etc., which costs the taxpayers money.”

Advocates for the league asked the House Education subcommittee for leeway until the organization’s March legislative assembly meeting in Charleston. There, Vice President Marion Waters said members are scheduled to discuss amendments to the league’s constitution. There are currently 13 amendments up for a vote, and representatives from the league’s schools will have a voice, he said.

Among the league’s supporters was Rep. Mike Anthony, D-Union and a retired coach.

But the House Education subcommittee wasn’t swayed, voting to approve H. 3229 as amended. Daning, who serves on the House Education and Public Works Committee but is not a member of the subcommittee that voted on the bill, contended that lawmakers have given the league more than enough time.

“Several legislators called them after the Goose Creek incident to ask them to change their decision when the judge gave them some latitude,” he told The Nerve.

Daning said three weeks before the subcommittee hearing, lawmakers requested that the league make at least three changes: Create an appellate panel separate from its executive board; create different penalties for various offenses because there is presently only the “death penalty” (disqualification from playoffs) for every infringement; and make an executive board that is geographically representative of the state.

“They refused,” said Daning, adding, “I would not be willing to stop the bill in the hopes that they’re going to do so [implement changes].”

League supporters say, however, that the state Education Department should not be directly involved with high school sports.

“We feel the state Department of Education should remain focused on classroom and student achievement and not the politics of high school sports,” said Duane Cooper, governmental relations and advocacy coordinator for the South Carolina School Boards Association.

Smith disagrees with that position.

“I think it’s a way of deflecting what is a responsibility of the General Assembly, oversight and to be responsible for taxpayer dollars – and also making sure that its agencies run effectively,” Smith said. “That’s not politics. That’s doing what we’re supposed to be doing.”

Reach Weston at (803) 254-4411 or kelli@thenerve.org.