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Earlier this year, Gov. Henry McMaster signed legislation that gave the public swifter, easier, less costly access to public records. It was and remains a significant step in the right direction in what we all should hope is a path toward greater transparency among elected and appointed officials who expend taxpayer dollars and are (or should be) accountable to the public they serve.

Unfortunately, another piece of legislation, H. 3931, has the potential to keep dark that which should be in the light. If the bill is approved, nonprofits that receive public dollars would not have be accountable to the public regarding how the money was spent.

As written, the legislation initially seems to be in sync with transparency, providing that any nonprofit receiving $100 or more in public money “from a state agency or political subdivision” must provide financial reports to the funding agency. Report details are to include how much was spent, the purposes for which the money was spent and “any other information required by the jurisdiction so as to increase the public’s knowledge of the manner in which the funds are expended.”

Another section of the bill, however, adds the odd caveat that subsequently excludes the public from information it should easily access. It reads: “The expenditure reports must be made available by the awarding state agency or political subdivision in accordance with the requirements of Chapter 4, Title 30; however, the entity receiving the funds is not subject to such disclosure provisions.”

What that means is the nonprofit receiving public money must make reports available to the funding agency or political subdivision, but it is not required to release the same information to the public under the state’s Freedom of Information Act.

Look closely and it is easy to see how there is a conflict. On one hand, it seems the bill is making information available to the public via the financial report the nonprofit must produce for the funding entity, but nothing says that entity must in turn make the report public. In fact, the added provision quickly slams the door on the public’s access to the same information by giving the nonprofit a pass on disclosure.

Complex? Convoluted? So what, since the funding agency will get the information, one might be inclined to think.

Let’s take a closer look at the implications.

Think of the number of nonprofits that receive public dollars. Volunteer fire departments receive taxpayer dollars for various purposes and purchases. So do chambers of commerce, museums, community theaters, economic development bodies and even private schools.

When it comes to taxpayer dollars, transparency is the best policy, and it’s a policy that ought to fully apply to nonprofits receiving public funds. Really, there are but a couple of options here:

1. Lawmakers can amend H. 3931 to ensure there is no way for nonprofits to secret away how the public dollars it receives are expended.

2. Nonprofits receive absolutely no public dollars, meaning they will have to rely solely on the philanthropic giving of others.

The second option is unrealistic. Without accommodations and hospitality tax dollars, many nonprofits would have a difficult time keeping their doors open.

The best bet would be for lawmakers to cease allowing tinting to be applied to what should be an otherwise clear window into how public business is conducted.

This is an abridged version of an editorial from the Index-Journal of Greenwood.


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