GEORGETOWN | The board of directors for Five Rivers Community Development Corp. gave its staff a unanimous vote of confidence on Tuesday following a 1½-hour closed meeting.
The meeting may have been in violation of the S.C. Freedom of Information Act.
The closed session was held after the board heard an update about Five Rivers' programs and reviewed a financial report that shows the nonprofit agency had a budget deficit of $181,635 through the first six months of this year.
Board members voted to hold the closed session to discuss legal and contractual matters related to personnel, which is allowed by state law.
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The board did not have an attorney at the meeting, but allowed its accountant and the accountant's father to attend the closed session.
The board played loud music during the closed session.
However, during fluctuations in the music, media could hear the raised voices of some staff and board members discussing topics unrelated to personnel, including reports in The Sun News about financial problems at the agency and The Sun News' attempts to gain access to financial documents that show how Five Rivers spends public money.
Five Rivers gets about two-thirds of its money from state and federal grants that are funded by tax dollars.
Board members, Executive Director Beulah White and Chief Financial Officer Dayo Smith also discussed the agency's strategic plan, fundraising, plans for a community center, progress in filling out the agency's federal tax return and other issues during the closed session.
It is illegal to discuss anything in closed session that is unrelated to the stated purpose of the closed meeting, said Bill Rogers, executive director of the S.C. Press Association.
"They [the board] have to state specifically what they want to discuss in a close meeting," Rogers said. "It would be an illegal meeting if they talked about something they didn't specify. They didn't have a lawyer, so it's pretty difficult to say they were getting legal advice."
At one point during the closed meeting, a voice that sounded like White's told board members she had hired a lawyer to represent Five Rivers against The Sun News, which has filed a request under the state's public access laws for financial documents showing how public money has been spent since 1996.
"The board needs to decide how long we're going to keep records," said the person who sounded like White. "If we go back 10 years, we're going to be tied up forever."
The person who sounded like White told the board she hired a lawyer to represent the agency in the public records request, "to give us time."
Documents obtained from Five Rivers earlier this month show the agency spent $70,937 on travel between 2001 and 2004, much of it for trips with no documentation showing how they relate to the nonprofit agency's stated purpose of building affordable homes and enhancing economic development for Georgetown County's low- to middle-income residents.
At another point during the closed session, a person who sounded like board President Sam Livingston said the board needs to do a study showing whether salaries paid to White and Smith are fair.
"It doesn't need to be an in-depth one," said the person who sounded like Livingston.
White and Smith, who is White's daughter, have nearly doubled their salary since 2000, and both are among the highest-paid executives of community development nonprofits in South Carolina. White made $83,039 in 2004, the most recent year for which Five Rivers has filed a federal tax return. White directly supervises Smith, who now makes $48,755 a year.
Smith's salary for this year was included on a financial document she provided to The Sun News. White has declined to say how much money she now makes.
After the board went back into open session, board member Darren Holmes said he wanted to give White and Smith a formal vote of confidence. Board member Marjorie Hemingway seconded the motion and the vote was unanimous.
Board member David Hamilton did not attend the meeting but listened to the open and closed sessions on a speaker telephone. Hamilton recently moved to the Hilton Head Island area. He did not say Tuesday whether he plans to continue serving on the Georgetown-based nonprofit's board.
Livingston would not comment on Five Rivers after Tuesday's meeting.
In other news Tuesday:
The board reviewed a financial report that shows Five Rivers received $5,818.65 in grants, donations and other revenue through the first six months of 2006. Five River spent $187,453.88 on salaries, travel, operating costs and other expenses during that same period, leaving the agency with a budget deficit of $181,635.23.
Smith told the board that 16 people attended the agency's most recent home-buying class, and that one of those people has purchased a home. The four-day class is taught twice a year. Participants learn about loans, filling out financial documents and other home-buying basics.
White told the board that 18 people completed the agency's most recent Diamonds in the Rough class, which teaches participants time management, financial and job skills. White said three of those people might start their own businesses. Diamonds in the Rough is a seven-day class that is taught four times a year.