The Waccamaw Economic Opportunity Council has until Sunday to address findings in a state audit of the program that was issued in March, Thomas Welch, senior audit manager for the S.C. Office of Economic Opportunity, said before Tuesday's board meeting.
If it fails to comply, Welch said, the state and Waccamaw EOC board members will have a conference, after which the EOC will be allowed 15 days to submit a quality improvement plan to the state office to stave off closure.
The actions board members need to address include board member separation from the day-to-day activities of the agency and proper election of board members.
Welch said he wouldn't comment after Tuesday's meeting if the board took any of thecorrective actions.
During the meeting, board member Abdullah Mustafa said the board no longer retained its legal counsel. The board directed EOC Executive Director Beth Fryar to contact board Chairman Zach Grate if there were any legal questions. It was also reported at the meeting that the board's line of credit, originally at $100,000, was down to $51,000. It has paid all its bills for vouchers issued to electric companies.
The agency gets about $15 million in federal funds each year for programs to assist low-income residents of Horry, Georgetown and Williamsburg counties including weatherization and Head Start. Because of the problems cited in the state audit, the OEO put the agency on a reimbursement status, meaning it would not send any of the federal funds to the agency until the money had been spent and receipts were submitted to the state.
That moved the agency to insolvency because it did not have money in the bank to operate in that manner. The state office then started a process to terminate the agency's funding agreements with the federal agencies because of the insolvency.
The state reversed that action earlier this month saying that because of the hot weather the need among clients for money to pay electric bills for fans and air conditioning was too great.
That does not mean the agency is off the hook, though.
If the agency does not meet the state office requirements by Sunday and submits a quality improvement plan following the conference, then the state has 15 days to approve or reject the plan.
If the plan is accepted, Waccamaw EOC will then have 30 days to carry out the plan.
If it is rejected, then the state office can terminate the federal funding agreements, essentially cutting off the EOC's source of revenue and shutting it down, Welch said.
But the agency can appeal a rejection, first to the governor's office and then to the federal agencies that fund the EOC's programs.
Welch said the agency could be shut down in two months at the earliest. Or the process could take months more.
There are 14 agencies that function as the Waccamaw EOC across South Carolina, Welch said.
He has been with the state office and was faced with another troubled agency in 2008.
"It's not an everyday situation," he said.