COLUMBIA, S.C. — State lawmakers tell News19 they're investigating something wrong with the state's finances --they're trying to determine where an account of $1.8 billion belongs.
Senator Larry Grooms, is a member of the SC Senate Finance Subcommittee, the entity in charge of overseeing the investigation. He said they've been looking into this situation since November and are still in the early stages.
According to the State Comptroller General's Office, the agency discovered the issue with this fund in October of 2022 during its compilation of the 2022 Annual Comprehensive Financial Report.
"The governor appointed a new comptroller," Grooms said. "The new comptroller trying to close the books alerted us to what appeared to be something wrong with one account within our state's finances. Out of thousands of thousands of accounts, here's one account with $1.8 billion associated with it."
Grooms explained it's his subcommittee's duty to get to the bottom of this, and determine where this money belongs, so that the public can have confidence in the accuracy of the state's financial situation.
"Having $1.8 billion dollars in an account that's supposed to be zero tells us that something is clearly wrong with our state's accounting and the problems aren't solved," Grooms said. "The State Treasurer's Office operates a bank. He's like our state's chief banker. The Comptroller General is our state's chief accountant. Right now we know the bank has so much money in it. No one disputes how much cash we have. But what's in dispute is what accounts those monies belong."
The State Treasurer's Office tells News19 they are in charge of investing the funds, and the State Comptroller General's Office maintains the record of ownership.
But the Comptroller General's Office said the State Treasurer's Office is responsible for tracking the state's cash and investment balances and to whom they belong.
According to Section 11-5-210 of the SC Code of Laws, “the State Treasurer shall publish, quarterly, by electronic means and in a manner that allows for public review, a statement showing the amount of money on hand and in what financial institution it is deposited and the respective funds to which it belongs."
The State Comptroller's office told News19 that the $1.8 billion balance was created by the State Treasurer's Office during its conversion of cash and investments from the state's legacy accounting system to the current accounting system. The State Treasurer's Office explained this was a conversion from tracking system, STARS, to its replacement, SCEIS, several years ago.
"The subcommittee is requesting certain information [in this investigation]. We will have interviews, we will have hearings, and the end result will be a work product that will be produced, so we will produce a report for the entire general assembly. It'll be made public," Grooms said.
In addition to this, the SC Senate Finance Subcommittee is expecting a report in the next couple weeks from a group they hired one year ago to look at the flow of information between these state financial agencies, including the state auditor.
According to the State Comptroller General's Office, this money is currently stored in an account controlled by the State Treasurer's Office and the money in that fund is not being used.
The State Treasurer's Office explains that this money is secured, invested and audited, adding that it is not new cash or revenue, and that it's been fully visible in SCEIS and included in the year-end closing packages it has provided the Comptroller General's Office every year since 2016.
The State Treasurer tells News19 their office will continue to invest the funds, which have earned approximately $194 million. If the Comptroller General or the General Assembly would like to move the funds, the Treasurer’s Office said they will do so.
"We've got some legislators already chomping at the bit to re-appropriate these monies," Grooms said. "Look, there's $1.8 billion in cash found, I want it to be used for this purpose, which is why I introduced and my subcommittee introduced legislation putting these monies in a lock box so that nobody can touch them until the ownership could be identified, and then certified by several different groups before the monies could be re-appropriated, or could be used for any type of purpose."