PIERRE - Eyebrows arched Tuesday as a panel of state legislators learned details about the severance package Wayne Carney received when he retired last year as executive director for the South Dakota High School Activities Association.
The total value exceeded $128,000 and is to be paid over three years, according to testimony from Dan Swartos, who succeeded Carney in the top spot, and from Isaac Jahn, the association's finance director.
The association also participates in the South Dakota Retirement System, making Carney eligible for a pension too.
Swartos and Jahn testified to the Legislature's Government Operations and Audit Committee.
They went to explain findings by the state Department of Legislative Audit.
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But they spent more time responding to questions about Carney's package and about the non-profit foundation created to accept donations to help fund the 180 member schools.
Carney didn't attend.
Legislative auditors don't have authority to look at the foundation's numbers, according to Tim Flannery. He is one of the department's top deputies.
Legislators want to know more about the foundation.
"I don't like the foundation," Rep. David Anderson, R-Hudson, said. "It is moving it farther away. It is not something I like to see."
Swartos said he is an advisor to the foundation board and strongly recommended the foundation file a report to the committee.
On the severance issue, Jahn said Carney received $52,896.01 during the 2017 fiscal year.
Future payments were scheduled to total another $75,530.94, according to Jahn.
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The audit report said no money was set aside for future payments.
Sen. Justin Cronin, R-Gettysburg, drew a target on the $119,553.46 that the association finished in the red for the fiscal year that ended June 30, 2017.
Replied Jahn: "Historically we do not lose money."
Jahn said the loss resulted from "a large severance payment that was not budgeted for."
Cronin wanted 10 years of details. "If you charge enough for everything, I just don't know how you lose money," Cronin said.
Swartos said the office has a total of 10 people. "We're pretty lean in terms of that," Swartos said
Rep. Hugh Bartels, R-Watertown, said there appeared to be a lot of general administrative expenses. "I just think that's something you need to review," Bartels said.
Jahn said the severance policy was explained on page 17 of the report https://bit.ly/2LjHrrh .
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He said much of the additional cost resulted from the former executive director retiring.
There also was $23,658.71 for severance for unused vacation. The accounting for it is on page 28, Jahn said.
"That's where a large amount of it comes from," Jahn said.
