SC education officials ask court to restrict charter school authorizer’s spending
A data sharing dispute between the S.C. Department of Education and the Limestone Charter Association escalated Wednesday when the state filed suit against the charter school authorizer alleging violations of its closure protocol.
State education officials seek to restrain Limestone from unapproved spending of public money, destroying public records or assets, and denying the agency access to its property, assets, information, technology, accounting, records “or any other tangible thing,” according to a complaint filed in Richland County Circuit Court.
The charter school authorizer, which is in the midst of winding down operations in anticipation of its impending corporate dissolution, has been at odds with the department over the proposed closure process.
Established in 2021, Limestone Charter Association was tasked with opening, closing and overseeing charter schools in exchange for a portion of each schools’ state funding.
In the wake of Limestone College’s abrupt closure last April, state lawmakers directed the Department of Education to develop a “closure protocol” for its affiliated charter association to be fully implemented by June 1, 2026, and a timeline for the transfer of Limestone’s 17 schools to other authorizers.
The unprecedented shuttering of a privately-run charter school authorizer has not gone smoothly.
The conflict has stemmed from a fundamental disagreement over the level of operational control and responsibility that Limestone should retain throughout the process.
Documents obtained by The State Media Co. show that education officials sought greater control of the authorizer’s finances and internal systems than Limestone was comfortable providing them.
As Limestone’s attorney John Reagle explained in a March 2 letter to the department, the charter authorizer was concerned about what it perceived as the agency’s overreach.
“The important distinctions that need to be recognized and addressed are those between financial and operational control and responsibility, on the one hand, and transparency and monitoring, on the other hand,” Reagle wrote. “LCA is committed to transparency, monitoring, and sharing of data as appropriate for a smooth transition for its schools to new sponsors, but at the same time LCA must maintain control over its finances and operations necessary to carry-out its remaining obligations and responsibilities as a nonprofit corporation, sponsor, and (Local Education Agency).”
With progress toward an agreement stalled, the department asserted operational control of the authorizer in mid-March, citing its broad authority under the state budget clause that directed it to develop a closure protocol.
Under the new structure, state Superintendent Ellen Weaver told Limestone that the department would continue to direct the closure process while delegating certain administrative functions to the South Carolina Public Charter School District, according to a March 19 letter obtained by The State.
Limestone subsequently provided some of the documents the department sought, according to the agency’s legal filing, but continued to withhold access to bank accounts and “other relevant financial information to substantiate questionable planned expenditures, such as payouts to employees for leave and bonuses worth hundreds of thousands of dollars.”
On April 6, in light of the Department of Education’s assumption of control over its operations, the authorizer’s board approved the dissolution of Limestone Charter Association and assigned its responsibilities as a local education agency to the department, effective April 15.
This week, Limestone submitted its plan of dissolution to the attorney general’s office, according to the state’s legal filing.
The department said in its filing that it had directed the authorizer not to spend any additional funds until it had reviewed the dissolution plan, but was notified by Limestone employees that they could not guarantee the authorizer would comply with the request without board action.
Documents obtained by The State show that Erik Norton, an attorney for the Public Charter School District, wrote Limestone’s attorney Tuesday and directed him to obtain written approval from the Department of Education before spending any money that remained in the authorizer’s bank account.
Prior approval was necessary, Norton wrote, to ensure that public funds were not subject to waste, fraud or abuse and to avoid any disagreement about the proper expenditure of funds.
“Any expenditures made without written approval from the Department will be considered an unauthorized expenditure of public funds, which could subject both LCA and the individuals responsible to civil and/or criminal liability,” Norton wrote in bold, underlined text.
Reagle, Limestone’s attorney, responded to Norton on Wednesday writing that neither he nor the authorizer’s employees could comply with the demand.
As a nonprofit, Limestone’s dissolution plan, including its closure budget, was under the jurisdiction of the attorney general, he wrote.
Further, Reagle questioned the Department of Education’s authority to create a nonprofit dissolution process “out of whole cloth” in derogation of state law.
“I find the request to effectively assume control over the assets of a private, nonprofit corporation without any due process under these circumstances both extraordinary and unnecessary,” he wrote. “Indeed, the State Department’s request seems, without evidence, to suggest or insinuate that (Limestone Charter Association) or its employees are not trustworthy and have acted in an improper or illegal manner.”
Reagle went on to say that Limestone had been audited annually and had never been suspected of any financial impropriety, waste, mismanagement or fraud.
The authorizer, he wrote, had already distributed to its schools all the money it owed them and everything left in its account had been earned in exchange for services.
The Department of Education’s request for a temporary restraining order and injunction states that Limestone has more than $600,000 in taxpayer funds remaining in its bank account, according to the dissolution plan submitted to the attorney general’s office.
The agency’s lawyers argue that the department and South Carolina taxpayers would be “irreparably harmed” if Limestone wasted or misallocated its remaining funds during the dissolution process.
“Because LCA is no longer operating it has no reason to expend funds other than for limited winding-up purposes,” their filing states. “Yet the documentation submitted to the Attorney General and the Department indicate that LCA has allocated hundreds of thousands of dollars to pay for continued employee salaries and leave payouts without providing any backup documentation to support these expenditures.”
In addition to requesting the court prohibit Limestone from spending additional money without its permission, the department also seeks a determination that the authorizer must comply with its closure protocol and immediately provide access to all records, passwords, bank account information and contracts.
Bridgett Fowler, Limestone’s board chair, said the organization had repeatedly told the department it could not legally share its passwords with the agency due to federal reporting requirements and state system access rules.
Permitting department officials to log in using Limestone’s personal system credentials and take actions on behalf of the authorizer after it had ceased operational control would expose the organization and its officers to legal risk and create irreconcilable conflicts across federal grant records and IRS filings, she said.
“LCA’s leadership and Board have a duty during wind-down to safeguard the organization and ensure that no actions are taken that could be construed as unauthorized, misleading, or noncompliant,” she wrote in an email to fellow Limestone officers that was provided to The State.
Fowler said the charter school authorizer owed Limestone University more than $600,000 and that any money left over after paying out employees’ accrued vacation and sick time would be delivered to the university’s receiver.
This story was originally published April 23, 2026 at 10:10 AM with the headline "SC education officials ask court to restrict charter school authorizer’s spending."