Horry County Council and Fiduciary Responsibility

By Paul Gable

I have heard much recently about how Horry County Council was exercising its fiduciary responsibility, overseeing the use of public money, by appointing an ad hoc committee to report on Coast RTA.

I always get a funny feeling when I hear ‘fiduciary responsibility’ from public officials because it’s usually a dodge for some other agenda.

The recent cancelling of a contract for signs and bus shelters by SCDOT and the possibility that Coast RTA may be required to pay back money already spent on the project is the alleged reason the ad hoc committee will be looking into how effectively Coast RTA spends its public dollar grants.

Sounds reasonable, until we look at some specifics.

Horry County Council has a fiduciary responsibility to oversee the spending of the Horry County Solid Waste Authority. The HCSWA budget is included as a section of the overall Horry County government budget.

Horry County Council didn’t know the HCSWA spent over $1 million, over the course of three years with a registered lobbying firm, until after the fact. That doesn’t sound very responsible to me.

Horry County Council agreed to a contract with Canadian airline WestJet that guaranteed the airline a 15% profit, up to $1 million of county money, for new routes to Myrtle Beach.

When council approved the contract, the public was told there ‘was almost no chance that it would cost the county even one penny’. It didn’t! It cost the county $571,000, in the one year of the contract, to pay WestJet to fly empty seats to Horry County.

Horry County gives Coast RTA $1.06 million per year in grant funding from public dollars, an amount approved by Horry County voters in a 2010 advisory referendum.

Horry County gives the Myrtle Beach Regional Economic Development Corporation $1.6 million in annual funding. When MBREDC CEO Brad Lofton was hired in April 2011, he promised to provide 500 new jobs to the area in his first 18 months on the job.

According to the latest statistics available to Horry County government, MBREDC has been responsible for the creation of 316 new jobs (actually filled by employee hires) as of December 31, 2013.

That is 316 new jobs in 32 months and MBREDC has been making noises recently about wanting $60 million in funding over the next 15 years. Where is the ad hoc committee studying that beauty?

I can’t leave a discussion about MBREDC funding without mentioning AvCraft, the first job initiative Lofton brought to county council in late 2011.

AvCraft, an aircraft refurbishing and maintenance company, came to the Myrtle Beach International Airport in January 2004 amid much hoopla about creating 400-600 “high paying jobs” over five years and with millions of dollars in public dollar incentives arranged by Partners Economic Development Corporation, a forerunner of MBREDC.

Despite the hoopla and incentives, AvCraft created zero new jobs in that five year span. It went back to council at least twice between 2004 and 2010 requesting further help, including rent reduction on the property it rented at the airport and finally for the newest package by the MBREDC in 2011. (You can’t make this stuff up)

The 2011 package MBREDC presented to council included $100,000 in cash from the county and $100,000 from the state AND $1.25 million in further rent reductions over a five year span.  This time, AvCraft only promised to create 150 new jobs over the next five years.

As of December 31, 2013, AvCraft has created zero new jobs. I guess AvCraft deserves some small credit for consistency in the 10 years it has been getting the benefit of public dollar incentives while consistently failing to provide jobs.

What evidence is there of Horry County Council exercising its fiduciary responsibility over the incentives given periodically to AvCraft for no good reason? NONE!

But, Horry County Council is going to exercise its fiduciary responsibility with respect to funds given to Coast RTA with this ad hoc committee.

It will be interesting to watch and see what is really going on.


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