I-73 Funding Remains Roadblock to Hospitality Fee Lawsuit Settlement

By Paul Gable

The question of funding Interstate 73 is the obstacle preventing settlement of the hospitality fee lawsuit brought by Myrtle Beach against Horry County earlier this year.

A proposed settlement agreement that was voted on Monday by the councils of North Myrtle Beach, Myrtle Beach, Surfside Beach, Aynor and Atlantic Beach as well as Horry County Council included a provision that one-third of the proceeds from a continuation of the 1.5% countywide hospitality fee collected by Horry County would be dedicated to funding I-73.

The five municipalities voting approved the agreement. Horry County amended the agreement, which necessitates a reconsideration by the five municipalities. Conway and Loris did not vote.

City of Conway officials said in various media reports over the last day that they have no intention of voting on the amended settlement agreement to the hospitality fee lawsuit proposed by Horry County Council Monday night.

Properly looking out for the interests of its citizens, Conway City Council wants to reserve the right to use any hospitality fee revenue collected within its city limits to meet local needs in accordance with allowable uses of hospitality funds.

The refusal by Conway to vote on the agreement effectively kills the amended settlement agreement since one condition of the amendment was that the cities in the county, less Briarcliff Acres, must unanimously approve the amended agreement.

Myrtle Beach Mayor Brenda Bethune tried to take the high road when the county amended the agreement, but she can’t. It was Bethune who summarily dismissed the county’s offer to settle the dispute in early April, long before attorneys began racking up large bills to continue the lawsuit.

The exact same conditions the county proposed in April became the conditions for settlement voted on Monday night, including the I-73 funding.

Attorneys representing Myrtle Beach negotiated with attorneys representing Horry County with the other municipalities essentially left out of the negotiations. The settlement agreement was presented to those municipalities, essentially as a fait accompli. Conway and Loris chose not to accept and Horry County Council members chose to amend it.

The entire lawsuit began with Myrtle Beach claiming that Horry County was no longer entitled to collect hospitality fees within its jurisdiction. Horry County earlier had removed a sunset clause from its hospitality fee ordinance supposedly allowing it to collect the fee countywide, including within the cities in the county, in perpetuity, with the intent of using that revenue to fund construction of I-73.

The entire scheme of removing the sunset clause to provide funding for I-73 was concocted by former county chairman Mark Lazarus, former county administrator Chris Eldridge with county attorney Arrigo Carotti saying the county was on solid constitutional grounds with such an action.

Therefore, a dispute arose about the legality of Horry County collecting the fees within municipal limits after Ride I bonds were paid off. This is a dispute between two political sub-divisions of the state.

If Myrtle Beach wanted to do the right thing in the beginning, it would have asked the South Carolina Supreme Court to take the case with original jurisdiction and issue a declaratory judgement settling the dispute.

But, the issue became murky with attorneys for the city attempting to establish grounds for a class action in the lawsuit which would allow them to collect larger fees on a settlement.

However, the inclusion of I-73, with the requirement that local municipalities dedicate one-third of the collected revenue within their respective jurisdictions to the project is the real stumbling block.

As has been demonstrated three times in the last five years, each governmental body within Horry County has experienced the effects of major rain events that have highlighted more immediate local needs than contributing funding to a road that may be built within 20 years or not.

The I-73 project has been continuously pushed by certain special interests within the county who stand to directly or indirectly gain monetary benefit from construction of the road.

The five municipalities who voted for the settlement agreement continue to bend to the will of those special interests. The seven members of county council who voted to approve the amended agreement, Dennis DiSabato, Johnny Vaught, Cam Crawford, Gary Loftis, Bill Howard, Tyler Servant and Orton Bellamy, continue to do the bidding of those special interests at the county level.

Congratulations to Conway and Loris who refused. It is time to get rid of the I-73 roadblock and allow each legislative body in the county determine what are the correct priorities for the expenditure of hospitality fee revenues within their respective jurisdictions


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