Riordan Claims No Political Work by Chamber, the Record is Different

By Paul Gable

“The Chamber of Commerce does absolutely no political work. We advocate for issues. We never advocate for candidates. We do not have any budget to do that.” – Karen Riordan, CEO MBACC

The above words were spoken by Riordan during the regular meeting of county council Tuesday night in response to questions from Horry County Council member Al Allen about the Chamber’s financial contributions to the Grand Strand Business Alliance.

Riordan explained about the Chamber accounting with respect to public and private money. The public money comes from local and state governments from 30% of accommodations tax revenue, approximately 80% of tourism development fee revenue and various state grants, approximately $51 million per year in recent years.

Private money comes to the Chamber in the form of membership dues, ad sales on the website and other sources.

Riordan said when member organizations pay their annual dues, they can “voluntarily” elect to have 18% of the annual fee given to the GSBA. She did not mention but it is known that a percentage of the money from the ad sales also goes to the GSBA.

While Riordan’s explanation appeared to make it sound like individual Chamber members were making voluntary contributions to the GSBA, I submit that is not the case. A member pays a fee per year to the Chamber. If a “voluntary” election of 18% is chosen, then the Chamber receives 18% less of the fee. If no election is made, the Chamber keeps the entire fee. Therefore, it is actually Chamber money that goes to the GSBA, not some imaginary “voluntary” donation by a member.

The total of membership dues and volume-based membership contributions (ad sales) was $3,333,451 in FY 2021, according to the MBACC audited financial statement. Eighteen percent of the above amount is $600,021.

It is unclear how Riordan defines political work. She admitted Chamber money goes to the GSBA for that organization “to use it for their activities.”

Chamber private money provides the major portion of income for the GSBA each year. That money is used for political purposes. Therefore, I contend just the act of donating money to the GSBA is political work.

The Chamber donations to the GSBA fund activities of the GSBA certainly such as sending out mailers supporting candidates as well as Chamber priority “issues” such as supporting local funding for Interstate 73. That is political work.

A few examples:

In 2011, the GSBA funded an organization called Citizens for Conservative Values which placed television ads encouraging the reelection of incumbent Myrtle Beach City Council members.

In 2017, Citizens for Conservative Values, again with GSBA funds, paid for mailers, television and radio ads advocating for the election of Tim McGinnis.

In 2022, the GSBA supported the candidacy of former Chamber Board President Carla Schuessler for election to the SC House of Representatives.

In the 2022 primary runoff between Johnny Gardner and Mark Lazarus, a mailer encouraging the election of Lazarus had the same post office box address as the GSBA.

Those activities were certainly advocating for election of specific candidates. And, no matter how many Chinese Walls these organizations attempt to set up, the bottom line is without Chamber contributions to the GSBA, much, if not all, of these ads, mailers, emails and letters would never exist.

It is all political work by my definition and Chamber “private income” is the funding source. Any other definition is just parsing words.

Last year, the Chamber itself produced and mailed a brochure, with some very questionable ‘facts’, and several other pieces advocating for county council to vote to provide local tax dollars for I-73 construction. That’s political work.

An organization, such as the Chamber, that receives tens of millions of public tax dollars each year should not be contributing to an organization that plays so actively in local political elections and issues nor lobbying for citizens to pressure a political body that provides funding to it.

What wasn’t mentioned by Riordan is that the approximately $51 million the Chamber received in public tax revenue in 2020 is actually a subsidy of private business marketing expenses by the taxpaying public. It is my opinion $51 million in public tax revenue paid to a private organization to be used to pay for the marketing costs of other private corporations is obscene.

The Chamber and the portion of the business community it serves should be thankful for the public dollars it receives and go about its business of promoting tourism to the area.

It’s my opinion one could put a padlock on 1200 Oak Street tomorrow and there wouldn’t be a measurable fluctuation in the number of tourists that come to the area. With or without the Chamber and its cronies, that big blue ‘pond’ off the sandy coastline is still the biggest advertisement for the area and it’s free.

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