Tag: Johnny Vaught

Horry County Council Votes Unanimously to Cancel I-73 Contract

Horry County Council voted unanimously at its regular meeting Tuesday night to cancel the Financial Participation Agreement with the South Carolina Department of Transportation that would have provided funding for the Interstate 73 project.

The agreement was approved by council during a special meeting held on November 28, 2018 and signed by former county administrator Chris Eldridge on December 13, 2018. Former council chairman Mark Lazarus led the charge to get the agreement signed before he left office December 31, 2018. Lazarus and Eldridge were the two foremost proponents of having the county enter into the agreement with SCDOT.

In addition, Lazarus and Eldridge were instrumental in orchestrating the elimination of a sunset provision from the county’s hospitality fee legislation earlier in 2018 in order to direct revenue to I-73.

But it all began to fall apart in March 2019 when the City of Myrtle Beach sued Horry County over continued collection of hospitality fees after the bonds for the first RIDE projects were paid off, an action the city called illegal.

Last spring, Horry County Council approved a resolution to refund hospitality fee revenue collected within the municipal boundaries to the respective cities where it was collected. The resolution included a proposal for the municipalities and the county to provide some funding for I-73 with percentage contributions from each agency in line with the percentage of the total amount of hospitality fee revenue each city received.

The cities dismissed that resolution out of hand.

Now, the cities and the county are considering a settlement agreement to the lawsuit with virtually the same terms with the exception that the cities will be on the hook to pay their attorneys 33% of the refunded revenue, approximately $7 million.

The blame for the cancellation of the I-73 agreement can be laid directly at the feet of Myrtle Beach and the other cities that joined in the lawsuit and refused to accept virtually the same settlement they are now considering.

Several county council members, including Chairman Johnny Gardner and council members Harold Worley and Johnny Vaught made exactly the point that the cities could have had the same settlement without paying such large attorney fees by accepting the resolution in the spring. It must also be noted the I-73 contract would not have been cancelled if the cities had taken this action.

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Another Hospitality Fee Filing, Another Email, More County Lunacy

The City of Myrtle Beach filed a supplemental memorandum Monday in support of its lawsuit against Horry County’s continued collection of hospitality fees.

Leading the memorandum is an affidavit by North Myrtle Beach City Manager Michael Mahaney providing evidence of the county’s continued collection of the hospitality fee in the City of North Myrtle Beach after June 21, 2019, and supporting a June 26, 2019 motion by Myrtle Beach for the county to show cause why it was not in contempt of a temporary restraining order issued by Judge Seals on June 21, 2019 prohibiting same.

Included in the filing was an email originated by attorney Henrietta Golding who is representing the county in the lawsuit.

The email appears to have evolved out of the string of emails that were the subject of several media stories yesterday. The email that appears to have started the string was sent by former county council chairman Mark Lazarus to Golding.

In her email, Goldings criticizes the judge and the temporary restraining order the judge issued against the county for having “many errors”; states, “This is solely the fault of Myrtle Beach” and appears to discuss the county’s strategy in moving forward by saying the county will try to get a “supersedeas” and saying “if the county took steps to suspend the ordinance (creating the hospitality fee), then probably create legal issues detrimental to the county.”

Golding’s email was sent to Lazarus, county council members Johnny Vaught, Harold Worley, Tyler Servant and Dennis DiSabato, interim administrator Steve Gosnell, county attorney Arrigo Carotti, North Myrtle Beach Mayor Marilyn Hatley, Mahaney and Surfside Beach City Manager Dennis Pieper.

The choice of recipients is confusing as Golding only represents six – the four council members, county administrator and county attorney. Lazarus has no official position with the county since his term ended December 31, 2018. Hatley, Mahaney and Pieper support the position of Myrtle Beach that the county has been illegally collecting the hospitality fees since January 1, 2017 when the original sunset provision of the county hospitality fee ordinance expired.

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Time to End the County’s Hospitality Fee Lunacy

Events occurring over the last week served to magnify the need for the county and the cities to get past the lunacy that has developed over the county’s efforts to continue collecting a countywide Hospitality Fee that is in all likelihood now illegal.

Myrtle Beach initially filed a lawsuit against the county “for itself and “similarly situated plaintiffs” on March 21, 2019 stating its claims against the county’s continued collection of the hospitality fee and requesting a temporary restraining order on the county’s continued collection of the fee while the case was being litigated.

After District Court Judge Seals issued a temporary restraining order on the county’s continued collection of a 1.5% hospitality fee within the City of Myrtle Beach and “similarly situated plaintiffs”, on June 21, 2019, the cities expected the county to stop collecting the fee within their jurisdictions.

Last Tuesday, the county dashed those expectations by sending out an email announcing it would only stop collecting the fee within Myrtle Beach and would continue to collect it in the other cities in the county as well as the unincorporated areas.

This led to outrage from North Myrtle Beach officials who called the county’s continued collection of the fee within their city “illegal.” In addition, Myrtle Beach filed a new motion requesting the county be required to show cause that it was not in contempt of the judge’s order.

With the angry rhetoric flying, a special meeting of county council was called for June 29, 2019 at which council was expected to vote on a recommendation to suspend collection of the fee within the cities until the lawsuit was settled.

Instead, council convened, immediately went into executive session where, according to sources with knowledge of the discussion, county attorney Arrigo Carotti and attorney Henrietta Golding, representing the county in the case, urged council to “stay the course” and continue collecting the fee in the other cities until ordered not to by the Court. In addition, the attorneys reportedly told council the judge had used the wrong standard of review in making his ruling. Golding filed a request for reconsideration of the ruling and was prepared to take the issue to the S. C. Supreme Court where, she told council, she expected the restraining order would be overturned.

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Horry County and Illegality are Becoming Synonymous

For the past week, Horry County and illegal have been combined in local media headlines about several issues..

Wednesday was a banner day for the county in such actions. Not only did Jay Bender, the preeminent legal authority on the South Carolina Freedom of Information Act, say county council conducted an illegal executive session but also lawyers for the City of Myrtle Beach went to court requesting the judge to find the county “in contempt of the authority of this Court” for apparently violating a court order issued last Friday with respect to the county’s continued collection of the Hospitality Fee.

The actions that led to executive session were well orchestrated. After council member Johnny Vaught made the motion to go into executive session, council chairman correctly called it out of order because no executive session was listed on the agenda. County attorney and council parliamentarian Arrigo Carotti jumped up to say under Robert’s Rules of Order, a motion for executive session was proper.

What Carotti never addressed were the requirements of the FOIA law, which made executive session illegal in this case, according to Bender’s statement. Shouldn’t the county attorney and parliamentarian have addressed those requirements before ruling executive session legal?

As Bender pointed out, this is at least the third time this year Horry County has not adhered to FOIA requirements. Unfortunately, the FOIA law has no teeth. There are no consequences for the county if it chooses to ignore the law, which it does when necessary.

While Vaught stated some reasons for executive session that sounded shaky at the time, he accomplished his goal in keeping the interviews of candidates for the administrator position out of the public eye.

I submit Vaught did not want the public to be able to compare the candidates’ respective presentations, especially make comparisons with his chosen candidate Steve Gosnell. In that Vaught was successful even if it took an illegal executive session, which Carotti ruled appropriate, to accomplish it.

The Hospitality Fee issue is one that could affect the county significantly. Last Friday, Judge Seals ordered a temporary restraining order, which prohibits the county from collecting hospitality fees within the at least the city limits of Myrtle Beach and quite probably in any of the incorporated municipalities.

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Huffman Affair Shows Need for Different Leadership

The recent resignation of Joseph Huffman from senior staff at Horry County Government demonstrates the need for a new approach to leadership of the county staff.

Huffman, who was the county’s public safety director for two years, resigned after the Mississippi Auditor demanded he repay approximately $6,800 to the state of Mississippi for mismanaging bond money as city manager of Pascagoula.

The mismanagement of the money included depositing the bond proceeds into the city’s general fund in order to make the budget appear to have a surplus instead of the deficit it was actually running. The deposit into the general fund also cost the city interest earnings on the bond money.

According to sources in Horry County Government, Huffman went to interim administrator Steve Gosnell to say it was best if he (Huffman) resigned. Those sources said Gosnell responded that he would support Huffman if Huffman did not wish to resign.

Such an offer should never have been made by Gosnell. A man acting as the county public safety director had mismanaged funds in Pascagoula, Mississippi in order to deceive the council he worked for.

Is this really the type of person we want being the top public safety official in Horry County? I think not!

The problem goes deeper. According to the government sources, former administrator Chris Eldridge was aware of Huffman’s difficulties in Mississippi as early as last summer. According to sources, Eldridge blamed the entire problem on political differences with a new city administration rather than the actual mismanagement of city money.

Huffman was hired in May 2017, approximately two years after Eldridge received a substantial raise from county council partially on the condition that in addition to being administrator Eldridge would assume the duties of public safety director after the firing of Paul Whitten.

Two years later, Huffman, who reportedly knew Eldridge since they both served in public administration jobs in North Carolina, was hired at a salary of approximately $135,000 annually.

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County Administrator Applications Close While Vaught Continues Hijacking Attempt

The application period for a new, permanent county administrator closed yesterday while council member Johnny Vaught continued his attempts to hijack the entire process in favor of interim administrator Steve Gosnell.

As recently as Tuesday, Vaught was maintaining that he had the votes of 9 – 10 council members to appoint Gosnell to the permanent position. This is before all applications were in, before the qualifications of any of the applicants were assessed and before any interviews were conducted to determine who might be the best person to lead the administration of Horry County Government going forward.

After former administrator Chris Eldridge and county attorney Arrigo Carotti failed in their attempt to discredit incoming chairman Johnny Gardner and it became obvious Eldridge had to go, Gosnell said at that time he didn’t even want the administrator job on an interim basis.

Ultimately, after Eldridge was separated from his county employment, Gosnell did accept the interim job but, with the provision he could return to his job as Infrastructure and Regulation Division head.

When the application process for the permanent position opened, Gosnell said he did not know that he would even apply.

Still, Vaught pursued his personal agenda to keep Gosnell in place. But, Vaught’s personal agenda is not what the county needs at this time.

Gosnell is a nice man and has been a good county engineer. However, with only two years to go until retirement and having served in the senior staff of the failed Eldridge administration, he is not what is needed for the county to move forward to realize its potential.

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How Far Will the Deep Six Go to Block Change With a New Administrator?

The first phase in finding a replacement for former county administrator Chris Eldridge will be completed next week as applications from candidates must be in by June 5, 2019.

The Deep Six, council members Harold Worley, Tyler Servant, Dennis DiSabato, Gary Loftus, Cam Crawford and Bill Howard, assisted by council member Johnny Vaught, already tried to hijack this process once.

In behind the scenes maneuvering, this group attempted to promote the hiring of interim administrator Steve Gosnell to the administrator job without consideration of any other candidates. When the plot was exposed, several of the plotters backed away quickly.

Voters in the county opted for change in the way the county does business when they elected council chairman Johnny Gardner to replace Mark Lazarus last year.

Since Gardner took office, the Deep Six have attempted to obstruct change to the point of initially blocking the firing of Eldridge after he and county attorney Arrigo Carotti were discredited in their attempt to smear Gardner. That little episode cost county taxpayers approximately $300,000, the cost of paying off Eldridge to get rid of him.

But, that cost will be minimal compared to the cost to taxpayers of blocking a new vision to county administration.

Steve Gosnell has been a good engineer for the county. He has approximately two years to go before hitting the 28 year mark for full retirement. He is not the person to look to for changes in the way county government is run.

Gosnell has been head of the county’s Infrastructure and Regulation Division and an assistant administrator for a number of years, once before serving as interim administrator. He has built a working relationship with other members of senior staff and, as such, is not expected to look at what changes are necessary to make county government more effective, more responsive to the needs of citizens and more transparent.

County government does not need, in the administrator position, a two year placeholder looking forward to retirement while keeping many of the failed Eldridge policies and senior staff in place.

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Deep Six Secret Attempt to Hijack Administrator Search

Only minutes after the end of the last regular meeting of county council during which plans for a search for a new county administrator were discussed, several council members moved to hijack the search.

According to information received from various council members:

Immediately after the close of the regular meeting: council member Harold Worley approached interim administrator Steve Gosnell about taking the permanent administrator job without going through the search process.

Being a single member of council, Worley had no right to circumvent the search process in this manner, but he did it anyway.

Worley contacted council member Johnny Vaught the following day, explained he had talked to Gosnell, brought Vaught on board with the plot and tasked Vaught to secure sufficient votes from other council members over the next few days.

While Vaught was contacting other council members, council member Gary Loftus contacted the county’s Human Resources Department telling them not to post the job opening for administrator as had been discussed before full council at the meeting. As a single council member, Loftus had no authority to issue such an instruction.

At the regular council meeting, Loftus made a motion to reconsider the vote to accept the separation of former administrator Chris Eldridge to add to it acceptance of Gosnell as interim county administrator. Loftus said this motion was made, “So we make sure that we follow proper legal procedure.”

After the motion to reconsider was approved, Loftus offered an amendment to appoint Gosnell as interim administrator “under short term contract to be entered into by the chairman on behalf of county council,” The amendment passed and the main motion accepting Eldridge’s separation and appointing Gosnell to interim administrator under short term contract passed.

On the dais in front of the public, proper procedure was the rule of the hour. However, proper procedure was ignored immediately after the meeting and in the next several days as this behind the scenes plot unfolded. And nobody bothered to contact the chairman until the plot was in motion and Vaught called Gardner to ask for his support.

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County Attorney Reverses Stance on Eldridge Agreement Release

One day after denying Freedom of Information requests for the release of the termination agreement with former county administrator Chris Eldridge, Horry County Attorney Arrigo Carotti honored those requests.

What changed in 24 hours? Absolutely nothing!

Carotti tried to lay blame for the initial denial of release of the agreement on a claim that is was “confidential.”

This claim apparently rose from a “non-disclosure” clause that was included in the document.

The non-disclosure clause was never discussed in negotiations with the attorney representing Eldridge in the matter, according to council Chairman Johnny Gardner. Gardner said council was told it was a standard clause the county’s Human Resources department adds to this type of agreement.

But, the clause is illegal under state law. It not only violates the state Freedom of Information Act, but also violates state statutes with respect to public contracts and the expenditure of public funds. The clause also attempted to infringe on the First Amendment protections of free speech by limiting what council members could say about the agreement.

The termination agreement with Eldridge is a public contract. The severance package for Eldridge, agreed to by council, will be paid from public funds. State statutes specifically require public disclosure of such contracts and payments.

Carotti also claimed in an email to council members that he reached out to Eldridge’s attorney to see if Eldridge would agree to public disclosure of the document. Carotti claimed he received written permission from Eldridge’s attorney and released the document at 4 p.m. Thursday.

Let’s explore those statements.

Carotti claims to need approval from Eldridge’s attorney to disclose the agreement due to a ‘boilerplate’ clause in the contract that was never part of the negotiations. Rather, the clause was put into the contract illegally by the county’s HR department and then used to initially deny public access to the agreement.

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Horry County Council Embarrassment Continues

A discussion during last week’s Horry County Council Budget Retreat, about county council hiring its own attorney to represent council only, highlighted the deep rift that continues to plague and embarrass council as long as administrator Chris Eldridge is allowed to remain in his county position.

Council member Al Allen introduced the idea of council hiring an attorney to represent council as a body after referring to actions by county attorney Arrigo Carotti in what now appears to have been a civil conspiracy to keep Chairman Johnny Gardner from taking office.

Carotti authored a five-page memo based entirely on his recollection and interpretation of one or more conversations he had with economic development officials weeks before. The memo described actions and statements that never occurred in attempting to weave a narrative implicating Gardner in possibly illegal actions. In his narrative, Carotti made false statements about other persons in the community, supposedly in connection with Gardner and Barefoot, including yours truly.

The memo was used by Eldridge to request a SLED investigation into Gardner and his business partner Luke Barefoot. Eldridge’s request to SLED was made on the morning of December 20, 2019 after the Carotti memo had been leaked and published by a Columbia media outlet.

After the memo was leaked and published, Myrtle Beach Regional Economic Development Corporation President Sandy Davis, the primary source for the Carotti memo according to Carotti, was quoted in several media stories as calling most of the memo “fabricated.”

Carotti and Eldridge were interviewed by SLED investigators on January 7, 2019. The next day, Carotti sent an email to SLED attempting to influence the direction of the investigation and dictating what conclusions should and should not be drawn from it.

SLED found no evidence of impropriety on the part of Gardner and Barefoot during its investigation and Fifteenth Circuit Solicitor Jimmy Richardson announced there was no evidence of criminal activity.

There was nothing documenting or confirming the allegations made in the Carotti memo. It was nothing but recollections about third party conversations he and/or Eldridge had with Davis and the memo was quickly discredited by Davis to both media and SLED investigators

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