Tag: WestJet

WestJet Deal Still Haunts County

A 2013 contract between WestJet Airlines and Horry County Government is still costing the county three years later.

Boiling the deal down to its essence, Horry County Council agreed to guarantee WestJet a 15 percent profit on a new airline route established for the 2013 summer tourist season. The county placed a maximum payout of $1 million on its guarantee.

At the time the deal was struck, we heard pronouncements from members of county council such as it was ‘almost guaranteed that this deal would not cost the county one cent.’

Instead the county owed WestJet $500,873 at the end of 2013 in order to live up to its contractual obligations.

A meeting of the Horry County Administration Committee, held on October 11, 2013, agreed to a payment plan whereby the Myrtle Beach Area Chamber of Commerce would pay WestJet the total amount due and the county would repay the Chamber out of its 5 percent set aside funds from county accommodations tax.

At that time, a balance of approximately $250,000 was in the county’s set aside account. The remainder would be repaid to the Chamber from county set aside accommodations tax funds in the coming years.

The Administration Committee approved a resolution at its meeting Tuesday to allow for continuing repayment of those funds.

The deal with WestJet raises several points about the functions of county government.

This was a bad deal from the beginning. County government has no business guaranteeing a private business a profit that includes the use of any county tax funds, property or otherwise.

Myrtle Beach International Airport

Horry County Airport Advisory Board Dissolution

The proposed dissolution of the Horry County Airport Advisory Board currently being considered by Horry County Council is a mistake.

This has not always been my attitude.

From the late 1990’s through approximately 2008, the board was a rubber stamp for some of the worst decisions made by Horry County Department of Airports staff.

Horry County Council and Fiduciary Responsibility

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.

Myrtle Beach International Airport

Closing the WestJet Deal

Horry County Council members approved a method for paying WestJet the approximately $583,000 it owes the Canadian airline from a deal approved by council last February.

The payment will come from accommodations tax revenue the county receives, called holdback funds, which council personally directs the expenditure of.

Hopefully council learned a lesson about attempting to buy business from this debacle.

Myrtle Beach International Airport

WestJet End Game

Horry County Council will vote on a proposal to pay the county’s approximately $570,000 bill to WestJet Tuesday night bringing an end to the WestJet guaranteed revenue saga.

The proposal, which gained approval of the Administration Committee, last week will have the county’s current set aside portion of accommodations tax money, $250,000, paid to WestJet immediately.

The Myrtle Beach Area Chamber of Commerce will pay the other $320,000 and recoup that money over the next few years from annual accommodations tax set aside funds the county receives.

Horry County and the WestJet Guarantee

Horry County has finally made public the full extent of the cost to county taxpayers for the deal the county signed with WestJet to bring the Canadian airline to Myrtle Beach International Airport.

According to a press release from Horry County Public Information Officer Lisa Bourcier, the county expects to owe WestJet $570,000 by the end of the year.
The county entered into an incentive agreement with WestJet in order to attempt to open up new markets to the airport.

It was our original understanding, from members of council, that the county was guaranteeing WestJet against loss, in the first year of these new routes, up to $1 million.

WestJet Guarantee to Cost Horry County Half Million

If current passenger expectations remain valid through the end of October, Horry County will pay WestJet over $500,000 pursuant to a guarantee to the airline county council approved in February 2013.

According to a source familiar with airport operations, the county is already in the hole to WestJet to the tune of $325,000 and expects the bottom line, after WestJet ends this year’s operations October 31st, to be approximately $510,000.

County council approved setting aside a contingency fund of up to $1 million that would be used to guarantee WestJet 60% occupancy, the break-even point for WestJet, on each flight to Myrtle Beach. The county would buy up empty seats on each flight so WestJet would not lose money.

WestJet won’t lose money, but the county did.

Carolina Southern Railroad and Horry County

Carolina Southern Railroad and Horry County officials appear to remain far apart on any plan to get the railroad back in operation.

Service on portions of the rail line was voluntarily suspended by Carolina Southern Railroad officials when new federal regulations, especially on bridges, went into effect in the summer of 2011. Those service interruptions directly affect Horry County.

Since then, the railroad has been searching for funding with which to make the repairs. It joined with Horry County in two unsuccessful applications for discretionary railroad infrastructure TIGER grants from the federal government.

Horry County Council and Its WestJet Guarantee

The vote by Horry County Council earlier this week to set aside a contingency fund of $1 million to guarantee Canadian airline WestJet from suffering losses on new passenger service to Myrtle Beach International Airport continues to be a topic of discussion by the general public.

Several times this past week I was asked the question, “What is Horry County Council thinking by guaranteeing a private business against losses?”

My first inclination was to respond that ‘Horry County Council thinking’ is an oxymoron, but I settled for ‘I don’t have the slightest idea.’