Economic Development Secret Revealed

August 6, 2012 1:55 PMViews: 599

Horry County Big Economic Development Secret Revealed, Just a Call Center

By Paul Gable

The hoped for home run from Myrtle Beach Regional Economic Development Corporation was reduced to a bunt single when it was revealed the secret Project Blue is really just a 1,000 job call center.

County council debated the project behind closed doors in executive session for two weeks, before council member Gary Loftus and EDC CEO Brad Lofton made the details of the project public in an interview with the Myrtle Beach Herald last week? Why all the initial secrecy?

A 1,000 job call center project that offers $14 per hour to employees while it receives $24-$30 million of combined incentives is about as good as it is going to get for Horry County economic development. At least that is what Loftus told the Herald last week.

Lofton called the project “our Boeing” in the same Herald article, further stating it is hard for the county to compete for manufacturing jobs.

Project Blue will come in with jobs right at the county average while there will be no financial risk to the private businesses associated with the project. We understand a tentative five-year deal (two years guaranteed and three one-year options) exists between the LLC that will operate the call center and a large communications company for which the call center will provide services.

The incentives package includes $1.8 million ($1.25 million from the county and $550,000 from Santee Cooper) in upfront cash to the LLC bringing the project. A local developer will provide a 60,000 sq. ft. building on 10 acres of land to house the call center with the first six months rent free. If the call center does not renew beyond five years, the county is guaranteeing the purchase of this facility funded by an $8 million general obligations debt. Other local and state tax abatements account for the remaining $14-$20 million incentive amount.

The LLC is guaranteed $1.8 million in public money which it can use to leverage a bank loan to cover equipment and other startup costs. The developer is guaranteed the county will purchase the facility if a tenant is not occupying it after five years. The county is risking $9.25 million and Santee Cooper $550,000 in public money to make these guarantees to private businesses.

There are already numerous vacant commercial buildings in the county that could be refurbished at a fraction of the cost to house the call center, but this is not a consideration. The county owns considerable acreage in its industrial parks, including the ITAP park at the airport, but none of this is in the equation to reduce the amount of public money at risk.

Yet we are told that this is a fantastic deal. No risk to private business, 1,000 jobs that will earn approximately $7,500 less per year than the state average wage with no long term outlook and $24-$30 million public incentives to get those jobs.

It’s great we live in a conservative Republican county that believes in reduced government spending with government staying out of the private business sector. Can you imagine what would be happening with this deal if liberal Democrats were running the county?

Horry County consistently ranks dead last in a quarterly survey of average wages paid in the 335 largest counties in the U.S. The county’s average wage is approximately $31,000 per year while the average wage in South Carolina is $38,540 according to the Bureau of Labor Statistics.

The EDC organization was modified two years ago and county funding to the agency was increased by 450 percent, to $1.8 million per year from the county budget, to alter those statistics.

According to the Herald article, Loftus said the county might as well close the EDC office if county council does not support this project. We agree Gary, close the doors – It’s not working!

 

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2 Comments

  • Told you you were drinking the kool aid. This bunch is only into helping themselves, not the poor average citizen in the county.

  • joedickerson

    When it sounds too good to be true it probably is. Remember Avcraft?

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