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Horry County Impact Fee Discussion Moves Forward

Horry County Council is expected Tuesday night to have second reading on an ordinance establishing impact fees on new construction.
Council held a workshop on impact fees Thursday with a view to having some parameters for what the new fee would cost.
There has been discussion about impact fees in Horry County for most of the last two decades. Two years ago, an advisory referendum showed three out of four voters supported establishment of impact fees on new construction.
Predictably those in the development industry have fought establishment of impact fees. To date, that industry has been successful in holding the fees off.
However, a number of cities and counties in South Carolina have established impact fees in the nearly twenty-year interim they have been under periodic discussion in Horry County.
One engineer predicted a $6,000 impact fee would stop half the business currently with his firm. This, however, seems a ridiculous statement when the cost of lumber has quadrupled in the last 12 months and construction hasn’t slowed at all in Horry County due to the increase in cost.
Long time county residents have been remarking recently that new home prices have reached ridiculous levels in the county. But new homes are still selling at record levels.
Any cost to the developer and builder winds up on the final purchase price of the home. Impact fees can be thought of as a tax that will be paid by purchasers of new homes to help fund the increased level of government goods and services additional homes and their residents require.
The question for council is who should pay for these increased demands on county government and how much should be paid.
Council member Harold Worley said during the Thursday discussion that $4,500 (impact fee) is not going to slow down development one bit. He noted failure to pass an impact fee ordinance could result in a tax increase of 13.2 mils to residents of the unincorporated areas of the county in the future. Council will vote on third reading of a budget ordinance that increases taxes 7.6 mils in the unincorporated areas of the county next year with additional rises in stormwater and solid waste fees.

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Rice’s Failure to Deliver for his 7th Congressional District Constituents

It has been six months since the day Tom Rice’s political career changed.
The January 6th disturbance at the U. S. Capitol building led to Rice’s ‘vote of conscience’ one week later to impeach former President Donald Trump.
Rice’s vote to impeach changed the political landscape in his South Carolina 7th Congressional District as Rice was immediately attacked by a large majority of his former supporters for casting that vote.
At the time, Rice’s campaign consultant Walter Whetsell downplayed the outcry against his five-time candidate as something that would fade in a couple of weeks. However, rather than fading in the six-month interim, the opposition to Rice has only grown.
At least 10 Republican challengers to Rice’s nomination for a sixth term as the Congressman from the South Carolina Seventh have already registered with the Federal Election Commission. In the eyes of most Republicans, the 7th Congressional District is being treated as an open seat rather than one with a five term Congressman in place with all the advantages of incumbency.
But, it is not only Rice’s vote to impeach Trump that will cause him trouble in the June 2022 Republican Primary, should he choose to run. He has no record of producing results for the citizens of the 7th Congressional District despite being in his fifth term as their representative.
When Rice first campaigned for the new 7th Congressional District seat in 2012, his two main issues were “Jobs, Jobs, Jobs” and “Interstate 73”. He has failed on both issues.
Horry County, Rice’s home county and the location of a full 50% of the Republican voters throughout the district, has experienced no job growth attributable to Rice’s efforts in his four plus terms in Congress.
This comes as no real surprise. In his two years as chairman of Horry County Council before being elected to the 7th Congressional District seat, Rice promoted jobs as a major issue. Working with the Myrtle Beach Regional Economic Development Corporation, Rice’s two prime efforts for creating new jobs during those two years were “Avcraft” and “Project Blue”.
Avcraft was an aircraft completion and services company that had relocated to Horry County in 2004 with promises of 400-600 new jobs. After six years of failure to produce any new jobs in Horry County, Avcraft received one more stimulus package from the county with Rice leading and promoting the effort. Not only were no new jobs forthcoming, Avcraft finally bowed to the inevitable and filed for bankruptcy in 2014.
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County Council Must Make Hard Decisions on Budget

Two weeks after voting to defer second reading of the county budget for fiscal year 2021-22, Horry County Council will again consider second reading at its regular meeting Tuesday night.
How to pay for growth and who should pay for it will again be at the center of the council’s considerations.
Council rejected a staff proposal for a 2 mill increase in the county general fund, a 2.5 mill increase in the county fire fund, a 3 mill increase in the county solid waste convenience center fund and a $45 per year increase in the county stormwater fee two weeks ago.
According to several sources, county staff has come up with four possible options for council consideration Tuesday.
At one extreme is the proposal that council rejected. At the opposite extreme, reportedly is a small tax increase to help the convenience center fund.
The answer will probably lie somewhere between the two extremes.
While there is no doubt that the rapid growth currently being experienced and expected to continue in residential construction is straining county resources, the question of raising taxes on every taxpayer in the county to fund increased goods and services is a sticking point.
This is especially true when considering the hospitality fee money that was freed up with the settlement of the lawsuit with Myrtle Beach (approximately $26 million), with the money coming from the federal government American Rescue Plan (approximately $34 million per year for two years) and from impact fees should the council pass an impact fee ordinance after its scheduled June 10, 2021 workshop on impact fees.
It’s difficult to raise taxes when there is a spare $60 million in the bank with another $34 million promised next year and a new potential revenue resource from impact fees.
Here is where the discussion comes down to who is calling the shots in the county. County staff constantly warns against spending what it calls one-time money such as the hospitality fee and federal government money on recurring expenses such as funding increases for police and fire personnel.
There is nothing wrong with that logic in static times. However, staff reportedly has designs on the entire $60 million one-time money available this year for its own ‘wish list,’ another way of saying increase the size of the bureaucracy.

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County Council Will Ask Voters’ Permission to Raise Taxes

A strong majority of Horry County Council was unwilling Tuesday night to vote for a significant increase in taxes and fees without hearing from county voters.
Council voted to defer second reading of the county’s budget ordinance until June 1. In the interim, county staff will be putting together two ballot questions, one for a countywide 2 mill tax increase and the other for an additional 2.5 mill tax increase and an addition of $45 in stormwater fees for the unincorporated areas of the county.
The questions will be put to voters throughout the county in an advisory referendum special election scheduled for August 17, 2021. Voters in the cities will only be voting on the countywide tax increase while voters in the unincorporated areas of the county will vote on both questions.
The basics of the budget now being held in abeyance calls for a 3 mill tax increase in the unincorporated areas of the county to add revenue for the operation of the county’s solid waste convenience centers.
County staff proposed budget enhancements (additions) Tuesday night that call for a further 2 mill tax increase countywide to pay for police, E911, EMS and court security additions of personnel as well as a pay increase for all county employees. In addition, staff proposed an additional 2.5 mill increase in the unincorporated areas of the county to fund increases in fire services and a doubling of stormwater fees in the unincorporated areas from the current $44.40 per year per household to $89.40 per year per household (a $45 per year increase).
If both questions are approved by voters, taxpayers in the unincorporated areas of the county will see a 7.5 mill tax increase plus a $45 fee increase on their fall tax bills. Taxpayers residing in the cities will see an additional 2 mills of county tax added to their tax bills.
Staff was also directed by council to determine if the increases could be offset somewhat with the hospitality fee money that was freed up with the settlement of the lawsuit with Myrtle Beach (approximately $26 million), with the money coming from the federal government American Rescue Plan (approximately $34 million per year for two years) and from impact fees should the council pass an impact fee ordinance after its scheduled June 10, 2021 workshop on impact fees.
Growth and its impacts on infrastructure and services has caught up with Horry County, some may say surpassed. Numerous studies conducted throughout the United States over the years conclude that a growth rate of over 1.5-2 percent per year cannot be paid for by the new tax revenue generated by that growth. Staff said growth was estimated to be 5 percent this year with an average of 3.25 percent estimated over the next five years.

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DiSabato Proposes Ordinance that Could Violate State Law and the U.S. Constitution

Included in the various email exchanges following last week’s Horry County Council brouhaha was one from council member Dennis Disabato to council Chairman Johnny Gardner in which DiSabato notified Gardner he had instructed staff to prepare a new ordinance that appears to be pointed at one fellow council member and may violate both the US Constitution and South Carolina law.
DiSabato and council member Al Allen were on opposite sides of the issue to discuss county legal fees on last week’s agenda. Allen requested the discussion be placed on the council agenda, DiSabato moved to adjourn the meeting to prevent the discussion from taking place.
In an email to council Chairman Johnny Gardner, DiSabato said that since Gardner had a desire to discuss the use of public funds so transparently, he wanted to place an item on the agenda for the next meeting.
“I would like to discuss the use of public funds and awarding contracts to organizations owned by council members and/or their immediate family. I believe it is important for the public to understand exactly how much of our tax revenue is being spent with Allen Aviation, in particular, for mosquito spraying contracts, as well as how those contracts are awarded,” DiSabato wrote to Gardner in the email.
Had DiSabato stopped there, he would have been fine.
However, DiSabato’s email took it further, “Furthermore, I’d like to take this opportunity to let you know that I have instructed staff to prepare an ordinance to prevent the county from further contracts with companies owned by council members and/or their immediate family. The intent here, Mr. Chairman, is to protect and prevent individuals on council from undue public scrutiny of perceived improprieties stemming from such activities.”
An ordinance such as DiSabato proposes may violate both state law and the Equal Protection Clause of the Fourteenth Amendment to the U.S. Constitution.
The Fourteenth Amendment provides that no state may deny any person within its jurisdiction the equal protection of the laws. It mandates that individuals in similar situations (classes) be treated equally by the law.
South Carolina has no law prohibiting public officials from conducting business with the agency they represent. It does have laws prohibiting members from voting on or influencing a governmental decision in which the public official has an economic interest and laws on disclosing the income (economic interest) from such business.

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Gagging of Al Allen Points to Deeper Issues in County

Last week’s premature adjournment of the county council meeting in order to gag council member Al Allen’s requested discussion of county legal fees allowed deeper issues inside the government and county to come to the surface.
A simple request from Allen for county legal fees paid to outside attorneys has been blown up into a supposed politically motivated conspiracy, according to a report in a local media outlet. Two “county officials” speaking on conditions of anonymity, according to the story, put forth a theory alleging a plot to fire County Administrator Steve Gosnell and County Attorney Arrigo Carotti was the reason for Allen’s request.
And make no mistake, the information Allen requested and which was ultimately provided to Allen, other council members (although many of those other members saw the information well before it was produced to Allen) and the media is definitely public information.
According to statements in local media, County Attorney Arrigo Carotti brought Allen’s request for the information on legal fees to council member Johnny Vaught. The excuse Vaught gave to the media was Carotti did that because the legal department budget falls within the oversight of the county Administration Committee of which Vaught is chairman.
Vaught told media he had concern that county legal strategies could be discussed and he didn’t want that sensitive information to become public. I would submit that type of information is already public.
If someone wants to assess legal strategy in any lawsuit, they can go online to the judicial records to read the complaint, response, motions and responses, depositions and view the exhibits associated with the case. All of that information becomes open to the public the minute it is filed with the court. A person is going to gain a lot more information about legal strategy from those documents than from records of how much in legal fees was paid and to whom it was paid.
Vaught’s entire premise that he was attempting to protect privileged information is ridiculous. But the ensuing rhetoric which evolved around the issue and the players involved point to deeper intent.
The real story is the one involving those who said the information requested by Allen should not be released publicly and who created a false narrative in an attempt to publicly embarrass Allen and, later, council Chairman Johnny Gardner.

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DiSabato Motion Ends County Council Meeting Prior to Discussion of Legal Fees

Horry County Council member Dennis DiSabato moved to adjourn council’s regular meeting last night before a discussion of county legal fees by council could take place. Council agenda listed the request for the discussion was initiated by council member Al Allen.
There is no question that a discussion of how much and to who the county pays fees for outside attorney assistance is public information. In a lawsuit two years ago, the county agreed that disclosure of legal fees ”is not legally privileged, is not exempt from disclosure under FOIA, and that it is important to the public interest that this information be available to the citizens and taxpayers of Horry County.”
Council voted 8-4 to adjourn the meeting with chairman Johnny Gardner and council members Allen, Harold Worley and Tyler Servant voting No.
Prematurely ending the meeting was the only parliamentary maneuver available to keep discussion of county legal fees from taking place in the meeting. Coming as it did immediately prior to the scheduled discussion makes it appear that DiSabato’s erratic behavior in bringing the motion was prompted by an ulterior motive for not wanting the discussion to take place publicly from the council dais.
This is not the first time DiSabato has exhibited erratic behavior with respect to issues associated with the county legal department.
In December 2018, county attorney Arrigo Carotti authored a five-page memorandum attempting to allege that then council chairmen elect Johnny Gardner had acted in an unethical manner with respect to a discussion held with the executive director of the Myrtle Beach Regional Economic Development Corporation.
The memo was quickly leaked to a Columbia media outlet who reported the allegations.
The memorandum was sent to SLED by then county administrator Chris Eldridge. SLED conducted an investigation into the allegations which completely exonerated Gardner from any wrongdoing.
While the investigation was underway, Carotti sent an email to SLED which appeared to be an attempt to influence how the investigation was being conducted.

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Proposed Land Sale by SWA to County Government Raises Many Questions

The Horry County Solid Waste Authority is proposing to sell a piece of property to Horry County Government while keeping the transaction as quiet as it is questionable.
The SWA board voted at its meeting last week to send a proposal for sale of the property to Horry County Council even though such action was not included on the board meeting agenda. It is not legal to vote on any item not included on the agenda and publicly advertised in advance of the meeting.
Horry County Council agenda for May 4, 2021 keeps the issue under the radar by listing an executive session to discuss the proposed sale or purchase of property but nothing to indicate the proposed seller is the SWA and the proposed buyer the county.
Why all the secrecy?
The SWA is a component unit of Horry County Government established by county ordinance. Its budget is included in the annual budget for the county and receives final approval from county council. The SWA bylaws and other rules must be approved by county council. SWA board members must be approved by county council. The SWA has never filed a Form 990 with the IRS, which it would be required to do if it were indeed a private, non-profit corporation.
Because of some vague wording in the county ordinance that established the agency as an authority, SWA executives and board members have tried, through the years, to claim the SWA is an independent, private non-profit corporation. It is not.
County council can dissolve the SWA any time a majority of council votes to approve an ordinance to do so.
Therefore, this is not some private entity offering to sell land to the county. It is a component unit of county government trying to gain some revenue from the county general fund to help with its expenses on Hwy 90.
When the SWA was established, council agreed to deed the approximately 700 acres that constituted the land which the county had utilized “for the specific purpose of solid waste collection, disposal and management.” This was done in order to give county council a degree of separation from landfill day-to-day operations.
Included in county Ordinance 60-90, which established the SWA, is the direction from council to the SWA to, “Reimburse the County for expenditures made in connection with the establishment of the Authority and the creation of the Solid Waste Disposal and Resource Recovery/Recycling System.”

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Rice, Fry and Crawford’s Interstate 73 on Life Support

Since the City of Myrtle Beach killed a funding source for Interstate 73 with the hospitality fee lawsuit against Horry County, the cabal that stands to benefit from construction of the road has been attempting to keep the project alive.
In the last two years of his tenure as county chairman, Mark Lazarus led council to remove the sunset provision in the county’s hospitality fee ordinance. Then, Lazarus convinced council to approve a financial participation agreement with the S. C. Department of Transportation to provide dedicated funding for the interstate project.
Lazarus’ entire scheme to provide county funding for construction of I-73 blew up with the hospitality fee lawsuit and recent settlement.
Congressman Tom Rice, and state Reps. Heather Crawford and Russell Fry and former Rep. Alan Clemmons didn’t even get as far as Lazarus in securing funding for construction of Interstate 73 despite constantly proclaiming the project a major priority.
The most successful representative in obtaining funds for I-73 was former SC 1st Congressional District Rep. Henry Brown in the days when Horry County was part of that district. During his 10 years in Washington, Brown managed to secure approximately $83 million total for the road. Brown served in Congress from Jan. 2001 to Jan. 2011.
According to sources familiar with the project, SCDOT is currently spending the last of the Brown secured funding to purchase rights of way in the Mullins area.
Rice has demonstrated no ability to secure federal funding to move the I-73 project forward. Neither have Fry, Crawford and previously Clemmons at the state level.
Grand Strand Daily has learned that a recent private meeting was held after Gov. Henry McMaster made an address to the Myrtle Beach Area Chamber of Commerce. The meeting included McMaster, Myrtle Beach Mayor Brenda Bethune, North Myrtle Beach Mayor Marilyn Hatley and Horry County Council member Dennis DiSabato. The meeting reportedly discussed providing some state funding, with local matching funds, to keep the project alive.
It is interesting that McMaster chose to meet with Bethune and Hatley, the two mayors who played the largest part in eliminating I-73 funding from hospitality fee revenue, as well as DiSabato who will struggle to get seven votes among council members for the proposal. One wonders, where was Horry County Council member Johnny Vaught when this meeting occurred. Vaught was attached at the hip to Lazarus with attempting to provide dedicated annual funding for I-73 from hospitality fee revenue.
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Old Guard Out at HCGOP

A new day dawned Saturday for the Horry County Republican Party when the ‘Old Guard’, ‘establishment’ or whatever you want to call it was swept out of power at the party’s biennial convention.
The three top offices in the HCGOP were won by relative newcomers to the local party – Roger Slagle-Chairman, Jeremy Halpin-Vice Chairman and Tracy Beanz Diaz-State Executive Committee member (pictured above).
The feeling that change was needed in the local party has been building for a while, but accelerated over the last month. Two years ago, there were approximately 206 voting delegates at the convention. This year that number increased to approximately 370.
The increased surge in participation can be at least partially linked to two events this week at which approximately 400 people attended each time. Both events were hosted by local Republican Patriot activist Chad Caton. Caton has battled with members of the ‘Old Guard’ for the past two years about how the local party was being run.
Wednesday night saw an event in Aynor to introduce Tracy Beanz Diaz to delegates and the general public. The highlight of the night for many of the attendees was a speech given by former President Donald Trump’s first National Security Adviser, retired Lt. Gen. Michael Flynn, in support of his friend Diaz. Horry County Treasurer Angie Jones also spoke in support of Diaz’ candidacy and additionally worked hard at helping to organize the event.
Friday night saw an event in Myrtle Beach where Slagle, Halpin and Diaz all spoke to the crowd about their vision for a new Republican Party in Horry County. The main speaker, however, was Lin Wood, attorney for President Trump and a candidate for the South Carolina Republican Party Chairman post at next month’s state party convention. Wood also mingled with the crowd at the Aynor event talking and taking photos with the attendees.
Change is building in the state. Many people who have become active Republicans in the last five years are disgusted with the ‘good ole boy’ system that has run Republican Party politics in the state since the party became a majority among South Carolina voters.
State party Chairman Drew McKissick is running for reelection to his post. However, if Horry County and other recent county conventions are any indicator, Lin Wood could well oust McKissick from office.
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