Tag: Doug Wendel

Final AvCraft Chapter?

The Horry County Transportation Committee voted earlier this week to write off $113,687 in unpaid rent from AvCraft Technical Services that the county will never collect anyway.

AvCraft filed for bankruptcy in March 2015 after an 11 year history of failing to make good on its promises to Horry County.

This should be the final chapter in the saga of local and state politicians, especially Horry County Council, looking at AvCraft through rose colored glasses in the name of economic development.

Since arriving to much hoopla in 2004, AvCraft was consistent in only two areas – it consistently failed to meet job goal promises and it consistently requested and received rent reductions on the three hangars at Myrtle Beach International it rented from the Horry County Department of Airports.

After eight years of failing to meet goals, Horry County Council tried one last time in January 2012 to help AvCraft save itself with the recommendation of the Myrtle Beach Regional Economic Development Corporation.

One of the main items in that agreement was a $1.25 million reduction in rent on the county hangars over a five year period. This came after three earlier rent reductions, agreed to by the county, failed to make AvCraft profitable.

The following four comments made after the 2012 incentive package was approved demonstrate how far from reality politicians and their economic development arms exist from reality:

“I am thankful for the company’s commitment to Horry County and proud of our economic development team for this terrific announcement.” – Rep. Tom Rice.

“It’s another great day in South Carolina, and we are going to celebrate AvCraft’s decision to expand and create 150 new jobs in Horry County.” – Gov. Nikki Haley.

“AvCraft is a tremendous asset to our community, and this project is just the beginning for aviation-related businesses locating and expanding in the Myrtle Beach region.” – Doug Wendel, MBREDC board chairman at the time.

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Complaints Filed in AvCraft Bankruptcy

Bankruptcy trustee Michelle Vieira filed adversary proceeding complaints against directors of AvCraft Technical Services recently in bankruptcy court.

Vieira, the Plaintiff, is the court appointed bankruptcy trustee for KNH Aviation Services Inc. d/b/a AvCraft Technical Services in the matter of the Chapter 7 bankruptcy filing of the company, Case #15-01641-dd in U.S. Bankruptcy Court District of South Carolina.

The causes of action include breach of fiduciary duties by the defendants for capitalization of the debtor, sale and lease agreements with Sun Air, removal of equipment and self dealing.

The defendants are former owners and directors of KNH Aviation Services Inc. d/b/a AvCraft Technical Services, Mike Hill, Donald Kamenz, Derek Nice and Carol Drew along with the owner of Sun Air and former AvCraft director Jesper Lundberg and Sun Air of Scandinavia A/S.

KNH Aviation Services was put together by Mike Hill. He originated the company and got Kamenz, Nice and Drew to come in as investors to buy AvCraft Support Services in a foreclosure sale from AvCraft’s principal debtor, Maple Financial of Toronto.

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David L. Rocker and The Many Faults of Project Blue

David L. Rocker and Project Blue

The real reason for the big secret called Project Blue by the Myrtle Beach Regional Economic Development Corporation may have surfaced Monday when myhorrynews.com, the website for Waccamaw Publishers, broke a story on the shady past of David L. Rocker.

According to documents provided to Horry County Council, Rocker is listed as the Chief Operating Officer of Covation Holdings, a startup Georgia company that is trying to land a call center jobs project in the Carolina Forest area. However, last night the EDC was trying to spin Rocker as merely a consultant on the project.

Whatever the truth is behind Rocker’s participation, his past difficulties should raise some eyebrows about whether the county should be risking public dollars on a project which has, so far, been much hype with very little substance.

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Top Secret Economic Development

The secrecy surrounding a project of the Myrtle Beach Regional Economic Development Corporation, which will soon be up for second reading by county council on an ordinance to issue $8 million in public debt for the project, may be very good news for county residents.

I have had several conversations recently with local Republican activist, and one of the founders of the South Strand Republican Club, John Bonsignor about possibilities for the project. Bonsignor said he was asked, by EDC board member and former county Republican Party chairman Robert Rabon, to help promote passage of the ordinance by council members.

Even though he was given few details of the project, Bonsignor agreed to do so. Bonsignor did mention to me that he was of the understanding the total incentive package for the project totaled approximately $30 million for a 1,000 job call center. Bonsignor said he would like to get more details to have confidence in the project.

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Why All the Secrecy

Several days ago, we ran a story about how South Carolina ranks dead last among the 50 states for freedom of information access to government information. Thursday night, we learned that Horry County is attempting to rank at the bottom of the state’s 46 counties for public disclosure of information about its actions.

Horry County Council voted 7-2 Thursday night to pass first reading of an ordinance that would allow the issuance of $8 million of general obligation debt while refusing to publicly state what the money will be used for. Council members Harold Worley and Marion Foxworth voted no on the ordinance while members Brent Schulz, Paul Price and Paul Prince were not present at the meeting.

This vote took place during the second specially called council meeting in three days, both dedicated to executive sessions on a Myrtle Beach Regional Economic Development Corporation initiative called “Project Blue.”

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COAST Board Member Blasts Council

Mickey James, President of the Myrtle Beach Chapter of the NAACP and member of the COAST RTA board of directors, blasted Horry County Council Tuesday night for its stinginess toward the transit authority’s funding needs.

“No other agency receives the type of challenge and scrutiny (for funding) from this council,” during a presentation to council Tuesday night. “The bar for COAST is always higher.”

The question of funding from Horry County was supposedly decided in November 2010 when Horry County voters passed an advisory referendum, by an over 60 percent margin, to provide approximately $1 million in county funds to COAST on an annual basis. The referendum question was non-binding, but it was decisive.

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Council Votes on AvCraft Incentives Tuesday

Horry County Council will vote on approving a $100,000 incentive package and formalizing a reduced rental agreement for AvCraft Technical Services, Inc. at its regular meeting Tuesday night.

Council reconsidered the $100,000 incentive package after initially approving it for a code named company. When AvCraft was named as the recipient in late December 2011, some council members moved to reconsider the approval based on AvCraft’s past employment history.

The new incentive package calls for AvCraft to add an additional 150 jobs to its current work force, which is approximately 57 full-time employees.

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Researching Lofton

In the wake of county council’s reconsideration of incentives and reduced rent to AvCraft at Tuesday night’s regular meeting of council, Brad Lofton, chief executive of the Myrtle Beach Regional Economic Development Corporation, told the Myrtle Beach Sun News other companies would be watching the treatment of AvCraft.

According to the Sun News story, Lofton said businesses that consider setting up shop in Horry County will undoubtedly research the area and see how it treats existing industry. In addition, Lofton said other prospects that MBREDC is talking to are monitoring the AvCraft situation and awaiting the outcome.

In the spirit of full disclosure, it seemed appropriate to research Lofton’s past in other locations to determine how he performed.

Photo Credit: The Myrtle Beach Digitel/Creative Commons

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Council to AvCraft “Sell Us”

Mike Hill, Chief Operating Officer of AvCraft Technical Services, Inc., will have the opportunity next week to demonstrate to Horry County Council members why the county should provide economic development funds and reduced rent to his company.

Hill complained to the media last week that he ‘failed to understand why some area politicians continue to criticize his business (AvCraft) which has no financial or ownership relation to the one that failed to live up to job promises years ago.’ Now Hill has the opportunity to sell council on the idea that the present AvCraft is indeed a new company, but he will have to provide supporting documents and other information to justify that position.

Council voted 9-3 Tuesday night to hold up those funds and a new, reduced rent lease agreement until AvCraft and the Myrtle Beach Regional Economic Development Corporation (MBREDC) make a presentation to council’s Committee of the Whole (COW) on the benefits to the county of moving forward with the deal.

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Jobs, AvCraft and Rice for Congress

Reflecting further on Thursday’s announcement that the county and the state would combine to provide AvCraft Technical Services, Inc. with $200,000 of new incentives, I am offended. I can’t help but ask just how stupid county council chairman Tom Rice, Gov. Nikki Haley and officials of the Myrtle Beach Regional Economic Development Corporation think the citizens of Horry County are!

“I am thankful for the company’s commitment to Horry County and proud of our economic development team for this terrific announcement.” – Rice.

“It’s another great day in South Carolina, and we are going to celebrate AvCraft’s decision to expand and create 150 new jobs in Horry County.” – Haley.

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