Oconee County Council Opens Corporate-Welfare ‘Pandora’s box’

May 23, 2013

Inside Insight

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Pandora's Box

Editor’s Note: The following column was submitted by Nerve Citizen Reporter Donna Linsin of Oconee County.

If you are a private developer and do not have the funds to develop your project in Oconee County, County Council will help make it easier by giving you millions of dollars of taxpayer money. It is seen by local taxpayers as a corporate welfare program of the county.

This new corporate welfare program was formed in early 2010 when the South Carolina Budget and Control Board voted 3-2 to allow the Oconee County Council to issue up to $5.5 million (the Council authorized the developer to receive $3.5 million of that $5.5 million) in special-source revenue bonds for the creation of the Pointe West development located near Highpointe of Clemson. Former Gov. Mark Sanford and state Comptroller General Richard Eckstrom voted against the bond, which is normally reserved for industrial projects. Sanford said that it would open up a Pandora’s box.

Gov. Sanford was right about Pandora’s box. The project is located on a former industrial site that had been designated as a brownfield. The project was to include a master-planned, multi-generational community that would be a mix of single-family homes, town homes, garden-style and patio condominiums, along with a town center.

County Council fell for the developer’s sales pitch. Due to the downward spiral of the economy, the developer was unable to obtain financing for the development, and the developer had to reduce the scope of the project to college student housing on a portion of the tract of land, changing the project’s name to “The Pier.”  All we have to show for the $3.5 million taxpayer-supported giveaway is approximately 30 small student housing cottages, some paved roads and an open field with a walking tract and no trees.

Last year, the Oconee County Council had another giveaway of $1 million to Seneca to help build a private hotel in the city. This was not a loan to be paid back by the hotel developer. It was a free gift.

The most recent example of a taxpayer-supported giveaway to a private corporation is the old courthouse building in Walhalla. For a while, the county pursued an agreement with another developer who wanted to renovate the courthouse and transform it into office space for attorneys because of its location near the new courthouse, along with space for retail stores. This deal fell through for unknown reasons. A few months thereafter, a local Realtor shows up and pulls off a deal in which he would purchase the old courthouse for $10 to renovate it into a hotel.

Even though citizens have spoken out against the project because it would interfere with parking for a church, a veteran’s museum and other businesses, the county proceeded anyway, even giving the developer an additional $500,000 in more free money as a grant. In essence, the agreement with the county to build this new hotel was a 300-day lease from the county, a $500,000 grant (giveaway) from the county with the developer paying back $150,000 of the grant, and the sum of $10 for the initial purchase.

So, Pandora’s box has been opened, and the county has set a precedent for other developers in other counties to follow. In Oconee County, developers now know if they make a slick presentation to County Council and promise jobs, council will drink the Kool-Aid and give them millions of dollars in free money for their projects.