Friendly Skies: $500 Dinners, $85K Luxury Box Characterize Airport Board Spending

May 16, 2016

Investigative Reports

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By RON AIKEN

Airport

CAE travel spending second-highest in Southeast, five times that of Charleston

A week in Maui in mid-January.

Five-hundred dollar dinners.

Posh accommodations at hotels in Washington, D.C., Philadelphia, New Orleans and California.

Eighty-five thousand dollars for a suite at the Colonial Life Arena for mens and womens basketball games with booze and food tabs totaling $14,000.

All of the above are just some of the lavish perks and excessive costs accrued by members of the legislatively elected Columbia Metropolitan Airport Commission, a review by The Nerve of receipts, travel documents and budgets over a three-year period has found.

Despite being just the fourth-largest airport in South Carolina, CAE’s $72,000 travel budget for its commissioners is second in the Southeast to airports of a comparable size and is more than five times larger than that of the state’s largest airport by passenger traffic, Charleston International ($12,000).

For those wondering why it remains so expensive to fly out of Columbia or why the airport in the state capitol ranks behind Charleston, Greenville and Myrtle Beach, the answers are, at least in part, tied to a culture of privilege, overspending and rule-flouting that has characterized the commission that governs the airport’s budget and strategic development for more than a decade.

TOPS IN TRAVEL

Formally known as the Richland/Lexington Airport District (RLAD), the Columbia airport’s governing body is a special-purpose district of the state whose 12 commissioners – five from each county and two from the City of Columbia – are elected by the legislative delegations of each county and the city to serve up to two consecutive four-year terms “or until their successors are appointed,” according to Section 55-11-310 of the S.C. Code of Laws, created in 1962.

In addition to the RLAD, similar special purpose districts govern the Pee Dee Regional Airport District, the Charleston County Aviation Authority and the Greenville-Spartanburg Airport District. The Myrtle Beach airport is owned by Horry County.

Regarding service terms for commissioners, the Lexington legislative delegation and the City of Columbia adhere to the law, capping commissioner service at eight years. The Richland County delegation does not, meaning its members may serve well beyond the eight-year limitation, often serving for 15 years or more.

By law, commissioners are given the functions of “planning, establishing, developing, constructing, enlarging, improving, maintaining, equipping, operating, regulating, protecting and policing such airports and air navigation facilities as shall be necessary to serve the people of the Richland-Lexington Airport district and the public generally.”

What is not anywhere in state law but is the accepted practice of the commission is that each commissioner is allowed a “travel and education” budget of $6,000 per person per year for a total budget line item of $72,000 annually. That’s by far the highest in the state, and a survey of 11 airports of comparable size from across the Southeast revealed that the only airport with a higher travel budget than Columbia’s was Jackson, Miss. ($85,677 in 2015). Seven of the 11 airports surveyed had no budget for commission travel.

While not every commissioner travels, the ones who do often do so in a big way.

“Some members of the committee barely travel at all, and others use it like their personal vacation money,” said a longtime former commissioner who did not wish to be identified. “They feel like they’re entitled to it, that it’s their personal money to spend.

“It’s been my experience that some members of the commission are there with an intent to give back, others with an intent to take. There are quite a few takers on that board who regularly use up all their allotted money each year, and I can’t say that the airport is better for it.”

In 2015 two commissioners exceeded their allotted $6,000: Duane Cooper, the executive director of the S.C. Democratic Caucus (whom The Nerve first reported received $170,000 in Richland County penny tax money for public relations work that no submitted invoices detailed), and Jerry Howard, a former longtime Lexington County Council member.

Cooper spent $6,697 in 2015 on three trips: two days at the Isle of Palms, three days in Ft. Lauderdale and six days in Washington, D.C., at different aviation-related conferences.

Included among Cooper’s Washington expenses was a $552 dinner bill at Mastro’s Steakhouse that included a $100 tip. That charge came after he already had spent $41 at the bar before dinner, meaning he spent nearly $600 in a little more than three hours time. Also notable is earlier that day before Cooper already had spent $101 in room service and bar charges at the Washington Court hotel where he was staying ($289/night), bringing Cooper’s one-day food and drink total on July 20, 2015, to $776.

Other daily totals in D.C. were similar, including the day before the Mastro’s dinner when he began with a $90 brunch featuring mimosas and Bloody Marys and ended it after midnight drinking at an Irish Pub.

That was just two days of one trip. The examples continue throughout Cooper’s travel, including a $200 tab at the Mariott bar in Ft. Lauderdale on a day when he spent $303 on food and drink.

Howard also went over his budget in 2015, spending $6,861 for three nights at the Isle of Palms, four nights in Philadelphia and four nights in Long Beach, Calif.

While in Philadelphia, Howard had consecutive nights of $100+ dinners, including $117 at Maggiano’s Little Italy and $136 at the Oyster House the following night.

In 2015, three commissioners – James Whitmire, Carol Fowler and Roxanne Wilson – claimed no travel cost, though that doesn’t mean their $6,000 cannot be spent because the money rolls over to the next year, according to airport director Dan Mann. That means a commissioner who travels not at all or just a little in one year may spend $12,000 the next (though the money does not roll into a third year).

Already in 2016, one commissioner – James Whitmire – has nearly spent his entire $6,000 on one six-day trip to Maui on which he spent $5,055. Commissioner Xavier Starks is second in spending this year, with $2,724 on a four-day trip to Portland, Oreg.

“In all the years I served on the commission, I can honestly say not one of us brought back anything from those conferences that made the airport better or brought more flights in,” said a former long-serving commissioner. “I straight-up asked people at a meeting one time, ‘Have any of you brought back anything that has made the airport measurably better?’ No one said a word.

“Did it make us better commissioners? Sure, probably. But is that worth the cost and how it gets abused? I don’t think so. Not at all.”

Mann is a proponent of eliminating – or at least reducing – the amount of money spent on for travel for reasons that don’t just involve trimming costs.

“We had about 110 employees when I was hired in 2010, and now we have 57,” Mann said. “The staff here has had to undergo some significant cuts and hardships to keep us competitive, and while $72,000 isn’t but a percentage of our overall budget ($15.5 million in 2015), what the spending does have an affect on is employee morale and public perception of the commission.”

That perception has not always been positive for an airport that, while beautiful, is too costly for many Columbians to use.

WHY SO EXPENSIVE?

Unlike other special purpose districts governed by legislatively controlled boards and/or funded by county councils, CAE is self-sufficient in that it does not receive any state or local tax dollars, though it can.

State law section 55-11-400 provides that the airport may receive public money from Richland and Lexington counties to meet or prevent an operating deficit, but Mann said that has not been needed since the 1980s and would only be needed again in an emergency situation.

The airport receives the lion’s share of its operating revenue from parking ($4.9 million in 2015), the airlines ($6.1 million in 2015), rental car companies (approximately $4.3 million in 2015) and other sources. It also is exempt from property taxes. The overall revenues, including parking, are what fund the commissioner’s travel budget.

“(Being self-sufficient) means we are accountable to the people who fund us directly, the airlines, the rental car companies, the customers,” Mann said. “The airlines look hard at spending practices and your financials, but so do we.

“We’re competing against 350 other commercial airports in the United States for flights. So already as a small hub, we’re battling on the margins to add flights. That pressure motivates us to make sure we’re doing everything we can do to reduce our cost per enplaned passenger.”

When Mann was hired in 2009, the cost per enplaned passenger was more than $12 per person. The number for 2016 is $8.73.

“Ten dollars per passenger is a huge line in the sand for carriers,” he said. “If you’re above it, you’re going to struggle to get routes. Getting below that was important for us.

“Continuing to bring that number down as much as we can is huge, because that’s the one number we can influence,” he said.

The number he cannot influence – and a major reason Columbia enplaned 546,345 passengers last year to Charleston’s 2.6 million. – is 1.

“We’re an hour from Charlotte,” he said. Charlotte’s volume (45 million in 2015) and cost per enplaned passenger ($1.26) are too significant for airlines to overlook.

“Airlines aren’t a charity. Our geography works against us.”

PARTIES AT THE CLA

When the airport signed a $422,000, three-year marketing deal back in June 2014 with Gamecock Sports Properties, which holds the broadcast rights to the University of South Carolina’s athletic teams, it was looking to get the most bang for its rather large buck with an audience that often travels to follow its favorite team.

Besides promotions on-air and online, signage at games, scoreboard sponsorships and more, a big component of the buy – $85,000 – was a luxury suite for men’s and women’s basketball games at the Colonial Life Arena along with 16 tickets per game.

It began as a way to attract ad partners, fete clients and lure new business. It became, almost immediately, a playground for commissioners, especially those from the Richland County delegation and their legislative sponsors, sources say.

“(The Richland County commissioners would) use the 16 tickets, but at halftime they’d invite all their friends up and just pack the place and party,” a commissioner who attended but did who not want to give their name told The Nerve.

When asked to confirm those reports, Mann deferred.

“I’d just say there were rarely only 16 people in the suite,” Mann said.

Abuses of expenses on food and alcohol were so rampant in the suite’s first year (2014-15) that going into year two Mann said he had to draft an official policy for use of the suite and even tried to govern which particular groups could attend the 30-plus total home games, from advertisers to specific legislative delegations to games for staff.

Those guidelines gradually were ignored.

Also part of the new policy was a standing $480 catering order per game, paid for by the airport, that included 42 beers, a $100 bottle of Scotch, Cokes, water and platters of food and desserts to feed 16. The order was meant to be a limit for what the airport would reimburse, with the memo reading, “Any orders outside this menu will need to be paid on-site and out-of-pocket by whomever places the order.”

That guideline also was regularly ignored.

Despite the prescribed limit on spending, this past season the the airport was billed more than the standing order of $480 for nearly half the games attended, topping $500 15 times and $600 four times times with a high of $741.90 for the men’s game against Alabama on Jan. 30, according to records received by The Nerve from a Freedom of Information Act request.

In every case the airport paid the overages, not the commissioners or their guests. For the 2015-16 season as a whole, the airport spent $14,116 for commissioners and others to attend men’s and women’s basketball games. The suite also was available to commissioners to use at any other Colonial Life Arena events such as concerts, though individuals had to pay for their own tickets and catering. Since no airport money was used, no records of who or how many people attended which events were kept.

Who’s to blame?

The same legislative delegations that have been widely criticized recently for issues with special purpose boards ranging from mismanagement at the Richland Election and Voter Registration to allegations of outright bribery and sexual harassment at the Richland County Recreation Commission that has drawn an FBI investigation. Since commission members often serve at least eight-year terms and positions rarely come open, the competition is tough when a seat is available, and the politicking for delegation votes means making phone calls, shaking hands and engaging in State House politics.

When reached Monday, Rep. Kirkman Finlay (R-Richland) said he was shocked by the expenditures, especially those spent on alcohol.

“I don’t understand why the airport would be buying alcohol for anybody,” Finlay said. “I don’t know why we would do that.”

Finlay said he also had never stepped foot in the luxury box at the Colonial Life Arena and questioned the expense as a whole in addition to the travel junkets.

“My goals for the commission would be, number one, to eliminate alcohol purchases as an acceptable reimbursement,” he said. “Number two, my goal would be able to measure exactly what new business we can trace to the travel and the luxury box in particular. What new business have we brought to Columbia? What’s our return on that investment?

“It’s crazy that we’re the number four airport in the state and yet we’re investing more than anyone else in their commissioners for education and travel and box seats. That is amazing to me.”

For the longtime commissioner, the board’s practices now do not reflect the best interests of the airport.

“The commission has become something it wasn’t meant to be,” the commissioner said. “There is so much good that can be done, and a lot is, but when you have legacy people on the commission who are there to enjoy themselves, it makes those who don’t treat the system that way get very discouraged year after year.”

The Nerve reached out to several other members of the Richland and Lexington legislative delegations to discuss commissioner spending, but as of press time none had yet responded.

Reach Aiken at (803) 254-4411 or email him at ron@thenerve.org. Follow him on Twitter @RonAiken and @TheNerveSC.