CharlestonWatch.com

The Price of Liberty is Eternal Vigilance

The Watch

Archives

Individual Articles

Cruise ships

Preservation Society plan - bold but improbable
There are many issues, and funding is one of them
Warwick Jones

The Preservation Society fired off another round last week in its battle with the City over cruise ships and the Gaillard auditorium. The proposed plan is bold, but improbable in our view. It is bold in the scale of the recommendations and the assumptions. The cost of the projects recommended could leave little change out of half a billion dollars (our guess). And it is improbable for a number of reasons, but particularly because all of the stars would need to be favorably aligned - the City, the SPA, the State, private donors and almost certainly, the Federal government – to fund the plan.

Could the stars be nudged into place? Possibly, but who is going to do the nudging? The only person likely to have the experience, power and persuasion is Mayor Riley himself. And for a number of reasons, we don’t think he will be available!

For those who have just arrived “from off”, the relatively new President of the Preservation Society, Evan Thompson wrote an Op-ed in the Post and Courier recently suggesting that part of the State Port Authority’s (SPA) Union Pier site be used to house a performing arts center, the Gaillard Auditorium be torn down and be replaced with single family housing, and that the Cigar factory be bought and renovated by the City to house staff. The Op-ed follows on the efforts of the Preservation Society and others over the last year or so to codify limits of cruise ship activity and shape the Gaillard development.

The article by Mr. Thompson can be seen by pressing Download file.

Mr. Brian Hicks in his column in the Post and Courier aired his views of the proposals. Like us, he is skeptical and stated that the proposals came too late to be considered. We won’t detail his comments. They can be seen by pressing Download file. We have no issue with Mr. Hick’s views, but we would like to add some of our own.

Three or four years ago, the suggestions made by Mr. Thompson possibly could have influenced the nature of the development of the Union Pier and a new performing arts center. As Mr. Hicks said, these projects are now under way and funds have been raised and committed. But we would go further. Would the funds necessary for the developments have been any easier to raise? The magnitude of the funding was and is well beyond that available to the City of Charleston – at least if the projects are to be completed in a time frame of a few years. And is the SPA going to give the City the site needed for the proposed performing arts center? The SPA has a major investment program in front of it which needs to be funded.

The City of Charleston with a population of 120,000 or so has a General Fund budget of about $130 million. It has a limited capacity to borrow. Borrowings for capital and other projects are now at a manageable level of around $150 million and the City maintains a very favorable bond rating. But the scope for higher borrowing does not stretch to hundreds of millions of dollars. And we doubt that few citizens will want to see a sizable increase in millage rates to fund major developments. Indeed, an increase in the millage rate necessary to fund such obligations would be subject to a referendum.

The City of Charleston adjoins two other large municipalities - the City of North Charleston and the Town of Mount Pleasant with General Fund budgets of about $88 million and $67 million respectively. As their citizens would share the benefit of a large performing arts center, would the municipalities contribute to the cost? We assess the likelihood as nil. The County perhaps could be persuaded. Its General Fund budget, at about $160 million, is modestly bigger than that of the City of Charleston. But for most if not all the municipalities and counties of the state, times are tough. There is little scope for major borrowings to fund large projects. We believe the total borrowings of the County amount to $200 million with General Obligation Bonds and another $100 million relating to the Transportation sales tax.

This leaves the Federal Government and private donors. Viewers can make their own assessments as to the likely contribution of both. With a massive budget deficit to rein in, the largesse of the US government is likely to be less in future, regardless as to which Party is in power. And with the economy struggling along, the largesse of private donors may also be limited.

Mayor Riley has tasked the City to raise $71 million from private donors to complete the $142 million Gaillard renovation. The private donor kitty stood at $20 million or so some months ago and we have not heard of further contributions. And the Mayor also has an African American Museum to fund. The latter is projected to cost some $80 million and little so far has been raised. We doubt the Mayor or City Council are going to abandon this project which also most certainly they will have to do if they were to fund Mr. Thompson’s proposal.

Your Comments:
Post a Comment:
Your Info:
Remember personal info?
Comments: