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Finance Committee kills TIF proposal for Kiawah River Plantation
Great presentation by Johns Island Conservancy
Warwick Jones

The Finance Committee voted down the proposed TIF district for the Kiawah River Plantation (KRP) development. After last week’s special Finance Committee meeting where the Beach Company and others gave presentations, the action was not a surprise. Council at that time showed no enthusiasm for the proposal and some Council members were conspicuously hostile to it. And if it were concealed at that meeting, any enthusiasm should have been sundered last night by the presentation prepared by of the Johns Island Conservancy (JIC). The presentation raised a host of issues and called into question the legality and legitimacy of the proposed TIF district.

For us in attendance, the voting was at first confusing, and given the mood of Council, inexplicable. Council member Condon moved to deny the TIF district. She was immediately seconded by Council member Qualey but for reasons at that time unknown, the Council member withdrew his second. Nobody stepped up to second Council members Condon’s motion. After questioning County Attorney Dawson and a subsequent executive session, Council member Rawl moved that the TIF proposal be given a statutory 45 day period to allow public comment, other taxing authorities time to form an opinion, and for more information to be gathered by staff. This was voted down with only Council members Rawl, Summey and Chairman Pryor in favor.

Council member Condon then again moved to deny the TIF request. It was duly seconded and only Chairman Pryor* and Council member Summey voted against it. After the vote was counted and declared, Council member Summey changed his mind. He wanted to vote yes! We don’t know why there was such vacillation but a lot of people wondered. Could it be that he was trying to give himself the option to raise the issue again? Under Roberts Rules and the Rules for Council, only a member on the prevailing side can bring an issue up again to the Council. Was he planning on working Council members to change their vote before next Council meeting? We don’t know. But we do understand that it was procedural issues, not second thoughts about the TIF, that restrained Council member Qualey and others from seconding Council member Condon’s first motion. And as we don’t understand the procedural process, we won’t attempt to explain it.

After watching the presentation by the representative of JIC, we confess to wondering how the TIF proposal got as far as it did. Council member Rawl probably thought similarly when he asked County Attorney Dawson as to whether he had reviewed the legality of the proposed TIF. He was told that the review was not complete. Attorney Dawson needed to obtain more information for Council to make a decision.

The JIC didn’t need more information. It had been studying the proposed TIF for months, and in particular the State Law pertaining to TIF districts and the Development Agreement signed in 2009 by the Beach Company and the County. It found the Beach Company wanting. It noted the following;

State Law Section 31-7-80 – Conditions for issuing obligations; approving and modifying redevelopment plans.
(7) findings that :

(a) the redevelopment project area is blighted, conservation or sprawl area and that private initiatives alone are unlikely to alleviate these conditions without substantial public assistance
(b) property values in the area would remain static or decline without public intervention

The JIC stated that the Beach Company must prove that the TIF is “needed”, not just “wanted”. Where was the evidence that the conditions imposed by the law as being necessary, existed? The JIC went further.

Section 31-7-20 Intent
(3) the sprawl and conservation areas are rapidly deteriorating and declining and may soon become blighted areas
.

JIC to Beach Company –You must be kidding?

Or
Section 31-7-30 Definitions:
(2) “Conservation area – “may become a blighted area”
(3) “Sprawl area “ – “potential to become blighted”

JIC to Beach Company - The 2000 acres of the proposed TIF is potentially blighted. Come on!

Referring to the Development Agreement with the County, the JIC noted that the Beach Company is referring to 2,000 acres in the proposed TIF which contrasts with the 1,427 acres in the 2009 agreement. It went further. The law says that the minimum number of rural acres needed to qualify for a TIF district was 1,000. So why is the Beach Company calling for a TIF? It does not have 1,000 rural acres, only 967. Of the 1,427 acres in the original agreement, 460 were within the Urban Growth Boundary. And the 573 acres that the Beach Company has since added to the TIF proposal are all marsh and cannot be built on.

The JIC also questioned as to whether substantial public assistance was necessary to alleviate so called blight and sprawl. There was no evidence presented by the Beach Company that it had exhausted or tried to seek financing opportunities beside the TIF. Had it approached any lending bodies? What about using connection fees tied to the sale of properties to finance sewage and water? Anyhow, the company said that the development will go ahead even if TIF district is denied.

The Beach Company’s request for a $63 million contribution under the TIF from the County School District did not go unnoticed. The Company justified its request by noting that there will likely be few children attending public schools. It presumed that the School District could give up much of its entitlement of tax revenues without jeopardizing the education of the children in the development. The JIC rightly observed that American public policy for over 100 years – EVERYONE pays for public education for all.

The JIC also warned about the issues over bonds to be repaid by TIF monies. They may be revenue bonds with recourse only to TIF funds, but a default would be more than a black eye for the County. The JIC opined that if there were shortfalls in TIF funding, the County would need to step up. And what would that do to County Credit ratings? The Beach Company may be substantial, but these things happen.

There was much more to the presentation and as we noted, it was very persuasive.

* The P&C reported that Chairman Pryor voted against the denial. We may have misheard.

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