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County Council, April19

Container traffic at Port to get boost
Citadel seeks Accommodation Tax funding
Warwick Jones

The Economic Development department thought that Council would be pleased by the plans of Frontier Logistics to assist port development. But it overlooked the hostility of the nearby residents in North Charleston. Bowing to their concerns, some Council members opposed the plans though the majority of the Finance Committee voted for approval.

At issue was financial help for the group through a Fee in lieu of Tax (FILOT) program. The program would have pegged the property tax to a 6% assessment and the millage rate to that at present. Frontier Logistics’ business is shipping plastics and presently it uses Union Pier in the City of Charleston to ship about 10,000 container loads a year. It has 30 acres in North Charleston abutting the new port. It is studying a plan to move its operations to the new site and boost shipments to 30,000 containers a year.

Staff called the plans a game changer for the port and the plans are supported by the SPA. The property will be linked to the rail lines that will serve the port and this was primary factor behind the purchase of the property.

Council members Pryor and Darby opposed the FILOT. They decried the likely increase in truck traffic through the neighborhoods that they represent. They also noted that they and the neighborhoods were not engaged in discussion over the project.

The Council members’ opposition to the FILOT, or indeed that of Council if they vote down the proposal, will make no difference. Frontier has the zoning and necessary approvals to undertake the project. The FILOT will represent financial assistance, but at a very modest level, it seems.

The benefit to the County and the Community is confused. The property falls under a State TIF district. When this expires was uncertain, 2 years, 4 years or 16 years? How this makes a difference was not clear to us but most likely the County FILOT cannot be imposed until the State TIF expires. Staff was tasked to determine the facts before the Council meeting on Tuesday.
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It seems when you are the Citadel, you don’t need to abide by the application procedures defined by Council for Accommodation Tax funding. And it seems that Council is happy to cast aside its rules. Ignoring the defined procedures, the Citadel sought funding for its stadium from the Accommodation Tax back in 2007. Council approved it

Now it looks that Council is about to approve another round of funding for expansion and improvement of the Citadel's stadium in the City of Charleston and its Beach House on the Isle of Palms. The Citadel is seeking $350,000 a year for 5 years beginning in 2020 and then a further $350,000 a year for the following 5 years if the institution realizes its performance objectives.

The Finance Committee approved the request though members pointed that effectively, this was not a commitment. Council could not bind future Council to commitments. The proposed spending would need to be confirmed by future Councils. Council member Pryor voted against the request preferring to wait for an assessment by the CVB, as is usual for Accommodation Tax allocations

Representatives of the Citadel noted that the fullfilment of the plans for the stadium and beach house should boost patronage by 19% and 25% respectively. They estimated Accommodation Tax revenues would be boosted by $1.5 million annually and effectively be more than 4 times the County’s investment. The Citadel wanted a commitment now from the County to assist in raising other funds for the projects by way of bonding.

Only Chairman Rawl had reservations about the proposal, not because he opposed the project but because there are many other worthy projects on the Peninsula in the City of Charleston that will be competing for funds. We would add that the reason for setting up the formal procedures was for Council to be able to assess them all at the same time. And as Council member Pryor noted, the Charleston Visitors Bureau and the College of Charleston were tasked to rank applications according to the formulas they developed.