Every time we think it couldn’t possibly get any more corrupt, the “Coastal Kickback” – a brazen pay-to-play scam involving numerous South Carolina politicians – finds a way to prove us wrong.
In case you’re new to FITS, this scam began last May when the city of Myrtle Beach, S.C. passed a one cent sales tax increase – ostensibly to fund tourism efforts at the Myrtle Beach Area Chamber of Commerce. This tax hike was approved by the Horry County legislative delegation – which is comprised almost exclusively of “Republican” state lawmakers.
Not long after the tax hike passed, the Myrtle Beach Chamber was accused of orchestrating a massive kickback scheme that routed nearly $350,000 in campaign contributions to Myrtle Beach area politicians (including delegation members and U.S. Rep. Gresham Barrett) as payback for their support of the measure. Later it was revealed that these campaign contributions were doled out in cashier’s checks cut from a shadowy network of “corporations” all affiliated with a former Chamber executive.
The checks were all cut at the same bank – on the same day (in sequential order, no less). They were then stuffed into envelopes and hand-delivered to numerous politicians including S.C. Senator Ray Cleary and S.C. Reps. Thad Viers, Nelson Hardwick, George Hearn and Alan Clemmons (all “Republicans”). State Rep. Tracy Edge, another Republican, declined the contributions.
After initially denying any involvement with the scam, Chamber leaders later admitted that they had helped deliver the stuffed envelopes to several of the politicians involved. In fact one of the individuals who handed out the checks is Mark Kelley, a former lawmaker and lobbyist for the chamber. Another is Brant Branham, a former chamber chairman who is reportedly in line to become chief of staff to incoming S.C. Lt. Governor Ken Ard.
Sadly, this whole scandal was on the verge of being swept under the rug earlier this year – but local activists kept making noise and blogs like FITS kept applying pressure.
Now not only is a major federal investigation underway, but the local mainstream media has started digging … and digging hard.
What are they uncovering?
Well, according to a big Sunday spread by reporter David Wren in The (Myrtle Beach S.C.) Sun News, the corruption associated with the “Coastal Kickback” goes deeper than pay-to-play.
From Wren’s story:
Some businesses that made campaign donations to politicians who approved a sales tax increase for the Myrtle Beach Area Chamber of Commerce now are among the biggest beneficiaries of that tax increase.
The chamber has paid those businesses and others that donate to a political action committee supporting those politicians at least $5.9 million in public money – including sales tax revenue – during the first nine months of this year for marketing work without any competitive bidding and little public oversight.
The lack of oversight could become an issue this year in the state legislature, with some politicians calling for increased scrutiny of how public money is spent.
For those of you keeping score at home, the tax increase is expected to generate around $18 million a year – with all of that money dumped directly into the chamber’s coffers. In fact through the first nine months of 2010, the tax has generated $12.3 million for the chamber.
Now we discover that nearly half of that cash has been routed to businesses that financially supported the tax increase – without any transparency or competitive bidding?
Amazingly, several state lawmakers interviewed for Wren’s story see absolutely nothing wrong with this arrangement.
“I wouldn’t want to do anything that would create a bureaucratic, slow procurement process that would make (the chamber) jump through hoops,” S.C. Senator Luke Rankin (RINO-Myrtle Beach), told Wren.
Meanwhile, S.C. Rep. Bill Herbkersman – a RINO who is proposing a similar one cent sales tax increase in Beaufort, S.C. – said that he trusts the Myrtle Beach chamber and that the organization has been doing a “fantastic job.”
Here’s a novel idea … if businesses that benefit from our start’s tourism economy (in Beaufort, Myrtle Beach, Charleston or anywhere else) want to band together and create a fund to support their industry, let them do so – with private money. Promoting tourism – even when it’s done cleanly – is simply not a core function of government.
Donors profit from Myrtle Beach sales tax (Myrtle Beach Sun News)