MYRTLE BEACH — Horry County Administrator Chris Eldridge said Wednesday he expects that by the end of August, the attorney authorized by the Horry County Council will file an action that could result in a forced sale of Carolina Southern Railroad.
The council voted Tuesday to authorize a Chicago attorney to seek an investigation of the shutdown of the Conway-based rail company by the U.S. Surface Transportation Board.
Concurrently, said County Council Chairman Mark Lazarus, the county is considering a lawsuit against the railroad’s owners within two weeks over about $320,000 they owe Horry County for back property taxes and lease payments on county-owned rail line between Conway and Myrtle Beach.
Tommy Brittain, attorney for railroad owner Ken Pippin, said he would welcome the investigation. He said Pippin is earnestly trying to seek a buyer for the railroad, but couldn’t say how long that might take. He said he thinks the county should be involved in the sales process by talking with potential buyers.
County Councilman Gary Loftus said he has no confidence that Pippin and his son, Jason Pippin, Carolina Southern general manager, are in fact trying to sell the railroad and that he doesn’t know what would convince him short of a finalized sale.
“I’m not confident in anything the Pippins say they are doing,” Loftus said.
Loftus is a member of a two-state railroad committee that has been trying for more than a year to get the railroad back in operation.
The committee voted no-confidence in the Pippins several months ago because of frustrations members had in dealing with them. Gary Lanier, chairman of the Columbus County, N.C., Economic Development Commission, said the Pippins would never provide any information to show that they didn’t have money to fix bridge problems that shut down the railroad nearly two years ago, or to support a loan for the work.
The shutdown has caused railroad customers along about 100 miles of track in Marion, Horry and Columbus counties to resort to more expensive ways to get raw materials and ship finished products. Columbus County officials fear a lumber mill may close permanently without rail service. The mill employs about 400 when it is operating.
Ken Pippin has said he doesn’t have the money to make the needed repairs and an attempt to get a federal grant for the money failed.
Brittain said he believes the current effort to sell Carolina Southern is real because he has a photograph of potential buyers standing on the platform of the railroad’s trackside office in Conway that he said was taken last Monday. He said the photograph is not dated.
But he said that if both sides could forget the bad feelings of the past, they could work together toward the sale. Selling the railroad, he said, would be a lot quicker than going through the STB to force a sale.
“What I’d like to see is everybody come out better as far as a solution,” he said.
Brittain said the sale process should at some point result in an appraisal of the railroad, something the two-state committee tried unsuccessfully to get. Committee members had believed the Pippins would have done a recent appraisal, but Brittain said they didn’t.
“The Pippins can do whatever they want to do,” Lazarus said about moving forward with a sale while the county initiates action with federal transportation authorities. He said at a Council meeting Tuesday night that, if anything, the county’s hiring of a lawyer should entice the Pippins to talk with the county.
He said the county is willing to negotiate a new lease on the 14 miles of track the county owns between Conway and Myrtle Beach is the Pippins pay back taxes and lease payments.
Ken Pippin, who could not be reached for this story, suggested to the Council at Tuesday’s meeting that Brittain’s attempts to meet with county officials drew no response from the county.
But Lazarus rejected that argument. He said there is ample evidence of the county’s willingness to talk with the Pippins.
Lazarus said the county will move aggressively forward on its action with the STB, which could result in a forced sale of the railroad.
The county declared the railroad in default of the lease of the county-owned track a couple of months ago, and has since moved to have encroachment fees paid to the county that formerly went to Carolina Southern.
Lazarus said Wednesday he couldn’t recall the exact amount of the payments and said it wasn’t enough to fund a loan for approximately $2 million that was estimated to be needed for the bridge repairs. But he said it was enough that it could have gone toward paying what the railroad owes the county.
And Lazarus and Loftus aren’t sure that the county knows the total amount of payments owed on its 14 miles of track.
County Attorney Arrigo Caratti said he’s sent letters to all he knows that make the encroachment payments and told Council members that if they know of others, he will send letters to them as well.
Loftus said a sale is not the only way the Pippins could dispose of the railroad without incurring significant loss. He suggested they could give it to the county.
“Why not?” he asked. “Is it worth all (Ken Pippin is) going through? If he can’t fix the railroad, what good is it doing him?”
Contact STEVE JONES at 444-1765.