What Horry County’s decision on I-73 contract with SCDOT means for its future
Horry County is tired of being the only government tied to a contract to fund Interstate 73.
County council voted unanimously to terminate a contract with the South Carolina Department of Transportation that would eventually see I-73 built. Council Member Al Allen was unable to make the meeting.
“If Horry County is the only entity to kick in money, it’s not going to get done,” Horry County Chairman Johnny Gardner said.
SCDOT and the county made an agreement last year after the county said it would use hospitality tax fee money to build the Horry County portion of the interstate.
Honoring the contract was delayed when a legal battle over the funding began earlier this year. In March, Myrtle Beach sued the County over the collection of the hospitality fee that the County hoped to use to fund I-73.
Myrtle Beach and other municipal leaders have indicated they’re willing to contribute to I-73 and that the hospitality fee lawsuit is about protecting its taxpayers. In September, Horry County gave the cities an ultimatum to either put their willingness to contribute money into writing or the SCDOT contract would be canceled.
Council member Johnny Vaught said if the cities formally agree to funding the road, he imagines a better contract with SCDOT can be made.
“It is not possible for the SCDOT contract to get done this year,” Vaught said. “If the cities step up and do their part in building I-73, I don’t think SCDOT will be against us recalculating and making a new contract.”
State funding
Council member Harold Worley said it is time for the State of South Carolina to step in and help get the road completed. Worley supports I-73, but he said no other government entity has come in to help the county.
He thinks state intervention could be what’s needed to bring an interstate to the area if the municipalities are not willing to make an acceptable deal with Horry County.
State Rep. Russell Fry, R-106, said it is his hope Horry County and the municipalities can find a solution to complete I-73 without the state having to get involved. But a bill was filed in the statehouse Wednesday, weighing in on the dispute.
“The Horry delegation has always been interested in an amicable resolution of the I-73 issue — between the county and cities — and outside the halls of State House,” Fry said. “The goal of this legislation is to protect these critical investments in I-73, but I still believe the best option is for the parties to pass an agreement which adequately funds the road.”
Worley would also like to see the state contribute money from the $2 billion budget excess to the completion of I-73.
U.S. Rep. Tom Rice, R-7, said he and other leaders have been working at the state and federal level to build the interstate. It is a shame that local leaders couldn’t set aside their differences and keep the SCDOT contract alive, he said.
Council member Dennis DiSabato is worried about what getting the state heavily involved in settling local affairs could mean for potential future uses of the hospitality fee. While he hopes it doesn’t come to it, he fears if the local governments can’t come to an agreement the legislature would take the fee out of local control and use it to build I-73.
This would mean the money could not be used for public safety like council previously promised.
“If the legislature gets involved, they’re going to take the hospitality money away from us and the municipalities and say ‘you can’t figure out how to play with this, so we’re going to tell you how to play with this,’” DiSabato said.
Future of hospitality fee lawsuit
Until the hospitality fee lawsuit is resolved, however, no money from any local government can be given to I-73 or any project.
A tentative deal was reached in mediation last month to bring an end to the lawsuit. It included money to fund I-73, but Worley and the rest of council agreed it is a worse deal than what the county has previously offered the cities in the spring.
The lawsuit began in March, when the City of Myrtle Beach sued Horry County over the collection of a 1.5 percent tax on hospitality services in the city.
Early on in the dispute Horry County sent a proposal that would divide up the hospitality fee money between all the municipalities, but reserve some costs toward the completion of I-73.
The offer was not accepted by Myrtle Beach.
The legal battle continued on and now the money is in escrow due to a judge’s order that allowed Myrtle Beach to keep its portion of the fee until the lawsuit is over. Horry County appealed the judge’s decision and the matter currently sits with the South Carolina Supreme Court that has yet to set a hearing date.
During this time Horry County Council kept extending the SCDOT contract in hopes the lawsuit would reach a conclusion.
As a part of the pre-trial process, Myrtle Beach and Horry County underwent a mediation process lasting well over 20 hours. If the mediation deal is approved by a judge and the council, the matter will be settled without further battles in the court.
Gardner said he does not know why neither government has voted on the mediation deal yet, but he still hopes a decision can be made soon.
While the exact details of the mediation agreement are not public, Worley gave some insight into what the plan might be. It would see the county and city contributing to I-73’s construction, but also included millions be given to the city to cover legal fees.
Vaught said the original deal presented in March was a “free deal” that gave the municipalities all the money they were expected to collect minus funds to honor the I-73 contract. Vaught said Horry County leaders have been the “adults in the room” and he wants to see the county continue to show leadership.
“We’ve been showing leadership, we’ve been doing everything we should have been doing,” Vaught said. “I’ve had enough.”
This story was originally published November 19, 2019 at 7:49 PM.
