Concerns about the structure of a proposal to buy land in Buckwalter Place and uncertainty over the future of that property led Bluffton Town Council to withdraw its support for the deal, two council members said Wednesday.
In a 3-2 vote after an hourlong closed session Tuesday, Town Council decided not to contribute about $750,000 to the Bluffton Public Development Corporation's effort to buy 34 acres. Its vote also means the corporation won't get greater access to a multi-county industrial park tax fund it needs for the deal.
The decision reversed the council's initial -- but conditional -- approval of the measure in March, when it voted 3-2 to contribute up to $1 million for the land purchase.
Council members Fred Hamilton and Karen Lavery opposed the deal both times. Councilman Larry Toomer changed his mind and provided Tuesday's swing vote.
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Toomer said the debt obligation from the proposed purchase was too large, and the return on the investment too distant and uncertain.
Toomer added that the corporation did not seem to have a firm commitment from a company that would repurchase and help develop the property. The development corporation has declined to name any of the companies it is trying to attract to the land.
Hamilton agreed and said the deal involved too many moving parts. Voting to support the development would have been "voting in the dark," he said.
Lavery said Tuesday she was concerned about the purchase being made entirely with borrowed money. She also cited concerns about the town entering the real estate business with the purchase.
Town Council's withdrawal puts the $4.2 million deal with developer Tom Zinn in jeopardy, although it does not kill it. Beaufort County has agreed to commit $1 million and the Beaufort County School District $923,000.
The corporation was created to purchase the land from Zinn and use it to attract companies similar to CareCore, the development's anchor tenant.
Deputy town manager Marc Orlando, also the Public Development Corporation's director, said Tuesday that the corporation's board would discuss how to proceed Wednesday. However, that meeting was canceled Wednesday morning.
Attempts to reach Orlando and corporation chairman Roberts Vaux for comment Wednesday were unsuccessful.
County Councilman Brian Flewelling said the town's decision "certainly calls our participation into question." He said council will seek more information from the Bluffton Town Council and the corporation board before deciding whether the county will pull its support, or increase it to cover Bluffton's earlier commitment.
Flewelling, who voted for the county's contribution in the purchase, said the county's participation was predicated on equal support from the town, so it was unlikely it would increase its support to cover Bluffton's share. Further, the $1 million the county pledged represents the upper limit of its support for the project.
Discussion of the project is not on the agenda for the County Council's July meeting but could be added, Chairman Paul Sommerville said.
Several members of the Beaufort County Board of Education echoed County Council's concerns.
Since its 6-4 vote in April to help finance the land purchase, the board has remained divided over whether it should participate.
Board chairman Bill Evans said he and district officials are trying to determine what the Town Council's vote means for the district.
"If the council is not supporting the project in its own town, then that does raise the question of why would we or the county," said Evans, who voted for the deal. "I would assume that the rest of the board members who voted for this project will be looking at their position on this."
A $1.8 million loan from Santee Cooper for the purchase may also be in doubt, because Bluffton's vote Tuesday denied the corporation a greater share of a tax fund that could be used to repay it. The resolution would have increased the amount available from $1.3 million to $2 million.
The resolution needs approval from both the town and county councils to be enacted, county attorney Josh Gruber said.
However, the loan cannot proceed without the town's involvement, because the town must match some of the funds, Santee Cooper spokeswoman Mollie Gore said. Even if the amount matched is changed, the new loan proposal would have to be reapproved by the company's board of directors, Gore said.
Mayor Lisa Sulka and Town Councilman Ted Huffman, who both voted for the land purchase, were confident the development corporation would return with another proposal that council could support.
Sulka said Wednesday the deal would boost economic development over the next 50 years, and such development is more likely if the corporation, not the private developer, controls the land. Without the town's control, the land could be used for high-tech business, which the town prefers, or retail development, which it hopes to avoid.
How Tuesday's vote might affect the town's standing with its largest private employer, CareCore, is unclear. The company, whose headquarters is adjacent to the property the corporation wants to buy, has encouraged the purchase.
"I would love to have another CareCore, and I will fight tooth and nail to keep them here," Sulka said. "I want them to stay there, but they need some comfort for what's around. We have no say unless we purchase the land."
- Bluffton withdraws from Buckwalter Place land purchase plan, July 15, 2014
- Bluffton development group hopes to complete land deal by July 31, June 24, 2014