Why did a dozen Beaufort Co. private communities get small business coronavirus loans?
Private golf neighborhoods and gated community property owners’ associations in Beaufort County obtained at least $8.5 million in small business loans through the federal government’s massive Paycheck Protection Program, data show.
The loans, which are forgivable, ranged from at least $150,000 to $1 million each, according to data released in early July by the Small Business Administration and the U.S. Department of the Treasury. The program was established to help small business owners cover employee pay or rent, among other things. The loans were calculated based on payroll needs.
The $660 billion PPP was included in Congress’ $2 trillion CARES Act, a sprawling economic relief package that was passed in March to address the financial fallout of COVID-19.
Some POAs in Beaufort County last month said the program helped them retain workers as the coronavirus spread through the Lowcountry, though most wouldn’t say exactly how they used the loans.
But one Charleston County POA drew the ire of state leaders earlier this year after taking advantage of the PPP.
U.S. Rep. Joe Cunningham, a Democrat who represents South Carolina’s 1st Congressional District, criticized the Kiawah Island Community Association for accepting a $1 million PPP loan.
“Congress approved the spending of billions of dollars in taxpayer money to help small businesses weather this storm and keep paychecks going to their employees, not pad the pocketbooks of giant corporations or wealthy community associations that have millions of dollars in reserve,” Cunningham said in a statement released by his office in April.
The Kiawah Island association returned its loan after the public rebuke.
PPP loans in Beaufort County
The SBA on July 6 disclosed the names of businesses and nonprofits that received a PPP loan of $150,000 or more, according to federal officials, although some local business owners dispute the data’s loan ranges.
The following POAs and private golf communities in Beaufort County each received PPP loans of $1 million to $2 million, according to the data:
- Belfair Property Owners Association in Bluffton
- Berkeley Hall Club Inc. in Bluffton
- Brays Island Plantation Colony Inc. in Sheldon
- Community Services Associates Inc., the POA for Sea Pines Resort on Hilton Head Island
- Haig Point Club and Community Association on Daufuskie Island
- Moss Creek Owners’ Association Inc. in Bluffton
- Wexford Plantation Home Owners Association Inc. on Hilton Head
Other POAs and private golf communities obtained loans of $350,000 to $1 million, the data show:
- C3 Golf LLC, which is the Chechessee Creek Club in Okatie
- Colleton River Club in Bluffton
- Hampton Hall Club Inc. in Bluffton
- Long Cove Club Owners Association Inc. on Hilton Head
The Spring Island Property Owners Association also received a loan of $150,000 to $350,000, according to the data.
How was the money spent?
POAs and private golf communities in Beaufort County retained 989 jobs using PPP loans, according to the SBA data. It’s unclear, though, how accurate those numbers are.
Berkeley Hall, for example, used its PPP loan to keep about 45 employees on the payroll who would have otherwise been furloughed, according to general manager Adam Kushner. The club in the data was listed as having retained 134 jobs with a loan of $1 million to $2 million. That’s close to the club’s total number of employees, Kushner said.
Similar discrepancies have been noted across the country, with several companies arguing that the “jobs retained” data is simply wrong.
General managers at half of the POAs and private golf communities that obtained PPP loans in the county did not respond to multiple phone calls seeking comment for this story.
Shelle McDermott, an executive assistant to the CEO at Haig Point Club on Daufuskie Island, told The Island Packet she was not interested in commenting on the club’s loan of $1 million to $2 million.
Similarly, general manager Leon Crimmins of the Long Cove Club declined to comment on the club owners’ association’s loan, which was between $350,000 and $1 million.
At Sea Pines, a PPP loan of $1 million to $2 million helped Community Services Associates retain 110 jobs, according to the SBA data.
Victoria Shanahan, Sea Pines CSA director of finance and administration, in an email said the association used the loan to keep all employees on the payroll during the pandemic and to fund benefits.
Shanahan said the loan was also used to “offset the significant decline in revenues generated during normal operations,” citing months of decreased gate fee collections. It costs single-day visitors $9 to get into Sea Pines.
No Sea Pines CSA employees were furloughed as a result of the pandemic, Shanahan said.
Bill Griffon, general manager at Spring Island, in an email said the island’s POA used a loan of $150,000 to $350,000 to keep all employees working full time as the coronavirus spread across the state. He did not respond to a follow-up phone message.
Kushner, the general manager at Berkeley Hall, in an interview said the club’s PPP loan went entirely to payroll.
The club, he said, is already facing a $1 million top-line loss this year thanks to the pandemic. If not for the loan, roughly 45 people would have been furloughed, he said.
“We were able to keep people employed,” Kushner said. “I think it’s been crucial.”
Berkeley Hall had to cancel weddings and temporarily close the golf course and its cottages to guests, he said. Thirty percent of the club’s annual revenue comes from “outside revenue,” which includes events, he said.
The club, he said, is just like any other small business. And the pandemic upended its operations this spring, he said.
Returning one loan
Bill Kennedy, general manager of Chechessee Creek Club in Okatie, said he was actively returning the club’s $350,000 to $1 million PPP loan. Regions Bank approved the loan, according to the SBA data.
“He does not feel good about it,” said Kennedy, referring to the club’s owner, who he declined to name.
Kennedy said the club hasn’t furloughed any employees due to the pandemic.
According to Golf Club Atlas, a golf course architecture website, David Proctor bought Chechessee Creek Club in 2012.
Proctor is listed on the website as a principal at Jane Street Capital, a global quantitative trading firm. He did not respond to phone calls or emails this week requesting clarification on why he wanted to return the loan.
Beaufort County, SC businesses that got PPP loans
Here is a searchable list of PPP loan recipients. Some businesses have contested the loan amounts reported below.
