Nonprofit sues Beaufort economic agency over access to public financial records
A local nonprofit has filed a transparency lawsuit seeking records that show how public money moves into and out of the Beaufort County Economic Development Corporation, the mostly taxpayer-funded nonprofit responsible for recruiting new businesses to the county.
The lawsuit alleges that the BCEDC violated the Freedom of Information Act, a federal and state law, by not disclosing financial and operational records tied to the use and distribution of public funds after those records were requested by Protect Beaufort Foundation Inc.
BCEDC also filed a motion to dismiss, in which the nonprofit appears to claim it is not subject to public record laws.
According to claims in Protect Beaufort Foundations’ lawsuit, the BCEDC allegedly withheld some requested records without a legal explanation, imposed charges without a set fee schedule and required the foundation to formally request documents that should have been available without a request.
FOIA laws require public bodies, defined as organizations supported in whole or in part by taxpayer dollars, to disclose certain records upon request. In South Carolina, public agencies must produce requested records within 30 calendar days after notifying a requester that the request will be fulfilled.
What is the BCEDC?
The BCEDC is separate from the county government but, according to its Executive Director John O’Toole, municipalities provide at least 95% of its annual funding — nearly $12 million since 2018. Beaufort County has contributed the most over that span, $10.8 million, with Hilton Head, Bluffton, Beaufort and Port Royal collectively chipping in about $1 million.
The BCEDC was formed in 2016 to diversify the economy by attracting businesses with well-paying jobs in key industries such as aerospace, defense and healthcare.
Until recently, BCEDC had not been audited in the nearly 10 years since it was formed. The county, citing the corporation’s limited oversight, ordered the audit earlier this year. The audit has not yet been completed, according to O’Toole.
What the lawsuit against the BCEDC claims
The complaint, filed in October by nonprofit Protect Beaufort Foundation Inc., alleges the BCEDC violated FOIA laws in its response to a public records request seeking the executive director’s employment contract, credit card use policies and information related to a $75,000 grant given to a local organization, among other things.
One of Protect Beaufort’s board members, Graham Trask, told The Island Packet that questions arose earlier this year about various grants and expenses made by the BCEDC, prompting their requests for documents. The documents they did receive “raised more questions than answers,” Trask wrote.
The group claims the BCEDC did not provide all the requested documents in their response while also not providing a legal explanation as to why the documents were withheld. Specifically, O’Toole’s, employment contract and copies of “completed questionnaires” were not provided.
The complaint also says the BCEDC required a deposit of more than $1,600 to produce documents, despite not having a rate structure in place at the time. They claim the BCEDC did not provide an explanation as to how they calculated the deposit amount, which they say also violated the law.
The foundation is asking the court to issue an order declaring the group violated the law and to get all the documents asked for in the initial request.
What does the motion to dismiss say?
In its response, the BCEDC asked the court to dismiss the lawsuit altogether. The motion appears to claim that the BCEDC is not required to adhere to public records laws. The BCEDC’s executive director, O’Toole, told The Island Packet on Tuesday that while he should refrain from interpreting legal documents, the motion had more to do with the complaint’s form.
“In summary,” the motion says, “Plaintiff’s Complaint states no facts sufficient to support a conclusion that BCEDC is, or was at any relevant time, a ‘public body’ as that term is defined in FOIA.”
The BCEDC’s lawyer did not answer questions from The Island Packet about the lawsuit’s interpretation, citing a lack of authorization from his client.
O’Toole also told The Packet on Tuesday that the foundation does abide by FOIA rules and regulations. Some of the information requested by the foundation, he said, was “beyond what our counsel advised us should be released” and “some required a great deal of time” to fulfill, which was why there was a cost.
Other Protect Beaufort litigation
Protect Beaufort was formed in August 2024 after questions arose about the legality of the lease the city of Beaufort has with a private operator of the publicly-owned marina. The foundation opposes the privatization of public property, and is now in litigation with the city over marina management.
Trask, the Protect Beaufort board member, filed another public records lawsuit against the city of Beaufort after it unintentionally released thousands of unredacted documents with sensitive information such as social security numbers of various individuals and information relating to ongoing litigation.
Trask wanted to review the documents to see if personal information about himself or other board members involved in group’s lawsuit against city had been compromised in the document release. His complaint was that the city did not immediately release the documents, which had already mistakenly made their way to the public.
This story was originally published December 31, 2025 at 5:00 AM.
