Conflict of interest? Hilton Head mayoral candidate declines to interview with chamber
A leading candidate for Hilton Head mayor declined to meet in a private session with the Chamber of Commerce’s board of directors, staff and leadership boards, saying it could have posed a conflict of interest.
JoAnn Orischak said because the chamber has a contract with the town to promote tourism on the island, she did not think it would be proper to meet. She said she has “great respect” for the chamber, and looks forward to working with it if elected, but felt passing on the meeting was the right thing to do given the “unique scenario” involved.
“Whether (the interview) was open to the public, or whether it was private, really factors in a small way,” she said. “The larger issue, of course, is the contractor-contractee relationship.”
Orischak’s stance once again puts the chamber’s relationship with town politics in the spotlight and serves as a separation point between the former Beaufort County School Board member and her main challenger in next month’s election, businessman Alan Perry.
Hilton Head pays the chamber to be the town’s designated marketing organization, or DMO. The DMO is responsible for promoting the island to tourists, and agreements with the chamber have been contentious in the past, with the chamber criticized by public officials for refusing to produce an accounting of chamber spending that town and county leaders requested.
In fiscal year 2022, Hilton Head paid the chamber just under $4.18 million as part of the contract from accommodation tax funds and grants.
The chamber, which does not endorse candidates nor donate to campaigns, invited the candidates for mayor and town council and all accepted but Orischak.
Candidates who win their races will be in office when the current contract expires and negotiations begin in 2025, making this election vitally important to the chamber.
While Perry told The Island Packet that he’s pleased with the chamber’s current level of reporting and wouldn’t press for more spending transparency than is required in the current contract, Orischak said she could not make the same promise.
Orischak said she needed to review a recently completed audit before commenting on transparency measures but did offer that she wondered if the town was spending too much money on marketing an island where so many visitors are repeat-tourists.
“My concern is if the current DMO is adequate for the island’s needs, or if it’s perhaps too much,” Orischak said.
Bill Miles, president of the chamber’s Board of Directors, could not be reached for comment.
Candidates were also asked to submit questionnaire responses the chamber will post online for voters to review, chamber spokeswoman Charlie Clark said.
Clark said Orischak did submit questionnaire answers despite declining to interview in person. Orischak signed up for a speaking time in advance, Clark said, and asked in an email whether the chamber would endorse or donate to any candidates.
“In response we informed Ms. Orischak that our chamber does not endorse, vet, nor financially support any political candidates. It’s been our long-term policy to ensure there are no conflicts of interest between the chamber and elected officials,” Clark said.
Orischak said she asked that because she aims to avoid interviews with organizations that could donate to candidates.
Perry, for his part, said he had no problem with the chamber’s request.
“We all have our meet-and-greets with different groups of people to speak about our stance,” Perry said. “Nothing that was asked from the chamber was inappropriate at all. I don’t see any lines being blurred there or anything that was out of line within the questioning.”
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The contract’s requirements
The Hilton Head Island-Bluffton Chamber of Commerce has drawn criticism from county and town officials for transparency failures, particularly when it declined town and county requests for clarity on how millions in public funds were spent to promote the island in 2019.
Tourism is the island’s No. 1 industry, and the town invests heavily in the chamber’s marketing activities. Without appropriate accounting of the public portion of chamber funding, the effectiveness of spending can be difficult to gauge, past leaders have argued.
The current contract, negotiated in 2020, does have some transparency requirements:
▪ The chamber must submit a budget of planned expenditures from its “Thirty Percent Fund,” or 30% of Accommodation Tax funds received by Hilton Head each fiscal year, for the town’s review.
▪ The chamber must also undergo an annual audit by an independent auditor as stipulated in the current contract.
▪ In addition, the audit must show Thirty Percent Funds by expense type, and the auditor must conduct an “agreed-upon procedures” review. The auditor samples 100% of payments and invoices over $10,000, randomly samples 55% of each payment over $5,000 and 5% of each below $5,000.
The required audit was completed in September and submitted to the town’s Finance and Administrative Committee on Oct. 18. No action was taken on the audit at that Town Council meeting, and Ward 1 Councilman Alex Brown said he’d “appreciate” the audit being made available farther in advance of the meeting so council members could properly review the document.
Many of the island’s visitors are repeat-tourists, Orischak said, leading her to wonder whether the town could be more fiscally responsible in its marketing.
“We could probably go with a lesser effort. … We’re making a big commitment with the chamber as the DMO,” Orischak said. “My concern is if the current DMO is adequate for the island’s needs, or if it’s perhaps too much.”
This story was originally published October 21, 2022 at 9:46 AM.
