Politics & Government

SC senator sues state agency over ‘cult of secrecy’ in economic development deals

A state senator is suing the S.C. Department of Commerce for refusing to publicly disclose records on a pair of economic development deals that have come under scrutiny.

In a late Tuesday filing, freshman state Sen. Dick Harpootlian accused the agency of violating the state’s Freedom of Information Act by withholding some documents and heavily redacting others that he requested regarding incentives for Singapore-based Giti Tire and Moncks Corner-based Viva Recycling.

A day after the filing — and hours after The State published a story on the lawsuit online — the Commerce Department decided Wednesday to release the requested records on Viva Recycling.

Harpootlian said his lawsuit will move forward anyway.

“We’re going to digest those,” he said. “But they’re a day late and a dollar short.”

The lawsuit will be the second fight the Columbia Democrat has picked with the Commerce Department over its economic development efforts. In the first bout this spring, Harpootlian held up and repeatedly blasted a legislative proposal to offer the Carolina Panthers $115 million in tax credits in exchange for moving the NFL team’s headquarters and practice facilities to Rock Hill.

If a judge rules in Harpootlian’s favor this time, the case could force the Commerce Department to reveal far more about how it attracts businesses to locate and expand in South Carolina and whether the touted benefits of those deals come to fruition.

“There is a cult of secrecy at the Department of Commerce,” Harpootlian told The State Wednesday. “This is going to give the public the ability to look behind the curtain and see what the facts are.”

In a statement, the Commerce Department said it responded to Harpootlian’s request “in full compliance with the South Carolina Freedom of Information Act.”

“While the law provides access to certain public records, it also protects, among other things, competitive company-specific information,” agency spokeswoman Alex Clark wrote. “Commerce stands ready to respond in accordance with state law and remains committed to protecting the confidentiality of our companies, as the law allows.”

The case stems from a pair of open-records requests Harpootlian sent the Commerce Department in August about Giti Tire, which opened a tire manufacturing plant in Chester County in 2015, and Viva Recycling, which operates a tire recycling facility in Berkeley County.

Harpootlian’s lawsuit asserts the companies have “received substantial taxpayers assistance” and goes on to cite news reports that detail Giti’s recent problems paying its bills and contractors and Viva Recycling’s environmental and financial woes.

Harpootlian, a two-time S.C. Democratic Party chairman, requested copies of Commerce’s correspondence about the two companies, any cost-benefit analyses of the incentive deals and copies of any agreements with the companies.

Commerce denied Harpootlian’s request for records on Viva Recycling, claiming some records were exempt from disclosure under state law and others “are not readily available because the file has been closed and archived.”

The agency added that Viva Recycling was approved in May 2011 for tax credits but never received those credits because the company didn’t invest enough money in South Carolina or create enough jobs.

Later Wednesday, the Commerce Department released those records to Harpootlian, saying it had retrieved them from the archives and only lightly redacted them.

In September, Commerce provided 160 pages of documents on Giti. But Harpootlian complained the agency unlawfully redacted important information, such as the names of Giti corporate officers who signed agreements with S.C. governments, some construction and operational costs that Commerce used to estimate the project’s economic impact in South Carolina and the project’s estimated costs and benefits to the public.

The case could come down to a judge’s interpretation of the state’s Freedom of Information Act. That law generally allows S.C. residents to review a public body’s records but makes certain exceptions, protecting records that contain trade secrets or personal information that “would constitute unreasonable invasion of privacy.”

Harpootlian contends Commerce redacted and withheld records that aren’t protected by those exceptions.

“It’s the public’s right to know how their money is being spent,” Harpootlian said. “It’s the most basic concept of a participatory democracy.”

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Avery G. Wilks is The State’s senior S.C. State House and politics reporter. He was named the 2018 S.C. Journalist of the Year by the South Carolina Press Association. He grew up in Chester, S.C., and graduated from the University of South Carolina’s top-ranked Honors College in 2015.