SC Senate approves $550M for port project. Taxpayers would be on hook for most of it
South Carolina senators on Wednesday approved a $550 million borrowing plan to pay for train and barge upgrades at the Port of Charleston — what will become, if it passes, the largest loan the state has taken out since lawmakers borrowed money to improve school facilities in 1999.
But the proposal to invest the large chunk of money into the Charleston Port has sparked a debate about whether the port should bear the cost of the project and whether the S.C. Ports Authority would move forward on a long-promised project down the coast that proponents say would provide economic benefits to blighted rural counties in the southern part of the state.
Taking advantage of low-interest rates that make borrowing money more affordable, the Senate plan would fund improvements meant to bring rail access to the docks at Port of Charleston and reduce truck traffic atand around the port from businesses importing and exporting goods.
Taxpayers would be on the hook for the Charleston project, which the Ports Authority, already at 94% of its borrowing capacity, cannot take on in the form of more debt, lawmakers said.
If approved, the borrowing package is expected to cost state taxpayers about $43 million a year for 15 years from the general fund. However, the state has a line item in its general fund budget to pay back debt, and previous debts have been retired, opening up money to help pay for the new debt.
Still some senators pushed for the Ports Authority to help pay for the proposed project, which now goes to the House.
State Sens. Richard Cash, R-Anderson, and Rex Rice, R-Pickens, each called for the Ports Authority to pay a nominal fee per container toward the state’s general fund to repay all or part the bonds.
“All of the request is on the taxpayers; 100% of the risk in on the taxpayers, because it’s all taxpayer money,” Cash said.
“We would like to see full repayment. If we can’t get that, get partial repayment. (It’s) better than no repayment,” he added.
Initial efforts to have the Ports Authority pay a per container fee toward debt repayment failed. However, in order to gain support from almost the entire chamber, senators agreed the Ports Authority would have to repay $150 million of the debt through a $1 per container fee.
The proposed project calls for $400 million to pay for an intermodal facility at the former naval base to provide near dock rail access for the port.
An additional $150 million is being proposed to allow for barge improvements at the Port of Charleston to reduce the amount of truck traffic on the surrounding roads when containers are being moved to different parts of the port.
Senate Finance Chairman Hugh Leatherman, R-Florence, was initially against adding a per container fee because it would hurt the state’s ability to attract businesses to the state.
“I really don’t want to put this on our companies who came here to employ our people,” Leatherman said.
The push to invest more than half-a-billion dollars in the Charleston area commerce hub has also led to calls for investments in other areas in the state, such as making improvements to school buildings constructed about 60 to 70 years ago.
However, a lot of discussion went towards another promised port lawmakers say the state has failed to make good on.
Lowcountry lawmakers have longed called for building a port in Jasper County at a location where a port facility would help help meet expanding capacity needs at the Port of Savannah as it expects to see a growth in amount of containers coming through its facility.
South Carolina and Georgia have planned to partner in a port in Jasper County at a location is 6 to 7 miles closer to the Atlantic Ocean than the Savannah Port location. However, in recent years, the Georgia Ports Authority has made moves to expand its Savannah port including expanding operations at Hutchison Island as work with South Carolina has dragged along.
Work on the Jasper port is in “pre-permitting phase,” ports officials have said.
The Ports Authority has asked for $5 million from the state to help with permitting costs for the Jasper terminal. South Carolina and the Georgia Ports authority already spend $800,000 a year now for permitting.
State Sen. Tom Davis, R-Beaufort, pushed for assurances that a long-planned port in Jasper County would go forward, saying a Jasper terminal before 2040 or 2050 is probably infeasible if improvements in Charleston go forward.
Over the weekend ports authority and Jasper County officials hashed out an agreement meant to allow the Georgia Ports Authority to move forward with developing with Jasper County instead of the S.C. Ports Authority and reduce the need for major improvements at the Savannah Port.
The S.C. Ports Authority has agreed to transfer its ownership share of 1,500 acres of land to Jasper County.
The development will allow Jasper County to move forward with developing a port facility with Georgia, as opposed to waiting for the S.C. Ports Authority to come to the table.
“Essentially what you had is dual ownership and one of those partners unwilling in the South Carolina Ports Authority because they didn’t need the capacity,” Davis said. “So we’re replacing an unwilling half owner with a willing half owner in Jasper County.”
Still up in the air are the questions of whether Jasper County is now on the hook for South Carolina’s portion of the costs of building a port and whether Georgia could front the costs for it in exchange for getting paid back over time, Davis said.
“The important thing is we now have two owners who are motivated to make the Jasper port happen, as opposed to one of those owners not being motivated to make it happen anytime soon,” Davis said.
Davis pushed for Jasper’s concerns to be brought forward as the state looked to pay for improvements in Charleston.
In 2009, the Legislature directed the S.C. Ports Authority to build the Jasper Port as expeditiously as possible.
“Twelve years have gone by and we haven’t seen much of anything going on at Jasper,” Davis said, who added he wanted to find a way to keep the promise to Jasper County while also moving the Charleston Port project forward.
Although the port of Charleston is a state asset that benefits the entire state, Jasper, Hampton and Colleton counties have not seen much if any benefits, Davis said.
“This body has to recognize that Jasper has been left behind,” Davis said.
Having a port facility in Jasper will help counties as well, Hampton and Colleton and help spur economic growth in those areas, which are rural and among the poorer areas of the state.
“Manufacturers don’t look to those counties in the same way they look at Berkeley and Dorchester, frankly because Berkeley and Dorchester are more proximate to Charleston and the port,” Davis said.
As with any new agreement, Jasper County’s next steps include a study period to determine exactly what the transfer include and didn’t include, County Administrator Andrew Fulghum said Monday.
“We’re cautiously optimistic,” he said. “The terminal has the potential to be a huge economic driver for not just the county, but the region and state. I’ve been working on this project, as many people have, over the years and it’s taken many different iterations.”
Fulghum, who has watched development boom in the county and region including many current projects, said this is a “huge opportunity” to also diversify the tax base for the region.
“We’re ready for (the growth), looking forward to it, and pleased it seems to be growing in a diverse way,” he said.
Jasper County Councilman Marty Sauls said the county will work closely with the private sector and the Georgia Ports Authority to make the Jasper Ocean Terminal a reality.
“The impact this will have on our economy, educational system, enhancements to our infrastructure, is transformational,” Sauls said, adding that it will enhance not only counties in the Lowcountry, but both South Carolina and Georgia as well.
He said now that Jasper County has the opportunity to take ownership, it can work to formulate a plan that’s mutually beneficial to both states.
“We’re starting with a fresh slate to move forward,” he said. “It’s been pushed off and pushed back ... but now we are looking forward to a new joint venture.”
This story was originally published February 24, 2021 at 10:15 AM.
