SC ethics panel fines Horry County Council leader for 2018 campaign finance violations

Horry County Council’s chairman Johnny Gardner admitted to six violations of state ethics rules stemming from his 2018 campaign for chairman, and agreed to pay a $3,650 fine, the South Carolina Ethics Commission said.

The charges against Gardner were campaign finance violations. An investigation by the Ethics Commission found that he improperly handled loans to his campaign and accepted several campaign donations greater than allowed limits.

Gardner signed a consent order Wednesday to admit wrongdoing. It was released Thursday.

Gardner said Thursday that though he didn’t handle the day-to-day finances of his campaign, he “assumed responsibility” for the violations and was ready to pay the fine and put the matter behind him.

“In a nutshell, I didn’t do the day-to-day management of the campaign account, but once I found out there were some issues I cooperated and we fixed the errors,” he said. “It will be good to not have to answer questions about it anymore.”

Gardner admitted the following six violations, according to the consent order signed by Gardner and Childs Cantey Thrasher, the chair of the Ethics Commission:

• Not disclosing a $50,000 loan from Anderson Brothers Bank on his campaign disclosure reports;
• Not disclosing a $20,000 loan from Anderson Brothers Bank on his campaign disclosure reports;
• Not disclosing a $8,700 contribution to his campaign from his campaign manager Luke Barefoot;
• Not disclosing a $1,200 contribution to his campaign from local developer Randy Beverly;
• Accepting a campaign donation greater than $1,000 from Barefoot and;
• Accepting a campaign donation greater than $1,000 from Beverly.

Gardner agreed to pay the fine, according to the consent order. The state Ethics Commission charged Gardner $500 per violation, for a total of $3,000, as well as a $650 administrative fee.

Gardner previously said he planned to plead guilty and pay any fines the Ethics Commission charged him, according to local media reports. A hearing for his case was scheduled for Aug. 19.

William Martin, a Myrtle Beach resident who filed the initial complaint against Gardner, didn’t return a message from The Sun News seeking comment on Thursday.

How complaint began

The charges against Gardner originated in February 2020, when Martin, a former political operative, filed a complaint against Gardner alleging that the now-chairman had improperly accepted, repaid and reported loans to his campaign in 2018.

Under South Carolina campaign laws, candidates for local offices, such as a county council, can’t accept loans or donations greater than $1,000, and must report all contributions on regularly filed campaign disclosure reports. In the case of loans, state law outlines that the loan must originate from a written agreement and that the terms of the loan must be reported on the disclosure forms.

On the forms Gardner originally filed, Gardner listed the loans as coming from the law firm he owns, which the Ethics Commission investigation called improper. Gardner had also failed to list the other two contributions from Barefoot and Beverly. In the course of its investigation, the Ethics Commission subpoenaed and reviewed Gardner’s bank records as well as documents for the two loans.

According to the consent order, Gardner has since amended his campaign disclosure reports and repaid both of the contributions that exceeded the $1,000 limit. The consent order also states that Gardner has pleaded guilty to the violations and will pay the fines.

“(Gardner) acknowledges he violated the Ethics Act when he failed to disclose the correct source of his campaign loans,” the consent order states. “(Gardner) further admits that he violated the Ethics Act when he accepted $8,700 from Luke Barefoot and $1,200 from Randy Beverly.”

Prior concerns about campaign

Concerns about Gardner’s 2018 campaign have hung over his administration, beginning before his 2019 inauguration. Then, the State Law Enforcement Division (SLED) opened an investigation into Gardner and Barefoot after allegations were made that they had extorted members of the Myrtle Beach Regional Economic Development Corporation for donations.

News reports then revealed that Horry County attorney Arrigo Carotti, who had been made aware of the allegations, wrote a letter to SLED investigations saying he believed the allegations contained some truth.

In 2019, after Gardner was sworn in, there was a push by Gardner and others on council to oust then-County Administrator Chris Eldridge, who ultimately agreed to resign later that year. County Administrator Steve Gosnell replaced Eldridge.

Then, in 2020, came the campaign violation charges against Gardner, which were made public in March of this year.

As Horry County has emerged from the COVID-19 pandemic, though, Gardner has made significant headway on several significant initiatives, including increasing funding for public safety services, better protecting residents from flooding and imposing impact fees on developers.

On Tuesday, Gardner celebrated the County Council passing two major pieces of legislation, one that drastically updated the county’s building rules to prevent the future flooding of homes, and one that imposed impact fees on new development for the first time. Both were heralded by advocates as historic.

Gardner said Thursday he hopes the consent order will put the controversies behind him and allow him to focus on his other priorities and accomplishments.

“I am glad to have (the consent order) so we don’t have to talk about it anymore,” he said. “We can talk about flood mitigation and impact fees and all the good stuff we’re doing for public safety.”

This story was originally published July 15, 2021 at 7:01 PM with the headline "SC ethics panel fines Horry County Council leader for 2018 campaign finance violations."