KIAWAH ISLAND — An open, sandy area nestled among trees and perched along the Kiawah River seems an unlikely ground zero for a development controversy that has gone nuclear in this normally peaceful resort community.
But some feel this 6.4-acre site on Rhett’s Bluff Road is the most suitable site for a new fitness center with treadmills, bikes, and weights, plus showers and changing rooms and a ship’s store — a place that will help ensure that Kiawah, where net worths are measured in millions not thousands, keeps its reputation for having five-star amenities.
Others feel just as passionately that shoehorning a fitness center into the island’s main boat landing is a bad idea — one that would violate a deed restriction, lead to an unnecessarily expensive $16 million project and trigger a costly lawsuit.
The controversy — which played out last week on the private side of the island’s gate, inside a full house at the Turtle Point Golf Club — also lifts a curtain on how the island is governed — and how its community association is more powerful and well-financed than its town government.
Mayor Charles Lipuma said Town Council decided in January to stay on the sidelines, but everyone is following the arguments pro and con.
For now, the Rhett’s Bluff kerfuffle has easily surpassed the simmering debates over building a road to Captain Sam’s spit or the way the town handled its recent purchase of a 27.7 acre parcel as the site of a new Kiawah Town Hall.
“Certainly at this time, it is the hottest issue going,” Lipuma said. “It’s been quite an interesting situation.”
The controversy points out one reality of life here, where four separate public and private players have significant say in development and quality of life.
There’s the town government, which wasn’t formed until 1988 — well after the island began to develop. Its $7 million budget and dozen employees pale in comparison to the Kiawah Island Community Association, which has about 100 employees and a $12 million budget.
Meanwhile, two private companies, the developer, Kiawah Partners, and the Kiawah Island Golf Resort also loom large, while the Kiawah Property Owners Group is a nonprofit that provides information and analysis on island issues.
“We call it the maze of K’s,” said Jimmy Bailey Jr., director of the association.
While the town government has become more active, the association actually has a much larger constituency — largely because more than 80 percent of properties here either are second or third homes, investment properties or undeveloped.
Kiawah has about 4,000 families and individuals who own homes or buildable lots. The town’s population is about 1,600, only 1,200 of whom are registered voters.
The Kiawah Island Community Association maintains almost 1,000 acres of common property on the island. Almost a decade ago, it began reviewing what should be done to improve the island’s amenities, which range from leisure trails to pools to viewing towers and fitness centers.
After years of surveys and consultant work, the association unveiled a two-pronged, $16 million plan to improve the pools, food service and parking at its beachfront community center affectionately known as the Sandcastle.
The second prong was to move the fitness space from the Sandcastle to a new home at Rhett’s Bluff, a quiet, largely undeveloped site on the river side.
David Schoenholz, the association’s chairman, explained the history and thinking behind the plan Wednesday to a room packed with about 300 Kiawah property owners.
Schoenholz said one survey showed 86 percent agree that the island’s quality amenities improve property values, and a new fitness center also would appeal to a younger demographic.
“If we limit ourselves to our 4 acres at the Sandcastle site, we have to suboptimize something,” he said. “We have to make trade-offs.”
He came prepared to answer critics, some of whom had questioned how much money the association had sunk into a plan. Schoenholz said it had spent about $253,204 developing the plan in the past few years, mostly on consultants, and that was “a very small fraction” of $35 million in total spending by the association during that period.
While the association has authority to renovate facilities and borrow money, its board cannot increase the assessment fees paid by Kiawah’s homeowners — at least not unilaterally.
“We’re going to have the ultimate survey,” Schoenholz told the crowd, “because you’re going to vote.”
To outsiders, the future of the island’s amenities is probably not nearly as interesting as the passions that have surfaced.
The controversy has played out over a flurry of emails to an online forum, where writers feel free to criticize.
“Clearly you have drank whatever Kool-Aid the KICA Board is offering,” one wrote. “Should the opponents fund a road show at the Ritz Carltons and other high end hotels? Yes? No? Or perhaps only those who have drank the kool aid offered by the board should be allowed to speak? Seriously this feels more like Russia than Kiawah Island right now.”
Some argued converting Rhett’s Bluff would compromise its use by boaters, while others said the property is ostensibly open to the entire Kiawah community but, “if you’re not a boater, you can’t use the facility.”
The email exchanges actually stirred up news that Schoenholz was among the Household International executives subject to a $2.6 billion judgment in 2013 — a judgement that HSBC, which acquired Household has appealed.
Others criticized him for donating his plane to help the association present the amenities issue to Kiawah owners in cities outside the Lowcountry. He and Bailey visited six cities with a large number of Kiawah property owners to give them a presentation on the amenities issue.
One woman speaking Wednesday said she was “very unhappy with the way the conversation has been going on,” drawing applause when she added that the association’s volunteer board deserves respect for its work.
Another got emotional as she voiced concern over the toll it has taken on a place she always considered her happy place. As for the money involved, she said, “We’re talking about a couple of rounds of golf at the Ocean Course ... and you’re destroying the community over this? We’re a community. We used to get along.”
The decision also apparently has split the island’s former owners.
Former Kiawah Partners President Buddy Darby posted on the association’s website saying “it is imperative that these facilities be built.”
But Leonard Long, Darby’s cousin and the former vice president of Kiawah’s owner partnership, has been among its most prominent critics and said the island’s amenities already are second to none and that upgrading the Sandcastle to improve its pool and fitness space would be the better move.
“I don’t want to spend $7 million or $8 million more than I need to,” he said. “It (the current plan) doesn’t meet the market today. It over meets it.”
Long’s biggest complaint, however, may be the unresolved legal issue surrounding Rhett’s Bluff. A lawyer and former vice president of Kiawah’s ownership group, Long drafted the deed restriction when the property was transferred to the association years ago.
He noted that legal language says the site “shall” be used only for a Kiawah Island boat landing and related facilities.
“You would have to be off your rocker to think it (the boat landing) is related to the YMCA or something,” he said.
The association already has sought three legal opinions about whether that restriction means Rhett’s Bluff could be used for a new fitness center, Schoenholz said. All advised that it could be.
“The real question is what is that ‘something else’ (besides a boat landing) and who gets to decide that?” Schoenholz said. “If we’re wrong, we’re wrong. If we’re right, we’re right. Clearly, we have an impasse. KICA would like to resolve the issue once and for all.”
Earlier, opponents to the Rhett’s Bluff fitness center plan got their own legal opinion from a neighbor. Mike Luttig, a former federal judge and current executive vice president and general counsel of The Boeing Co. “It is not even arguable under the covenant, as all of you have noted, that a ‘facility’ comprising an indoor swimming pool, a massage spa, a wi-fi cafe, a workout facility, and meeting rooms, would be deemed a ‘related facility’ to the ‘boat landing,’” he wrote in a 2014 email.
And others criticized the association for not seeking a declaratory judgement from a court to clear things up. They note the lack of legal clarity mars the upcoming referendum. If Rhett’s Bluff cannot be used, then there should be a new push to expand fitness at the Sandcastle, but that’s not part of the Phase 1 proposal being put before property owners next month.
The legal uncertainty also could drive up the costs, which already would increase assessments on homeowners by about $500 a year for 15 years. The current rate ranges between $1,500 and $2,000, depending on the property, Bailey said.
“People have to decide if that’s a lot of money or not a lot of money,” Schoenholz said.
The issue ultimately will be decided by Kiawah’s “Class A members,” those approximately 4,000 people who own residential property here. Those who own a home get two votes, while those who own a lot may cast one. The deadline for voting is June 1.
Until then, Lipuma said he will try to delete all the flurries of emails going back and forth.
“I know that passions can get pretty high,” he said. “I think when all this blows over, it will go back to being a nice relax place with the sun shining and the beach, but it is what it is. And we’ll just have to let it run course.”
Reach Robert Behre at 937-5771.