COLUMBIA — State legislators, still stinging from the multibillion dollar failure of the V.C. Summer nuclear plant expansion years ago, have agreed to send a proposed $550 million debt deal for Port of Charleston infrastructure improvements to the full Senate for consideration, but only after adding a series of financial controls.
A Senate vote on the deal for the State Ports Authority and Palmetto Railways has not yet been scheduled.
South Carolina's oversight of bond debt typically has been "a matter of trust with the agency that is administering the construction project," Rick Harmon, the Senate's research director, told members of the Senate Finance Committee this week.
"I think a little oversight is important going forward," said Sen. Kent Williams, D-Marion. "As my dad always told me, there's not much education in the second kick of a mule."
Sen. Nikki Setzler, a Lexington Democrat, said he agrees the amount of debt calls for "more accountability and transparency than normally you might be accustomed to." To that end, he amended a resolution to require that the SPA and Palmetto Railways to file quarterly financial and progress reports with legislative oversight groups as a condition of getting the money.
The amendment also calls for the S.C. Joint Bond Review Committee to approve the deal before any funding is granted. And it requires that audited financial statements be posted for the public to view on the SPA and Palmetto Railways websites.
Also, the SPA and Palmetto Railways must finalize a detailed written agreement spelling out each agency's responsibilities for the projects before the bond deal can get the General Assembly's final approval.
The plan calls for spending up to $400 million toward construction of a rail yard at the former Navy base in North Charleston. The SPA would operate the rail yard on roughly 120 acres near Hobson Avenue and Viaduct Road on land owned by Palmetto Railways, a division of the S.C. Commerce Department.
Norfolk Southern and CSX Corp. trains would haul cargo moving through the Port of Charleston to and from the rail yard, officially known as the Navy Base Intermodal Container Transfer Facility.
Another $150 million would pay to set up a barge system to move shipping containers by water between the SPA’s Wando Welch Terminal in Mount Pleasant and the Leatherman Terminal in North Charleston, which is scheduled to open in March. The containers could then be taken to and from the rail yard, reducing the number of trucks carrying cargo on area roads.
The Leatherman Terminal is named for Sen. Hugh Leatherman, a Florence Republican and chairman of the Senate Finance Committee. The Pee Dee lawmaker also is the sponsor of the bond resolution.
"Our port is in competition with other ports on the East Coast and Gulf Coast, and if we don't at least keep up with them we're going to be left at the wayside," Leatherman said during a hearing. He said projects paid for by the bond debt would give Charleston near-dock rail availability, putting it on equal footing with Port of Savannah and other maritime industry rivals.
Construction of the rail yard and barge project would take about two years. The bond debt would be repaid from tax collections that go into the state's general revenue budget.
The rail yard has received approval from the Federal Railroad Administration and the Army Corps of Engineers, but has struggled to get financing. It and the barge facility would round out roughly $2 billion in improvements at the Port of Charleston, including the new terminal, equipment, and the deepening of the Charleston Harbor shipping channel.
Like other legislation, this joint bond resolution must be approved by the House and Senate before moving to Gov. Henry McMaster for approval or veto. The governor said in his recent State of the State address that he opposes more borrowing.