In the wake of its executive director's abrupt resignation, the Patriots Point Development Authority is scrambling to find funding as the clock ticks on the multimillion-dollar repairs that its aging fleet of warships require.
"The financial structure of the Patriots Point Development Authority does not work," said Chairman John Hagerty. "It was never structured to maintain the ships, which have a 25-year useful life. That has run out."
The Patriots Point Naval and Maritime Museum was opened by the state in 1975, and the agency that runs it is responsible for sustaining itself financially.
Officials two months ago unveiled a $64 million master plan to repair the four deteriorating warships and redevelop the prime waterfront site to keep the Mount Pleasant visitor attraction thriving — but no plan for how to get the money it needs to pay for it all.
The authority relies heavily on ticket sales for operating revenue. But attendance peaked in the 2002 fiscal year at nearly 297,000 paid admissions and has slumped nearly every year since, dropping to 218,000 customers in fiscal 2007, according to the authority.
The numbers rebounded last year, though, reaching more than 229,000 paid admissions.
A state-funded audit from September noted the fiscal 2008 increase and said "the authority's overall financial position is sound, and the authority is well-positioned to maintain its financial stability with resources being closely guarded in order to maintain the ability to react to changing economic times."
Then came the events of the current fiscal year, which began July 1 and has encompassed not only the entire recession but also a major new financial challenge for Patriots Point — its aging fleet of warships.
With only three months left in fiscal 2009, paid attendance totals fewer than 145,000 so far this year. When Patriots Point laid off 11 employees, reduced part-time hours and required unpaid time off for its remaining 70 full-time workers, it cited the attendance decline and emergency repairs for one ship in particular.
The destroyer Laffey, which in World War II gained the nickname "The Ship that Would Not Die," for surviving heavy damage, recently received a grim prognosis: It'll sink within a year if not removed from the water for major work on its hull. That doctoring could require upwards of $8 million. And the museum's other ships — the aircraft carrier Yorktown, the cutter Ingham and the submarine Clamagore — need extensive repairs.
"I think if we, the state, allow the Laffey to sink, it would be a slap in the face of every veteran," Hagerty said. "The game plan is to continue what we've been doing, which is to press our case with politicians — local, state and federal — and to be transparent as an organization, so the public will know what our situation is, and the public will influence politicians to make a decision."
Before resigning Sunday after less than a year as Patriots Point executive director, Hugh Tant III appealed to lawmakers in Columbia and Washington, D.C. He received interest and support, even a $20 million federal funding request from U.S. Rep. Henry Brown, but no firm financial commitments.
In the meantime, Hagerty said, the authority's options include seeking authorization to issue bonds or obtaining a loan through the state treasurer's office.
Rep. James Smith, D-Columbia, said he hopes to make the bonding option a reality by the end of this legislative session. As for the loan, Deputy State Treasurer Scott Malyerck said Patriots Point representatives asked for about $12 million but that his office cannot yet offer them a reply.
Despite the urgent need for money, Hagerty worries about taking on debt.
"Here's what makes me nervous," Hagerty said. "What if we had the opportunity to borrow some money short-term? We'd have to figure out how to spend that money and then how to pay it back."
Another big worry, he said, is that if the Laffey sinks, the salvage could cost more than the repairs.
"It could be a significant environmental hazard," he said. "We are very worried about what could happen to the waters."
In its current condition, the Laffey might not survive if a hurricane or tropical storm churns up Charleston Harbor, Hagerty was told by a staff member.
The person whose task it is to lead Patriots Point from here is interim Executive Director Dick Trammell, who said he will begin his job with staff briefings on the agency's priorities and its budget. Trammell, a finalist for the executive director position when Tant was selected last May, previously headed the Charleston Area Convention & Visitors Bureau.
Patriots Point, by state mandate, will seek candidates for Tant's permanent replacement. Trammell, who most recently was the maritime museum's marketing director, said he's not yet sure whether he plans to apply again.
"My focus right now is on this interim position and getting everything we need to get done before this session of the Legislature ends," he said.
Asked how long Patriots Point knew about the dire situation with the Laffey and the growing concern with its other ships, Trammell said the U.S. Navy conducts an annual survey on the fleet, though that inspection only looks inside the vessels. He said the extent of the Laffey's damage only became apparent when water rushed into the hull in December.
Trammell said he recognizes that the task ahead means simultaneously formulating a plan and gathering resources.
"We have support from the delegations in Columbia and Washington and the administration of the governor, but we have not received any checks," he said. "Not only are we in need of checks, but we're in need of answers about how we can save the ships."