State agency says it wants all $11.6M repaid from abandoned I-526 project


COLUMBIA -- Charleston County Council spent $11.6 million to kickstart Interstate 526 across Johns and James islands, a road it decided not to build, and now the state wants the money back in 60 days.

The State Infrastructure Bank board voted unanimously Thursday that the county must repay the funds or lose an equivalent amount of state aid. The result could be up to 200 layoffs or non-essential service cuts, Council Chairman Teddie Pryor said.

Because of the dilemma, Pryor said he would work for council approval of the controversial expressway project.

"I'm going to have to. I promise to get something done. There's no way we can justify giving $12 million away," Pryor said.

Council recently voted for a "no-build" option. Pryor said he would explore a smaller version of the project to Johns Island.

About $6 million of the money was spent on right-of-way acquisition for the final leg of a loop around the city linking the James Island connector and I-526 at Savannah Highway.

Recouping that money by selling the land is problematic, Pryor said, particularly in a depressed real estate market. He said the rights of way are strips of land with little value except for the project. "Who would want to buy it?" he said.

Pryor said council went against the advice of its legal counsel when it decided to back away from the I-526 project in a vote last month.

A contingent of seven County Council members attended the bank board meeting.

Councilman Dickie Schweers told the board that the hundreds of people who attended five public hearings on the project were overwhelmingly against it. In addition, the town of James Island, the city of Folly Beach and the James Island Public Service District passed resolutions in opposition.

Pryor spoke briefly to the board. "Give us some time to come back and figure out where we go from here," he said.

The bank board went into an executive session for 30 minutes before returning to vote on the issue, in effect telling the county that it was in default and that it must return the money because it had not proceeded with the $420 million project that it stated as the reason for wanting the funds.

"People overwhelmingly want this thing finished," Pryor said in an interview after the vote.

Pryor said he was "ashamed and embarrassed" to be at the bank board hearing because of the circumstances surrounding it. He said the I-526 project is a public safety issue. It would improve evacuation from the islands in the event of a hurricane, flooding or earthquake.

"We got elected to make the tough decisions," he said.

Loss of the funds will not affect police, emergency medical and other vital services, Pryor said, but libraries, drainage-ditch cleaning and mosquito control could suffer.

The new county budget year begins July 1.

Meanwhile, other governments are waiting in the wings for the $420 million the bank pledged for I-526 in the event it becomes available. Those attending the meeting included Mount Pleasant Mayor Billy Swails and Dorchester County Administrator Jason Ward.

The bank provides hundreds of millions of dollars for transportation projects around the state. If the county does not reimburse the money as required, it could jeopardize the bank's credit rating, officials said.

Some members of County Council have suggested using money the bank pledged for I-526 to improve existing roads on the islands. However, critics likened that to borrowing for a house and then building a gas station instead, which a bank would not allow.

Although the Infrastructure Bank pledged $420 million for I-526, the project has an estimated cost of $489 million. The lack of full funding is among the county's concerns.

Reach Prentiss Findlay at 937-5711