The Lancaster County Natural Gas Authority, in the spotlight after the Post and Courier reported on how it spends ratepayers’ money, defended its actions Tuesday, including the purchase of a $2,247 shotgun as a retirement gift for its top executive.
Other spending included $96,000 for two convention trips that included spouses, expensive meals and plenty of sight-seeing and resort recreation.
LCNGA General Manager Rocky Hudson said his agency has done nothing to conceal its finances or spending activities from its customers.
“At the end of the day, I can stand firm and say that we have done nothing illegal, unethical or corrupt,” Hudson said Tuesday.
The LCNGA is one of five S.C. natural gas authorities. The others are in Chester, York, Newberry and Pickens/Anderson counties.
The Post and Courier partnered with community newspapers across the state, including The Lancaster News, to closely examine self-regulating agencies that “supply everything from fire protection to natural gas and electricity” to millions of South Carolinians.
More than 12,000 pages of spending records, including those of LCNGA, were examined in the first installment of the series “Uncovered,” which was released Sunday.
Hudson discussed the investigation’s findings, including retired General Manager Tim Thornton’s shotgun, with TLN. He also talked about how the authority communicates with the public, as well as its board makeup, which is appointed by the governor at the recommendation of the local legislative delegation.
Hudson confirmed the Post and Courier’s reporting on board members’ attendance at a 2018 American Public Gas Association conference in Portland, Ore. Ratepayers picked up the expenses for spouses who attended.
Board members from Chester and York also went to the conference. Together, the three agencies racked up more than $160,000 in total expenses. Combined, the three authorities are known as Patriots Energy Group.
The gas association’s 2019 conference was held in Stowe, Vt., and it cost the three local agencies $130,000.
Hudson said the LCNGA’s share of those expenses were $46,000 for the Portland conference and about $50,000 for the Vermont trip.
“Uncovered” notes that the Lancaster and York delegations spent $1,545 on a zip-line adventure during the Vermont conference.
Hudson said roughly 800 people attend the annual events. The American Public Gas Association canceled its 2020 conference in Chicago due to the COVID-19 pandemic.
Hudson said the LCNGA has always paid conference expenses for spouses, because spouses are included in APGA programs.
“While we are in classes, they have different things lined up for spouses. They don’t go out shopping. They have a breakfast every morning for spouses and have programs for spouses and they interact. We think it’s vital that spouses attend,” Hudson said.
David Knight, chair of the LCNGA board since 2017, said he agrees with Hudson. Knight, retired public information officer for the Lancaster County School District, has been a board member since 1989.
Other members of the board are Steve Sherrill (vice chair), Audry Curry (secretary), David Funderburk, Betty Cauthen, Dwight McPherson, Tracy Caldwell, Bruce Brumfield and Robin Hensel.
The board’s members, Knight noted, are not paid by the gas authority.
“Our board volunteers hours and hours and hours of time. Time spent at those meetings, and especially those conferences, helps educate us about what a gas company should be doing and about coming issues,” Knight said.
“We’re just laypeople, and it’s important for us to be educated about what we are supposed to do.”
“Uncovered” notes that the LCNGA board spent $2,247 for a Miroku 20-gauge shotgun in 2019 as a retirement gift for Tim Thornton.
Thornton worked for LCNGA for almost 23 years and was named its general manager in 2001.
A spokesman for the agency, not named in the article, told the Post and Courier the gift was “a small amount to pay to show appreciation for a job well done.”
Hudson, the authority’s former chief financial officer, was named general manager after Thornton retired.
Hudson said that in 2001, when former General Manager Troy Elmore retired, the the authority gave him an $800 “bass fiddle” as a gift.
“I am the third general manager since the ’70s. When Troy retired, he received a gift and when Tim retired in 2019, he received a gift. This was not a one-time thing. It had been done before for the top executive,” Hudson said.
Knight said Hudson was directed by the board to purchase a retirement gift for Thornton.
“That is correct,” Knight said.
While elected officials must report expenses and gifts to the S.C. Ethics Commission, members of appointed bodies, such as the nine-member LCNGA board, do not. A loophole in state law allows it to go unchecked.
“We report everything we are required to report,” Hudson said.
When the state’s five natural gas authorities were created in the 1940s, by law they were required to turn over any profits to the municipalities they serve.
In Lancaster County, that would be the city of Lancaster and the towns of Heath Springs, Kershaw and Van Wyck.
During the last three years, the LCNGA had $7.1 million in net earnings but didn’t turn over any of it to the four municipalities, as pointed out in “Uncovered.”
Hudson acknowledged that, as did Paul Dillingham, the attorney for LCNGA as well as the Chester and York natural gas authorities.
Dillingham told the Post and Courier there is no surplus revenue to turn over to the municipalities.
Hudson said while he could not speak for the Chester and York gas boards, the LCNGA has spent $7.3 million on expansion in the last three years, in effect churning those profits back into the authority’s operations.
The authority’s customer base, Hudson said, increased from 21,200 in 2015 to 27,500 in 2020.
“I would say that 80-90% of it is in Indian Land, but this year, we can now see it coming closer to Lancaster,” Hudson said, noting that planned growth is now extending down the U.S. 521 corridor to the Shiloh Unity Road area.
Since the start of the current fiscal year on July 1, 2020, Hudson said LCNGA has already spent almost $1.5 million on construction. The construction cost of a natural gas line is at least $50,000 a mile, he said.
In the last three years, Hudson said the authority has constructed 65 miles of gas lines.
“It can get really expensive…. When I came here in 1997, we had 9,000 customers. “We now average adding over 1,000 customers a year,” Hudson said.
The state’s Freedom of Information Act requires all public bodies to post agendas and keep minutes of all meetings, whether any action is taken or not.
Hudson said the board agendas and board meeting dates are always posted at the LCNGA headquarters on Kershaw Camden Highway. The agency also has offices in Indian Land and Kershaw.
The board meets every two months on the last Thursday of the month. While those meetings are always open to the public, Hudson said, seldom does anyone attend except board members.
“Since I have been going to board meetings, in all these years, we’ve only had two people show up,” he said.
The LCNGA, he said, launched an updated website, lcngasc.com, last year that allows it to post public information.
But when checked last week, the website listed no meeting dates for 2021. Calling that an oversight, Hudson said meeting dates for this year are now online.
However, the minutes from past board meetings and financial statements are not.
Knight said the LCNGA board will “take a hard look at our policies and practices” to see if they should be posted on the website.
“If we see anything we need to change, we will definitely do that,” Knight said.
Until that determination is made, Hudson said that information is available to anyone who asks for it.
“We don’t have anything to hide. If you request it, I’ll send it to you – budgets, meetings, everything. All you have to do is ask for it,” Hudson said.
Follow reporter Greg Summers on Twitter @GregSummersTLN or contact him at (803) 283-1156.