The Post and Courier
State must keep the SPA’s word to North Charleston
BY BEN A. HAGOOD JR.
Saturday, January 1, 2011
Last week, outgoing South Carolina Commerce Department Secretary Joe Taylor delivered what he likely hoped would be an early Christmas present to the Port of Charleston — an “equal dual access rail plan” to serve the new container terminal being built at the old Navy Base.
Turns out it was really a lump of coal.
That’s because Taylor and some state legislators have concocted a plan to violate an agreement the State Ports Authority penned eight years ago with the city of North Charleston. The implications of such a reckless and unlawful action could have disastrous effects on every municipality in the state.
At issue is whether trains serving the new port terminal being constructed on the southern end of the former Navy base should be allowed to run north through North Charleston. An agreement between the city and the SPA signed in 2002 forbids it.
Yet Taylor and some state legislators claim the agreement between the SPA and the city is not binding on the state.
These legislators should know better. They wrote the law that directed the SPA and the city to enter into an agreement; they were actively involved in the approval of the agreement; and the agreement clearly makes binding commitments on rail access.
Let’s go back to 2002. South Carolina and North Charleston were in a heated contest over whether the new terminal, originally planned for Daniel Island, should move to the base, a site with an industrial history but also the location of a mixed-use, residential redevelopment plan. State leaders were looking for alternatives as support for the Daniel Island site faltered. City officials were working to “down zone” the base to prevent the Legislature from forcing the terminal on the city.
Enter the Legislature. Act 256 directed the SPA to begin permitting the Navy Base terminal, directed other state agencies to pursue funding for infrastructure improvements, and created an exception to general zoning laws to prevent the base from being “down zoned.”
Meanwhile, the city struck a deal with key legislators to divide the base in half. The SPA would get the southern half, and the city would support the new terminal by changing its zoning to allow for it. In exchange, the city would get the northern half to pursue its redevelopment plans.
A second bill was passed to facilitate this compromise. Act 356 directed the division of the property — but also contained clear language that is critical to understanding the rail-access agreement. The act expressly directs the city and the SPA to enter into a “memorandum of understanding and agreement” — and that is precisely what happened.
On Oct. 25, 2002, that agreement was signed. It states that it is a result of negotiations between the city and the SPA at the direction of the Legislature, and that Act 356 required the conveyance of property after the city and the SPA entered into this agreement.
Among other things, the agreement states that “the SPA acknowledges that The City does not want the SPA to utilize rail access from the north end of the Property, and the SPA will use rail exclusively from the south end of the Property.”
The SPA certainly was not out on a legal limb when it entered into this agreement.
The SPA’s enabling legislation authorizes it to act as “the instrumentality of the State for accomplishing the purposes of developing port facilities.” Its authority includes development and use of terminal railroads and making connections or crossings with other railroads. So the SPA would have had the clear legal authority to enter into the agreement with North Charleston even if the special legislation passed in 2002 had not directed it to do so.
Once the agreement was executed, the property transfers were approved by the State Budget and Control Board as is customary under state law. On Dec. 12, 2002, the board approved the transfer of property to the city “in accordance with Act 356.”
Thus, the formal executive arm of state government approved the transfer of property to the city and expressly referenced the act that directed the city and the SPA to enter into the agreement.
In short, the legislation and legislative history are clear. The SPA and North Charleston were directed by the Legislature to enter into an agreement to address, among other port-related issues, rail access to the terminal.
To say the state is not bound by this agreement is to simply ignore history, clear legislation and principles of fairness.
This flagrant departure from fairness led Gov. Mark Sanford in 2009 to veto a proviso that would have undermined the rail-access portion of the agreement. The governor had strong words: “The principle here is a simple one, your word is your bond — and this proviso would break with the words given that facilitated the SPA move from Daniel Island to North Charleston. Were it not for that agreement the port would likely have never come to this site in the first place. It isn’t right to some years later try and change the deal that got you where you are. … (T)he same legislative principals … who were there in negotiating this original agreement are now party to this proviso that would change it. …”
The city of North Charleston and the homeowners, entrepreneurs and private companies that have invested in the redevelopment of the northern end of the Navy Base — in reliance on the agreement of the state not to run rail through there — should expect nothing less from their state government.
If our legislators are allowed to cast aside written agreements between state agencies and municipalities whenever it becomes convenient, it will be a dark day in the legislative history of South Carolina.
Ben A. Hagood Jr. is an attorney for Shipyard Creek Associates and the Noisette Co., and a former member of the S.C. House of Representatives.
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