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H 5321: “A Bill to Establish the Horse Creek Regional Public Service Authority and Dissolve the Aiken County Public Service Authority”

An effort is afoot, via South Carolina House Bill 5321 that is sponsored by Aiken, Edgefield, and Saluda Counties’ State Representatives, to have the State of South Carolina seize control of Aiken County’s wastewater processing system, most notably the Horse Creek Pollution Control Facility. The process has created the unusual situation of two sets of locally elected officials in direct confrontation, as Aiken County Council vigorously opposes the legislation.

by Don Moniak
March 23. 2026

Aiken County’s Horse Creek Pollution Control Facility (also referred to as the Horse Creek Wastewater Plant or the County sewer plant) was at the center of two controversies in 2024.

The first, involving the proposed House of Raeford chicken slaughterhouse and processing plant, was highly publicized. In that instance, a large public outcry merged with the realities of a wastewater plant audit that showed the County’s plant had nearly exceeded its sold, committed capacity—although the plant is still operating at only about 2/3 of its physical and permitted capacity of 20 million gallons a day. As a result, the County Council was able to cite the dedicated capacity shortage as a reason to not move forward with a vote on a Fee in Lieu of Taxes agreement with House of Raeford—which was a deal killer for the company.

The second, involving the raising of one-time capacity purchase costs from $0.48 per gallon per day to $10.89, actually had a greater impact but was underpublicized. The rate was raised (1) by County Council in September 2024, following a closed-door Executive Session.

Two years later, Aiken County’s delegation in the South Carolina House of Representatives appears to have taken offense (2) to those circumstances and opted this month to introduce legislation to abolish the operating entity of the sewer system, the Aiken Public Service Authority.

House Bill 5321 (3), “A Bill to Establish the Horse Creek Regional Public Service Authority and Dissolve the Aiken County Public Service Authority,” seeks to shift ownership and operation of wastewater operations from the county-controlled Aiken Public Service Authority to a state-controlled Horse Creek Regional Public Service Authority.

The bill would transfer all assets, primarily the wastewater plant and surrounding infrastructure, to the newly formed Authority. Thus, if the state were to somehow gain control of the sewer system, it would be run by political appointees from the Governors office rather than by local government.

The latter would be run by a nine-member Board of Directors from Aiken, Edgefield, and Saluda Counties, with members appointed by the Governor at the recommendation of County legislative delegations. No criteria for Board membership, other than residency, is stated in the bill.

According to members of County Council, the legislation came out of the blue. At their regular meeting on March 17, 2026, not a single Council member described being contacted by their local House representative about the bill. The legislation was a sneak attack.

During that meeting, County Attorney Bradley Farrar presented the case against this bill; during an agenda item to discuss a Council Resolution against the legislation that was ultimately unanimously approved. (Audio of presentation and subsequent Council discussion can be heard here.)

After reviewing key elements of the legislation and describing it as “having no legislative history, purpose, or rationale for its prescriptions,” Mr. Farrar identified holes in the proposal. One key issue is that the 1973 legislation—known as Act 542 (4)—that created the Aiken Public Service Authority was found to be unconstitutional in 1976 (Figure 1). The Authority created by Act 542 was thereafter defunct.

Figure 1. Slide from County Attorney Brad Farrar’s presentation during the March 17, 2026, County Council meeting. The entire presentation is available on the County’s website; as is the Resolution Against HB 5321.


What does exist is an Aiken Public Service Authority that is merely a Department within County Government—albeit one with its own “self-supporting enterprise fund” and not an entity dependent upon taxpayer dollars.

The Department was created in 1989 by the current Ordinance . The plant has been run as a Department of our County government, and not a Board of Directors, for 37 years. The County has been authorized by state law and the state Constitution to provide wastewater services, since it went online in the late 1970’s—with no interference from the state. Mr. Farrar made the case that even if the state were to create the Horse Creek Regional Public Service Authority, the County remains authorized to operate utilities and as such can continue to control its existing wastewater processing assets. (Figure 2).

Mr. Farrar also addressed the human element in the equation. During a visit to the wastewater plant its workers, who are currently county employees, asked where the legislation would leave them and would they still have their jobs.

Unless workers qualify as assets in the same manner as a section of pipe, the legislation contains no mention, other than the transfer of personnel records, of a workforce that has the experience and institutional knowledge to operate the plant 24 hours a day, 7 days a week.

Figure 2: Slide from County Attorney Bradley Farrar highlighting key talking points in opposition to legislation seeking state control of the County’s sewer system.

H 5321 will be heard during a meeting of the Environmental Affairs Subcommittee of the House Agriculture, Natural Resources, and Environmental Affairs Committee on Tuesday, March 24, 2026. The meeting is at 9:30 a.m. and will be live streamed. H 5321 is the only agenda item.

(Update. As of 7:40 pm on 3/23/2026, the meeting is no longer listed under the video schedule)

Footnotes

(1) In regard to the capacity purchase cost of $10.89 per gallon per day, the cost increase from $0.46 was not as dramatic as perceived; because for years the County has been almost giving away its sewer capacity.

A December 18, 2024, letter (Pages 200-203) from County Attorney Bradley Farrar to the utilities who send their effluent to the wastewater plant contained a simple table (Figure 3), created by the County’s wastewater plant auditor, showing the varying levels of fees across the state. Aiken County’s “barely registered on the scale,” Farrar wrote.

Figure 3.

(2) The following is an excerpt from an email from Representative Bill Taylor to his constituents:.


“Wastewater Treatment Challenges in Aiken, Edgefield,
and Saluda Counties

When you flush the toilet, the waste doesn’t just vanish. Unless you have a septic tank, it travels miles to a treatment facility. For many residents of Aiken, Edgefield, and Saluda Counties, the Horse Creek Wastewater Treatment Plant in Beech Island, located on the Savannah River, is the facility.

Operated by Aiken County, the treatment plant serves Aiken, North Augusta, and nearly every town in the region. However, it’s currently struggling to meet the demands of our growing area. Despite $56 million in state loans and grants for upgrades in the past 5 years, the facility has not been expanded and is nearing capacity. That hinders economic development. 

In 2024, the Aiken Council rejected a request from House of Raeford for sewer service for a proposed chicken processing plant that would have created 950 jobs, with one councilman declaring that Aiken County is “closed for business.” What if a major manufacturer wanted to locate in Aiken County, bringing thousands of jobs? Would the answer be, “Sorry, we’re closed?”

Municipal customers have expressed frustration with their lack of input in setting sewer rates, expanding capacity, and having their complaints addressed. Compounding the issue, the SC Department of Environmental Services has cited the Horse Creek Plant for numerous violations, some of which have gone unreported. 

Underscoring the current crisis, a letter-to-the-editor in yesterday’s Aiken Standard was highly critical of the Aiken County Council for proposing a hike in the sewer impact fee to $10.89 a gallon from the current 48-cents. That’s an increase of 2,176% that would certainly stifle planned housing developments.

Proposed Solution: Horse Creek Regional Public Service Authority

In response, a bipartisan group of legislators from the affected counties has introduced legislation (H.5321) to create the Horse Creek Regional Public Service Authority. This new authority would take over the management of the wastewater treatment plant, transferring ownership from Aiken County.

A Horse Creek Authority would oversee water, sewer, and waste management services, governed by a nine-member board appointed by the Governor upon recommendations from the affected County Legislative Delegations. This organizational structure aims to ensure that municipal and other customers have a voice in the management of sewer services and the setting of reasonable rates.

The establishment of the Horse Creek Authority seeks to improve the efficiency and quality of public services in the region. A House subcommittee is expected to hold a hearing on the bill soon, during which many affected entities are likely to testify in support of the legislation.”

Comments:

Taylor is incorrect in his description of the chicken plant debate. The audio of that Aiken County Council meeting is available and there was no such claim of that Aiken County “is closed for business.”

Former Councilman Kelly Mobley did make a similar statement during the July 17, 2024 Public Hearing regarding the Capital Project Sales Tax. Councilman Mobley spoke strongly in favor of enacting developer ”impact fees” in Aiken County to compensate for the costs of rapid growth. 

He also added that the rate of housing developments is excessive and stated that, in terms of residential development, Aiken County should switch its “open” sign to “closed“ until the impacts on our infrastructure are better addressed.

It is notable that two nights later, at the July 19, 2024, County Planning Commission meeting, H5321 co-sponsor Representative Melissa Oremus also stated that “we can not continue to build things and worry about the aftereffects later.” The statement drew loud applause. 

During the chicken plant debate, Mobley actually said this;

““ I want everyone to know and understand that we have a great deal of concern about this project…all of this is top of mind. But do please understand we only took up the FILOT issue, and by right this company can build on this property…”

(3) The sponsors of the bill are Representative Bill Taylor (R-Aiken); Representative Melissa Oremus (R-Aiken/Beech Island/Midland Valley), Representative Bill Hixon (R-North Augusta), Representative Charlie Hartz (R-Aiken), Representative Bill Clyburn (D-Aiken and Edgefield Counties), and Representative Cally R. Forrest, Jr (R-Lexington and Saluda ).

(4) It is notable that HB 5321 is, with the exception of the paragraphs regarding abolition of the 1973 version of the Aiken Public Service Authority, a near carbon copy of Act 542.

The City of Aiken’s First-Come First-Served Sewer Capacity Policy.

Aiken County’s sewer processing capacity is a very finite resource, and the number one limitation on growth in the County, and thus, the City of Aiken. The County operates the Horse Creek Wastewater Plant and sells a portion of its processing capacity to the City of Aiken and several other utilities, including the City of North Augusta and Valley Public Service Authority.

Until now, the City of Aiken Planning Department, Planning Commission, City Manager, and Aiken City Council has treated it like an infinite resource, with Council ultimately granting every sewer service request from outside the City during this decade. Even following the news in the first half of 2024 that Aiken County had sold more than 95 percent of its permitted sewer capacity and the City itself was overallocated, the City of Aiken proceeded with business as usual, even granting sewer allocations to several more out-of-town developments constituting more than 1,200 homes—a total administrative commitment by the City amounting to more than 0.3 million gallons per day (MGD) of wastewater flow.

At its January 12, 2026 Work Session, Aiken City Council and the public were informed that the City’s future additional allocation from the County’s current wastewater plant expansion would be 40 percent lower — down to 1.5 million gallons per day (MGD) from the previously assumed 2.5 MGD. In addition, it was disclosed to Council that the City had only 0.41 MGD of remaining processing capacity from its current allocation with the County. At the same time, the City has at least 0.50 MGD of immediate claims against that remaining gallonage awaiting approval from the Aiken Public Service Authority, leaving a current 90,000 gallons per day deficit. That deficit is arguably significantly larger when considering all the sewer service approvals made by City Council over the past few years that are not accounted for in the 0.50 MGD schedule.


These other Council-approved projects, not yet counted for, are direct demands on the City’s share of the upcoming 1.5 MGD of expanded processing capacity. An analysis of the already Council-approved projects that will be serviced from the future 1.5 MGD is made far worse when new projects currently under review by the Planning Department are also taken into consideration. It appears that Aiken’s capacity to meet future needs is extremely limited.

Despite these disclosures, the City’s sewer policy is still operating on a first-come, first-served basis; not on an in-City project priority basis.

by Don Moniak
February 22, 2026

Since the late 2010’s, the City of Aiken has been aggressively expanding the extent of its sewer and water distribution system; and continues to grant further expansion despite limitations on capacity available from the Aiken County Public Service Authority (PSA).

This expansion has not been accompanied by an increase in sewer capacity. Aiken does not have its own wastewater treatment system, and is reliant upon the Aiken County Horse Creek Wastewater Plant (HCWP)—which is operated by the PSA— for its processing needs. As a customer of the PSA, the City must pay the fees recommended by the PSA and approved by Aiken County Council.

In early 2024, an audit of the plant’s then-permitted capacity of 20 million gallons per day found that the wastewater processing capacity already purchased was nearly at the permitted limit.

No clear public summary of the situation resulting from the audit has ever been issued, but a May 2024 memo (Figure 1) from County Administrator Brian Sanders to Aiken County Council provides the most salient details—the County had sold all but 30,000 gallons a day of its physical and permitted capacity of 20 million gallons a day (MGD). A 6.0 MGD expansion would allow the sale of additional capacity to provide something of a stopgap measure until the Horse Creek Wastewater Plant is further expanded. According to one engineering firm, that future total could be as high as 40 MGPD. (It is important to note that the plant is currently processing about 12 MGPD on average, of which more than half derives from the City of Aiken.)

Figure 1. May 2024 Email from County Administrator Brian Sanders to Aiken County Council. The referenced tables from the audit can be found through this link. (click to enlarge)

The County also recognized that it was not recovering the actual costs of its processing, as it had not raised rates since 2012. In response, County Council approved a 62 percent increase, from $1.50 per thousand gallons to $2.41 per thousand gallons, for sewer treatment processing.

The bad news for the City of Aiken was contained in a subsequent email from County Administrator Brian Sanders to City Manager Stuart Bedenbaugh, in which Sanders wrote that there had been a “major breakdown of communications between the County and DHEC during the permitting process.” According to the audit, the City of Aiken was permitted nearly 0.4 MGPD above its allocated amount since 2012. The good news was that an accounting adjustment added another 1.03 MGPD, leaving the City at that time with 0.64 MGPD of available capacity.

Figure 2. Email from Aiken County Administrator Brian Sanders to Aiken City Manager Stuart Bedenbaugh. (Source: July 8, 2024, Aiken City Council Work Session Agenda Packet). (click to enlarge)


Several months later, following a closed-door Executive Session, County Council approved a massive fee increase for capacity connections (the one-time fee for new capacity purchases). The increase functions as a de facto impact fee, one achieved without any public hearings or public scrutiny.

The rate rose from $0.49 per gallon per day to $10.89 per gallon per day. For example, at an average of 300 gallons per day per home, the new fee increased costs for a 100-home development requiring sewer connections from ~$15,000 to ~$317,000.

Aiken’s Recent Sewer and Water District Growth

The City of Aiken has been expanding its utilities systems and services in two manners—-to grow the City and to grow its sewer and water business.

Expanding Sewer Services to Grow the City

Efforts to grow the City have largely involved annexing contiguous tracts for high-density developments. In addition, there have been a few in-city developments.

The most notable of these is the commitment to developers within the Powderhouse Connector project area, where the City essentially traded sewer connections for road rights-of-way. (See Development Road for more details.)

Aiken has also provided services to several other developments that required annexation, including a district of low-income and affordable apartment complexes in the Dougherty Road area, the May Royal Drive development, which involves more than 200 homes, and another 150-home subdivision along Highway 19.

Expanding Sewer Services to Grow the Business

More notably, Aiken has grown its sewer business by providing sewer and water services well outside the City limits. In doing so, it imposed its urban/suburban growth model upon County residents accustomed to life away from high-density developments, high-impact industries, and relatively high peak-hour traffic. The business growth model also imposed costs upon the County, most notably upon emergency response and volunteer fire resources. (1)

One of the most questionable expansions is eight miles north of the City limits in the area of Interstate 20’s Exit 18. As reported in Aiken Takes on Exit 18, the City has embarked on an expansion that would extend nearly two miles west of Verenes Business/Industrial Park, involving a $3.5 million sewer lift station, and potentially provide sewer services for more than a thousand acres of development—some of it adjacent to or within the City’s Brunswick Tract that was obtained to protect its Shaw Creek water supply; and all of it well beyond any future hopes for annexation.

The planned, but at this point only attempted, growth around Exit 18–six miles north of City limits—also involved a secretive effort known as Project Unicorn, widely acknowledged as an effort to lure the Buc-cee’s company to establish its presence in Aiken County. The status of that project is unknown, but it is still rumored to be in the offering.

The City also pursued, in conjunction with the County, the unpopular notion of providing up to 1.5 MGD of sewer capacity for the proposed House of Raeford chicken slaughterhouse and processing plant, and even voted 6-1 in favor of an Ordinance to provide utility services during its First (and only) Reading. Ultimately, the proposal was defeated when a critical mass of citizen objections meshed with the aforementioned sudden and surprising realization by the County that its sewer processing capacity was nearly fully allocated. (see Sewer Capacity Makes the News).

Similarly, there have also been smaller efforts at sewer-line extensions that could lead to larger developments upwards of ten miles north of City limits. The most notable example is the 7-11 gas station at Exit 22, where the City spent more than a million dollars to extend sewer and water lines across the Interstate, where the 7-11 is, at this point, the only beneficiary of that largesse. (see The Public Costs of a 7-11 Store).

All of the above-mentioned developments occurred prior to mid 2024, and before the surprising findings of the capacity audit.

However, since that time the City’s Planning Commission has recommended, and City Council has approved, sewer services for three new subdivisions: Creighton Meadows (August 2024, 250 homes six miles north of City limits next to the Shaw Plant on Frontage Road) Bridge Creek (January 2025, 725 homes one mile north of City limits along Hwy 19), and Bedford Place (January 2025, 93 homes, four miles north of City limits along Columbia Highway/Hwy 1 N). The issue of the City’s limited remaining sewer capacity never entered the approval equation for these proposed subdivisions, where annexation is generally a distant dream.

This largesse has now contributed to an even greater pinch in sewer allocations for new developments.

The 2026 Reality Check

The present reality was addressed at the January 12, 2026 Aiken City Council Work Session, where City Engineer Thomas Parrot outlined the City’s sewer capacity problems. The highlights of his slide presentation, which can be viewed in the agenda packet and heard in this audio, include the following highlights:

1. The City was notified in early 2024 (around the time of the Chicken Plant controversy) that its “remaining allocation (at the plant) was fully committed.”

2. The City only has 0.41 million gallons per day (MGD) of remaining existing capacity, but there are an immediate “~0.5 million gallons per day” of development needs with capacity approval by the PSA currently pending. That leaves a present deficit of 90,000 GPD. The City is negotiating with the County to obtain a potential credit of 0.1 MGD from previously approved projects that are now stalled or abandoned, which would leave it with a slight surplus.

3. The County has only agreed to sell the City 1.5 MGD of new capacity after its 6.0 MGD Sewer Plant expansion is completed next year. This is 1.0 MGD less than the 2.5 MGD City Manager Stuart Bedenbaugh told City Council in June 2025 (Pages 456 to 474) was necessary to meet current and future demands.

4. The City implemented a policy in July 2025 to make developers pay the upfront cost of the $10.89 per gallon connection fee (although there is no record of City Council approving such a policy (2)

5. Council was told that sewer service approvals are operated on a “first come first served basis.”

6. Staff recommended that Council pass an Ordinance requiring that a Sewer Impact Fee be assessed for all projects outside of the city that are not yet approved for sewer. (3)

However, data obtained via a Freedom of Information Act request shows that while there is an immediate approved project’s need for 0.5 MGDP, the capacity promised by the City Council easily exceeds that figure.

In a document titled CMO Project Spreadsheet, the list of projects ranging from the preconceptual to working review stage that require PSA sewer capacity approval is nearly 0.65 MGPD, more than the 0.5 MGPD reported during the Work Session.

According to City Engineer Thomas Parrott, the 0.5 MGPD is a “planning estimate,” while the 0.65 MGPD “reflects a snapshot of the spreadsheet” that may include “preliminary numbers that are intentionally conservative,” projects at different stages of definition concept,” values that may be updated as plans change, or are on the list but “are not yet at a point where a formal capacity request would be made.”

In addition, no allocation figure is identified for the proposed 705-home Bridge Creek subdivision, for which City Council approved sewer and water in January 2025; and only Phase I of Creighton Meadows (147 homes out of 247 approved in August 2024) is listed in the spreadsheet. In total, ~850 homes are left out of the equation. This commitment by Council could eventually add up to as much as 0.25 MGPD of the 1.5 MGPD in additional capacity.

According to Mr. Parrott, no capacity is listed for Bridge Creek because the City “has not received a formal, usable submittal or a defined phase with enough information to quantify flow.” However, the Sewer and Water Services Agreement has been recorded with the County’s Register of Deeds; and a $40 million lawsuit filed this week against the City argues that such a recording constitutes a long-lived approval by the City and not one that expires (4).

The worksheet also contains a list of commercial projects, but has no sewer data associated with those businesses.

Completely missing from the project list are smaller developments like planned public school expansions and downtown developments.

All this begs the immediate question: why were the Planning Department and Planning Commission allowed to keep accepting and processing applications that required new sewer connections and allocations well outside of city limits? A second question is why City staff, not City Council, is setting policy, particularly the unwritten “first-come, first-served” policy? And a third question on many minds is why there is zero discussion at the Council level of a temporary moratorium on new sewer service for developments well outside of the City limits, at least until City Council can define some priorities that set the standard for which developments receive the benefit of this very finite resource?

Figure 3: Aerial view of the Horse Creek Wastewater Plant near Beech Island, SC. From Brasfield and Gorrie. Expansion area is in center of photo.


Footnotes:

(1) During a Planning Commission workshop last fall, County Development Director Joel Duke described the adverse impacts on the County from the sprawl enabled by the sewer and water expansion policy. These include strains on law enforcement, emergency response, and volunteer fire departments. The Center Fire Department has borne the brunt of this expansion in terms of emergency fire and accident response, and the City of Aiken has made no effort to pay its share of the increased costs.

(2) There was no such item on City Council’s agenda at its only July 2025 meeting.

Section 44-5(b) of the Municipal Code requires developers to pay a $400 per housing unit sewer facilities charge, which works out to only ~$1.25/gallon. There are no apparent plans to repeal this fee.

The new $ 10.89-per-gallon charge mandated by the County and now in effect is not yet part of the City Code.

It is unclear whether the City was authorized by Council to pass the costs of the de facto impact fee along to developers.

(3) The First Reading of the Public Hearing for a Sewer Capacity Impact Fee Ordinance will be held Monday, February 23, 2026 during Aiken City Council’s Regular Meeting. Information and comment opportunities for the Ordinance can be found on a dedicated City web page.

(4) This past week Crowell and Company filed a $40 million breach of trust lawsuit against the City of Aiken. At issue is whether a sewer service approval for a 60-acre parcel along Toolebeck Road, granted by City Council in 2020, is still valid. A key element of the lawsuit is the assertion that the recording of the sewer services agreement, which was signed by City officials, confers a long-term right to that service, one that does not expire as long as other conditions are met.

The “Punitive” Half-Million Dollar Development Subsidy

How one developer who successfully pursued a half-million dollar incentive agreement with the City of Aiken expected more financial assistance; and how the City acquiesced.

by Don Moniak
February 20, 2026

This past fall, spectators at two Aiken City Council meetings–October 27 (1:50 to 2:08 mark) and November 10 (from 1:27 to 2:26 mark)–endured more than an hour of confusing and indecisive Council discussions during public hearings. Specifically, the agenda item in question was:

Public Hearing of an Ordinance Approving Certain Economic Development Incentives for Residential Development to be Developed by Van Rock Holdings and Commercial Development to be Developed by VP Riverside, LLC (see pages 246-293).

The proposed economic incentives were for the Rutland Place development across from Aiken High School (see map). Aiken City Council approved the Concept Plan in July 2024, which consists of 245 housing units on 38.5 acres to be developed by Van Rock Holdings of Greenville, SC, and seven commercial parcels on an 11-acre strip fronting Rutland Drive to be developed by VP Riverside of North Augusta.

VP Riverside purchased the property in 2022 for $2.5 million. In 2025, they divided the property into three parcels, with the residential 38- acre portion being sold to Aiken Rutland Place LLC of Greenville for $2.79 million; a 4.57 acre parcel containing the Tractor Supply store being sold for $0.75 million to 3D Development Holdings LLC of Georgia; while VP Riverside retained a 6.3-acre parcel acre for future commercial development.

The anchor of the commercial development, a Tractor Supply store, was in the late construction stages at the time of the debate, and has since opened. In this instance the developer sought, and eventually received, an incentive for one part of the project that was nearly completed. Two fast food chains and an auto parts store are reported by the developer to be under consideration for development on the remaining six acres.

The Economic Development Incentive Ordinance.

In August of 2018, the Aiken City Council approved an Economic Development Incentive Program Ordinance that allows for up to fifty percent of certain fees, and fifty percent of the first five years of business license taxes, to be reimbursed to any developer who meets a specified investment threshold. The Ordinance does not specifically place a cap on reimbursements, but since its enactment reimbursement caps have been placed on all incentive awards.

The eligible development costs include utility connection and sewer impact fees levied per Section 44-5 of City Code, building permit fees, the first five years of business license fees, and any “such other Incentives that the Council, at its discretion on a case-by-case basis, determines are appropriate given the amount or type of investment made by the Project Sponsor.

The vaguely specified thresholds are that a project is consistent with the City of Aiken Comprehensive Plan, advances the goals of the City, and provides benefits to the City that exceed the value of the incentives.

The Ordinance was not passed on a whim. It was first presented at a work session in April 2018, had its first reading four weeks later, and was subjected to a subsequent public forum. Based on the input collected during that period, the Ordinance was amended and passed in its final form on August 13, 2018.

Since 2018, one small business and numerous developers have benefitted from the incentive program (Table 1). Although the Ordinance does not place a cap on the potential fees, it has been city policy to make fee estimates and cap the reimbursement at 50% of estimated fees. If actual fees exceed the estimate, then the developer receives less than half of those costs.

Project Name Year Reimbursement Cap
Betsy’s on Park2019$10,800
227 Park Avenue 2019$3,600
Chesterfield Place 2019$4,250
Mark at Woodford Apts 2020$100,000
Palomino Oaks2021$243,520
Portrait Hills 2021$112,661
The Magnolia2022$70,000
Seter Ridge Apts 2024$90,000
Weller’s Ridge Apts 2025$70,000
Rutland Place Commercial2025$187,747
Rutland Place Residential2025$356,516
Table 1: Economic Incentives approved by Aiken City Council since the program began in August 2018. Link are provided to all the incentive Ordinances for each project. The first three incentive agreements went to small local businesses. After that, the agreements were with larger developers. In two instances, the recipient was Great Southern Homes (Portrait Hills and Palomino Oaks). In one instance the developer, Mark at Woodford Apartments, has since achieved tax exempt status from the SC Department of Revenue by becoming a low-income housing provider–thus the City is not realizing the tax benefits for that property.


Since the inception of the incentives Ordinance, no developer had ever publicly challenged the City’s incentive numbers.

That changed during the first public hearing, on October 27, 2025, on the Rutland Place incentives package.

After the Ordinance was introduced, VP Riverside* partner Charles Johnson argued at length to City Council that the fee estimates submitted by his firm were higher than those formulated by City staff.

At one point, Mr. Johnson described the amount of actual fees to be reimbursed as “punitive” to developers because the reimbursement amount was capped by the estimated amount incorporated into the Ordinance. He stated:

Since this ordinance really pays back 50% of the total fees paid by the developer over five years by having a number that limits us to a a dollar value is really punitive to the developer. It’s not punitive to the city if the number’s low because if the developer pays more, they just don’t pay them back more. However, if the number’s too low and the developer pays more, they’re limited on what they can get back.

So, with that being said, having our numbers in there, which we feel are absolutely correct, and we’re willing to defend that, would not be punitive to the city, but if we went with the lower number that was submitted, and that is the cap on it, it’s certainly punitive to the developer.”

No member of Council challenged this assertion; but neither did any member of Council support an open-ended incentive based on actual final costs.

Despite the insurmountable confusion over the financial data, City Council unanimously approved the incentives on the First Reading, setting up a final public hearing two weeks later. In the interim, Council guided staff to work to eliminate the confusion by reengaging with the developer to provide final, more accurate and better understood numbers before the Second Reading of the Ordinance.

The Second Reading of the Public Hearing occurred on November 10th, and the discussion was even rockier; the numbers more confusing. At this meeting, VP Riverside partner Todd Glover–who is also Executive Director of the powerful Municipal Association of South Carolina–took over the task of arguing that city staff were shortchanging VP Riverside.

In short, the ensuing debate only added to the confusion and City Council voted for a continuation of the Second Reading.

During the next month, VP Riverside and city staff met to iron out differences, with VP Riverside clearly gaining financial benefit from the exercise. During the continued December 8, 2025 Second Reading, City Manager Stuart Bedenbaugh described the City’s interactions with VP Riverside as “hand-holding” and “everything short of singing Kumbaya.”

The size of the final incentive subsidies for VP Riverside dwarf previous awards (Table 1). The rise in the estimates of project fees between October 25 and December 8 is also striking (Table 2).

Date of EstimateCommercialResidential Total
10/27/26$113,135$700,855$813,990
11/10/26$118,910$842,910$961,820
12/08/26$375,495$713,032$1,088,520
Table 2: Range of estimates over time for fees related to proposed financial incentives for VP Riverside and Van Rock Holdings. The subsidy is 50% of the costs, which amounts to $544,260 in total potential reimbursements.


The financial differences between earlier versions and the final figures (Figure 1) were not revealed in the City Manager’s memorandum for Council’s December 8th meeting; when the Second Reading (see pages 119-136) was continued. The necessity for economic incentives for residential development during a housing boom across the County was never discussed or evaluated.

With no debate, the incentive package was approved by a unanimous vote by a Council with three new members.

Figure 1: Final incentive package figures for Rutland Place. (page 121 of December 8, 2025 City Council agenda packet)(click to enlarge)



Footnote

* VP Riverside LLC’s agent is Attorney Ray Massey, who is one of City Attorney Gary Smith’s law partners. Smith did recuse himself from the Second Reading of the Rutland Place concept plan public hearing in July 2024, after that potential conflict of interest was raised in a letter to City Council. At the time, he stated he was unaware of what Mr. Massey’s role, if any, was in the project. (see Page 4 of meeting minutes)

Mr. Smith did not recuse himself from the VP Riverside Incentive Ordinance process.

The City Manager’s Contract and the Sale of the Project Pascalis Properties

by Don Moniak
September 22, 2025
(Update September 27, 2025: Mr. Bedenbaugh’s contract extension and amendment was approved by a vote of 5-0. The sale of the Pascalis properties to the Oliver Group was also approved, on first reading, by a vote of 5-0. The second and final vote is tentatively scheduled for October 13, 2025).

The City Manager’s Contract

Stuart Bedenbaugh has served as Aiken City Manager since 2018. His current three-year contract does not expire until August of 2026.

Aiken City Council is now poised to extend that contract for another three years, through August 2029. The new contract provides a 6% raise to a $178,984 annual salary, and a one-year severance package in the event of being terminated without cause (figure 1).

Essentially, Council will consider a four-year contract during the Petitions and Requests portion of its regular meeting tonight, just two months before three new Council members will take office. The agenda item is open to citizen comments.

Figure 1. CIty Manager’s memorandum to City Council regarding extension of City Manager’s contract.


Bedenbaugh was promoted from Assistant City Manager to Interim City Manager in February 2018 following the departure of former City Manager John Klimm; and was promoted to the position in June 2018 when City Council approved a one-year contract. At the time, the contract included a two-month severance package if City Council dismissed him without cause.

Two years later, his year-to-year status ended, and a three-year contract was approved in June 2020 at an annual salary of $146,224, with a provision for $20,000 in “unused sick leave” if he were terminated without cause. That particular vote came after a closed-door Executive Session—it was not an agenda item subject to public input. (Pages 13-14)

Another three-year contract running from July 29, 2023 to August 7, 2026 was approved in June 2023, when his annual salary was raised to $162,840. (By comparison, North Augusta City Manager James Clifford’s salary was $185,891 as of early 2024). The June 2023 decision occurred during the Petitions and Requests portion of the agenda and was open to public input. One citizen spoke in favor of the contract, nobody spoke against. (Pages 11-12)

This will be the second time for the contract to be on the agenda. It was pulled from the August 25th agenda for unexplained reasons. In the leadup to the August 25th meeting, Council discussed the contract in closed-door Executive Session on both July 14th and August 11th.

The Pascalis Properties Sale.

The vote on Bedenbaugh’s longer-term contract will occur tonight following four public hearings, one of which includes the proposed sale of the six remaining downtown “Pascalis Properties” to the Oliver Group of Tennessee for $2.5 million—one-third the price paid by the City’s Municipal Development Commission (AMDC) in November 2021. Oliver Group was chosen on the basis of their overall bid–even though one other bidder made an offer of $5 million (Page 128). They have 150 days to conduct due diligence before sale closure.

The six properties at issue tonight, commonly known as the “Shah property,” were obtained for $7.5 million. Another $2 million was spent purchasing the Newberry Hall property; bringing the total sales price in 2021 to $9.5 million.

According to an April 2025 appraisal, these high prices were offered because “the city wanted control of how the property was to be redeveloped based on a much longer view and in the public’s best interest.” (Page 127)

The main problem with that Collier’s statement is that the public was never consulted in May 2021 about that “longer view” and its interests. The decision to gain control of the contracts was made behind closed doors at an unofficial and unannounced meeting of city officials; the public hearings for the $9.6 million bond issuance made no mention of specific properties; the AMDC held no formal public hearing prior to purchasing the properties in November 2021; .

Combined with the $0.85 million loss incurred through the sale of the Newberry Hall property in 2024, the total loss from the property sales is $5.85 million.

However, the sales contract with the Oliver Group includes two provisions that will further lower sale revenues.

First, a yet-to-be-determined amount will be deducted from the $2.5 million to facilitate the transfer of property housing a future parking garage; meaning the City plans to own and operate a public/private parking garage:

The Purchase Price shall be reduced on a pro rata basis for any portion of the property excluded from the purchase and sale in this Agreement (such portion of the Property to be determined by Buyer and Seller) and retained by Seller at Closing for the purpose of the development, maintenance, and operation of an integrated public/private parking deck structure….” (Pages 100-101).

Second, the City has agreed to pay up to $200,000 for project design costs:

From and after the Effective Date until the Closing Date, Seller shall pay all architectural and design fees incurred in connection with preparing the property for Buyer’s proposed, Intended Use…up to a maximum aggregate amount of…$200,000.”

Add to this the $100,000 cost in 2021 of securing the bond and paying closing costs, and the approximately $100,000 brokerage fee to be paid to Collier’s, and the total loss from these downtown real estate transactions easily exceeds $6 million.

The City Manager’s Role in Project Pascalis.

The public hearing for the sale proposal is being held just one week after Plaintiffs in the Blake et al vs City of Aiken et al lawsuit released depositions that revealed more of the role Mr. Bedenbaugh played in the failed Pascalis project.

His pivotal role should come as no surprise. He is the City Manager and is expected to closely monitor, if not oversee, major projects in addition to the daily operations of city government. He was also an ex-officio member of the AMDC.

Bedenbaugh was reportedly involved in the fateful and secret decision made in May 2021 for the Aiken Chamber of Commerce to act as a holding company and take assignment of the properties while the City sought financing; a decision attributed to “city staff.” (Keith Wood Deposition, Page 64).

Once the City and AMDC began to pursue a modified Project Pascalis in the wake of the Chamber of Commerce contract assignment, he participated to an unknown extent in negotiations, would weigh in on important issues, and lead the effort towards project financing.

For example, in early June 2021, after former AMDC Chair Keith Wood raised an ethical question involving City Attorney Gary Smith’s role in the process and requested a “firewall,” Bedenbaugh subsequently dismissed the concern by writing that these issues had arisen before and Smith was obligated to honor attorney-client privilege—but failed to address the issue of a recusal.

Then, in August 2021, Bedenbaugh shepherded City Council approval of a $10 million bond package (later reduced to $9.6 million) to purchase unidentified properties in the “Parkway District;” even though it was internally well known which downtown properties were under contract with the Chamber of Commerce. Ultimately, a bond issuance of $9.6 million would pay for the AMDC’s purchase of the seven properties.

Just one week after the AMDC bought the properties on November 9, 2021, Bedenbaugh threatened to directly intervene in the AMDC’s negotiation process with RPM Development Partners (figure 2), following hesitation by Chairman Wood to meet with RPM prior to having a meeting with the entire AMDC.

Figure 2: Email from Stuart Bedenbaugh threatening to intervene in negotiations between the AMDC and Pascalis project developer RPM Development Partners. At the time, RPM was not yet an official “preferred developer,” but had been in various degrees of negotiations under several different names since June 2021. For more background information see A Hotel in the Alley.


Five days later was the now controversial Prime Steakhouse meeting where the decision was made to forestall a formal and legal Request for Proposals; a process that had been neglected until that point. According to Wood’s sworn deposition, Bedenbaugh was not at that meeting but he did learn about it and “regretted” not doing anything about it (figure 3). Actions taken at that meeting ultimately led to the failure of the project, which today, some four years down the road, continues to cost the city.

Figure 3. Keith Wood deposition transcript. (click to enlarge) . Both his and former AMDC Vice-Chair Chris Verenes’ sworn depositions are available through The Project Pascalis Depositions.

The City of Aiken’s Project Pascalis Litigation Costs: $230,000 and Counting

(An update to Project Pascalis Legal Costs)
(Update, November 13, 2025: Response to FOIA request 341-2025 provides a July 14, 2022 letter from the City’s Insurance and Risk Fund denying a claim, and the City’s tally of legal expenses through early June of 2025).

by Don Moniak
September 13, 2025

The City of Aiken and numerous other entities and individuals were sued on July 5, 2022. In Blake et al vs City of Aiken et al; or the Pascalis lawsuit, plaintiffs alleged that the City of Aiken, its Municipal Development Commission (AMDC), Design Review Board (DRB), and City Attorney violated numerous state laws while pursuing the $75-100 million demolition and redevelopment project known as Project Pascalis.

When the lawsuit was filed, there was an expectation among City officials that the City’s insurance would cover legal costs; and in fact the City filed a claim.

For example, on June 29, 2022, in response to concerns that any cancellation or restart of Project Pascalis could result in legal action by the preferred Pascalis developer, RPM Development partners, City of Aiken Economic Development Director Tim O’Briant wrote to AMDC members that:

Each commissioner is fully covered by the City of Aiken’s policy with the SC Municipal Insurance Reserve Fund.” (sic; In actuality, it is the South Carolina Municipal Insurance and Risk Fund, or SCMIRF).

O’Briant would also write on July 5th (Figure 1) to commissioners, after the Pascalis lawsuit was filed, that “please be assured that the City’s tort insurance fully covers each of us named in the suit as a group and individually.”

Figure 1. July 5, 2022 email from Tim O’Briant to AMDC Commissioners.


That same evening, AMDC attorney Gary Pope Jr. wrote to AMDC Chairman Keith Wood, stating his belief that SCMIRF would be assigning counsel “fairly shortly.” (Figure 2)

Figure 2: Email from AMDC Attorney Gary Pope Jr. after the Pascalis lawsuit was filed.


No such coverage or counsel has occurred, or is expected to occur. A claim was filed in July 2022 and was under review for at least two months. Ultimately, the claim was apparently denied–a FOIA request for that denial letter is pending. (Update: The denial letter and City’s tally for legal costs can be viewed via FOIA 341-2025).

The City’s contract with the South Carolina Municipal Insurance and Risk Fund (SCMIRF) calls for SCMIRF to cover many, but not all, legal actions filed against the city. The insurance policy states:

SCMIRF has the right and duty to defend any Suit asking for covered Money Damages….SCMIRF will only defend any action or suit seeking Money Damages brought against the Member or Covered Person.”

The Plaintiffs in the Pascalis lawsuit did not ask for monetary damages, they only asked the Court for injunctive relief (stop the project) and declaratory relief (find violations of the law and instruct remedies.)

The policy also states that SCMIRF will not defend against claims involving “Dishonest or Criminal Acts,” and exempts “Any claim or liability arising out of fraudulent, dishonest, or criminal acts, including without limitation the willful violation of a penal statute or ordinance, committed by or with the consent of the Member or by a Covered Person.”

The Pascalis Lawsuit did not openly allege the willful violation of state law, but did infer the possibility of such actions.

These are two possible reasons why SCMIRF denied the City’s claim and is not defending the City; which in turn is bearing all of the costs of the lawsuit.

Table 1 shows the costs through May of this year. Since that time, there has been a costly deposition of two AMDC Commissioners; which was attended by at least five of the defendants’ lawyers.

As reported in Project Pascalis Legal Costs, only the City of Aiken can provide the most up-to-date and precise figures.

Table 1: Project Pascalis Litigation Costs Incurred by City Taxpayers, as of June 1, 2025.

Law FirmClient Billings
Smith Robinson et alCity of Aiken $78,051
Morrison AMDC $29,775
Holley DRB $30,593
LindemannDRB $23,154
McCantsCity Attorney$20,087
Albee Keith Wood and Chris Verenes$38,726
Davidson and WrenTim O’Briant $9,789
Total $230,176