How the Aiken Corporation Transformed a $500k Project into a $7.7 Million Boondoggle
The Playhouse Considers a Move:
Part One in a Three-Part Story
1998-1999: The Playhouse Considers a Move
2000-2001: The Amentum Model: “Corporate Coup”
2002: The Amentum Model: “Loosey Goosey”
Advocates for the Aiken Corporation spent the summer of 2023 extolling the virtues of the “Amentum Model” which, we are to believe, represents the gold standard for public-private, mixed-use development projects in downtown Aiken. In reality, the Amentum Model — which should rightfully be called the Aiken Corporation Model — serves as a cautionary tale, whose lessons went unheeded 20 years ago.
What Does the Aiken Corporation Do?
Ask five people to explain the Aiken Corporation and its relationship to the City, and you will likely get five different answers. Back in 2002, a City councilman described the Aiken Corporation as a “child” of the City. Last week, during a City Council meeting, Mayor Rick Osbon described it as, “almost like a cousin to the City.”
In this same meeting, Aiken Corporation Board Chairman Buzz Rich described the relationship as simply, “a public-private partnership.”
Earlier that same day, in an Aiken Corporation Executive meeting, Aiken Corporation Secretary Sam Erb described the organization as a “Community Development Corporation.”
Most people, if asked — including those who have been following the stories on Aiken Corporation over the years — would likely answer with variations of, “It’s convoluted,” or “It’s confusing,” or, “I don’t understand.”
Even City Council members had difficulty during a March 13, 2023 City Council meeting discussion on the approval of a “Resolution Authorizing the City of Aiken to Enter into a Professional Services Agreement with the Aiken Corporation” explaining what the Aiken Corporation does and doesn’t do.
In simple terms, the Aiken Corporation is the development arm of the City of Aiken — a 501(c)3 organization “organized in 1995 exclusively for charitable purposes,” which include, according to its bylaws, “to promote and assist in the growth and development of downtown Aiken” and “to create a prosperous and sustainable future for the City and its citizens by diversifying and expanding its economy and to assist building Aiken as a distinctive and special community.”
Enter the Aiken Community Playhouse
When the Aiken Corporation approached the Aiken Community Playhouse in November 1998 about helping the theater group move downtown, it seemed the Aiken Corporation was serving its stated purpose.
Up until this point, the Aiken Corporation had driven innovative development of unused and eyesore downtown properties to create in-town housing. This Playhouse project emerged as part of a larger vision to create a downtown arts district. The Playhouse project was, in fact, the genesis of the so-called Amentum Model — a project that went from costing an estimated $500,000 in 1998 to a towering $7.7 million in 2002, leaving everyone including City Council members, the local theater community, newspaper editors, and everyday citizens, grappling to explain what just happened.
Explanations were peppered with terms like confusion, boondoggle, loosey-goosey, and fiasco. The emerging consensus blamed a lack of oversight and an absence of a clear budget for the cost overruns that were shelled out like so much Monopoly money. As the reality of the $7.7 million price tag settled in during the spring of 2002, calls were made for an independent, third-party audit to prevent another such boondoggle. This audit never happened.
That the “Amentum model” is now being used to promote the construction of another mammoth public-private, mixed-use development project in downtown Aiken — and with the same cast of characters at the helm — should cause alarm bells to ring. A review of the history is in order.
November 18, 1998 newspaper headline: ‘Playhouse may move to downtown theater.”1
On Tuesday, November 17, 1998 the members of the Aiken Downtown Development Association (ADDA), a committee which functions as a subsidiary of the Aiken Corporation, voted unanimously to become involved in helping the Aiken Community Playhouse move downtown. The decision was made for the the Aiken Corporation to place an option to purchase the Mark II movie theater and an adjoining Newberry Street property to give the Playhouse board time to study and consider the idea.
On the table at that time was the possible purchase and renovation of the Mark II Theater (also called the Mark Twin Theater) by the Aiken Community Playhouse for $137,000 plus a small parking area in the back, owned by Margaret Holley. The preliminary estimate for the cost of purchase and renovation of the Mark II theater came to about $500,000.
This was no small price for an entirely self-supporting theater group that, for the past 50 years, had been delivering theatrical productions to the local stage through the all-volunteer efforts of a dedicated, hardworking theater community.
Mayor Cavanaugh supported the move and floated the idea of creating “tourist packages”2 which would include an evening of dining, theater, and accommodations in a local hotel.
Wade Brodie, ADDA board member and chairman of the Aiken Corporation, described the endeavor as part of a larger plan to build an entertainment district that would draw tourists to the downtown to eat in restaurants and stay in hotels.2
At the same time, Mr. Brodie cautioned that the Aiken Corporation might not be in a position to repay the loan to the City, should the theater group opt not to buy the property. According to Brodie, Aiken Corporation funds were already earmarked for other projects.
November 24, 1998 newspaper headline: “Playhouse has time to consider move to downtown theater.”2
In late November 1998, Aiken City Council voted unanimously to lend the Aiken Corporation $12,500 for a pair of three-month options to hold the $137,000 Mark II property and the adjacent lot. The Aiken Corporation and the Aiken Community Playhouse (referred hereafter as either ACP or simply “the Playhouse”) were to work together to study the issue and develop a proposal within 90 days.
According to the Aiken Corporation’s November 20 meeting minutes, below, “Should the City get involved, the Playhouse has stated that they want autonomy and would want to own the building and retain control over the building and they type of plays they produce. “
Playhouse board member Thurmond Whatley was quoted in the November 24 newspaper article as saying, “We don’t want to move in and in two years be totally bankrupt. We would like to be a part of (downtown) if at all possible, but we are also quite content where we are.”2
During the Aiken Corporation’s executive meeting on November 20, 1998, various revenue sources were discussed for the half-million dollars needed to purchase and renovate the Mark II, including increased hospitality and accommodations taxes, Tax Increment Financing (TIF), Aiken 20/20 funds, donations and fundraising.
From the Aiken Corporation minutes 11/20/98
(Click for full-size view)
In a mere 3 months, the project’s $500,000 estimated cost would quintuple, and the Playhouse’s stated wishes to own and retain control of the building would go to the wayside.
December 9, 1999 A Feasibility Assessment.
Aiken Corporation chairman Wade Brodie stated in the Aiken Corporation’s December 9 meeting that a subcommittee of Aiken Corporation Executives and the Playhouse were meeting to assess within 90 days the feasibility of the theater making a downtown move.
March 9, 1999 newspaper headline: “Possible move draws applause”3
The Playhouse Committee met with Aiken City Council in a work session to discuss the findings of their feasibility assessment. It had been decided that, in order to remain viable, the building would have to be owned by the City. The Playhouse would take over operation of the theater, which could double as a conference center. The City could book conferences, while the theater took care of entertainment.
According to architect McDonald Law, “a conceptual plan of the new playhouse would require the (Mark II Theater’s) existing 7,500 square feet be expanded to 15,000 square feet to make space for a backstage and workshop space .” He gave a conservative estimate of the cost at $2.5 million.
The question then became, “How to pay for this project?”
March 9, 1999 newspaper headline: “Council votes on three taxes in one night.”4
The news that City Council was pushing to raise taxes through a 5% franchise fee on SCE&G customers, a 3% accommodations tax, and a 2% hospitality tax drew hot response in a March 8, 1999 City Councilmeeting. Citizens who came prepared to speak were asked to hold their comments until a planned public hearing to take place during the March 22 City Council meeting.
March 10, 1999 letter to the editor: “Voices concern over playhouse proposal” 5
Veteran Playhouse board member, volunteer and actress, Ginger Ingram — one of the pillars of Aiken’s theater community — wrote a letter to the editor of the local paper expressing concern among Playhouse supporters over the lack of communication being received on the downtown proposal. She also pointed out that the existing Playhouse at the corner of Price Avenue and Two Notch Road was entirely self-supporting; their building was paid for, and they had plenty of parking — claims that could not be made of the proposed downtown location.
March 22, 1999: Public hearing and second readings on the “triple tax” proposals; ordinance to amend the City Code to adopt a a local Accommodations Tax and local Hospitality Tax.
Over 275 citizens were in attendance at the Monday night City Council meeting to voice their positions on two new taxes:
- A proposed 3% Accommodations Tax to be imposed on any business providing accommodations with 6 rooms or more and would be placed on any rental providing lodging for 90 days or less, and
- A proposed 2% Hospitality Tax imposed on the gross sales from the sale of prepared meals and beverages sold in local restaurants, fast food establishments, grocery stores and convenience stores in the City of Aiken.
All proceeds from these taxes were to be used for the promotion of tourism and cultural related projects. The purpose was to finance nearly $12 million worth of specific projects, including $1.5 million for the theater project.
From the Aiken City Council meeting minutes 3/22/1999
Click for full-size view.
The public was assured that, once these projects were fully paid and their debts satisfied, the tax would be repealed by ordinance.
After a series of statements from Aiken Community Playhouse veterans, board members and other citizens — a more or less even mix of pro and con viewpoints, with Playhouse leadership largely in support of the new taxes — the discussion was turned over to council members.
Councilman Skipper Perry offered the lone voice of dissent. He pointed out that, when the above-listed projects had been prioritized in 1997, the city had been thinking about issuing bonds, not raising taxes. He was also concerned about the lack of specificity in the budgets for the projects and the absence of end date for the taxes. He asserted that that the proposed tax would affect the people who could afford to pay it the least. The motion passed with a 6-1 vote, with Councilman Skipper Perry opposed.
From the March 22, 1999 Aiken City Council meeting minutes.
(Click to view full size).
April 1, 1999 newspaper headline: “Theater closes suddenly”6
The Mark II Theater suddenly closed without notice or explanation, disappointing local parents, who looked forward to the wildly popular, annual children’s film festivals in summer, with tickets costing only 50-cents each. While the theater is sometimes depicted in modern lore as an abandoned building, this was not the case.
May 12, 1999 Aiken Corporation discusses the Whittle Building; the Playhouse project changes shape.
According to the May 12 Aiken Corporation minutes, “The current thinking about the Playhouse is that it could be a t-shaped building and sell/lease land for commercial purposes in front of the playhouse. To do so requires entering into an option for the Whittle Building. Mr. Brodie and Mr. Brodie (sic) will work to enter into an option using interest money to secure the option. Mr. LeDuc encouraged the group to write the sale of the land into the business plan for the theater.”
Also:
A motion was made by Mr. Tim Simmons, then seconded by Sam Erb to authorize Wade Brodie and Buzz Rich to negotiate with Mr. Lewis Whittle to purchase the Whittle Building for the development of the Playhouse. Mr. Brodie indicated that the option should not exceed $1,000. Motion passed.
From the Aiken Corporation minutes 5/12/1999
(Click to view full size)
June 10, 1999 newspaper headline: “Playhouse project remains on track for moving to downtown Aiken.”7
On June 9, the Aiken Corporation held a meeting during which the capital cost estimates were reviewed. According the June 10 story in the local paper, funding would be “derived from a $1.5 million investment from the city, $80,000 from the sale of two lots once the project is completed, $12,500 from the sale of half of the Holley lot, $175,000 from the existing playhouse location, $75,000 from existing playhouse equipment, $75,000 from three years of accommodations tax revenue, $12,000 from continuance of Whittle Building rent, and a $441,086 capital campaign” for a total of $2,370,586. “7
Committee member Skipper Perry appeared to be the lone voice of skepticism, saying that he wanted to see “more evidence that the project will succeed, and not create undue hardship on the playhouse or other entities involved.”7
The now-$2.37 million plan called for the purchase and demolition of both buildings. The Aiken Corporation board voted to recommend that City Council proceed with the project. The motion passed, with member Skipper Perry abstaining.
From the Aiken Corporation minutes 6/9/1999
(Click to view full size)
June 13 letter to the editor: “Voices concern about playhouse move.”8
On June 13, 1999, another letter from Ginger Ingram appeared in the local paper. She questioned a recent front page story that had called the downtown move a certainly, when the decision had yet to be approved by council. She said there’d never been a poll of the Playhouse membership, nor Aiken citizens. She urged a poll and offered her opinion that the same level of citizen participation that had recently been given to a downtown statue should also be given to this decision on the theater. She urged concerned citizens to attend the June 14 City Council meeting.
On June 14, 1999, notice was mailed from the ACT Board of Directors to Playhouse members outlining the plans to relocate to downtown by 2002.8 Aiken City Council was scheduled to vote that same day on approval for the downtown theater project as a capital project.
June 14, 1999 newspaper headline: “Playhouse relocation on City Council Agenda.”9
Discussion among Council grew contentious during the work session, with Councilman Skipper Perry — who would be the sole dissenting vote that evening — said to be incredulous over the numbers presented. He also said of he Playhouse, “This is a group that didn’t ask to go downtown.” 9
The mayor and another council member volleyed back in support of the project. Input among citizen attendees was mixed, with Ginger Ingram again making a call for more input. “Something this important needs to go to the membership.”
The details of discussion from the City Council meeting minutes provide important perspective on events to that were to unfold over the next year.
Excerpts from June 14, 1999 City Council meeting minutes.
(Click to view full size).
The vote was 5-1 for the City to buy the property.
As the local paper would relate the next day, the proposal to move downtown had been in the works for two years and was jointly encouraged by the ADDA and Aiken Corporation, who described the move as an economic shot in the arm.
August 1999: Aiken Corporation encourages SRS contractor to locate in Aiken.
According to an August 12,, 1999 newspaper headline, “Playhouse moving forward – Aiken Corp. paving way for downtown location,”10 the ADDA met with Aiken Community Playhouse members for about two hours in August. Afterward, ADDA chairman Sam Erb reported, “Other than a few people who might not be for it, I think the consensus is they can’t afford to let it (the opportunity) go by the wayside.”
From the Aiken Corporation minutes 8/11/1999
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According to the Aiken Corporation’s August 11, 1999 meeting minutes, on the topic of SRS, “it was agreed that the Aiken Corporation should write a letter of support to encourage the location of the government division of Morrison Knudsen to locate in Aiken.” The impact of this move on the Playhouse project would soon become clear.
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- Smith, Thomas. “Playhouse may move to downtown theater,” Aiken Standard, November 18, 1998.
- Smith, Thomas, “Playhouse has time to consider move to downtown theater,” Aiken Standard, November 24, 1998.
- Nidiffer, Nina J., “Possible move draws applause,” Aiken Standard, March 9, 1999.
- Nidiffer, Nina J., “Council votes on three taxes in one night.” Aiken Standard, March 9, 1999.
- Ingram, Ginger, “Voices concern over playhouse approval,” ” Aiken Standard, March 10, 1999.
- Nidiffer, Nina J., “Theater closes suddenly,” Aiken Standard, April 1, 1999.
- Smith, Thomas, “Playhouse project remains on track for moving to downtown Aiken,” Aiken Standard, June 10, 1999.
- Ingram, Ginger ,”Voices concern about playhouse move,” Aiken Standard, June 13, 1999.
- Nidiffer, Nina J., “Playhouse Relocation on City Council Agenda,” Aiken Standard, June 14, 1999.
- Smith, Thomas, “Playhouse moving forward – Aiken Corp. paving way for downtown location,” Aiken Standard, August 12, 1999.