One year ago yesterday, the Aiken Municipal Development Commission (AMDC) announced its intention to “acquire significant property in the downtown area,” and a planned vote on the proposed purchase during its November 9, 2021 meeting. The announcement came less than three months after Aiken City Council had approved a $10 million municipal bond issuance in support of the AMDC purchasing properties in the “Parkway District,” an arrangement City Manager Stuart Bedenbaugh described at the time as a “land bank.”
The AMDC did not identify the properties in its news release, leaving those details to the Aiken Standard by providing the paper with advance copies of meeting agenda materials; most notably the Purchase and Sale agreements. On the same day as the AMDC announcement, Standard reporter Colin Demarest described the properties to be purchased for $9.5 million as:
“the languished Hotel Aiken and neighboring motel, businesses on Richland Avenue, the former Playoffs Sports Bar, Warneke Cleaners, Newberry Hall and three shops on Laurens Street.”
The Standard did identify by name the three existing shops on Laurens Street, and the four businesses operating on Richland Avenue–of which only the Taj Aiken Restaurant remains today. But not until July 2022, in an article examined in “The Project Pascalis Evictees,” did the paper report again on the nine businesses being forced by their local city government to close or relocate.
Demarest did manage to report, deeper within the article:
“The Aiken Chamber of Commerce intervened in May, documents show, and salvaged contracts critical to the redevelopment effort.”
That single sentence was the first time the Aiken Standard mentioned the involvement of the Aiken Chamber of Commerce. It was also the last time the Chamber’s role was mentioned for more than eight months. The paper has never provided details of the Chamber’s deep involvement in salvaging the land deal in May, 2021 (1); a move that bailed out the first Pascalis project developer Weldon Wyatt.
Two days after his first story Demarest quoted J. David Jameson, not as an AMDC Commissioner who was instrumental in the furtive May 2021, dealmaking, but as the Chamber of Commerce President. This pattern continued with a December 3, 2021 article announcing the selection of RPM Development Partners, LLC as the AMDC’s “preferred developer” for its $100 million plus demolition and redevelopment effort originally code-named Project Pascalis in March 2021.
Whether the self-censorship was related to Aiken Standard publisher Rhonda Overbey’s role as a Chamber board member is unknown. As reported in “The Influencer’s Meetings,” Overbey was also one of 113 people on an “influencers” list who were invited to private, invitation-only meetings with the second Pascalis project developer in early January, 2022.
What is known is the the November 4th announcement was also accompanied by an op-ed by the Standard’s editorial board, titled “Downtown Aiken Entering the Age of Enlightment.” The board was all in for Project Pascalis, before any significant details were known:
“This is no joke and there isn’t a punchline; we think it’s going to happen. And happen huge. The marketing buzz words seem to be bold action. We like it…It’s time for triumph.”
This editorial praising the project ran the same day the story broke.
Project Pascalis was not the first major project during which the Aiken Standard’s news coverage appeared distorted by its editorial position. The city’s hospitality tax and Aiken School District bond referendums enjoyed the same journalistic approach. But the Pascalis coverage lowered the bar for minimizing scrutiny of a megaproject involving tens of millions of dollars of public funds.
For example, not until August, 2022, did the Aiken Standard file a Freedom of Information Act request to the City of Aiken for Pascalis related records. And, during a public Zoom meeting in late June, 2022, the lack of investigative zeal was reflected when Standard staffers repeatedly employed the phrase “the City says,” while avoiding the phrase “We asked the City.”
“The first Pascalis project collapsed in early May (2021) when Weldon Wyatt withdrew from the deal. As part of the negotiations to salvage the deal, Mayor Osbon met with Weldon Wyatt and Greenville based developer Andy Cajka, President of Greenville, SC based Southern Hospitality Group. A memorandum from Tim O’Briant to AMDC members Jameson, Chris Verenes, and Chairman Keith Wood described the meeting:
The Mayor and Weldon met with Andy on Monday, I was out of town, apparently shg hotels will possibly deliver a LOI (letter of intent) regarding the hotel this week. The mayor agreed the meeting went well and Andy was engaged in making a deal that would be privately funded based on the public dollars and incentives driving the project. Mayor indicates he deferred question about Friday negotiations and City’s position on deal points citing my absence and his lack of information on the subject.
A day later O’Briant and AMDC Treasurer and Chamber of Commerce President David Jameson had lunch with Weldon Wyatt, his investment and development partner Thomas “Chip” Goforth, and GAC Management Services employee Ryan Bland, who two weeks earlier had still held the position of City of Aiken Planning Director. O’Briant described that meeting as follows:
David Jameson and I went to lunch with Weldon, Ryan, and Chip. Weldon continues to promote the benefits of 100 percent public funding of the entire project, but now says he doesnt’ intend to participate in the cost or the proceeds—just wants a fee/commission for the project to be successful. This despite bringing in a potential private partner with money to spend just yesterday. He is somewhat cagey and defensive and says he believes I have conveyed messages not representative of the City’s position. Indicates he believes there is some possibility the city council would accept the deal that I rejected Friday. Indicates Lessie (Price) is setting up the Thursday meeting to get everyone in one room to verify my position does not reflect that of leadership.
After that point the known paper trail ends, and the outcome of any meeting set up by Council member Lessie Price is unknown. What is known is:
On May 10, 2021, Aiken City Council met in closed door Executive Session for nearly two hours to discuss a range of topics, including “a possible purchase of real estate” and “a possible contractual arrangement with a real estate developer.” The outcome of that meeting was not summarized during the subsequent public session.
On May 14, 2021 the Aiken Chamber of Commerce took assignment of the purchase and sale contract for the Shah’s suite of properties; and then on June 3rd took assignment, of the Anderson (Newberry Hall) contract. In all, the Chamber reimbursed Wyatt’s firms $135,000 of otherwise nonrefundable earnest money managed by City Attorney Gary Smith’s law firm. From that point, the AMDC secretly referred to the properties as “AMDC controlled.”
In August 2021 Aiken City Council approved a $10 million bond issuance in support of AMDC property acquisitions in the “Parkway District,” with the AECOM Plan’s reference to “fragmented property ownership” a key justification in the supporting bond documents.
AMDC Chairman Keith Wood, whose letter to City Council urging the bond passage included citations from the AECOM plan, also wrote in a July 26, 2022 letter to the Historic Aiken Foundation: “The AMDC first pursued the purchase of the property in question and those adjacent to it at the behest of Aiken City Council.”
There is no record of Aiken City Council asking the AMDC to purchase the Pascalis project properties. Any such request made in closed-door, Executive Session would constitute a serious violation of Open Meetings law, which dictate that no votes are to be taken in Executive Session.
When questioned about the origin of this unsubstantiated statement, neither Chairman Wood nor Tim O’Briant have offered any reply.”
Excessive Fees, Double-Billing, and the Suppression of Public Inquiry
by Don Moniak October 4, 2022
Recently obtained information (1) has revealed serious irregularities in the City of Aiken’s response process to Freedom of Information Act (FOIA) requests. The information denials were mostly related to the city’s $100 million demolition and redevelopment project known as Project Pascalis. City Manager Stuart Bedenbaugh, who also serves as the custodian of records, has thus far refused to reply to a letter regarding infractions that function to illegally deny access to public records.
Specifically, officials responsible for complying with South Carolina’s Freedom of Information Act:
Issued exorbitant search, retrieval, and redaction fees that suppressed public inquiry into government operations by maximizing costs for access to public records;
Issued identical FOIA fee determinations of $5312 involving exactly 332 hours of labor in response to three distinct, separate FOIA requests over a two month period from March 18 to May 12, 2022.
Issued identical FOIA fee determinations of $443 involving eight hours of labor at an increased rate of $48 per hour—triple the previous rate— in response to two distinct, separate FOIA requests on August 10, 2022;
Responded to requests involving Project Pascalis in an arbitrary and inconsistent manner at odds with SC FOIA response requirements; and
Cannot document whether searches for responsive records, upon which some fee determinations are based, actually occurred; suggesting the probability of fraudulent fee determinations.
The Fundamentals of Openness: When in Doubt, Disclose
A fundamental aspect of South Carolina’s Freedom of Information Act (FOIA) is the powerful encouragement to disclose information and an equally strong discouragement to keep information secretive. Openness is the standard, not the exception.
South Carolina FOIA is characterized by frequent use of the word “may” that favors meetings open to the public and disclosure of records produced by government bodies. Conversely, use of the word “must” is infrequently applied to compel the sealing of documents and the closing of meetings to public view and input.
This legislative urge towards openness is exemplified by two simple statements in SC FOIA law:
“A public body may but is not required to exempt from disclosure the following information:” (SC 30-4-40 (a)); and
“A public body may hold a meeting closed to the public for one or more of the following reasons:” (SC 30-4-70 (a))
The State’s top officials have strongly endorsed this fundamental path towards openness. In 2016 South Carolina Governor Henry McMaster wrote, on behalf of the South Carolina Press Association (SCPA):
“As public servants we should always endeavor to maintain the public’s trust and confidence in their government. In that spirit, I hope you will remember ‘When in doubt – disclose.’”
When in doubt, post the time, place, and purpose of the meeting
When in doubt, open the meeting to the public
Records and public meetings pertaining to Project Pascalis do not fall under any category mandating non-disclosure or closed meetings. Yet, time and again city officials have acted against the spirit of openness as expressed by South Carolina FOIA by denying information access, falsely claiming exemptions for non exempt information, excessively gathering in closed-door executive sessions, and charging exorbitant fees to deter inquiry.
This story is about the latter example, the levying of excessive FOIA processing fees that deters inquiry. It is a story that has been reported for other jurisdictions; but prior to the advent of Project Pascalis the City of Aiken had never resorted to such obstructionist tactics.
The City of Aiken’s Excessive Fee Formulas
South Carolina’s Freedom of Information Act (FOIA) calls for the law to “be construed so as to make it possible for citizens, or their representatives, to learn and report fully the activities of their public officials at a minimum cost or delay to the persons seeking access to public documents or meetings.”
Between March 29, 2022 and May 12, 2022, City of Aiken Economic Development Director and designated Freedom of Information Act (FOIA) Officer Tim O’Briant issued identical FOIA fee determinations in response to three distinctly separate FOIA requests (2) from three different citizens. Each fee determination was exactly $5312 due to an estimated 332 hours of labor to search, retrieve, and redact (if necessary) records related to Project Pascalis.
Aiken Economic Development Director Tim O’Briant sent this identical FOIA fee determination in response to three separate FOIA requests; with two being sent on March 29th, 2022; and one being sent on May 12th, 2022
The response to the first two FOIA requests were preceded by a
a billing of 4.0 hours from Aiken Municipal Development Association (AMDC) attorney Gary Pope ($350/hr), in part for “Emails re FOIA to Tim O’Briant”
a billing of 0.5 hours by Pope Flynn associate Sara Weather ($225/hr) for “communications with Gary regarding overly broad FOIA requests and research of prior language.”
Invoices to AMDC from Pope-Flynn law firm for the month of March, 2022.
These legal discussions surrounding FOIA requests cost taxpayers as much $1500 in legal fees before the city even responded to two requests.
In a response to another FOIA request (3) made on September 9, 2022, City of Aiken Solicitor Laura Jordan explained that no records of “initial searches” for information are kept. There is no evidence to date that the “initial searches” that led to thousands of dollars in FOIA processing fees were ever conducted.
On August 10, 2022, Ms. Jordan issued two more identical fee determinations for two separate and very different FOIA requests. The fee determinations involved eight hours of “economic development” labor at a rate of $48 per hour. As the city’s Economic Development Director, Mr. O’Briant was being tasked with reviewing information from his own department for possible redactions.
South Carolina’s Freedom of Information Act does allow government bodies to:
“Establish and collect reasonable fees not to exceed the actual cost of the search, retrieval, and redaction of records. The public body shall develop a fee schedule to be posted online. The fee for the search, retrieval, or redaction of records shall not exceed the prorated hourly salary of the lowest paid employee who, in the reasonable discretion of the custodian of the records, has the necessary skill and training to perform the request.”
SC FOIA also allows for fees to be waived if the information is in the public interest:
“Documents may be furnished when appropriate without charge or at a reduced charge where the agency determines that waiver or reduction of the fee is in the public interest because furnishing the information can be considered as primarily benefiting the general public.”
The $48/hr fees for information pertaining to Project Pascalis were instituted on August 4, 2022 and coincided with publication in The Aiken Chronicles of incriminating and embarrassing AMDC emails obtained via FOIA. The $48 per hour fee is triple the only published rate of $16 per hour on the city’s legally required FOIA online fee schedule page.
Since being informed of these particular findings on September 12, 2022, City Manager Stuart Bedenbaugh, who also serves as Custodian of City Records, has refused to address the issues.
Following is the letter to Mr. Bedenbaugh detailing these particular violations of South Carolina’s Freedom of Information Act.
Mr. Bedenbaugh,
I recently submitted a Freedom of Information Act request for the tracking spreadsheet for the city’s FOIA system. In it I found two interesting situations that warranted further investigation. Here are the results.
1. Summary:
Case 1: Three individuals charged identical amounts ($5312) for identical labor estimates (332 hrs) for three different requests. In Case #1:
a. Why was there first a double-billing of $5312 in FOIA fees?
b. Why was there a third identical billing while one of the original requests remained open?
c. What evidence is there that an “initial keyword search” actually occurred in response to any of these FOIA requests?
d. How would the City of Aiken defend itself against an attempted fraud complaint?
Case 2: Two individuals charged identical amounts ($443.98) for identical labor estimates (8 hours of “Economic Development Time” and two hours of IT staff time) for two very different FOIA requests. In Case #2:
a. Why was there no “initial keyword search” reported for a FOIA request that generated a 10 hour labor estimate?
b. Why was an identical fee determination issued for one request within twenty minutes of another request; and only 1.25 hours after the request was filed?
c. How would the City of Aiken defend itself against an attempted fraud complaint?
2. Double Billing and Fraud
Double billing in legal parlance refers to charging an hourly rate to two clients for the same time spent, or to bill different accounts for the same charge. It is a serious problem in the legal and health professions.
“any activity that relies on deception in order to achieve a gain. Fraud becomes a crime when it is a ‘knowing misrepresentation of the truth or concealment of a material fact to induce another to act to his or her detriment’ (Black’s Law Dictionary). In other words, if you lie in order to deprive a person or organization of their money or property, you’re committing fraud.”
Public records are public property.
SC FOIA allows for fees to be charged for the search, retrieval, and redaction of records:
“The public body may establish and collect reasonable fees not to exceed the actual cost of the search, retrieval, and redaction of records. The public body shall develop a fee schedule to be posted online. The fee for the search, retrieval, or redaction of records shall not exceed the prorated hourly salary of the lowest paid employee who, in the reasonable discretion of the custodian of the records, has the necessary skill and training to perform the request. “
3. Case 1: Three fee estimates for exactly $5312 for three different requests from three different individuals.
March 16, 2022: Citizen 1 files a detailed, two-page Freedom of Information Act request for a wide range of records, broken down into sixteen categories, related to Project Pascalis. It is designated FOIA #49-2022 by the City of Aiken’s FOIA response system.
March 18, 2022: Citizen 2 files a one paragraph FOIA request for a wide range of records related to Project Pascalis. It is designated FOIA # 54-2022.
March 18, 2022: AMDC contract attorney Gary Pope, Jr. bills the AMDC for 0.5 hrs to discuss “overly broad FOIA requests” with “Gary,” who is assumed to be Gary Smith, Aiken City Attorney. (Correction, 10/4/22: This is now believed to be a discussion between Gary Pope and Pope-Flynn associate Sarah Weather).
March 29, 2022: Citizen 1 receives a five-page response (2) to request #49-2022, with citations to information already publicly available, and a fee determination of $5213 for 332 staff hours to complete the request. Most of this The fee determination reads:
“In order to comply with this broad and extensive request, considerable staff time will be involved. For instance, an initial keyword search of the City email archive returned 32,000 individual results that must be reviewed for exemptions, attorney-client privilege, relevance, etc. If an average of 30 seconds is spent reviewing each of those mail items that will involve a minimum of 267 hours. The other records involved will require an additional estimated 65 hours from multiple staffers and from various departments to research and fulfill the request. The City of Aiken’s FOIA fee schedule provides for an hourly charge of $16 for such research and collection, therefore the charge to complete the request as stated would be $5,312. Staff will be assigned to begin the compilation of the requested records following the payment of a $1,328 (25%) initial payment. Once the deposit is paid, the City of Aiken would make the documents available within 30 calendar days as required by the South Carolina Freedom of Information Act, §30-4-10. Prior to release of the collected records, the remainder of $3,984 would become due and payable.
Sincerely, Tim O’Briant”
The request is kept open, pending payment.
March 29, 2022: Citizen 2 receives a response to request #54-2022. In it, Tim O’Briant wrote:
“Your request is substantially similar to one received just days prior to your own submission. That being the case, I have included the response that request here along with links to many of the records and information requested. See below.”
A carbon copy, cut and paste version of the detailed letter and the Hotel Aiken Historic Registry attachment for #49-2022 followed; including the exact same fee determination.
Citizen 2 accepts the response and their request is cancelled.
May 12, 2022. At 12:14 a.m., Citizen 3 filed a FOIA request for correspondence “between Weldon Wyatt or any LLC associated with the Wyatt family, and the Aiken Economic Development Commission and the Mayor of Aiken, between January 1, 1999 and January 1, 2022, regarding Project Pascalis, Downtown Redevelopment, the Hotel Aiken, The Johnson Drug building, and any properties purchased by the AMDC in November 2021. All details of this correspondence can be placed online via the AMDC transparency page.” The FOIA is designated #89-2022.
May 12, 2022. At 8:18 a.m., Tim O’Briant responds to #89-2022. Unlike #49-2022 and #54-2022, no additional information is provided—such as the information provided in the five page letter to Citizen 1.
Even though Request #49-2022 remains open and involves much of the same information requested in #89-2022, a fee determination of $5312 for 332 hours of search, retrieval, and review time is provided. The entire paragraph detailing costs is cut and pasted from the response to Citizen 1 for #49-2022; just as it had been for Citizen 2 for #54-2022. (See Table 1).
June 13, 2022: An attempt to narrow the scope of FOIA #89-2022 is denied by Tim O’Briant, and Citizen 3 is asked to file a new request. O’Briant then cancels the original request.
A new, narrower request is filed, resulting in an $80 fee determination.
Table 1: Identical FOIA Fee Determination Requests. March 16 to May 12, 20222.
FOIA #49-2022
FOIA #54-1022
FOIA # 89-2002
Date of Request
3/16/22
3/18/22
5/12/22
Date of Response
3/29/22
3/29/22
5/12/22 (1)
Time Estimate Hrs
332
332
332
Cost Estimate $
5312
5312
5312
Number of Results in Initial Search
32,000
32,000
32,000
Hourly Charge
$16
$16
$16
Day Cancelled
5/31/22
3/29/22
6/13/22 (2)
Number of Results
32,000
32,000
32,000
(1) Time of Request
12:14 a.m.
Time of Response
8:18 a.m.
(2) Cancelled by City which requested a new request instead of a narrowing of the request.
Case 2: Another identical billing: $443.98 for eight hours of “Economic Development” labor and 2 hours of IT labor at $16/hr.
August 10, 2022: 8:45 a.m. In response to FOIA Request # 185-2022, Citizen 3 charged $443.98 for eight hours of “Economic Development” labor at $48/hr; and 2 hours of IT labor at $16/hr.
Request #185-2022 was filed on August 1, 2022, for “Copies of all emails from to and from Aiken Economic Development Director Tim O’Briant’s private email account tim.obriant@icloud.com. for the periods May 1, 2021 to June 30th, 2021 and December 1, 2021 and January 15th, 2022.”
The first response to this FOIA request included a suggestion by Ms. Jordan to narrow the search due to the volume of emails, estimated at 6,000 for the 3.5 month period in question; which would yield a minimum of 6,000 pages of paper copies at a cost of more than $9,000. Subsequently, IT determined that the emails could be downloaded and provided in an electronic format, resulting in the current, excessive $443.98 charge.
Fee Determination for FOIA # 185-2022.
August 10, 2022: 9:04 a.m. In response to FOIA request #203-2022, Citizen 4 was also charged $443.98 for eight hours of “Economic Development” labor at $48/hr; and 2 hours of IT labor at $16/hr.
The request was sent on August 10th at 7:45 a.m. for: “Emails to or from anyone from the firm Smith Massey Brodie Guynn and Mayes to any members of The AMDC, the Aiken City Council, The DRB and any city of Aiken staff from the time period of Jan 2021 – present.”
This request was for a 19-month period, yet there was no estimation of total records volume and no report of an “initial key word search.” This means the cost estimate was established within one hour and twenty minutes, and only fifteen minutes after the identical cost estimate for #185-2022.
The JustFOIA fee notification stated:
“The requested records for 203-2022 have been processed and will be released pending payment of the issued fee.”
Fee Determination for FOIA Request 203-2022. The invoice is identical to FOIA Request 185-2022 .
While this would be considered a broad request in terms of the time span, there was no apparent initial search—which is routine in some cases and absent in others, as indicated in Case 1 above. A few more examples illustrate this inconsistency:
For FOIA #79-2020, filed in July 2020, then City Solicitor Leigh Staggs wrote, in response to questions about the $48 fee estimate (3 hrs at $16/hr):
“Dear Mr. Moniak,
There are over five hundred emails that will need to be reviewed to determine which ones meet the criteria for the information you’ve requested.
Best,
Leigh Staggs City Solicitor.”
For FOIA’s 193-2022, 194-2022, and 195-2022, the initial fee determination included an estimate of 300-325 pages for each request.
Yet, for 203-2002 there was no reported initial search and no estimate on volume of reviewable records; and both (fee determinations) contained the odd “IT Staff KH” labor cost of $35.99/hr.
Thank you for your prompt attention to this very serious matter.
Donald Moniak
__________________
Footnotes and References
(1) In FOIA Request #230-2022, the following was requested:
“A copy of a listing of all FOIA requests since January 1, 2022 to the City of Aiken. Since this system is very well organized and systematic, I believe there should be a spreadsheet, database, table, or other document, on paper or electronic, that provides a listing of all FOIA requests by number, date of final response, fee determinations, fee collection, and any other information the City of Aiken finds pertinent. I believe this should take less than 15 minutes as this is a living document being updated on a regular basis.”
(2) Here are the three FOIA responses described in Case #1:
FOIA #49-044
Request Date: 3/16/22
Response Date 3/29/22
“In order to comply with this broad and extensive request, considerable staff time will be involved. For instance, an initial keyword search of the City email archive returned 32,000 individual results that must be reviewed for exemptions, attorney-client privilege, relevance, etc. If an average of 30 seconds is spent reviewing each of those mail items that will involve a minimum of 267 hours. The other records involved will require an additional estimated 65 hours from multiple staffers and from various departments to research and fulfill the request. The City of Aiken’s FOIA fee schedule provides for an hourly charge of $16 for such research and collection, therefore the charge to complete the request as stated would be $5,312. Staff will be assigned to begin the compilation of the requested records following the payment of a $1,328 (25%) initial payment. Once the deposit is paid, the City of Aiken would make the documents available within 30 calendar days as required by the South Carolina Freedom of Information Act, §30-4-10. Prior to release of the collected records, the remainder of $3,984 would become due and payable.”
FOIA #54-2022
Request Date: 3/18/22
Response Date: 3/29/22
The response was cut and pasted from #49 to #54 because they were “similar in nature.”
“In order to comply with this broad and extensive request, considerable staff time will be involved. For instance, an initial keyword search of the City email archive returned 32,000 individual results that must be reviewed for exemptions, attorney-client privilege, relevance, etc. If an average of 30 seconds is spent reviewing each of those mail items that will involve a minimum of 267 hours. The other records involved will require an additional estimated 65 hours from multiple staffers and from various departments to research and fulfill the request. The City of Aiken’s FOIA fee schedule provides for an hourly charge of $16 for such research and collection, therefore the charge to complete the request as stated would be $5,312. Staff will be assigned to begin the compilation of the requested records following the payment of a $1,328 (25%) initial payment. Once the deposit is paid, the City of Aiken would make the documents available within 30 calendar days as required by the South Carolina Freedom of Information Act, §30-4-10. Prior to release of the collected records, the remainder of $3,984 would become due and payable.”
The actual invoice listed the total time for search, retrieval, and review as 83 hours; and a cost of $1325 at a rate of $16/hr. There is no invoice for $5312 with a request for 1/4 deposit.
FOIA #89-2022
Request Date 5/12/22; Request Time 12:14 a.m.
Response Date 5/12/22. Response Time 8:18 a.m.
The City of Aiken has determined that in order to comply with this broad and extensive request, considerable staff time will be involved. For instance, an initial keyword search of the City email archive returned 32,000 individual results that must be reviewed for exemptions, attorney-client privilege, relevance, etc. If an average of 30 seconds is spent reviewing each of those mail items that will involve a minimum of 267 hours. The other records involved will require an additional estimated 65 hours from multiple staffers and from various departments to research and fulfill the request. The City of Aiken’s FOIA fee schedule provides for an hourly charge of $16 for such research and collection, therefore the charge to complete the request as stated would be $5,312. Staff will be assigned to begin the compilation of the requested records following the payment of a $1,328 (25%) initial payment. Once the deposit is paid, the City of Aiken would make the documents available within 30 calendar days as required by the South Carolina Freedom of Information Act, §30-4-10. Prior to release of the collected records, the remainder of $3,984 would become due and payable.
(The following was added to #89-2022)
Bear in mind that much of the material you seek will not be disclosed as it is exempt from disclosure. As related to the proposed sale of the referenced properties, FOIA provides that a public body may exempt from disclosure “documents of and documents incidental to proposed sales or purchases of property,” as well as correspondence “relative to efforts or activities of a public body and of a person or entity employed by or authorized to act for or on behalf of a public body to attract business or industry to invest within South Carolina” S.C. Code Section 30-4-40(a)(5), (9). The City has reviewed the FOIA Request and determined the Requested Correspondence is subject to exemption as it relates to the sale of the property and efforts to attract investment. In light of the foregoing, the City has determined to exempt the Requested Correspondence from disclosure and will not produce any documents responsive to that portion of the FOIA Request.
3) FOIA Request #243-2022 was for:
“1. A copy of any and all City of Aiken Freedom of Information Act policy, protocols, or any other document detailing standard procedures to comply with all South Carolina Freedom of Information Act requests; for the period January 1st, 2022 to present.
2. A copy of any and all records from the City’s IT department or other sources pertaining to the “initial search” for records for the following FOIA requests. a. FOIA # 89-2022, submitted at 12:30 a.m. on May 12, 2022; with a response at 8:18 a.m. on the same day. This search request resulted in a fee determination of $5312 with an estimate of 332 hours of search, retrieval, and review time. b. FOIA #49-2022, submitted on May 18, 2022. According to the City’s FOIA tracking spreadsheet, this FOIA resulted in a fee determination of $1328. c. FOIA # 54-2022, submitted on March 18, 2022. According to the City’s FOIA tracking database, this FOIA request resulted in a fee determination of $1328.
The September 15, 2022 response from City Solicitor Laura Jordan read:
“As to No. 1 of your request, the City employs the text of the South Carolina Freedom of Information Act, Title 30, Chapter 4, of the S.C. Code of Laws Annotated. A copy of S.C. Code Ann. 30-4-10, et. seq., cited as the Freedom of Information Act, has been uploaded to the JustFOIA portal. The City, as required by the Freedom of Information Act, employs a published fee schedule describing how charges will be calculated. That schedule is publicly available at the following Website URL: https://www.cityofaikensc.gov/government/freedom-of-information-fee- schedule/
As to No. 2 of your request, no records are generated by the City’s IT Department pertaining to the “initial search” of records for emails. Specifically, no records were created by the IT Department or any other department pertaining to the “initial search” for records for FOIA Requests #89-2022, #49-2022, and #54-2022. FOIA obligates the City to disclose “public records” which by definition only include items in the possession of, or retained by the City. Accordingly, to the extent the body does not have a record conforming to your request, the City is under no obligation to create a public record and has not done so with respect to this item in your FOIA Request.”
Recently obtained documents add weight to allegations that Aiken City Attorney Gary Smith, also the agent for the law firm of Smith, Massey, Brodie, Guynn, and Mayes, violated State of South Carolina ethics law by failing to properly recuse himself from the City of Aiken’s $100 million plus demolition and reconstruction endeavor known as Project Pascalis. No written evidence of a recusal has been produced by the City of Aiken, and Mr Smith has acted in his role as Parliamentarian at numerous City Council meetings where Project Pascalis or its funding was on the agenda.
These documents also further undermine the credibility of City of Aiken contract attorney Gary Pope, who on April 20, 2022 issued a strongly worded, though weakly supported, defense of Mr. Smith, claiming that he had “recused himself” via a phone call at “an early juncture of the project.” Mr. Pope never defined the date of that alleged recusal, and no written recusal, as required by law, has been produced.
Three lawsuits to date (1) allege that City Attorney Gary Smith failed to recuse himself from business related to the $100 million plus downtown demolition and reconstruction endeavor known as Project Pascalis. Specifically, litigation to date describes Mr. Smith acting in his customary roles of Parliamentarian and legal advisor during:
The January 24, 2022 City Council meeting where a proposal before City Council to sell city property to a firm represented by his partner Ray Massey was discussed in closed-door, executive session; and
The March 28, 2022 first public reading and hearing of the Newberry Street privatization (conveyance) ordinance which sought to transfer a part of Newberry Street to RPM Development Partners, LLC in exchange for land owned by Aiken Alley Holdings, LLC, also owned in part and represented by Ray Massey.
To date, litigants have not included his actions in the August 9 and 23, 2021 public hearings when Aiken City Council unanimously approved $10 million in general obligation bonds for use by the Aiken Municipal Development Commission (AMDC) to purchase properties undefined by the ordinance drafted by Mr. Smith, but well known to commissioners and Mr. Smith’s law firm.
Recently obtained documents reveal:
On behalf of their client, WTC Investments, LLC; at least one member of the law firm of Smith, Massey, Brodie, Guynn, and Mayes helped negotiat the purchase and prepared purchase and sale agreements for the seven Project Pascalis properties now owned by the AMDC.
City Attorney Gary Smith had not recused himself in June, 2021 while secret negotiations were ongoing with potential developers.
City officials discussed the potential conflict of interest in June 2021 after Aiken Muncipal Development Chair Keith Wood expressed concern over Mr. Smith’s continued involvement in the project and in potential meetings with developers.
City officials referenced the potential conflict of interest again in December, 2021 when his law partner was announced as a leader in the Project Pascalis development team.
In spite of these facts, Gary Pope, Jr. of the Pope-Flynn law firm stated at an April 20, 2022 public meeting that Gary Smith had recused himself “at an early juncture” of the project and “has been uninvolved in these matters.”
As the presiding officer in these official city proceedings, Aiken Mayor Rick Osbon was also remiss in his oversight of the state’s ethics laws that are intended to prevent corruption in government and to “make public servants more accountable to the citizens they serve in order to restore public trust in government institutions and the political and governmental processes.” (2) When confronted by Aiken County resident Drew Johnson with conflict of interest allegations on May 9, 2021, Mayor Osbon blithely dismissed the issue by stating the “City Attorney does not vote,” and accused Mr. Johnson of libel.
Recusals and the Basis for Conflict of Interest Ethics Violations
South Carolina law prohibits public officials, members, and employees from using their status to gain an economic interest or influence decisions affecting themselves, their family, their associates, and any associated business. The law requires anybody with a conflict of interest real or perceived to present written statements to that affect, and for “presiding officers,” such as Mayors, to excuse the person from the proceedings in which there is a conflict. (3) This is a major anti-corruption statute.
Recusals are not uncommon in City of Aiken proceedings. For example, Mayor Osbon recused himself from November, 2019, to January, 2020, from the process of selling city property composed of two parts: the City’s former finance and administrative building at 135 Laurens St, SW.; and a parking lot and drive-up building at 130 Pendleton St SW. The purchaser was WTC Laurens, LLC a firm owned, at least in part, by local investor and developer Weldon Wyatt, managed by his son Tom Wyatt, and represented by Thomas “Chip” Goforth. The final negotiated purchase price was $1.3 million. (4)
Mayor Osbon recused himself because he owned adjacent property where his downtown dry cleaning business, Osbon Cleaners, is located. Mayor Osbon’s recusal turned out to be especially necessary, because in May, 2021, the investment firm he represents, R and O, LLC, purchased the Pendleton Street portion of the property for $500,000 from WTC Laurens, LLC. City Attorney Gary Smith, who has held the position on a contractual basis since 1996, announced Mayor Osbon’s recusals during the sale process.
The power and significance of the City of Aiken’s City Attorney is apparent in state law, and city code and policy. According to the City of Aiken’s “Handbook for Effective Boards, Commissions and Committees:”
“The City Attorney, like the City Manager, is appointed by, and serves at the pleasure of, the City Council. As the City of Aiken’s chief legal advisor, the City Attorney consults with the City Council, its committees, the City Manager, and other city officers, when requested, on all legal questions arising in the conduct of city business. The City Attorney also serves by preparing city ordinances, reviewing all contracts to which the city is a party, and appearing for the city in all actions, cases, and special proceedings before all courts in which the city is a party. The City Attorney is directly responsible to the City Council, but acts in concert with the City Manager. “ (5)
According to a 2003 opinion from the South Carolina Attorney General’s office, the City Attorney is considered a “pubic member” subject to the same rules as public officeholders. In her lawsuit alleging a conflict of interest, Aiken resident Kelly Cornelius cited this 2003 opinion declaring the position is an “office for dual-office holding purposes.” At the time, Gary Smith was inquiring if his position as City Attorney disqualified him from holding a position with the Aiken County Commission on Higher Education. He believed he could hold that office, while the Attorney General disagreed. (6)
The City Attorney also acts as the City’s “Parliamentarian,” generally defined as “an expert in interpreting and applying the ‘Rules of Order’ for meetings,” that “enable groups to efficiently and fairly discuss and determine actions to be taken.” Gary Smith explained this role to the AMDC during his June 2, 2020 briefing on FOIA, ethics, and procedure, citing Section 2-68 of the municipal code:
“City attorney to attend, act as parliamentarian, etc. The city attorney shall attend all meetings of the council, unless excused by the council. The city attorney shall act as parliamentarian, propose ordinances and resolutions, review all ordinances, resolutions and documents presented to the council and give opinions upon questions of procedure, form and law to any member of the council.”
Smith also outlined ethical issues under SC law to AMDC commissioners that day.
d. Ethical Issues for City Council and Board Members i. Sec. 8-13-700(A), SC Code of Laws—No public official… may knowinglyuse his official office, membership, or employment to obtain an economicinterest for himself, a family member, an individual with whom he isassociated, or a business with which he is associated. ii. If a Council member is concerned about a possible conflict of interest,thatmember should consult the City Attorney who will seek an Informal EthicsOpinion from the South Carolina State Ethics Commission. 1. Please give as much notice as possible as these opinion letters cantake up to a month to process. iii. If a Council member is determined to have a conflict of interest, thatmember must refrain from ALL discussions regarding the matter. 1. Council member to leave the public meeting during the discussionand vote on the matter. 2. Council member must fill out the City Conflict Form. 3. Council member should have no informal discussions with Staff,other Council members, or the public.” (7)
There can be no doubt that after twenty six years as the City of Aiken Attorney, Gary Smith is an expert on the theoretical application of ethics law to city government. Yet, time and again he failed to formally recuse himself in writing, as mandated by ethics law, from proceedings where there were obvious and potential conflicts of interest; and this began early in the Project Pascalis history.
It also can not be overstated that while the City Attorney does not have a formal vote, they are integral to influencing and shepherding the city’s legislative process. It is one of the most powerful and influential positions in city government, alongside the City Manager and the Mayor.
The “Early Juncture” of Project Pascalis
On April 20, 2022, contract attorney Gary Pope, Jr. of the Pope-Flynn law firm informed a public gathering that Gary Smith had phoned him at “an early juncture” in the Project Pascalis proceedings to inform Mr. Pope he needed to fill the City Attorney role for project issues because Mr. Smith had recused himself. No date was given for the alleged recusal, and Mr. Pope did not discuss the fact that a phone call between colleagues is not a lawful recusal under South Carolina ethics law.
The only evidence the City of Aiken has provided in support of the recusal contention is an October 14, 2021 “Dual Engagement” agreement between the AMDC, the City of Aiken, and the Pope-Flynn law firm. The letter contains no reference to any recusals on the part of Gary Smith.
The earliest juncture of Project Pascalis is March 2021, when the AMDC announced on March 17th it had “identified and recruited an experienced, well-capitalized developer” to enter into a joint redevelopment venture with the city. Members of the law firm Smith, Massey, Brodie, Guynn, and Mayes were responsible for negotiating property purchases in what would come to be known as the Project Pascalis development area.
Also in March, 2021, Aiken City Council sanctified this land consolidation approach, though not the exact mechanism, by approving an “Economic Master Development Plan” prepared by the AECOM corporation (8). In the plan, consolidated land ownership is encouraged, while “fragmented” property ownership is cited as an impediment to growth.
Following the adoption of the AECOM plan, on March 29, 2021 Mayor Osbon wrote a letter to the AMDC in which he outlined his and “his colleagues” goals, including a conference center with a capacity for 500 people, adjacent to “first class lodging,” that should include a renovated or redeveloped Hotel Aiken — all with sufficient parking.
The law firm of Pope-Flynn, which had acted as counsel in previous City of Aiken municipal bond actions, was working for the AMDC. Attorney Gary Pope, Jr.; completed a cost-sharing agreement between the AMDC and project developer GAC, LLC (agent: Weldon Wyatt) in March 2021; and worked on an incentive agreement with the developer in April, 2021.
It is unclear who was providing additional legal advice to the AMDC during this period. Neither Gary Pope, Jr, nor Gary Smith are listed on the attendee list of any AMDC public meetings from March, 2021 through October, 2021, even though the AMDC held nine meetings during this time, including eight closed-door, executive sessions.
Documents dated between March, 2021 through June 11, 2021 indicate that Gary Smith had not recused himself from Project Pascalis proceedings even as his own law firm represented the land purchasing arm, WTC Investments, LLC (Agent: Ray Massey) of the project’s developer, GAC, LLC (Agent: Weldon Wyatt). Smith had also not recused while his partner, Ray Massey, was involved with soliciting other developers after GAC, LLC withdrew from the project in early May, 2021, nor after a discussion about potential conflict of interest occurred between AMDC commissioners and City Manager Stuart Bedenbaugh.
Simply put, the early Project Pascalis system of property acquisition (see “Property Aquisition Timeline”) and design worked as follows:
The AMDC and GAC, LLC finalized a cost-sharing agreement, drafted by Attorney Gary Pope, on March 23, 2021 that required GAC, LLC to be able to obtain properties necessary for development, and
Smith, Massey, Brodie, Guynn, and Mayes, on behalf of WTC Investments, LLC, and Alley Holdings, LLC (Agent: Ray Massey) made arrangements to consolidate land for the redevelopment effort.
Members of Smith, Massey, Brodie, Guynn, and Mayes, LLC negotiated and prepared purchase and sale agreements to consolidate property for Project Pascalis on behalf of WTC Investments, LLC. (9)
On April 4, 2021, Smith, Massie, Brodie, Guynn, and Mayes, LLC sent a $6,800 “Bill for Services Rendered” to WTC Investments, LLC, ATTN: Chip Goforth.
“Prepare Contracts and negotiate contracts for purchase of hotel, purchase of Mrs. Anderson’s property and purchase of Antique Mall.”
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Two weeks later GAC LLC submitted an invoice to the AMDC that included half of this cost (see below).
At the time, WTC Investments, LLC was reported as “dissolved” by the South Carolina Secretary of State’s Office. It would not be reregistered as a SC limited liability company until May 11, 2021, the day before the Chamber of Commerce took assignment of the “Shah Property” consisting of six different properties. The agent for the newly reregistered WTC Investments, LLC was Ray Massey, just as he had been when WTC Investments unsuccessfully pursued redevelopment of the old Aiken hospital property in 2019.
Smith, Massey et al also controlled the $135,000 in earnest money deposited by WTC Investments for the seven properties. The last of this earnest money was released in June, 2021. On June 3, 2021, Thomas “Chip” Goforth from WTC wrote to Mary Guynn, and cc’ed to Ray Massey:
Mary, We assigned the Myrtle Anderson Contract to Aiken Chamber of Commerce (ATTACHED), you can release the $35,000 Earnest Money we had up. You can wire to our account.
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The next day, GAC Management, LLC sent an invoice to “City of Aiken Municipal Development Comm, “Attn Tim O’Briant” for $14,417.50 for concept design and property contract work. $3,400 is billed for “Prepare Contracts and negotiate Contracts for purchase of hotel, purchase of Mrs Anderson’s property, and purchase Antique Mall.”
This is fifty percent of the amount billed to WTC Investments, LLC by Smith, Massey et al on April 4, 2021, as was allowed under the AMDC/GAC cost sharing agreement.
There is no doubt that members of the law firm of Smith, Massey, Brodie, Guynn, and Mayes were heavily involved in the earliest stages of Project Pascalis.
Phase Two Begins and A Flag is Raised
After the Chamber of Commerce took assignment of the seven properties, on behalf of the AMDC, in the proposed Project Pascalis demolition and reconstruction zone, Ray Massey pursued development options in conjunction with AMDC efforts to solicit new developers. In a June 4, 2021 email exchange between WTC Investments, LLC representative Chip Goforth and AMDC Executive Director Tim O’Briant cited “Ray and his group,” as a party pursuing new developers for the project.
In early June, 2021 the AMDC was also in discussions to select an unnamed developer in response to a privately issued request for proposals (RFP) sent in May, 2021 to select firms. On June 10th Tim O’Briant sent an email titled “Lobbying Concerns” to all AMDC members, City Manager Stuart Bedenbaugh, Diana Floyd, and ex-officio member Arthur Rich (10). In it, O’Briant wrote:
I understand that at least one of the firms we considered on Tuesday in executive session is making efforts to contact commission members to lobby for their proposal.
In all cases, please refer any questions about the status of the selection or the process to me. While I am pursuing discussions with the single developer, I will not be informing the other firms of that and until late next week at the earliest. I know I don’t need to remind you that any discussion of what occurred in executive session could be very damaging to the process.
Please call me if you have any questions or concerns.
Hours later, in response to the email, AMDC Chair Keith Wood raised the conflict of interest issue, but cited the matter as “CONFIDENTIAL” and only related his concerns to City Manager Stuart Bedenbaugh, Tim O’Briant, AMDC Vice Chair Chris Verenes, and AMDC Treasurer David Jameson. Wood wrote on June 10, 2021:
CONFIDENTIAL Stuart, Indirectly related, I have concerns relative to a conflict of interest the City Attorney may have in our process. I noted that Ray Massey submitted the Alley proposal on letterhead that included Gary Smith’s name. In addition, I am concerned that Gary’s attendance in future meetings with developers may compromise our process based on his relationship with Ray Massey (i.e. same legal firm). I recommend we ensure the proper firewall exists to alleviate any real or perceived conflict of interest.”
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Bedenbaugh responded early the next morning, June 11, 2021, with a statement that appeared to confuse Attorney/Client privilege with the conflict of interest provisions in SC ethics law:
Keith, Thank you for reaching out. We have had similar questions in the past and have not had any problems. Gary is bound by Attorney/Client privilege as the City Attorney and historically has taken that very seriously, as he recognizes he could face discipline by the SC Bar, as would any attorney that violates that precept.
Smith, Pope and Project Pascalis: Fundraising, Property Purchases, and the Selection of RPM Development Partners, LLC
Gary Smith continued in his role as the City of Aiken Attorney during Project Pascalis related proceedings. On August 9th and 23rd, 2021, Gary Smith was the Parliamentarian and legal counsel when City Council passed an ordinance authorizing, without a referendum, a $10 million general obligations bond issuance. The bond issuance allowed the AMDC to purchase undefined private property within the city’s Parkway District under the pretext of addressing abandoned buildings and impending blight, but without specifying which properties were being sought. (11)
Gary Pope, Jr acted as a counsel on the bond issue, as his firm had prepared the offering.
However, the Pope-Flynn law firm’s Pascalis work was not formalized until the signing of a October 15, 2021 letter titled “Advice and Counsel—-Joint Engagement by City of by Aiken Municipal Development Commission and City of Aiken.” In it, Pope-Flynn laid out the terms of the firm’s Project Pascalis involvement. (12) Although six months later this was cited as evidence of Gary Smith’s recusal, no reference to any recusals are in the agreement letter.
Shortly after that, Pope-Flynn’s involvement grew. The AMDC paid $9.5 million to accept the Chamber of Commerce property “assignments” on November 9, 2021. Pope-Flynn’s invoice for November, 2021 for $19,586 of billable work to the AMDC for described 62.8 hours of work by Pope-Flynn lawyers and paralegals involving the $9.5 million purchase, subsequent relocation assistance agreements, a “Letter of Intent” from Newberry Hall’s owners Patrick and Natalie Carlisle, AMDC meetings and executive sessions, and then another set of purchase and sale agreements. (13)
The purchase and sale agreements (PSAs) that Pope-Flynn helped prepare in the latter half of November, 2021 were between the AMDC and RPM Development Partners (Agent: Ray Massey), which had registered as a South Carolina company on October 27, 2021, nearly two weeks after the Dual Engagement letter was signed. RPM is primarily composed of Raines Company (or Raines Hospitality Group), the Lat Purser company, and Ray Massey. City officials and Massey have declined to identify any other local investors.
From December 1 to December 3, 2021, Tim O’Briant and the AMDC “Executive Committee” drafted and crafted a news release regarding the selection of RPM and the signing of the PSA’s. (14) In a December 2, 2021 email, AMDC Chair Keith Wood once again referenced the potential conflicts involved with having a City Attorney involved with the city’s developer that was represented by his law partner. Wood wrote:
1. Do we have to mention the Massey law firm as written? I think having Smith’s name in the release will raise unwanted questions. 2. Should we quickly mention our process to select RPM? If not, I think I need to do so tomorrow. 3. Let’s add a link to the Rainesco web site.
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O’Briant answered fifteen minutes later, giving a nod to the power of investigative reporting:
Massey is listed as RPM’s registered agent and the firm’s headquarters as recorded by the Secretary of State are his law office. Paper will report that regardless.
As for the procurement process, O’Briant wrote:
Best done during the presentation and not written in materials.
Three hours later another draft was complete and Keith Wood wrote:
I am fine with this if Rainsco and Massey are comfortable with the sentence highlighted in yellow.
That sentence read:
“The Raines-led team was assembled by and includes a group of Aiken investors, including Attorney Wm. Ray Massey.”
It is unknown whether O’Briant called Raines and Massey or contacted them through one of his private email accounts, but twenty minutes later he wrote:
“They just gave it a thumbs up across the board.”
The news release was sent out the next day and RPM Development Partners, LLC was formally introduced as the Project Pascalis developer. Ten days after choosing its developer, the AMDC published a Request for Proposals for Project Pascalis in the Aiken Standard. This RFP advertisement was also prepared by Gary Pope, Jr. This belated attempt to satisfy South Carolina Community Development law is another subject of litigation.
The 2022 Project Pascalis Land Deals
On January 24, 2022 , Gary Smith was the Parliamentarian and city counsel when City Council considered a purchase and sale agreement for city owned property to a firm owned in part and represented by his partner, Ray Massey. One of the properties, the Municipal building fronting The Alley, was proposed for a five story retail and apartment complex in the original Pascalis designs; as part of a larger residential complex that included property in The Alley owned by Massey’s firm Aiken Alley Holdings, LLC.
As described in Blake et al vs. The City of Aiken et al (1), a purchase and sale agreement already signed by Ray Massey was presented to City Council in their agenda packet. The issue was discussed in closed-door, executive session. Subsequently, the agenda item was tabled but not rejected. The proposed sale can be revisited at a future date.
Gary Smith at March 28, 2022 City Council meeting defending the Newberry Street privatization ordinance
On March 28, 2022 Gary Smith was the Parliamentarian and city counsel when City Council held its first reading and public hearing before a packed council chambers pertaining to an ordinance privatizing 0.644 acres of Newberry Street as part of Project Pascalis. Earlier in the month, on March 1st, the city’s Design Review Board (DRB) conditionally approved the demolition of the Hotel Aiken and the 106 Laurens Street building, home to three existing small businesses.
Controversy surrounding the project was increasing, and Freedom of Information Act (FOIA) requests were beginning to affect the process. According to a Pope-Flynn billing invoice for Project Pascalis, on March 18, 2022 Gary Pope, Jr billed 0.5 hours for “communications with Gary regarding overly broad FOIA requests and research of prior language.” That half hour of communication cost the City of Aiken at least $225, as Gary Pope Jr’s rate is $300/hr and Gary Smith’s rate is $150/hr. (Clarification: 10/5/21: The billing was for Pope-Flynn associate Sarah Weathers, probably for discussion with Gary Pope, Jr.)
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The Newberry Street ordinance would transfer a significant portion of the publicly owned Newberry Street to RPM Development Partners, LLC in exchange for two smaller parcels totalling 0.24 acres owned by Aiken Alley Holdings, LLC . The “property swap,” as the ordinance phrased it, was conditional upon final agreements being reached between RPM and the AMDC. (15)
The city’s odd justification for the “property swap” was that, without it, the proposed apartments and conference center on that block would exceed the city’s fifty-five foot height requirement. The fact that the AMDC had offered a part of Newberry Street to prospective developers in May of 2021 never came up for discussion that day.
The meeting was unusually full, with more than eighty people attending. Public comments overwhelmingly opposed the privatization proposal as well as the overall project. The last speaker was Design Review Board member Katy Lipscomb, who described the process as segmented, disjointed, and confusing.
Immediately after the public comments, Gary Smith became involved in the discussion of an ordinance he had helped write and that clearly involved his partner’s interests. In an exchange that verified Lipscomb’s sentiment, Smith himself initially appeared confused and deferred to AMDC Executive Director Tim O’Briant for clarification. Smith then turns more assertive and helps guide the ordinance towards approval. This transcript of the exchange reveals the confusion and complexity of the arrangement:
Ed Woltz:
I don’t see where (the ordinance) mentions Aiken Alley Holdings as transferring property. It mentions an RPM or RNP whatever it is but they don’t own the property . Aiken Alley Holdings does. So we’re doing an ordinance to transfer property with a group that doesn’t own the property is that correct?
Mayor Osbon:
I’d look to our city manager.
Stuart Bedenbaugh:
That is correct the ordinance does not mention Aiken Alley Holdings that is correct, but Aiken Alley Holdings consists of the same partners or some of the same partners so I would refer to I guess the city attorney, and is that something that could be handled with an amendment to the ordinance.
Gary Smith:
Um, maybe Tim knows the answer better than I do I thought that the agreement was between AMDC and the owners of the property. Did I misunderstand that? That’s how I understand.
Tim O’Briant:
That is correct there are additional members and investors in the rpm group outside of the Aiken Alley Holding which is a local group and yes those agreements would be between the AMDC and those investors. That would be contingent on their conveying that property to the overall project which is seen as in the betterment of the entire city to provide this economic development, and the conveyance of this right-of-way is going to be contingent on getting that entire agreement worked out with everybody. Essentially the vision of the ordinance is that all of this would happen simultaneously at any closing. Any closing is contingent upon DRB site plan approval, it’s also no small point about the elected officials. The real approval will be when the full plan is here and the council is asked to fund the project or not, so it will come back before council all of those pieces would have to be in place before the individual things came together.
Ed Woltz:
But this agreement, because we don’t have the owners of the property how’s it, I’m not smart to figure out how it can hold up when the people in the property aren’t a part of it. Just because some of the people are on that group doesn’t mean that the whole group’s going.:
Gary Smith:
If we don’t have a global agreement with all of the partners in the city and the Aiken Municipal Development Corporation then none of this is going to happen.
Ed Woltz:
Okay so don’t we need an agreement between Aiken Alley Holdings and RPM be executed too at the same time so when we agree with something with RPM we know that they can get the
Gary Smith:
We don’t have any control over that.
Ed Woltz:
Unless I miss that I’m not smart enough to figure this out.
Gary Smith:
In order for the right-of-way to be conveyed there’s going to be an agreement between everybody that has to be involved in the agreement and that’s going to include conveying the…
Ed Woltz:
I’m not a lawyer I don’t know I don’t see this I understand your simple language but i don’t see it here to say that and and so um i guess I’m a little confused.”
Tim O’Briant:
Yes sir, but this would authorize the mayor to execute the documents if all of the conditions precedent were met so i believe that that being the case if RPM development did not hold that property we would not convey it correct.
The April 20th Public Meetings: A Past Recusal is Vaguely Referenced
Gary Smith was not present on April 20, 2022, when the AMDC held the first open, public meetings, moderated by Tim O’Briant, addressing the entirety of the Project Pascalis proposal. (16) Instead, Gary Pope sat in his place, even though he, too, had worked on the project since its inception, including crafting the $10 million bond issuance that financed the AMDC purchase of the seven properties in the Project Pascalis proposed demolition zone.
The City of Aiken had replaced Gary Smith with Gary Pope, Jr., although this fact was not shared during the first meeting. Moderator Tim O’Briant did not explain the reason for Mr. Pope’s presence at either meeting until the conflict of interest issue was raised in the evening meeting by Aiken resident Kelly Cornelius. Three minutes after raising her concerns, and following another speaker, O’Briant returned to the issue, stating:
I was having a vapor lock which gave me an opportunity to remember what I wanted to say. I was a little bit concerned whenever individuals names are raised and brought into things. I don’t know if if Mr. Massey is here and if he’d like to address any of those concerns . I’m not sure if he’s here but I would like for Gary Pope just to discuss his role with the city and the commission and how that came to be and uh how the legal profession handles these ideas of uh conflicts.
O’Briant then deferred to Gary Pope for insights and opinions. Pope described a vague recusal process in an effort to prevent Gary Smith from being “besmirched:”
My name is Gary Pope. I’m with Pope Flynn. I work out of the Spartanburg and Columbia offices. I’ve typically served the city and capacity as bond council in connection with financings and also other special projects. At an early juncture in this project Gary Smith called me and said I believe that my partner may have maybe proposing as part of a group for this so I’m going to recuse myself, and I need you to represent the city and the AMDC as we go through this process.
So Mr. Smith has been uninvolved in these matters and I’ve been handling them on behalf of the city so I wanted to make sure before his good name was besmirched and let the record sort of reflect that we have done things by the book the right way and didn’t want to let that pass right, didn’t want that angle, and also that the property was sold from the sellers to the AMDC which Mr. Smith I believe does not represent any capacity currently that’s that’s my role at present, so i wanted to also clarify that he’s recused himself. (. )
Gary Pope, Jr never defined the date when Gary Smith called him, only stating it was at an early juncture; he did not articulate his role as defined in the October, 2021 “Dual Engagement” agreement. Mr. Pope did not explain that a phone call between colleagues is not a legally binding means of recusal in South Carolina, where the law requires “public members” such as Gary Smith to submit a written statement describing the matter and the conflict and “furnish a copy to the presiding officer of an agency, commission, board, or of a county, municipality, or a political subdivision thereof, on which he serves.”
May 9th, 2021: The Newberry Street Ordinance Has a Different City Attorney.
On May 9th, the Aiken City Council held a public meeting that included a second hearing on the Newberry Street privatization ordinance (17). By this time the ordinance had been amended to include 0.26 acres of Newberry Street, but the building height justification remained.
Gary Pope at the May 9,2022 City Council meeting defending the Newberry Street privatization ordinance.
According to another Pope-Flynn invoice (18) for Project Pascalis, ethics was a billable subject prior to the meeting. The invoice for the month of May, 2021 reveals that Gary Pope, Jr billed 1.7 hours for discussions involving a “question of a conflict of interest asserted by Ms. Dione,” referring to Aiken attorney Dionne Carroll.
Absent from the entire proceedings was Gary Smith and in his place as Parliamentarian and legal counsel on all city matters was Gary Pope, Jr. According to Pope-Flynn’s May 2022 invoice, Pope had helped amend the Newberry Street privatization ordinance.
The chamber was standing room only, with more than 120 people in attendance. This time supporters of the proposal appeared and spoke, and approximately fifty people stood up when asked to by Chamber of Commerce Board President Norman Dunagan.
Conflict-of-interest issues were raised at least five times that evening. The earliest exchange, between Mayor Osbon and Aiken City landowner Drew Johnson, had passages not recorded in the official meeting minutes. As Johnson was stating, “you can’t have a city attorney give millions of dollars to his—“, Mayor Osbon interrupted to state: “The city attorney doesn’t vote to give any money.”
Johnson replied:
Well you and you guys all knew about that y’all had to have known that they were business partners which makes you guys look really bad. This is crazy.”
Mayor Osbon interrupted again, stating:
You can’t stand and libel the City Attorney.”
Johnson replied, referring to Gary Smith’s presence at the March 28, 2021 meeting:
I mean, I’m just telling the facts he was at the meeting.
Video clip from May 9 meeting exchange between Drew Johnson and Mayor Osbon
At no time did Mayor Osbon acknowledge state law and city policies guiding potential conflicts of interest, nor did he acknowledge that while the City Attorney does not vote, he does prepare the ordinances that are up for a vote and provides legal counsel during the debate, as he did on March 28th.
After the public comment period, Council person Ed Woltz was the first member to speak, as he had been on March 28th. He articulated a number of concerns regarding the ordinance, primarily that Council would not have a final say on the matter. According to the minutes:
He felt it was Council’s obligation to the citizens of Aiken that we take a look at this before we give away the street. The people who are developing this have nothing but the best in mind, but it may not be what the rest of the committee thinks. He felt Council needs to take a second look, and we need to make sure we have the last say ‘yes’ or ‘no’ on whether this is a good master development agreement because it will affect the whole town.
Council person Kay Brohl then spoke, describing past projects as “controversial” while not addressing Woltz’s concerns. She also spoke obliquely to the conflict of interest issue by defending her colleagues:
Y’all were very respectful tonight but I’ve heard in times past insinuations that something underhanded or secretive has been going on that is just not true and I think that’s an affront to all of our character I don’t know anyone up here would do something like that and to have that insinuated about us is hurtful and disappointing.
Following Brohl’s comments, Pope interjected to offered legal counsel to Council regarding the issue raised by Woltz, accurately described in the minutes:
Mr. Gary Pope, Attorney, stated to Councilman Woltz’ point strictly speaking legally,the master plan does not need to come back to Council, but from a practical sense, it has to come back to Council because the public infrastructure is likely to be paid for by City Council and the money will need to be appropriated and the plan for finance will need to be finalized. That will need to happen before the master development agreement is finalized. For a practical sense it will have to come back, but speaking from a very narrow legal sense it does not need to come back, but it will be back.
Brohl commented again, agreeing with Pope, and stating:
But that’s the bottom line. I think people don’t understand that that they are not going to be given this money until this is finished.
Pope’s counsel also empowered Councilperson Andrea Gregory to state that City Council had the last word, that the “conveyance” and the project could not continue without approved funding.
After more discussion, the vote was taken and the ordinance passed 6-1, with Councilperson Woltz casting the lone dissenting vote.
Conclusions
Between March, 2021 and May, 2022, the two main attorneys for Project Pascalis have acted in a manner that undermines their credibility and severely weakened the public process.
City Attorney Gary Smith never recused himself from Project Pascalis related business, even though members of his law firm were involved in the project from its inception — both as representatives for the first developer and, at least in the case of Ray Massey, as investors in the project.
Mr. Smith was responsible for writing ordinances—and signing off on their approval—that provided nearly $10 million for the AMDC to purchase downtown properties and to give away a portion of Newberry Street to a developer represented by his law partner. On March 28, 2022, he provided legal counsel that helped guide the ordinance towards approval. All of this happened even after one member of the AMDC, Chairman Keith Wood, twice expressed concern over Smith’s role in the process.
From the beginning of the project, Pope-Flynn law firm’s Gary Pope, Jr has participated more directly and much more often in the Project Pascalis process than Gary Smith. Although he has yet to be named in any litigation, his role is hardly without controversy.
In November, 2021 Gary Pope, Jr. prepared the public advertisement for an RFP at the same time he was helping draft purchase and sale agreements with the yet to be announced developer. In March 2022 he consulted with Gary Smith on Project Pascalis FOIA issues. On April 20, 2022 he openly condemned any thought that Mr. Smith had not recused himself, and offered a legally invalid excuse, a phone call, as a means of recusal.
In preparation for the May 9, 2022 meeting, Mr. Pope helped amend the Newberry Street privatization ordinance. During the meeting he offered legal advice that helped solidify and justify support for the ordinance that led to its approval; which in turn gave strength to a project for which his firm was billing $8,000 to $11,000 of work per month to the City of Aiken’s Municipal Development Commission.
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References
(1) Aiken City Attorney Gary Smith has been named in three lawsuits this year alleging violations of South Carolina State Ethics Laws in relation to his partnership with Project Pascalis investor and developer Ray Massey, who is also the listed agent for RPM Development Partners, LLC.
a. On May 9, 2021 Kelly Cornelius filed a civil appeal complaint against Aiken City Council in the Court of Common Pleas alleging conflict of interest involving City Attorney Gary Smith for failing to recuse himself during the March 28, 2021 Aiken City Council hearing regarding the partial privatization of Newberry Street as an integral part of Project Pascalis.
In response, City of Aiken attorneys from the law firm of Nance and McCant’s filed a motion to dismiss, claiming the suit was filed in the wrong jurisdiction. No denials of conflict of interest allegations were made.
b. On May 10, 2022, John “Drew” Johnson filed a civil appeal complaint against Aiken City Council, Mayor Rick Osbon, City Attorney Gary Smith, and City Manager Stuart Bedenbaugh, in the Court of Common Pleas. Johnson also alleged a conflict of interest involving City Attorney Gary Smith for failing to recuse himself during the March 28, 2021 Aiken City Council hearing regarding the partial privatization of Newberry Street as an integral part of Project Pascalis.
The same response from the same legal firm as Cornelius vs Aiken City Council was made. Again, City of Aiken attorneys did not dispute the allegation, and sought to have the case dismissed on jurisdictional grounds.
c. On July 5, 2022. David W. Blake, Luis E. Rinaldini, Dudley Richard Dewar, Jenne Stoker, Beatrice B. McGhee, Gail King, Historic Aiken Foundation, Inc., Green Boundary Foundation, and the South Carolina Public Interest Foundation, filed a lawsuit in the Court of Common Pleas, Second Judicial Circuit of South Carolina, against the City of Aiken. The lawsuit named twenty-eight defendants ranging from Aiken Mayor Rick Osbon to RPM Developers,LLC. One of the defendants was Gary Smith.
Items pertaining to City Attorney Gary Smith’s conflict of interest include:
48. Gary Smith (“Smith”) served, at all times pertinent to this lawsuit, as the City of Aiken’s designated attorney and repeatedly advised the City, the AMDC and the DRB about redevelopment projects and matters that are subjects of this lawsuit and in which Ray Massey and Mary Guynn, Smith’s law partners, have and have had financial interests undisclosed to the public.
106. The first public announcement of Gary Smith’s recusal was made at the second of two information meetings about Project Pascalis, both held on April 20, 2022. No information about Smith’s recusal has been noted in any minutes or other public record of the AMDC or the City, as required by S.C. Code Sections 8-13-700(B).
136 The CTR Sale was documented in a fully negotiated Purchase and Sale agreement dated December 21, 2021, initialed on every page by, and signed by, Ray Massey and ready for City signatures. The Ordinance had signature blocks for Rick Osbon as Mayor, Gary Smith as City attorney, and Sara Ridout as City Clerk.
187 A. Gary Smith, the City Attorney, participated in numerous meetings dealing with, and gave advice and numerous opinions regarding, matters related to Project Pascalis matters related thereto after his law partner, Ray Massey, became and was an interested party in or before March 2021 by acquiring interests in Pascalis Project property and by representing WTC and RPM, and even though Mary Guynn, his law partner, owns a building on the Pascalis block and may represent other owners, investors and/or tenants in the Pascalis block;
The pertinent section is SC 8-13-700 (B), “Use of official position or office for financial gain; disclosure of potential conflict of interest;”
No public official, public member, or public employee may make, participate in making, or in any way attempt to use his office, membership, or employment to influence a governmental decision in which he, a family member, an individual with whom he is associated, or a business with which he is associated has an economic interest.
A public official, public member, or public employee who, in the discharge of his official responsibilities, is required to take an action or make a decision which affects an economic interest of himself, a family member, an individual with whom he is associated, or a business with which he is associated shall:
(1) prepare a written statement describing the matter requiring action or decisions and the nature of his potential conflict of interest with respect to the action or decision;
In the case of public officials or members:
(4) if he is a public official, other than a member of the General Assembly, he shall furnish a copy of the statement to the presiding officer of the governing body of an agency, commission, board, or of a county, municipality, or a political subdivision thereof, on which he serves, who shall cause the statement to be printed in the minutes and require that the member be excused from any votes, deliberations, and other actions on the matter on which the potential conflict of interest exists and shall cause the disqualification and the reasons for it to be noted in the minutes;
(5) if he is a public member, he shall furnish a copy to the presiding officer of an agency, commission, board, or of a county, municipality, or a political subdivision thereof, on which he serves, who shall cause the statement to be printed in the minutes and shall require that the member be excused from any votes, deliberations, and other actions on the matter on which the potential conflict of interest exists and shall cause such disqualification and the reasons for it to be noted in the minutes.
(4) “The Cleaners: How Aiken City Council got Taken to the Cleaners by the Wyatt Family” can be read at:
“The City Attorney, like the City Manager, is appointed by, and serves at the pleasure of, the City Council. As the City of Aiken’s chief legal advisor, the City Attorney consults with the City Council, its committees, the City Manager, and other city officers, when requested, on all legal questions arising in the conduct of city business. The City Attorney also serves by preparing city ordinances, reviewing all contracts to which the city is a party, and appearing for the city in all actions, cases, and special proceedings before all courts in which the city is a party. The City Attorney is directly responsible to the City Council, but acts in concert with the City Manager. “
City of Aiken Handbook Section 8-13- 700(A) provides:
“No public official, public member, or public employee may knowingly use his official office, membership, or employment to obtain an economic interest for himself, a member of his immediate family, an individual with whom he is associated, or a business with which he is associated. This prohibition does not extend to the incidental use of public materials, personnel, or equipment, subject to, or available for, public officials, public members, or public employees use which does not result in additional public expense. “
On August 9, 2021 Smith was present, and did not recuse himself, when Aiken City Council unanimously approved a $10 million general obligation bonds issuance for the AMDC to purchase property. While Gary Pope was the bond counsel for the city, Smith remained in his Parliamentarian role throughout the proceedings, as reflected in the August 9, 2021, meeting minutes:
The basis for the bonds was to purchase property as part of a “land bank” in the city’s Parkway District, an area running from Morgan Street to Williamsburg Street. The proposal was not specific to the downtown, and the memorandums of support from AMDC Chair Keith Wood, AMDC Executive Director Tim O’Briant, and City Manager Stuart Bedenbaugh did not specify any properties.
Instead, the memorandums spoke only in generalist terms, of an historic district with abandoned buildings, impending blight, and a need to consolidate properties because “fragmented property ownership” was deemed an impediment to redevelopment. This sentiment was instilled in the ordinance authorizing the bonds.
“The City may soon be in a position to obtain control over a significant and meaningful portion of Parkway District suffering from disuse and deterioration, and which portion of Parkway District may soon be blighted. Such property assemblage is a first step and condition precedent to the redevelopment of a significant portion of Parkway District, and theCity Council expects that the revitalization of the area will “encourage private investment in an area that has been ignored and even avoided for many years byprivate investors.”‘ City Council finds that such redevelopment will address the health and safety concerns attendant to abandoned buildings, buildings, and will also significantly add to the City’s tax rolls both due to the specific redevelopment of parcels to be initially acquired by the City and also due to anticipated follow- on investment throughout the Parkway District area.”
Even though the AMDC held the option for specific properties, no specific properties were identified in the ordinance. As it turns out, the bonds were not for “abandoned buildings,” they were for properties that were presently occupied by nine different businesses. Only one rental property was vacant, and the Hotel Aiken was officially undergoing renovation and was not abandoned.
A sunny Saturday afternoon in downtown Aiken, July 2022 (Photo courtesy of Michael Aiken)
Three recent Freedom of Information Act (FOIA) requests to the City of Aiken regarding the ongoing downtown demolition and redevelopment endeavor known as Project Pascalis yielded either no documents or incomplete documentation. But the paucity of documentation functions, in these cases, as good information shining more bad light on the vagaries of Project Pascalis.
The following information is good to know:
The City of Aiken has not compiled an account of questions and answers from its Project Pascalis public meetings of April 20th, 2022, and one of its meeting transcripts (which it has yet to release) omits all public comment. (1)
An offer was made to purchase the Aiken Antique Mall in March, 2021 as part of a larger land consolidation effort during the earliest stage of project development (2). The Aiken City Attorney’s law firm billed Weldon Wyatt’s investment and development firm WTC, Investments, LLC for the effort.
There is no contract yet between the City of Aiken and Newberry Hall’s operators for the management and operation of the proposed city-owned conference center. (3)
The City’s Listening Skills Are Not on Display
The City of Aiken’s website includes a five year old page titled “City of Aiken Revitalization Project.” This was the “Downtown Renaissance” project that included some elements found in the Project Pascalis proposal, but was more dispersed and did not involve demolishing a substantial portion of downtown Aiken. On that page, the City declared:
Downtown revitalization takes initiative, courage, and vision to look at what makes for a vibrant, walkable, livable center that fosters community vibrancy while creating economic opportunity. Aiken is no different. Our history of downtown revitalization is strong and the City stands ready to face the next chapter of downtown development. (4)
Although the “Downtown Renaissance” plan became mired in controversy and faded into recent history, the city did document citizen concerns in great detail. The revitalization project website features twenty pages of “Questions submitted from the public,” and links to other documents containing more than one hundred pages of comments and questions.
In contrast, the City of Aiken has no similar record of public input for Project Pascalis. The two transcripts from the April 20, 2022 public meetings, when the city promised to have transcripts the next day, are poor and incomplete records of that event:
a. The morning meeting “You Tube” transcript is painfully difficult to read and does not identify speakers; and b. The evening meeting transcript ends when public comment begins.
Until now, no transcript has ever been released to the public.
When asked for a copy of a question and answer document similar to the one found for the “Downtown Renassaince,” the city came up empty. No efforts to document citizen questions and comments has occurred. Listening is not on the city’s agenda for Project Pascalis.
The Antique Mall Was Targeted as Part of the Original Project Pascalis
Aiken Antique Mall, July 2022 (Photo courtesy of Michael Aiken)
The ownership of the Aiken Antique Mall has not changed hands, and there is no proposal to demolish it. But it was part of the aggressive effort to consolidate downtown property ownership to facilitate a major demolition and redevelopment project.
This consolidation effort is encouraged by the city’s “master economic development plan” completed by AECOM corporation in 2021, which cites “fragmented property ownership” as one of the “challenges for large-scale redevelopment.” This “fragmented property ownership” issue was cited by City Council in August, 2021 as a key justification to issue $10 million in bonds for the AMDC to purchase Parkway District properties.
Aiken Antique Mall, July 2022
An offer (or offers) was made on the Aiken Antique Mall, and Weldon Wyatt’s investment and development firms had enough confidence the property would be obtained to include it in the first concept plans completed in April, 2021 by The Boudreaux Group. (5)
In response to a FOIA request for the Antique Mall purchase and sale offer, the City of Aiken declared there is no responsive document. In response to a follow-up question, Aiken Economic Development Director and designated FOIA officer Tim O’Briant wrote:
WTC/GAC made an offer on the referenced property in the same timeframe that the firm(s) secured contracts on the other adjacent parcels. These discussions and agreements were in place prior to them approaching the City/AMDC about a public-private partnership and before the parties entered a cost-sharing agreement.
Since the contract on properties collectively referred to as “the Shah property” was secured on March 2, 2021 and the cost-sharing agreement was finalized on March 23, 2021, an offer on the Antique Mall was made during that period. It was then included in the planning process. Whether the developers had the consent of the owner to include their property in any plans is unknown at this point.
What is known is that the Aiken City Attorney’s law firm billed WTC Investments, LLC for $6,800 to “prepare contracts and negotiate contracts for purchase of hotel, purchase of Mrs. Anderson’s property and purchase of Antique Mall.” (6)
Another unknown is the status of the land consolidation effort that attempted to encompass the Antique Mall. The City of Aiken’s official economic growth strategy discourages “fragmented property ownership patterns.”
Aiken Antique Mall, July 2022 (Photo courtesy of Michael Aiken)
Aiken Antique Mall detail, (Photo courtesy of Donald Moniak)
The Aiken Antique Mall property with its facade of flaking paint could be portrayed as crumbling and blighted by another slick public relations campaign targeting more properties for demolition and redevelopment. What is to stop it?
Newberry Hall: No Contract, Yet.
Newberry Hall is a private business catering to conferences, meetings, and weddings. It is a common venue for groups hosting political leaders. The influential Aiken Republican Club holds its monthly breakfasts there, which in June 2022 featured U.S. Congressman Joe Wilson.
Newberry Hall’s website includes numerous favorable reviews, such as this one from City of Aiken public information officer Chris Ceasar:
Newberry Hall is one of the premiere catering facilities in Aiken County. Whatever your dining pleasure, they can and will accommodate. The staff is very professional. The cuisine is most delectable. The facility is gorgeous. Try Newberry Hall. You will be pleasantly surprised!
Newberry Hall accurately describes its property located at 117 Newberry Street, SW as follows:
Newberry Hall is on a tree-lined and beautifully landscaped city street in the heart of downtown Aiken. Walk through the front doors of Newberry Hall and enter the perfect environment for your social or corporate event.
Newberry Hall, July 2022. (Photo courtesy of Michael Aiken)
In March 2021 the development team led by Weldon Wyatt and Ray Massey sought to demolish this fixture of downtown Aiken life and the surrounding landscaping and replace it with a larger conference center connected to a new hotel. Eventually they signed a contract with the owner, Myrtle Anderson, to purchase the property for $2 million.
This negotiation was no cakewalk. Newberry Hall collectively negotiated favorable terms for the owner/operators of the Newberry Hall business, Patrick and Natalie Carlisle, and an “Agreement for Regarding Lease and Option” was added to the purchase and sale agreement and signed by Ms. Anderson and Weldon Wyatt. This agreement, first finalized on April 15, 2021, was retained by the Aiken Municipal Development Commission after the contracts were transferred to it via the Aiken Chamber of Commerce, which took “assignment” of the property from WTC Investments, LLC on June 3, 2021.
The lease and option agreement included options for Newberry Hall to purchase the new building, operate the new city owned conference center, and be compensated for lost income during the construction period. The agreement states:
C. The development of the Project contemplates that the improvements on the Property would be demolished and replaced with a larger conference center and kitchen and that Carlisle would be compensated for loss of income during interruption of Carlisle’ s business and would lease the replacement conference center and kitchen pursuant to a replacement lease and operating agreement, the terms of which are under discussion but are not finalized (the “Operating Agreement”).
D. Section 5 of the Lease provides Carlisle with a purchase option (the “Option”) that would be triggered by the closing of the Purchase.
E. Anderson and Carlisle desire to that Commission close the Purchase without triggering the Option and have requested that Carlisle grant a one-time waiver of the Option to allow Carlisle and Commission more time to attempt to finalize an Operating Agreement.
In its response to the FOIA request for the contract to operate the future conference center, the The City of Aiken “determined that no contract as described has been considered for approval by Aiken City Council or the AMDC and to date no such instrument has been executed by the parties referenced.”
The city did not provide any more information, yet, no followup questions have been posed. The fact that “no such instrument has been executed” implies that such an instrument is still under negotiation, and would arguably be exempt from disclosure by SC FOIA law due to being a contract under negotiation and not a final product.
Newberry Hall, July 2022. (Photo courtesy of Debbie Traves Brown)
If Project Pascalis survives legal challenges and citizen outcry, downtown Aiken will endure a minimum of three years of major demolition followed by construction. By comparison, reconstruction of The Alley took sixteen months and the Hotel Aiken has been vacant for four years. The Wedding parties, meetings, conferences, breakfasts, and other events routinely held at Newberry Hall will be held elsewhere. How much of a loss to downtown businesses will this inflict?
Commentary
Prying information from any government body that selectively spoon feeds the people its version of the truth can bring to mind former Secretary of State Donald Rumsfeld’s famous musing about information, a series of concepts so complex that even he tripped over them during later interviews.
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“There are known knowns. These are things we know that we know. There are known unknowns. That is to say, there are things that we know we don’t know. But there are also unknown unknowns. There are things we don’t know we don’t know.”
— Donald Rumsfeld
The secrecy and intrigue surrounding the $100 million downtown Aiken demolition and redevelopment endeavor known as Project Pascalis pales in comparison to the world of international nuclear insecurity that Rumsfeld was in part referring to that day. But the concept of information confusion is relevant to any process plagued by secrecy.
The details of Project Pascalis were kept secret for eight full months in 2021, and the AMDC met in closed door executive session more than fifty percent of the time since the project was announced in March, 2021, primarily to discuss the project. (8)
My wife describes ‘transparency’ as “something you can see through,” while ‘openness’ means “listening to and talking about what people see on the other side.” The City of Aiken likes to talk about being transparent, but continues to disregard the more important character trait of openness during this process.
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(1) A FOIA request was filed on July 6th for “1. A transcript of both April 20, 2022 public “design workshop” meetings held at 214 Park Avenue W. The meetings were also was held on Zoom, and during the 530-700 pm meeting, and during this Zoom call participants were asked if they wanted a transcript of the meeting. 2. All comments and questions submitted to the Zoom moderator. 3. Any compilation of questions and answers by City of Aiken and/or AMDC staff from the April 20, 2022 meetings. If they exist, these documents should be readily available with minimal search time.”
The City responded the same day with three documents:
No compilation of questions and answers from the meetings were provided, and none exist.
(2) A FOIA request was filed on July 11th for a “copy of the purchase (agreement) of the Antique mall referenced in the attached invoice. Since this was a part of the public-private cost sharing agreement between the AMDC and GAC, LLC, this should be available from the City of Aiken.”
The city replied there was no “responsive record,” meaning the record may exist but they do not possess it. The city did confirm “discussions” to purchase the property:
“The City replied determined the invoiced charge was related to initial discussions with the owners of the referenced parcels by GAC, LCC. No agreement was struck, the property was never placed under contract with nor purchased by GAC, LLC, the City of Aiken nor the AMDC. Therefore, there is no responsive record.” (1)
In a subsequent answer to a followup question, the city replied:
“WTC/GAC made an offer on the referenced property in the same timeframe that the firm(s) secured contracts on the other adjacent parcels. These discussions and agreements were in place prior to them approaching the City/AMDC about a public-private partnership and before the parties entered a cost-sharing agreement. Therefore, no documents related to the earlier unsuccessful offer on the referenced property were ever shared with either the City or the AMDC. If such a record were available within the City’s possession and control, I’d be happy to provide it. There simply isn’t one.”
(3) A FOIA request was filed on July 8, 2022 requesting:
“A copy of The contract between the City of Aike or AMDC and the owners and operators of Newberry Hall for Rental and operation of the proposed City of Aiken conference center.”
The city responded:
“The City of Aiken has determined that no contract as described has been considered for approval by Aiken City Council or the AMDC and to date no such instrument has been executed by the parties referenced.”
The City, Wyatt, Ray and His Group, and Creative Ways
As previously reported, the $100 million plus downtown demolition and redevelopment project named Project Pascalis actually involves two project areas. The unpublicized second project area is the popular commercial district and gathering spot known as The Alley, which has been a central and not peripheral part of the project.
One way to think about this is to picture two adjacent construction zones.
One zone is controlled by the City of Aiken’s Municipal Development Commission (AMDC) and its developers: first Weldon Wyatt’s GAC, LLC, which had contracts on seven properties, and now RPM Development Partners, LLC, which is seeking to purchase the seven properties at a discount from the city. It also involves a public-private partnership with a cost sharing agreement between the two. Because public funds and a public body are involved, the Freedom of Information Act (FOIA) allows for better access to information, and a stricter set of rules applies to obtaining project approvals from city boards and council. Specifically, South Carolina Community Development law applies in this case because the AMDC is governed by Chapter 10 of that law.
The second zone is privately controlled by Aiken Alley Holdings, LLC (Agent: Ray Massey), whose investors have remained silent, and are hereafter referred to as “Ray and his group” or “Ray’s group.” Aiken Alley Holdings owns four properties in the project area. Because these properties are not part of any public-private cost sharing agreement, their plans and communications are not subject to FOIA and South Carolina Community Development law.
Between March 2, 2021 and May 20, 2021 the two zones were treated more as a whole. The conceptual designs by the Boudreaux Group (an architectural firm who had signed an agreement with GAC, LLC in March) and its consultants clearly illustrate a seamless development that involved the Shah and Newberry Hall properties (under a purchase contract to Weldon Wyatt’s WTC Investments, LLC in the city’s zone) and properties owned by, or being sought by, Ray and his group.
Between June and November, 2021, the two zones were in limbo after Wyatt withdrew from the public-private project and the AMDC pursued a new developer, with some coordination with Ray’s group.
Since November, 2021, the AMDC and its developer, RPM Development Partners, have controlled discussion and plans of the public-private zone, while plans for the private zone remain the purview of Ray and his group and have been withheld from public view.
However, RPM stands for Raines, Purser and (Ray) Massey. At the April 20, 2022 AMDC public meeting, moderator Tim O’Briant stated that each party owns 1/3 of RPM. Ray and his group are a part of the public-private zone, but the AMDC is not a part of the private zone controlled by Ray’s group. If this were a swimming pool, the AMDC is only allowed to swim in the deep end, while Ray’s group can use the whole pool, an arrangement that has serious financial implications for taxpayer liability.
“Ray and His Group”
The existence of two projects is confirmed in a brief but illuminating June 4, 2021 email exchange between Aiken Economic Development Director Tim O’Briant and WTC Investments, LLC representative Chip Goforth involving the assignment of properties by the Chamber of Commerce, purchase contract earnest money, a cost-share agreement invoice, and the future of the project.
The two were cleaning house on the remants of the first public-private zone, which had crumbled when Weldon Wyatt’s development company GAC, LLC withdrew from the project in mid May, 2021. Subsequent to the latest Wyatt exit from a major city project, the Aiken Chamber of Commerce, in coordination with the AMDC, had negotiated the “assignment” of WTC Investments’ contracts for the Shah and Newberry Hall properties.
This involved transferring the contracts to the Chamber which would hold them for the AMDC to purchase after it procured funds from City Council; and helping WTC Investments salvage $135,000 in nonrefundable earnest deposits for its contracts. Yes, the city devoted administrative labor to insuring Mr. Wyatt recovered his otherwise nonrefundable earnest money.
The AMDC opted to keep this entire affair secret, as it did with its private efforts to recruit a new developer, an effort that also involved Aiken Alley Holdings, referred to at the time as “Ray and his group.”
In addition to confirming the two project zones, the exchange also indicates an amiable relationship, in spite of the Wyatt camp’s recent withdrawal from the project, and that Mr. O’Briant provided sympathetic assistance to WTC Investment’s efforts to retrieve their $135,000 in non refundable earnest money.
In his email, Goforth wrote:
How was your meeting with Andy Cajka. Thanks for helping get both Contracts assigned, glad we did the way we did and not a creative way. Better to all be on the same page. Will the Invoice attached work for reimbursement of the costs we spent. Let me know if you need anything. Also, sounds like Rays group has a lot of interest in the apartment side of the development. (1)
O’Briant responded fifteen minutes later:
The invoice looks fine. I’ll get that processed for you next week. It’s been busy but things are looking pretty good. The meeting with Andy was excellent. I hope to have a half dozen proposals in hand by a deadline next week to compare. Also waiting to see what Ray and his group come up with whatever it is it should be good for downtown. Hopefully we can figure out soon whether there’s a good way to overlap the two projects or if they work best independently.
I’m really glad we were able to get the contract worked out so we can go ahead and get you the earnest money back and make it all clean. Thanks for your help on that end.
The O’Briant-Goforth email. Obtained via FOIA.
There were two project areas and two projects, one controlled by “Ray and his group” and one controlled by the AMDC and its private partner. In the beginning the private partner sought legal counsel and aid from Ray Massey’s law firm. In the existing stages, it is unknown what role the developers in RPM are playing in the plans of Ray and his group.
The Wyatt Months: The Two Projects Merged
The issue of overlapping projects versus independent projects led to the creation of several design options in April, 2021; options that were scheduled to be presented to Aiken City Council on April 19th but never made it onto any public meeting agendas.
In early April Boudreaux had late draft plans, but there was some disagreement over the future of Ray and his group’s recently purchased properties in The Alley. During the discussions, their retail and office buildings in The Alley are referred to as “The Laurens Center” and this designation also appears on some maps.
In preparation for a meeting between AMDC Executive Director Tim O’Briant, Boudreaux, and Weldon Wyatt, Boudreaux group President Heather Mitchell wrote:
Tim and Weldon spoke this morning. Weldon has clarified that he wanted to understand the impact of excluding the Laurens Center Alley buildings from the site, however he does want to proceed with developing the plan in accordance with the Option 2 version that includes rebuilding on the Alley (Laurens Center) retail site.
Three options focused mostly on The Alley portion were under discussion at that meeting:
Option 2 involved retail space in The Alley extending deeper to the north and underneath the proposed parking deck.
Option 2: “No Alley Building” involved leaving existing Alley retail buildings as is. This was looked at “per Weldon’s request,” and the issue that arose was that not modifying The Alley retail buildings would lead to a smaller hotel and less apartment space.
Option 2A; “No Alley Building” involved a “reconsidered hotel location. Hotel is at corner of Richland and Laurens which gets it back to 100 rooms.”
In an email, O’Briant wrote that he preferred the second option: keeping the existing retail.
There is also a set of plans, obtained via FOIA, (see below), that shows a smaller hotel behind the Alley retail, with the lobby of the hotel at the same ground floor as retail. These could be the plans that have been described by Art and Soul co-owner Stacy O’Sullivan in Part Two of this series, and plans to build residential and/or hotel above the existing Alley buildings may still be in the works.
Ground Floor2nd FloorFloors 3 thru 4 and 5Project Pascalis option for The Alley, April 2021. Images obtained via FOIA
The decision in the April 19, 2021 Conceptual Design Plans appeared to favor Option 2 .
The Two Projects Separate, But Ray’s Group Swims in Both Pools
Following the end of the AMDC/Wyatt partnership, the city secretly pursued a new developer. In the May 19, 2021 solicitation for Requests for Proposals (2), the AMDC only offered Option 2a, with a new hotel replacing the Hotel Aiken and no activity in The Alley. Apartments and a parking garage would replace the vacant historic Johnson Drug Store and adjacent existing businesses; a conference center would replace Newberry Hall.
This is also the vision the AMDC and its chosen developer, RPM Development Partners, presented to the pubic between November 2021 and April 2022, when the AMDC unilaterally announced, without any public or even City Council input, a conference center in the soon-to-be vacated City Hall at 214 Park Ave. W — an issue to be addressed in Part 4 of this series.
Ray and his group retain control and ownership of the “Laurens Center” retail center in The Alley, as well as the former State Farm building (which it has offered as a “trade” with the City of Aiken in exchange for a portion of Newberry Street). Their plans are not publicly disclosed, but their property is now in the center of the larger Pascalis footprint.
Ray and his group also sought to purchase part of the City’s municipal building complex in January, 2022. While that offer was tabled, the purchase agreement with the city remains in the files, and Part 4 of this series will discuss how Ray and his group tried to buy city property at a sizeable discount.
Next: Part 4: Ray and His Group Angle for City Property
Part 5: The AMDC Pulls a Fast One: Old City Hall as a Conference Center.
For Reference
(1) The invoice referred to the cost-sharing of the Boudreaux Group’s conceptual design.
Andy Cajka is a member of the Clemson University Research Foundation. According to his bio on the foundations’s website, he is “the founder and president of Southern Hospitality Group, LLC, a hotel management and development company in Greenville, South Carolina. Prior to starting his own business, Mr. Cajka was a managing member of Hyatt Hotels Corporation from 1986 until 1998.”
(2) The summary of that RFP is posted on the AMDC “transparency page.” Requests for the entire RFP continue to be denied by the city on the basis of a FOIA exemption. However, that exemption does not mandate nondisclosure, it is a choice.
