County files lawsuit, targets former EDC

Update: County council did not have the third reading of an ordinance changing the makeup of the EDC board during its regular meeting Tuesday evening.

After a lengthy and heated discussion, council decided to give a copy of the ordinance to the three mayors and give them two weeks to decide whether to agree to it. If the mayors do not agree, then county council will go with a three-member EDC board -- one representative from each of the county's three school districts.

The ordinance council is presenting to the mayors keeps control of the EDC in county council's hands, and it's unlikely the mayors will agree to it. 

Original story:

Barnwell County has filed a lawsuit against former members of the county's Economic Development Commission and two employees who previously worked for the commission.

The suit, filed Monday, names former EDC board members Pete Grady, Loretta Atkinson, Janet Muldrow, Billy Johnson and Jeff Sandifer along with former employees Marty Martin and Sonja Hiers as defendants. The suit alleges the defendants breached their fiduciary duty, conspired to harm the county and illegally converted county funds to private hands.

The county seeks to regain the $475,068 paid to Martin and $176,817 paid to Hiers after their contracts were terminated by the EDC board - firing the pair without cause initiated a buyout clause in their contracts.

Marty Martin said he was unaware of the lawsuit when asked about it Monday and said he had no comment on the situation. None of the former board members could be reached for comment.

The county also is seeking punitive damages from the loss of property after the EDC board members voted in December to deed EDC land and assets to Blackville, Williston and the city of Barnwell.

The lawsuit states the defendants had no legal authority to take any of the actions they did. The county claims actual damages of between $13 million and $16 million - the total value of all the EDC assets.

The board members named in the lawsuit were the ones who voted to terminate Martin and Hiers and also to deed the properties. When county council learned of the transactions, it removed all the EDC board members from their appointments.

County Council Chairman Freddie Houston said the goal of the lawsuit is to recover the money given to Hiers and Martin along with any other funds that may have been misused.

He said the lawsuit will allow for an investigation into whether the board members were negligent in their actions and will hopefully bring to light all of the details about what happened.

When asked how the community might react to the lawsuit, Houston said, "If you talk to most people in the community they would tell you that it was wrong for them (the board) to do it anyway."

Former board member Jim Latham is not named in the lawsuit because he was not at the Dec. 4 EDC meeting when the board voted to fire its two employees - who were immediately rehired as "independent contractors" - and donate the property to the towns.

Williston Mayor Jason Stapleton was a member of the board but resigned shortly before the Dec. 4 meeting.

Since December, county council has been trying to reach an agreement with the mayors of the three towns that received EDC property to have the property deeded back to the county. But the two sides have not been able to come together, and it is quite possible that the dispute will end up in court too.

County council planned to have the final reading of an ordinance changing the makeup of the EDC board to give the county's municipalities a voice on the board during the regular meeting Tuesday evening (after press time). In February, the mayors gave county council recommendations for how the board should be made up, but Houston has said council won't be going along with the mayors' plan.

The county ordinance and the mayors' proposal differ drastically. The county's plan keeps control of the EDC in county council's hands, but the mayors' plan gives the three towns a six-to-three voting edge on the board and final say in the future of whether to sell the EDC properties.

The attorney representing the county is Robert Buchanan Jr. of Aiken. He was brought in by the county's regular attorney, J.D. Mosteller.