Horry County leaders sued the city of Myrtle Beach Thursday in an effort to block the city’s sale of campground land that generates millions of dollars for Myrtle Beach International Airport each year.
The lawsuit wasn’t a surprise, as county leaders had signaled their intent in court filings last month.
County spokeswoman Kelly Moore declined to discuss the case, saying the county doesn’t typically comment on pending litigation. City spokesman Mark Kruea also declined to comment.
Along with the lawsuit, the county filed a motion for a preliminary injunction to halt the sale. County officials have asked the court for an expedited hearing because they believe the city is trying to sell the property before the end of the year. If the sale is allowed to move forward, the county has asked that the money from the sale be held in escrow until the lawsuit goes through the court system.
The action against Myrtle Beach involves nearly 145 acres inside Lakewood Camping Resort and PirateLand Family Camping Resort. On Tuesday, Myrtle Beach City Council voted to sell those properties to the campgrounds for a combined $60 million.
County officials contend the sale price is below fair market value, and they object to the city’s plan to keep all of the proceeds from the sale.
“If the proposed below-fair-market-value sale is allowed to proceed, the County will have no mechanism for recouping amounts that would have been realized by a sale at fair market value,” the county’s motion states. “Put simply, public officials cannot donate or give away public property at their whim. Instead, public property is held in trust, and government officials selling public property act in a fiduciary relationship with the public and have an obligation to secure fair compensation in exchange for public property.”
The land, which has been leased to the campgrounds for decades, has traditionally generated revenue for the operations of the county-run airport.
A 2004 agreement between the county and the city that outlines how the revenues from the campground land should be divided.
The city leases the property to the two campground owners for $3.6 million annually. As part of the agreement with the county, the city sends 75% of the lease revenue — about $2.7 million — to the county to be used at the airport.
But the city maintains the county contract strictly deals with lease revenues, not the proceeds from the sale of the land.
The city’s plans have frustrated county officials. They object to the sale because of the impact the lost revenue would have on airport operations. They also maintain the proposal does not meet the city’s legal obligations to the county.
“We’re going to do what we can do legally to protect that property so that we can protect the airport,” Horry County Council Chairman Johnny Gardner said last month. “The airport’s important to Horry County.”
County officials said in court papers that they learned of the city’s plans to sell the property on Nov. 6. That same day, Horry County Administrator Steve Gosnell sent a letter to Myrtle Beach City Manager John Pedersen explaining the county’s concerns.
The city acquired the land from the federal government after World War II when the government deeded the city the land as surplus property.
County officials maintain that both the 1948 deed to the property from the U.S. Government and the 1953 release from the federal government “are expressly premised on agreement that these properties are intended for the use and benefit of the airport,” according to the county’s letter to the city.
“This fundamental understanding” was the basis for the 2004 city-county agreement, Gosnell wrote.
The administrator gave Myrtle Beach officials 10 days to confirm that the city intended to comply with the 1953 release, “wherein the city obligated itself to ‘utilize any revenue derived from the use, lease, or disposition’ of the properties for the benefit of the airport.”
Thursday’s complaint expanded on those claims.
"The County is thus entitled to judgment against the City for actual and consequential damages as a result of the City’s breaches of its fiduciary duties, including its badfaith actions, and its breaches of the duties of loyalty and against self-dealing,” the lawsuit states.