$650K marketing campaign included coal plant poll

By Molly Parker , Staff Writer

Last fall, Santee Cooper paid a Charleston public relations firm more than $650,000 to promote its green initiatives and sell the need for a new coal-fired power plant in rural Florence County.

Wild Dunes may get public dollars to curb erosion

By Scott Miller , Staff Writer

Charleston County took the first step Thursday in opening its public coffers to fund private-access beach restoration.

County Council’s finance committee unanimously agreed to give $900,000 in accommodation-tax revenues to the Isle of Palms to help combat erosion in Wild Dunes, a private resort community on the northeast end of the island.

Council member Paul Thurmond said the council’s action has set a precedent and that communities like Seabrook Island, Kiawah Island and Folly Beach are now likely to ask for money too.

Still, while Wild Dunes is private, the beach behind the community is public, though people may need a boat, a helicopter or good walking shoes to get there, noted council Chairman Tim Scott.

Moreover, Scott said, accommodation taxes are used to support tourism, and the beach contributes to the county’s $5 billion tourism industry.

The total project cost is estimated at $9.9 million, according to Isle of Palms Mayor Mike Sottile. The city is agreeing to put $1.9 million toward the project, and the Wild Dunes property owners association likely will ante up $6.1 million, he said. The city is also requesting a $1 million grant from the state.

The county would provide the funding only if the property owners association were to agree to contribute the $6.1 million. In approving the funding, the committee also suggested Wild Dunes provide public parking and stipulated that if the restoration project comes in under budget, the county will get a refund.

The project will temporarily protect four single-family homes, 420 condominiums and the 18th hole of a golf course from erosion. The community has placed sandbags on 2,000 feet of shoreline.

Those properties alone generate $184,000 annually in accommodation-tax revenues, and Wild Dunes as a whole produces some $500,000 in annual tax revenues, noted council members Joe McKeown and Dickie Schweers.

“We’re simply reinvesting some of their own money back into that area,” said Schweers, who represents Wild Dunes.

The community also generates $800,000 annually in property taxes, McKeown added.

Scott said he doubted property owners would let their multimillion-dollar investments wash out to sea.

While the finance committee unanimously approved the funding Thursday, the appropriation still needs final council approval. That vote is expected Tuesday.

SCANA Corp. earnings up 3%

By Molly Parker , Staff Writer

Columbia-based utility SCANA Corp. reported $320 million in earnings for 2007, an increase of about 3% over a “disappointing” 2006, said Jimmy Addison, the company’s senior vice president and chief financial officer.

Exceeding expectations, fourth-quarter profits were up more than 35%. SCANA posted earnings of $88 million, or 75 cents per share in the last three months of the year, compared to $65 million, or 57 cents per share during the same time in 2006.

In a conference call this morning with investors, Addison attributed the growth largely to increased sales of electricity and natural gas driven by the addition of new customers and increased wholesale sales. 

The utility is poised for “very good growth in 2008,” he said.

Reported earnings for South Carolina Electric & Gas, SCANA’s principal subsidiary, were up almost 5% in 2007. SCE&G posted earnings of $245 million, or $2.10 per share, compared to $234 million, or $2.02 per share in 2006.   

During the question-and-answer segment of the conference call, investors peppered SCANA officials with queries about the progress of the company’s plans to have a new nuclear reactor online by 2016 through a joint partnership with state-owned utility Santee Cooper.

Higher-than-projected cost estimates, Addison said, have forced the utilities to delay their application to the U.S. Nuclear Regulatory Commission. They had planned to file the application early this year.

“It’s a serious cooperative negotiation process,” he said, noting the utility hopes to reach a final decision regarding the application by this summer, if not sooner.

“We’re only one side of that discussion, and I can’t really be sure on that,” he said. 

Noting that prices were “way, way higher” than original projections, Santee Cooper President and CEO Lonnie Carter recently said he would ask his board to make a policy decision about the nuclear proposal sometime in the next few months.

Even with the postponement, Addison said the plant could still be online sometime in 2016.

Addison declined to discuss the cost estimates, citing the ongoing negotiations. But he said the price tag has essentially doubled since the time when the utilities first began to consider building the plant. The utilities want to build a 1,100-megawatt nuclear unit next to their existing jointly-owned V.C. Summer Nuclear Station near Jenkinsville. 

Most of the upsurge is commodity-driven as the prices of concrete, steel and copper are on the rise, cost increases that would impact any new generation project, said Stephen Byrne, SCANA’s senior vice president of generation, nuclear and fossil hydro.

The various nuclear vendors also are anticipating rising costs “for attracting labor and keeping labor on the project,” Byrne said.

Sanford, lawmakers spar over research, sprinkler funding

By Daily Journal Staff

Gov. Mark Sanford warned Thursday that the state House of Representatives is already overspending with its support of the Endowed Chairs research program and creation of tax incentives for sprinkler installation.

The state even now is facing a $270 million deficit, Sanford said.

“At a time when we’re going to struggle to meet core needs, we don’t believe it makes sense to create not one but two open-ended and very significant financial obligations for our state,” he said in a written statement.

The House approved legislation Thursday that provides tax credits equal to 80% of the cost of purchasing and installing fire sprinklers in homes and businesses. Fire sprinklers also would be exempt from the state sales tax.

Similar legislation is under consideration in the Senate. Both are responses to the June Sofa Super Store blaze that killed nine Charleston firefighters.

“This is about saving lives,” said House Speaker Bobby Harrell. “We want homeowners and businesses to install this life-saving device, but we do not want to overburden them with costly mandates. More fire sprinklers, installed in more buildings, will mean that more lives will be saved.”

Sanford, however, said the state can’t afford the tax credits, which he estimated to cost more than $108 million over a five-year period.

“I appreciate the fact that the House was looking at ways to bring good from the horror of recent fires, but we do not believe open-ended financial commitments that essentially create new entitlements are the way to do so, particularly when you look at the realities of the budget we’re about to head into,” he said.

Harrell noted that these incentives are similar to those Sanford championed in the coastal property insurance reform last year.

Meanwhile, Sanford said, state universities abused the Endowed Chairs program, officially called the S.C. Research Centers of Economic Excellence, because they failed to raise an adequate amount of private investment.

State funding for the program, which began in 2002, was set to expire at $200 million in 2010, but the House voted Thursday to extend it.

The goal is to capitalize on the spirit of collaboration that has been forged by the state’s three public research institutions: Clemson University, the University of South Carolina and the Medical University of South Carolina. The research is expected to create spinoff businesses and job growth.

“We have seen the great successes North Carolina has had with their Research Triangle,” Harrell said. “This public-private partnership we are continuing will take cutting-edge research and apply it in the private market.”

Acquisition expands MeadWestvaco’s local operation

By Dan McCue , Staff Writer

MeadWestvaco Corp. this morning announced its acquisition of the Eastman Chemical Co.’s pine chemicals product line and its intention to shift an unspecified amount of work to its own Charleston plant.

The deal is expected to close by the end of February, according to a written statement from the company. No financial figures related to the transaction have been disclosed.

The acquisition of Eastman Chemical’s tall oil rosins and tall oil fatty acids product lines will expand MeadWestvaco’s Specialty Chemicals’ Performance Chemicals business. The company operates specialty chemical plants in Charleston and in DeRidder, La.

MeadWestvaco spokeswoman Ricki Carruth said the manufacturer is acquiring intellectual assets of Eastman, rather than physical assets, and that no employees will be transferred between the companies.

She said that while the deal will expand MeadWestvaco’s business, the company believes its current production capacity and production team will be able to absorb the new work.

“This agreement will make our business operations in Charleston stronger and more profitable,” she said. “While our overall goal, of course, is to continue to grow the business, we don’t anticipate an increase to the size of our staff at this time.”

BAE nets $242 million Pentagon contract

By Dan McCue , Staff Writer

BAE Systems, a London-based defense contractor with U.S. operations in Charleston and San Diego, among other cities, has secured a $242 million Pentagon contract to provide a technological platform to the U.S. Navy.

The five-year contract requires BAE Systems to provide systems integration, engineering, fabrication, assembly, testing and limited installation services aboard all new Navy ships built during the assignment period.

It also includes three one-year options that could bring the total potential value of the contract to $344 million.

“This is an important and strategic win for BAE Systems,” said Doug Belair, president of the company’s Technology Solutions & Services division. “We have an outstanding partnership with the Navy, and we look forward to continuing to grow in the Charleston area.”

Belair also said the award ties directly to the core capabilities of the company’s Technology Solutions & Services business and will bring the full resources of BAE Systems for the benefit of the Navy.

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