An investigation shows FrontDoor Communications did not misuse, misappropriate, steal or scam the county out of the money, Lt. Mike Brown said.
The Council has fought to get the money back from FrontDoor president and CEO Robert Davis after the deal fell through.
The company had planned to spend $150 million to build a complex to produce magazines and create 1,600 jobs over five years. But the company later downsized its investment, and the county eventually severed its contract for land and incentives.
Davis returned the $500,000 in June, but his check bounced and he was later charged with one count of writing a fraudulent check and released on bond.
Davis was pleased with SLED's findings and said the finger-pointing had tarnished innocent lives.
But Councilman Stanley Smith says SLED didn't do a thorough investigation.
"I was one of the main players, and no one approached me - there were no telephone calls and no personal contact," he said. "I don't know how many hours they put in, but I don't feel like it was sufficient."
The investigation was requested by council member Calvin Blackmon and backed by Smith and council member Jack Estridge after they learned the company was given $500,000 in cash as an incentive to locate in Lancaster County. They say the money was improperly paid without a public vote.
Council chairman, Rudy Carter, has admitted the council made procedural errors but the SLED report confirms there was no criminal intent, he said.
The report allows the council to get back to business, Carter said. "We can begin to pursue what needs to be pursued without this overshadowing us."
Davis said last month he would give the county the second mortgage on 200 acres he'd purchased in Lancaster. He hopes to sell the land and business, and the contract requires the new owner to repay the county.
If the deal falls through, Davis has pledged to make the payment after putting in water and sewer and refinancing.
Smith, however, doesn't believe the county will ever get its money back, he said.
"A second mortgage is not worth 15 cents if there is no money there."
Information from: The Herald