Hunley project officials challenge cost analysis

Total should not include tens of millions for museum, campus, they say

By JOHN MONK

jmonk@thestate.com

Officials with the foundation preserving the Hunley dispute The State newspaper’s analysis that the current and future costs of preserving the Confederate submarine have risen to $97 million, saying the costs are much lower.

Officials of the Friends of the Hunley say The State should not have included three items:

• The estimated $42 million cost of a proposed museum for the Confederate sub

• The state’s $3.9 purchase of Civil War artifacts, known as the Peery collection. The collection is destined for the future Hunley museum.

• The complete $35 million cost of a campus Clemson University wants to build around the North Charleston conservation laboratory that houses the Hunley

Hunley officials also dispute The State’s tally of state spending that has gone toward the sub so far.

There are many sources of Hunley funding.

In compiling its numbers, The State was performing the first-ever comprehensive look at Hunley-related spending, which explains why the tallies could differ.

The State’s three-day series examined total spending — including projected spending — to give the public a chance to weigh in before tens of millions of dollars are committed to Hunley projects over decades to come.

A chart accompanying this story explains how The State, using public records, reached its $97 million projected total. Another chart shows the Friends of the Hunley computations.

A third chart shows Friends of the Hunley estimates for state spending on Hunley-related projects, compared with estimates from The State.

There has never been a state audit of Hunley spending, State Auditor Tom Wagner Jr. told the newspaper this month.

Here’s more about why the tallies differ:

THE PROPOSED MUSEUM

The State included the museum costs because the Hunley will be the showcase of the proposed North Charleston project.

The State’s museum figures came directly from the proposal put together by the city of North Charleston. Pledges from various sources might have changed since that proposal was assembled, but the cost remains the same. This month, Mayor Keith Summey said the city still plans a $42 million Hunley museum.

Two public bodies — the city of North Charleston and the Hunley Commission — have signed off on the museum and its $42 million cost.

State law designates the Hunley Commission as the legally constituted body charged with recommending a museum site to state lawmakers.

In February 2004, the Hunley Commission voted to accept the $42 million proposal from North Charleston, including $11 million from the city itself. The decision came after a years-long, intense competition between three Lowcountry cities.

Hunley Commission chairman Glenn McConnell, the Charleston state senator who heads the S.C. Senate, said at the time that North Charleston was selected because its package was financially superior, according to The (Charleston) Post and Courier.

“The dollars count to me,” McConnell said.

Hunley foundation officials insist the museum should not be counted in Hunley-related costs.

“No contract has been signed. Nothing is set in stone,” Hunley spokesman Richard Quinn Sr. wrote in an e-mail to The State on Friday. “Such a museum is far too preliminary in concept to be fairly listed as a ‘projected Hunley cost.’ And in any case, we would expect much if not most of the cost for a future museum to be raised from private sources.’ “

North Charleston’s written proposal relies on $6.9 million from foundations and grants; it doesn’t say how much of that money might be from private sources.

THE PEERY COLLECTION

The State included the $3.9 million that the state of South Carolina has approved to buy the Peery artifacts in future Hunley costs because the collection will be an essential part of a future Hunley museum, according to McConnell.

McConnell said on June 28, 2001, that the Peery collection will form the foundation for the museum, according to The State newspaper’s files.

“To get the (collection) and pair that with the crown jewel of 19th-century maritime history, the Hunley, is just going to be something beyond description,” McConnell said at the time.

Quinn said in an e-mail on Friday that the Peery collection “is unrelated to the Hunley conservation project.”

The cost of the Peery collection initially was estimated at $3 million. That cost now is estimated at $3.9 million. The cost is rising because the state has not yet bought the collection outright but is paying interest and other costs associated with the purchase’s delay, according to Mike Sponhour, State Budget and Control Board spokesman.

The state intends to finish paying the $3.9 million by mid-2008, Sponhour said last week.

CLEMSON’S CAMPUS

The State included Clemson’s proposed North Charleston campus because the Hunley is a central reason behind it, according to Clemson’s internal documents.

Clemson officials raved about the chance to get the Hunley and its “showcase (conservation) laboratory,” where it is housed in North Charleston.

“It (the Hunley project) is probably the only thing happening at Clemson right now that can get us an hourlong special on National Geographic or Discovery Channel,” Joe Kolis, Clemson”s director of special projects, wrote to other top university officials in an Aug. 25 e-mail.

About $35 million in state money is expected to go into the campus, The State reported. That includes the value of 82 acres being donated by the city of North Charleston.

The State included the cost of the land in Clemson’s campus because North Charleston taxpayers could benefit should the publicly owned land be sold in Charleston’s hot real estate market.

The State quoted Clemson president James Barker as saying that other major reasons for the new campus — to be called the Restoration Institute — included starting major historic preservation and brownfields reclamation programs.

But the Hunley lab played a key role in Clemson’s decision, according to the documents.

Once Clemson has the Hunley lab, Kolis wrote, it can start to preserve famous underwater artifacts from the American Revolution. “If that sort of project does not get us the national reputation points to move to (the) top 20, then there is no other project at Clemson that will.”

Clemson wanted a North Charleston campus, the documents show. And North Charleston had land available at the former U.S. Navy base, part of which Hunley officials were using rent-free for the Hunley conservation lab.

Clemson documents show that Clemson officials wanted the lab for projects other than the Hunley. Clemson also was seeking the benefits associated with taking over the Hunley’s preservation, the documents show.

Those expected benefits included getting Clemson on national television, elevating its academic prestige and currying favor with the powerful McConnell, according to the documents.

“If we deliver the goods in this we will make a valuable ally in Senator (Glenn) McConnell and capture a lot of support in Charleston,” Kolis wrote.

In the documents, Clemson officials also said the Hunley preservation project was becoming financially strapped for cash, and it needed Clemson’s money.

Once a deal is finalized, Clemson is expected to pay about $800,000 a year toward the Hunley’s preservation, according to Clemson officials.

The deal will go into effect after the Budget and Control Board signs off on $10.3 million in state bond money for the project, according to a contract Clemson has signed with the Hunley Commission.

That money was given preliminary approval in September by a state panel that allots money for research universities’ infrastructure needs.

To be eligible for the money, Clemson had to offer matching funds. It needed money or something of value that equaled $10.3 million. To meet that requirement, Clemson offered North Charleston’s land, including the lab, which an appraiser had valued recently at $18.5 million.

The State also noted that Clemson intends to put a $3 million endowed professor’s chair in the Hunley lab. The $3 million comes from state lottery profits.

Hunley spokesman Quinn said the only tax money The State should count as being Hunley-related is the $3 million Clemson intends to spend on upgrades and repairs at the Hunley lab.

STATE SPENDING

The State calculated that current and future state money intended for Hunley-related projects totals $23.6 million.

This includes:

• $4 million in initial expenses — approved by the General Assembly — for the raising of the sub and preparation of the lab

• $10.3 in state bonds for Clemson’s new campus, given preliminary state approval in September

• $3 million in state-approved lottery money for the endowed chair for the Hunley lab

• $3.9 million in state money pledged to the Peery collection

• And $2.4 million in state-provided services, including state police protection, use of a building rent free and free filming by ETV

Hunley foundation spokesman Quinn said only the $4 million in direct state appropriations, via the General Assembly, already spent should be counted.

Quinn said in an e-mail Friday state appropriations might be up to $6 million, “depending on how you calculate it.”

Reach Monk at (803) 771-8344.