A government watchdog group wants to know whether the Hunley Commission and the Friends of the Hunley have illegally diverted money that should have gone to the state of South Carolina. Common Cause asked the state attorney general on Friday to investigate.

The Confederate submarine Hunley was the first submarine to sink an enemy ship in wartime, but was lost on the same night of its successful strike.

After it was found off the coast of Charleston, $8 million of federal and state tax dollars helped raise the submarine. It was carried to a lab in Charleston where it's being studied and preserved.

The Hunley Commission and Friends of the Hunley organized tours of the lab and sell memorabilia. An agreement between the state and federal government says, "The state of South Carolina will receive all receipts, royalties and all other revenues generated by the exhibition, display...and all other activities related to the Hunley."

But the Hunley Commission has not given the state $1.3 million generated by ticket and souvenir sales.

Common Cause director John Crangle says, "We're concerned about the possibility that some individuals involved with the Friends of the Hunley and the Hunley Commission may be benefiting financially from it, and that there may be conflicts of interest, where people are doing things on the Hunley Commission in the posture of serving the public, actually serving themselves, making money off of it." 

He says there may also be some cases where the Hunley Commission wasted taxpayers' money by awarding contracts without bids, thereby spending more than may have been necessary.

Charleston Sen. Glenn McConnell is chairman of the Hunley Commission. He says the questions are a "ludicrous" attack engineered by his political opponent in the upcoming election.

He says the U.S. Navy is perfectly happy with the financial arrangement.

"All the money that we generate we use to pay the electric bills, the salaries. It goes to pay the costs of the Hunley," Sen. McConnell said. "If we don't pay the bills, you can't run the exhibit. And if you can't run the exhibit, you don't have a gate receipt. And if you don't have a gate receipt, you don't even have the money." 

He says since the Hunley is self-sustaining, it wouldn't make sense to put the money it makes into the state treasury, then turn around and ask for the same money back to run the exhibit.

And he argues that it would amount to fraud if the money from tickets and memorabilia went back to the state, when visitors are told that all money goes to preserve and maintain the Hunley.

There was also a question about financial irregularities concerning a grant given to a member of the Hunley Commission. The money was to write a book about the vessel, but no book has been published after two years.

Richard Quinn, who does public relations work for the Friends of the Hunley, explains that the grant was NOT tax money. It was a personal gift from Clive Cussler, the man who found the Hunley. And the man who got the money to do research on the Hunley was not a member of the commission at the time, but became one later because of his expertise.

As for the no-bid contracts, Quinn says those have been used only for very specialized work where it wouldn't be possible to put it out for bids.