FROM FIELD OF DREAMS TO FIELD OF SCHEMES
Is anyone surprised that our naive Governor Henry McMaster is just as dazzled by the glamour of the National Football League as the average Sunday fan?
As McMaster prepares to defend his sorry record as Governor for the November election, he will have to explain the embarrassing meltdown of his signature "economic development" project: a partnership with the Carolina Panthers, gleefully announced in 2019, to build an $800 million training complex in Rock Hill.
With Upstate Republicans on one side of the negotiating table and hedge fund billionaire David Tepper, the owner of the Panthers, on the other, you had to know who was going to get the shaft: South Carolina taxpayers.
This is the standard playbook written by pro sports team owners over the years. Tell gullible politicians that if only they appropriate public money to build a new stadium, all sorts of goodies will flow. The new stadium will jumpstart economic development for the area, raise tax revenues from new businesses, and bring in thousands of new jobs.
But it never does. Just read the seminal book Field of Schemes. How the Great Stadium Swindle Turns Public Money Into Private Profit, by Neil deMause and Joanna Cagan. Following the script, Tepper promised McMaster that he would build a new practice facility, office building, a small stadium, and an events venue in Rock Hill. This development would lure additional private restaurants, hotels, corporate headquarters, and other amenities.
What Tepper extracted was a promise from Rock Hill to float $225 million in bonds for infrastructure to prepare the site; $115 million in tax credits for jobs that would be produced, and $80 million for a highway interchange that would link this new Panther Palace to Interstate 77. Tepper's share of the $80 million interchange is a paltry $5.3 million.
The deal blew up, at least for now, in the middle of last month when, with steel in the ground and the interchange under construction, Tepper walked away, leaving local Republican pols and McMaster bewildered and angry.
Why this happened depends on whom you ask. Tepper claims Rock Hill had not floated the bond issue in a timely manner. Rock Hill claims the Panthers didn't provide information the City needed to float the bonds. They also claim Tepper wanted the City and County to bear more of the financial risk if the bond issue was not successful. They wisely refused.
In addition, the Covid pandemic delayed construction and the market for corporate headquarters looked weak, as employees discovered the joys of working remotely.
Perhaps Tepper now wants more gifts from taxpayers. Indeed, York County (in which Rock Hill is the largest city) was quick to offer $225 million in tax credits if Tepper agreed to front the money for the infrastructure. (So far, he hasn't.)
McMaster's dalliance with Tepper has left all South Carolina taxpayers with a big pile of wreckage:
Rock Hill has a half-built structure that must come down if it's not completed.
McMaster has said the interchange will be completed, even if it becomes McMaster Way, the Interchange to Nowhere. (Let him run for re-election on that.)
The state tax credits to the Panthers will be tied up and unavailable to other potential economic development partners until this dispute is settled.
If this cannot be resolved amicably, the city, county, and state are looking at lengthy and costly litigation against a billionaire team owner. (Tepper's estimated worth is between $16 billion and $17 billion. He is the NFL's richest owner.)
If Tepper strong-arms Republicans and finally gets his Panther Palace, he will pay lower property tax rates. This will make it harder for other developers in the area to compete with what he can offer to corporate tenants, hotels, or restaurants seeking to build on his 240-acre parcel. It will shift the paradigm of economic development in York County toward Tepper's property. (He also owns the nearby Waterford Golf Club, which sits on an additional 205 acres.)
In short, the Republicans will have anointed Tepper as the leading developer in the region. This is State Capitalism, Republican style.
Democratic State Senator Dick Harpootlian, a master of invective, had this to say about this misbegotten deal: "Well you know, a guy doesn't make $16 billion without being a self-centered, egotistical narcissist, so I am not surprised at all [that he walked away from it]. Obviously, the governor got hoodwinked by Tepper."
McMaster tried to spin the collapse of the deal by touting other economic development achievements over the past few years and holding out hope that talks with Tepper can be revived. If they are, count on McMaster and Upstate Republicans to be hoodwinked-- times two.
What Democratic candidates for Governor Joe Cunningham and Mia McLeod might want to do is get hold of that picture in the Post and Courier of McMaster, in his typical funereal dark suit, smiling and shaking hands with Tepper on the day this dumb deal was announced. That picture should figure in a strong attack ad.
AND THIS JUST IN. In the wake of the leaking of Justice Samuel Alito's majority opinion striking down Roe v. Wade, McMaster said that he will move to make ALL abortion illegal in South Carolina.
So, the battle is joined. Abortion will be a major state-wide voting issue in November. Now, however, Republicans will be defending the new abortion status quo, not trying to overturn it. Cunningham and McLeod can paint McMaster as the extremist he is on this issue and rally angry women to the Democratic cause.