PICKENS COUNTY — Former Pickens County Councilman G. Neil Smith was found to be in violation of the S.C. Ethics, Government Accountability, and Campaign Reform Act — commonly known as the Ethics Act — for his actions in 2016 involving the County’s recreation funds and the then-named Liberty Civic Auditorium.
The consent order, obtained by The Sentinel-Progress, states Smith was found in violation of section 8-13-700 (A) which states no public official may use his office to obtain economic interest for himself, family member, or business which which he is associated, and (B) which states no public official may attempt to use his office to influence a governmental decision in which he, a family member, an individual with whom he is associated, or a business with which he is associated has an economic interest.
For these violations, the Ethics Commission fined Smith a civil penalty of $3,000, plus a $500 administrative fee, to be paid in full within 90 days of the order, dated Oct. 21, 2019.
The original complaint against Smith was filed by former Pickens County Administrator Gerald Wilson, who retired earlier this year.
As previously reported by this publication, according to Wilson, in the past, the Pickens County Recreation Fund was divvied up between the six districts — $50,000 per district, per year — with funds “rolling over” from one year to the next.
Spending was at the sole discretion of that district’s councilperson.
“It was a disaster waiting to happen,” stated Wilson at the time. “And that’s what happened.”
Allegations of misuse of the rec funds combined with the appearance of personal gains through projects funded led the newly-elected council to freeze the rec fund shortly after they took office in 2017.
It all started in 2016 when according to county documents obtained by The Sentinel-Progress under the S.C. Freedom of Information Act, just after the November election, then Councilman-elect Roy Costner approached Wilson with concerns about the Liberty Civic Auditorium (LCA.)
“He (Costner) stated he had been contacted by a citizen about some issues with the Civic Auditorium that may have legal issues,” Wilson’s documentation log read. “I instructed (then county attorney) Ken (Roper) to pull all records related to this matter and see if he saw anything that looks suspicious.”
Documents from the county showed a series of bookings to the auditorium through two companies: Broadcast Music Incorporated (BMI) and O.S. Productions.
At the time, according to county employee Barry Chappell, bookings and contract negotiations for performances at the LCA were handled personally by former councilman G. Neil Smith. Smith also admitted to overseeing events and activities at the LCA in the Ethic’s Commission’s 2019 Consent Order’s Statements of Fact.
When contacted by The Sentinel-Progress, BMI executives acknowledged that Smith was on the Board of Directors for the company but refused to state whether it was a paid position.
BMI was contracted for 2016’s Carolina Songwriter Series at the LCA.
“In the past year, the county spent $62,434.00 on performances at the Auditorium. These shows included a Karen Peck concert and three dates of a Carolina Songwriters Series,” reads a county document from Jan. 18, 2017. “Average attendance at these events was between 100-150 people, while ticket sales only generated $1,622.00. The balance of expenses came from taxpayers.”
The concern about O.S. Productions was that the company itself was actually just a front, said Wilson.
“I was concerned that Neil (Smith) was OS Productions and actually the person running the operations,” wrote Wilson in his log.
On Nov. 14, 2016, Wilson, Roper and Chappell met with Smith to address the complaints and go over the county’s findings.
It didn’t go so great.
“During the meeting CM (council member) Smith became very upset that we were even bringing the matter before him,” Wilson documented. “He stated that the recreation fund he was using was his money and we did not question other Council members when they spend their money.”
Wilson said that he, as administrator, had a responsibility to investigate every complaint to determine its validity.
“… Smith looked at I and Ken and flipped a bird at both of us and stated he was coming after us,” the log reads. “He was talking in a loud rude tone.”
Wilson then informed Smith they would need to personally meet with Odell Scott — O.S. Productions — before recommending any contracts and that any future checks would need to be mailed or be picked up — in person — by Scott.
But the investigation didn’t stop there.
In a series of email correspondences with Wells Fargo Bank, also obtained by this paper under FOIA, County Finance Director Ralph Guarino attempted to find out who was cashing checks issued to O.S. Productions and Pickens County Sheriff Rick Clark was made aware of the situation.
This publication, in addition to Guarino, reached the same brick wall when it came to the name on the Wells Fargo account when bank officials refused to release any names without a subpoena.
Wilson, in the meantime, began requiring invoices for recreation expenses.
“In the past, you (a council member) could call down to the finance office and say ‘I want to cut a check for $25,000 out of my rec fund and have it sent to … whoever,’ and it would be done,” said Wilson. “There was no voting on it, there was no paper trail. It became where council members saw the rec funds as ‘their money’ and they could spend it how they wished.”
In December 2016, Smith turned in a stack of invoices including — among others — one from BMI for $65,000, five from O.S. Productions totalling $31,726.78, and one for $1,400 from the “City of Six Mile.”
The invoices, obtained under FOIA, appeared to have all been generated from the same or similar computer program and none of them contained any official letterheads or authorizing signatures.
In appearance, despite “originating” from different organizations, they were all identical — save for names and amounts.
“As far as I knew, the invoices were from who he (Smith) said they were from,” said Wilson. “But these weren’t paid.”
Wilson said that by that time, the election was over and he and Guarino we’re “stalling” until the new council was sworn in.
“We took vacations about then,” said Wilson at the time. “Those invoices never made it out of the hopper.”
On Nov. 28, 2016, Wilson met with Councilman Trey Whitehurst and discussed, among other things, O.S. Productions and the LCA. Wilson notes in his documentation log that Whitehurst said “Neil was concerned that after the first of the year the new council would come in and try and take control of Neil’s rec account funds.”
A month later, at a special called county council meeting on Dec. 30, Smith attempted to secure “his” funds on his last day in office by transferring $38,735.25 — close to the amount “invoiced” by O.S. Productions — to Whitehurst in Executive Session.
The meeting was not attended by the majority of council members and a quorum was only achieved by the phoning in of (also absent) Councilman Ensley Feemster.
“You don’t have to do this Ensley,” said Sheriff Rick Clark on the phone at the council meeting. “Just hang up the phone.”
Eventually it was decided that a quorum did not exist as a telephone connection can only be used in an emergency.
Although county officials admitted they were never able to produce any actual evidence of illegal activity, they agreed there was certainly the appearance of questionable practices — which led Wilson to file the complaint with the Ethic’s Commission in April of 2017 under the direction of Council Chair Roy Costner.
The scandal also led to the formation of an ordinance governing how members of Pickens County Council utilized the Recreation Fund by implementing a board as well as a system of checks and balances, effectively removing personal control over each district’s fund from the individual council members.
“Almost immediately after taking office, our new county council reformed the broken recreation funding system by giving up individual control and turning decision making over to a board of local citizens,” said Acting Administrator Ken Roper. “The old system allowed ridiculous and wasteful spending of tax dollars such as the misconduct in this case.”
For his part, in the 2019 Consent Order, Smith admitted he he violated the Ethic’s Act by using his office to obtain an economic interest for BMI when he directed county staff to pay them $25,000 on July 14, 2016, and again when he attempted to use his office to influence a governmental decision when he directed staff to pay BMI $65,000 on Dec. 19, 2016.
Smith asserted any violation of the Ethic’s Act was “unintentional and inadvertent.” Additionally, he maintained he was “transparent from the beginning and disclosed his BMI Board of Director’s position with County Council and staff” and that neither he nor his family profited from the County’s involvement with BMI.
Roper said with egos and politics out of the rec fund, taxpayers can now know their money won’t go to “personal pet projects,” but will instead be used for “more sensible recreation goals that can benefit us all.”
“I’m glad the State Ethics Commission agreed with County staff that the old way was illegal and just plain wrong,” Roper said. “I hope we never go back to those dark days.”
