MYRTLE BEACH, SC (WBTW) – The city of Myrtle Beach only “spot checks” reports that detail the Myrtle Beach Area Chamber of Commerce’s spending of taxpayer money, city spokesman Mark Kruea told News13 on Wednesday.
Asked whether the city had raised any issues with expenses, Kruea replied, “No.”
News13’s review of “transparency reports” published by the chamber from 2015 to 2017 revealed more than a third of taxpayer-funded spending didn’t list vendors. Instead, generic descriptions, such as “email marketing,” were tied to approximately $30 million of transactions.
The “transparency reports” documented the chamber’s spending of $74 million from the accommodations tax and a one-percent sales tax in Myrtle Beach known as the tourism development fee. Much of the money goes to the chamber to advertise the Myrtle Beach area.
“Other” described $95,509.29 worth of spending.
Kruea didn’t answer when asked whether anyone with the city questioned the spending attributed to “other.” He instead explained that he and the city council have looked at the “transparency reports.”
Asked how people can be comfortable with a transaction description like “other,” Kruea replied, “I think that’s a good question and I would point that question towards the chamber and say ‘Gee, can you give us some more detail on this?’” The chamber didn’t explain the “other” expenses in a written response to News13’s questions on Monday. It didn’t respond to another request on Thursday.
The chamber described some additional generic expenses as incidental charges such as a taxi ride or buying snacks for a crew at a video shoot. It tied much of the generic expenditures to “internet advertising” purchases with Visibility and Conversions, LLC.
With the oversight described by Kruea, News13 asked what would prevent the chamber from making lavish purchases with taxpayer money. Kruea said, “The folks at the chamber are smart enough not to do that.”
No one has offered corroborated allegations that the chamber made lavish purchases, but a lawsuit filed last week claimed the chamber funneled tax money to ‘crony companies’ and also sent money to chamber-favored political candidates. The chamber denied the allegations and said it followed the law when spending taxpayer money.
Kruea admitted the city doesn’t receive any more information about the chamber’s spending than the public sees. The chamber shares “transparency reports,” which use generic names in place of vendors in some cases, and an annual audit with the public.
The most recent audit of the chamber indicated its financial statements were accurate. Kruea described the audit as “the biggest backstop when it comes to being certain that money is being spent as shown in the reports and as required by state law.” The audit doesn’t say whether the chamber wisely spends taxpayer money.
Kruea said the city’s chief financial officer, Mike Shelton, “spot checks” the chamber’s “transparency reports.” Kruea told News13 he didn’t know how many transactions are spot checked. Asked whether anyone could get an answer, Kruea replied, “I don’t think there is an answer.” There’s no set amount of “spot checks,” he said.
“City council is comfortable with the spending reports, is comfortable that the chamber’s using the money well,” Kruea said. “The results have been very good. I think we are aware of the limitations of it, but we’re also aware of the sheer size, the sheer volume of that sort of recordkeeping.
Mayor Brenda Bethune told News13 on Tuesday she wouldn’t speak about anything related to the tourism development tax. She also didn’t respond to a text message on Monday asking about the chamber’s disclosures.
“I think you’re looking for something that simply doesn’t exist. Just by looking for it doesn’t mean that it’s a problem,” Kruea said.
