FOR IMMEDIATE RELEASE
Charleston, SC - In a bold move, the South Carolina State Ports Authority is encouraging reporters to visit the Ports Authority's Main Office at 176 Concord Street today to review nearly two years worth of corporate charge card statements.
"The Authority's corporate charges are reasonable and appropriate," said Bernard S. Groseclose Jr., president and CEO of the South Carolina State Ports Authority.
Contain the Port, a group of anti-port activists, recently requested all of the Ports Authority's American Express corporate charge account statements for 1997 and 1998. Copies of the exact same documents are being made available to the media today. Under the old system, which ended in October 1998, corporate charge card bills were invoiced directly to the Ports Authority. Individuals now pay their own bills and request reimbursement.
Included on the 202 pages of bills covering about 21 months are all charges that were incurred to every corporate credit card paid by the Ports Authority. They include expenditures for travel (such airfare and hotels), entertainment (such as meals and golf with customers) and other business expenses.
While the charges totaled $440,355 for the entire 21-month period, the Ports Authority earned more than $144 million in revenues from its shipping line and manufacturing customers in the same period. Therefore, the Ports Authority earned $327 in revenue for every one dollar in American Express charges for travel, entertainment and other business expense.
Every expense report filed by an employee must be approved by the employee's supervisor, and is then reviewed by the Ports Authority's finance department for appropriateness and documentation. The Ports Authority also employs internal and external auditors to review accounting practices.
"While the expenses are certainly reasonable," said Groseclose, "it is important to note that they were paid with revenues earned from our customers, not with tax dollars."
The Ports Authority has not received operating subsidies since 1959, when Senator Fritz Hollings was governor. Even with future port expansion, the Ports Authority would not seek operating funds from the state, only capital funds for hard infrastructure.
Many of the expenses were incurred by the members of the Ports Authority's marketing and sales team, who travel the state and world encouraging companies to bring their ships and cargo to ports in Charleston, Georgetown and Port Royal. Entertainment expenses, such as meals and golf, are common activities for salespeople.
In addition, top port officials visited several large accounts in Europe and Asia in 1997 to continue its close relationship with major port customers after the retirement of Don Welch. There are currently more than 40 global ocean carriers that send ships to Charleston, carrying trade between South Carolina and 140 countries around the world.
"Effective marketing is quite obviously a very important part of the Ports Authority's legislated mission and is vital to our success," said Groseclose.
Since 1998 when these expenses were incurred, revenues have increased more than 25% to a projected $104 million next year. Charleston is currently the nation's fourth busiest container port and handles international cargo valued at $29 billion annually.
Background on Contain the Port's Request for SPA Expense Reports
After fulfilling a request from Contain the Port for summary expense report information earlier this year, the group then requested four years of detailed expense reports for executive, public relations and marketing staff to support these numbers. This would have been a massive request requiring many man-hours.
Contain the Port later refined their follow-up request to one year, 1998. The Ports Authority informed the group that this request would require 120 hours of research because it involved 553 individual expense reports. This translates into about 13 minutes per report, as each expense report would have to be retrieved from the filing system, copied and stripped of personal information.
The total charge for producing these documents was estimated at $2,505, or roughly $20 per hour (The Post and Courier archives department charges $50 an hour for research). Not wanting to cover the costs that their request would have caused, Contain the Port then asked for copies of statements for all corporate credit cards from 1997 and 1998. Corporate credit cards paid by the Ports Authority were discontinued in October 1998.
Copies of these statements were retrieved in a relatively short period of time and have been forwarded to Contain the Port, as requested. Therefore, there will only be a minor charge to Contain the Port for compiling the documents.