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IS IT LEGAL? DRC SHELL “WORK AROUND” FOR HISTORIC TAX CREDITS

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On Saturday, December 12th, Myrtle Beach’s City Manager reported to city council that he had removed all former board members of the Downtown Redevelopment Corporation (DRC).

Councilman Mike Lowder informed all members that Pedersen was now the managing member of the DRC LLC. Lowder questioned this action orchestrated by the city manager.

Pedersen then told council he had placed Assistant City Manager, Fox Simons, Jr. on the DRC Board along with himself and former Myrtle Beach City CFO Mike Shelton.

He can clearly be heard above telling City Council he did so in order to do a legal “work around” which allows the city to get a historic tax credit on 3 of the buildings located along 9th Avenue.

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Those historic tax credits come to $775,000. City Manager John Pedersen stated it was “complicated”.

WAS IT LEGAL?

On the advice of legal experts (our news team consulted), we reached out to Lance Hatten, Deputy Director of the National Parks Service, Stan Austin of the National Parks Service, as well as, the IRS to determine if current City Manager John Pedersen’s DRC work around was in fact legal. We await their determination.

The IRS administers the Department of the Treasury’s involvement with the Federal Historic Preservation Tax Incentives Program. The IRS has provided written guidance on these complex federal regulations which is available as easy-to-read guidance in IRS Info.

The National Park Service administers a 20% income tax credit for the rehabilitation of historic income-producing buildings. A 10% tax credit is available for the rehabilitation of non-historic buildings constructed before 1936.

DRC Board Member Fox Simons Jr. is currently a finalist to replace John Pedersen as Myrtle Beach City Manager.

A Myrtle Beach City Council meeting will be held at 2 p.m. at the Council Chamber, Ted C. Collins Law Enforcement Center in Myrtle Beach on December 17.

The purpose of this special meeting is to select a candidate for the purpose of entering into negotiations regarding the terms of an employment agreement as City Manager and subsequent prospective appointment.

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HOW THE “WORK AROUND” IS ENVISIONED

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David Hucks is a 12th generation descendant of the area we now call Myrtle Beach, S.C. David attended Coastal Carolina University and like most of his family, has never left the area. David is the lead journalist at MyrtleBeachSC.com

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