By Delayna Earley
The Island News
A lawsuit filed by a local nonprofit is putting new scrutiny on how taxpayer dollars are spent — and how accessible those records must be — at the Beaufort County Economic Development Corporation.
Protect Beaufort Foundation Inc. has sued the BCEDC, alleging the organization improperly withheld public records related to the use of public funds and imposed fees that violated South Carolina’s Freedom of Information Act.
The case centers on whether the mostly taxpayer-funded nonprofit must comply with state transparency laws and, if so, whether it did so properly when records were requested.
“This is part of Protect Beaufort Foundation’s continued mission to protect Beaufort and to hold our municipalities — including their related organizations — accountable for their laws, their bylaws and their decisions,” said Graham Trask, a board member of the foundation.
The BCEDC is a nonprofit entity responsible for recruiting new businesses to Beaufort County and is largely funded by public money.
In court filings, the organization disputes that it is subject to FOIA and has asked a judge to dismiss the lawsuit.
According to the complaint, Protect Beaufort submitted a FOIA request on July 9, 2025, seeking records including employment contracts for the executive director, credit card use policies and correspondence related to grant funding provided to a local organization.
On July 21, the BCEDC issued a written response that the lawsuit alleges failed to provide all requested documents, including Executive Director John O’Toole’s employment contract and copies of completed questionnaires.
The foundation also claims the agency did not cite legal authority for withholding those records.
“This lawsuit is really about trying to get information that the BCEDC should lawfully provide through a FOIA request,” Trask said. “They actually make themselves subject to FOIA in their own bylaws, which were approved by the county.”
What South Carolina FOIA requires
South Carolina’s Freedom of Information Act is intended to ensure public business is conducted openly and that citizens have access to public records.
The law applies to public bodies, generally defined as entities supported in whole or in part by public funds or that expend public funds.
Under the statute, agencies must respond to FOIA requests within set timeframes by either producing the records or issuing a written determination explaining any denial.
While agencies may charge fees to cover the actual cost of searching for, retrieving and redacting records, those fees must be reasonable, supported by an established fee schedule and explained to the requester.
According to South Carolina law and appellate court rulings, whether a nonprofit must comply with FOIA depends on the specific facts of how it operates and is funded.
What the lawsuit alleges
The complaint alleges the BCEDC required a deposit of $1,613.45 — roughly 25% of the estimated total cost which Trask said was more than $6,000 — to continue processing the request, despite not having a published FOIA fee schedule in place at the time.
The foundation also claims the agency did not explain how the deposit amount was calculated.
“They had no fee schedule, and there was no explanation for how they arrived at such a figure,” Trask said. “We consider those fees usurious and unlawful.”
According to the lawsuit, Protect Beaufort sought reconsideration of the agency’s response the following day but did not receive a written reply.
The complaint also describes an Aug. 21 incident in which a foundation representative attended a public BCEDC meeting and requested copies of binders and materials prepared for board members that day.
The lawsuit alleges O’Toole declined to provide the documents and instead required the submission of a new FOIA request — a requirement the foundation says violates state law when documents have already been prepared and distributed at a public meeting within the previous six months.
“They provided some information, refused to provide all of it, and then proceeded to charge what we believe were unlawful fees,” Trask said. “We were really left with no choice but to file a FOIA lawsuit.”
The foundation is asking the court to declare the BCEDC in violation of FOIA, order the release of all responsive records and award attorney’s fees and costs.
Motion to dismiss
The BCEDC has asked the court to dismiss the lawsuit under Rule 12(b)(6) of the South Carolina Rules of Civil Procedure, arguing that the complaint fails to state facts sufficient to establish a FOIA violation.
In its motion, the BCEDC argues that Protect Beaufort did not adequately allege facts showing the corporation qualifies as a “public body” under state law.
While the complaint states that the BCEDC is a public body for FOIA purposes, the motion contends that assertion is a legal conclusion rather than a factual allegation.
The BCEDC further argues the complaint does not allege specific facts showing the organization was supported by public funds at the time the FOIA request was submitted, nor that it received government funding “en masse” or was generally supported by taxpayer dollars.
The motion also asserts that serving as Beaufort County’s lead economic development entity does not automatically subject the organization to FOIA.
Citing prior South Carolina Supreme Court decisions, the BCEDC argues that determining whether a nonprofit is subject to FOIA requires a fact-specific analysis that goes beyond a working relationship with government or the receipt of some public funds.
“In summary,” the motion states, “Plaintiff’s Complaint states no facts sufficient to support a conclusion that BCEDC is, or was at any relevant time, a ‘public body’ as that term is defined in FOIA.”
Protect Beaufort disputes that argument.
“We were puzzled by that position,” Trask said. “When you say you’re subject to FOIA, put it in your bylaws, create a FOIA cost schedule and have your board approve everything, then suddenly say you’re not subject to FOIA — that’s a very interesting position to take.”
O’Toole said the BCEDC complies with FOIA requirements but that some requested information exceeded what legal counsel advised should be released.
He also said certain requests required significant staff time to fulfill, which led to the proposed cost.
Alternative dispute resolution in the case is scheduled for May 14.
Delayna Earley, who joined The Island News in 2022, formerly worked as a photojournalist for The Island Packet/The Beaufort Gazette, as well as newspapers in Indiana and Virginia. She can be reached at delayna.theislandnews@gmail.com.
