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A Review of the Relocation of the South Carolina Farmers' Market and Related Expenditures
April 2010

REPORT (PDF) 

After spending more than $4.4 million to develop a Farmers’ Market in Richland County, the South Carolina Department of Agriculture (SCDA) decided the project was not viable and began looking for another site. The decision to move the Farmers’ Market from Richland County to a Lexington County site was based primarily on vendors’ lack of support for the Richland County plan, according to South Carolina Department of Agriculture officials, state and county records that we reviewed, and responses to a survey of vendors. Twelve vendors, representing about 80 percent of the market’s business, responded to a survey administered by SCDA. The responses supported SCDA’s decision to seek an alternative site. Some vendors expressed concern that relocating to the Richland County site was too expensive and financial incentives were not sufficient.

Plans for the Lexington County relocation site were in place before the Joint Bond Review Committee authorized funding for the project and before the SCDA officially notified Richland County that it was terminating its agreement to locate in Richland County. The General Assembly passed a resolution to relocate the site to Lexington County on May 8, 2008. SCDA officials and a General Services official with the Budget and Control Board stated that there was no official commitment to the Lexington County site until after the resolution passed. However, an incentive agreement between the developer and Lexington County was signed on December 15, 2007, and indicated that the Department of Agriculture would be occupying the “state parcel” and a state grant of $2.6 million would fund a portion of the public improvements. In addition, two newspapers ran articles in November 2007 that the market would be relocated in Lexington County, and another newspaper defined the relocation’s developer and precise location on March 14, 2008.

The General Assembly’s Joint Bond Review Committee authorized SCDA to purchase 46.2 acres from a private developer. We established that SCDA has purchased 35.15 acres, but its contract to purchase 11 additional acres and buildings has been delayed.

The Farmers’ Market is not planned to move to the Lexington County site until Summer 2010, more than two months after the scheduled date. However, the private developer did not officially notify the Department of Agriculture officials of this delay or request a waiver of damages until we inquired in February 2010. The agreement requires the developer to pay the state significant financial damages for this delay, and we could find no reason why financial damages should not be imposed against the developer.

SCDA used state funds to pay for certain expenses incurred by the developer before the state agreed to relocate in Lexington County. For example, we found that more than $49,000 of state funds were used to pay to survey the developers’ 174.12 acres for the site. We could not determine why the state paid for the entire surveying cost.

We noted several immaterial concerns related to documentation and recordkeeping. For example, invoices for the Farmers’ Market expenditures have not been reviewed by SCDA accountants for reasonableness and documentation because management has designated three other SCDA officials to approve payments. We found insufficient documentation in several transactions that we reviewed.