BLYTHEWOOD – Scout Motors, which is expected to create over 4,000 jobs in the Midlands, is the target of an ethics complaint recently filed by a pair of S.C. watchdog groups.
On April 29, the S.C. Policy Council announced that it had joined the S.C. Public Interest Foundation in filing an ethics complaint against Scout Motors.
A State Ethics Commission spokesperson said via email that the agency “can neither confirm nor deny the existence of a complaint.” The commission does not officially release complaints unless the agency determines there’s probable cause.
The ethics complaint distributed to media outlets this week by the Policy Council asserts Scout Motors EV, a Volkswagen subsidiary, failed to register as a lobbyist principal before the state awarded Scout $1.3 billion in economic development funds via Act 3 of 2023.
Stakeholders of the $2 billion project are pushing back, using terms such as “nonsensical” and “factually inaccurate” to describe the complaint. “Scout Motors did not have registered lobbyists in South Carolina before April 2023 because we were not lobbying,” a Scout representative said in a statement. “Scout Motors had no direct role in advancing the legislation that passed last year, and any suggestion otherwise is factually incorrect.”
A spokesperson for Gov. Henry McMaster called the complaint “nonsensical,” saying it “demonstrates a fundamental ignorance of the law and reality.”
“The governor and officials from the Department of Commerce asked the General Assembly to approve the proposed economic development incentive package in order to convince Scout Motors to locate and invest in our state,” the statement reads.
A S.C. Department of Commerce spokeswoman referred The Voice to the governor’s office’s prepared statement.
How the deal developed and the timing of payments to Scout rubbed the policy council and foundation the wrong way, however.
South Carolina law defines a lobbyist principal as “the person on whose behalf and for whose benefit the lobbyist engages in lobbying.”
A lobbyist principal also “directly employs, appoints, or retains a lobbyist to engage in lobbying,” the law states.
Lobbyist principals must further register with the Ethics Commission within 15 days of “employing, appointing, or retaining a lobbyist.”
Scout failed to properly register, according to the ethics complaint.
The complaint asserts Scout didn’t register as a lobbyist principal until a month after state lawmakers voted on March 13 to appropriate $1.3 billion in state surplus funds to Scout.
In the complaint, the policy council and foundation state that Scout executives actively met with governor’s office staff, state lawmakers, and other state officials on three occasions prior to March 13.
Scout leaders met with state officials in Washington, D.C. on October 22, 2022; at a private dinner in the Governor’s Mansion on February 2, 2023; and at a “Confidential Economic Development Dinner” at Williams-Brice stadium on February 26, 2023, according to the complaint.
“The facts cited above raise legitimate questions about whether Scout Motors or its representatives engaged in direct communication with lawmakers and/or the governor regarding Act 3 of 2023 before the law was passed,” the complaint states.
Per standard procedure, the ethics commission will assign an investigator if there are sufficient facts to investigate.
Once the investigator presents their findings to the commission, at least six commissioners must vote on whether or not probable cause exists to hold a contested hearing.
If the ethics commission finds Scout in violation, the manufacturer faces a $100 fine per violation.
In 2023, parent company Volkswagen reported annual revenues of 26 billion euros, or about $27.75 billion, according to the company’s annual report.
Scout is currently building an electric vehicle plant on 1,100 acres off I-77 near Exit 27. It’s slated to open in 2026.
