A missing $4 million, a $10 million loan installment coming due with no money to pay for it and whether former State Election Commission director Howard Knapp misrepresented the price of buying new machines for the state in 2024.

Those were three questions about a $28 million purchase for machines to count voter’s ballots aired Wednesday during an unusually open public meeting of the State Election Commission board.

“We know that we authorized $28 million (for the voting machines) ... but the loan appears to be for $32 million,” said Commission chairman Dennis Shedd during the meeting. The three other commission members agreed that they had approved a $28 million loan.

“The executive director (Knapp) misrepresented things to us,” Shedd said.

Consequently, there now appears to be $4 million unaccounted for in the $32 million loan the commission incurred to buy some 3,000 machines from Election Systems & Software after it had been told by Knapp that the machines only cost $28 million, Shedd said.

And now, Shedd continued, the commission owes an initial $10 million payment to TD Bank on the $32 million loan and will have to pay a penalty if it doesn’t come up with the $10 million. The penalty would be 10% of the $10 million, or $1 million.

“I think there’s a payment a few days past due,” Shedd said.

Shedd asked South Carolina Treasurer Curtis Loftis, who was at the meeting, what TD Bank would do if the Commission didn’t pay the $10 million due on the loan.

“The bank would repossess the equipment,” Loftis told Shedd.

Shedd asked, “You think the bank would take back the voting machines of South Carolina?”

Loftis: “They sure will.”

The election commission is expected to receive nearly $11 million for the loan payment in February. Money for one-time state agency expenses in the current fiscal year, such as for the voting machines, have been delayed by the General Assembly until February.

Shedd also asked Loftis, “Why did this contract go awry?”

Loftis answered, “Because the person in charge, Mr. Knapp, did not deal honorably. ... He negotiated behind your back.”

Knapp’s attorney, Joe McCulloch, said later Wednesday, “This is character assassination at its lowest.”

The $4 million is nothing more than the sales tax on the $28 million voting machine purchase, McCulloch said.

Furthermore, the Election Commission has records of the initial proposal, the final invoice and emails that will prove that commission officials knew at the time that the $4 million tax would be added to the sales price, McCulloch said.

“This misplaced criticism of Mr. Knapp is indicative of the low quality of the criticisms against him in general,” McCulloch said.

Loftis’ office has the authority to pay the $10 million now due, but the Election Commission has to approve the payment. Shedd said the current Commission doesn’t want to approve the payment because it might appear that the Commission is okaying the $32 million loan.

The Commission has authorized interim commission director Jenny Wooten to enter into discussions with TD Bank to see what can be worked out. Following an executive session, Shedd said the commission would not follow Loftis’ recommendation of asking for an amendment to the loan rather than a new legal agreement.

“The commission has not agreed to sign the amendment to the contract that was presented to us by the Treasurer,” Shedd said following the nonpublic portion of the meeting.

Knapp’s removal

Knapp, who was fired Sept. 17 by the commission, was discussed in detail at Wednesday’s meeting. Previously, the commission had only said it was looking for “new leadership.”

“The former director was removed because of his inappropriate conduct,” said Shedd.

In the part of the meeting discussing Knapp, Shedd ticked off the former director’s questionable conduct.

Under Knapp’s leadership, the Commission had become a “toxic and perhaps hostile work environment,” Shedd said as approximately 10 reporters from South Carolina major news outlets looked on.

Specifically, Shedd said, Knapp had used or misused agency funds for personal reasons, “conspiring with other management-level staff to falsify documentation the commission was seeking and conspiring with those staffers to lie about the fact they had falsified that information.” The falsified documents were unrelated to the voting machines, he said.

The falsification and agreement to lie “has all been admitted by those other staffers,” said Shedd, a retired federal district judge and federal appeals court judge who spent 28 years on the bench.

Knapp “also misled the commission on contract matters he asked us to approve,” Shedd said.

Since Knapp’s dismissal, the commission has learned of “additional misconduct and further details about misconduct we already knew about,” Shedd said.

Moreover, Knapp and his “very close friend and fellow employee Paige Salonich were involved in planting a device in this very room to record our conversations,” Shedd said.

Three state agencies – the Attorney General’s office, the Office of Inspector General and the State Law Enforcement Division – now have Knapp’s conduct during in his time in office “under review,” Shedd said.

Shedd said that an investigation into Knapp’s use or misuse of state vehicles has been in the hands of the Attorney General’s office “for over a year and I am not aware that we have ever been told that the investigation has been closed. As far as we know, that’s still an ongoing matter.”

Another investigation by the Office of the Inspector General involves the commission’s purchase of the voting machines, Shedd indicated. “I’m not going to deny that,” Shedd answered in reply to a reporter’s question during the meeting.

The Inspector General, Brian Lamkin, was in the audience. He was invited to speak on the investigation but declined. His office does not make public comments on investigations. In the past, SLED and the Attorney General’s office have declined comment also.

In other events at the meeting:

—Shedd made it clear that Knapp’s firing was not related to any concerns over a request by the U.S. Department of Justice for the Election Commission to give the federal government voting records of 3.3 million state voters, including partial Social Security numbers. The Commission has made no final decision.

—Commissioners revealed that besides Knapp, the agency’s second-highest employee, Paige Salonich, was fired Sept. 18. And former director of external affairs John Michael Catalano resigned from the election commission Oct. 10, according to a resignation letter. His resignation was effective immediately.

—Thomas Nicholson, the commission’s general counsel, said he would hesitate to say that employee departures and dismissals related to wrongdoing are over.

—Linda McCall, one of five members on the board of the Commission, turned in her resignation in a letter to Gov. Henry McMaster dated Sept. 22. McCall’s seat is listed as vacant on the election commission’s website. She was not at Wednesday’s meeting. In her letter, she said without giving further details that “what went on” with Knapp’s ouster was a reason for her departure, in addition to other personal reasons.

Election commission faces another lawsuit

Although Salonich was not discussed in detail at Wednesday’s meeting, a lawsuit she filed against the election commission was on the agenda for the executive session of the meeting.

On Sept. 30, Salonich’s lawyers filed a lawsuit against the election commission for invading her privacy by providing details to the press about a private object found in her office.

Election commission employees searched through Salonich’s office and found a health device meant to strengthen her pelvic floor, according to her lawsuit. Salonich had the device, called “Weight for It,” for “legitimate medical purposes following the birth of her third child,” according to the legal filings.

Employees or officials with knowledge of her “Weight for It” device told a FITS News reporter about it, Salonich alleged. The FITS reporter wrote an article about Salonich’s firing and the device, characterizing it in a way that would “embarrass and humiliate” Salonich, according to the lawsuit.

“The information disclosed concerned Plaintiff’s most intimate personal affairs and was of the type that would be highly offensive and likely to cause serious mental injury to a person of ordinary sensibilities,” the lawsuit read.

Her possession of the device was not a matter of public concern, according to the lawsuit. Salonich requested a trial by jury.

Salonich’s lawyers are Chris Kenney, Catherine Hunter and Jim Griffin, who represented convicted killer Alex Murdaugh at his murder trial.

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