Shad White: Taxpayers could be on the hook for $8 Million
OCEAN SPRINGS, MS — A new Mississippi State Auditor report reviewing BP settlement spending cites GC Wire reporting while raising questions about the ownership of the Ocean Springs parking garage funded with $8 million in public money.
The report notes “confusion over the final ownership of the garage” and references earlier GC Wire coverage documenting that the City of Ocean Springs admitted no ownership-transfer agreement ever existed despite representing to state officials that one did.
The citation appears in a section of the report examining the 1515 Government Street development project, where auditors note that questions have emerged about the final ownership of the parking garage built with Gulf Coast Restoration Fund money.
It Wasn’t Ambiguous
The City of Ocean Springs filed a joint application with OHOS Development / Land LLC seeking Gulf Coast Restoration Fund (GCRF) money to construct the parking garage as part of a larger downtown hotel development.
Several of the promises made in that application never materialized — most notably the claim that the City would ultimately own the garage.
The language used in the application was not vague.
On Page 3 of the grant application, project documents state:
“OHOS Land, LLC has entered into an agreement in which it will transfer ownership of the parking garage and amenities to the City upon completing construction.”
The same claim appears again later in the application. On Page 8, the document states:
“The City of Ocean Springs is in full support of the project as evidenced by the attached resolution and the fact the City is a co-applicant and will be the owner of the proposed parking garage.”
Yet when GC Wire later submitted a public records request for the ownership-transfer agreement described in the application, the City of Ocean Springs acknowledged that no such agreement existed.
Instead, officials produced a 2021 memorandum of understanding outlining a future lease arrangement — not a transfer of ownership.
‘Just a Sales Pitch’
The City’s response confirmed that the agreement described in the grant application did not exist. After GC Wire reported the discrepancy, current City Attorney David Harris dismissed the statements in the application as little more than marketing language.
At a November Board of Aldermen meeting, Harris offered a different explanation for the ownership promises made to the state. The statements that Ocean Springs would ultimately own the garage, he said, were not binding commitments.
They were merely “a sales pitch.”
According to Harris, the language used in the grant application — including the statement that the city would own the garage — was “aspirational,” wording intended to make the project more attractive to state officials reviewing the funding request.
But the state’s contracts tell a different story.
The city did not simply submit a proposal describing a potential project. It certified the statements in that proposal as fact.
In multiple grant agreements signed in 2023 and 2024, Ocean Springs formally re-certified that the information contained in the original GCRF application was “true and correct.”
Those agreements include a binding clause requiring that all material facts contained in the application remain accurate at the time the city signed the contracts.
What the State Auditor Found
The Mississippi Office of the State Auditor released the report as part of a broader review of the Gulf Coast Restoration Fund, which distributes Mississippi’s share of the BP Deepwater Horizon settlement.
Mississippi is expected to receive more than $562 million through the program between 2018 and 2033 to support economic development projects along the Gulf Coast.
The audit found that 62 percent of GCRF funds awarded by the Legislature went to projects that were not recommended by the GCRF Advisory Board or the Mississippi Development Authority.
State Auditor Shad White said the finding raises concerns about how projects are selected.
“This money paid to Mississippi as a result of the Deepwater Horizon oil spill is critical for the future of the coast,” White said in a news release announcing the report. “These projects should be high-impact and have clear performance metrics attached.”
White warned that lawmakers currently have the ability to bypass the state’s normal vetting process for projects.
“While MDA can recommend certain projects be funded, the Legislature still has the legal power to ignore their recommendations and spend money on what they want,” White said. “I worry that, in the future, projects may be funded just because a politician likes the project, not because the project is well-designed and meets a vital need.”
Within the report, auditors highlight the Ocean Springs development project at 1515 Government Street as one example among projects funded through the program.
The report notes that while the project received support from local officials, questions have emerged over the final ownership of the publicly funded garage.
The report states:
“However, since the completion of the project, there has been confusion over the final ownership of the garage.”
That sentence includes a citation to earlier GC Wire reporting documenting the city’s admission that the ownership-transfer agreement described in the grant application never existed.
Taxpayers Could be on the Hook for $8 Million
Ownership of the garage was not a minor detail in the project application.
The development received $8 million in Gulf Coast Restoration Fund money, part of Mississippi’s share of the BP Deepwater Horizon settlement intended to support economic development along the coast.
In the Ocean Springs case study, the State Auditor’s report explains that the project’s final performance metric requires the parking garage to be transferred to the City through a long-term lease arrangement.
The report states:
“The final performance metric for the project is the transfer of the garage to the City of Ocean Springs through a lease agreement. If the city does not enter an agreement with OHOS, it must repay all GCRF funds to MDA.”
Construction of the development was completed in December 2025, and the report states the grant must close out by June 30, 2026.
With the project now complete and the grant deadline approaching, the ownership structure described in the original application remains unresolved.
Questions That Remain
The State Auditor’s report does not outright accuse the City of Ocean Springs or the developers of wrongdoing. But it confirms that the ownership issue documented through public records requests and earlier reporting remains unresolved.
For Ocean Springs residents, the question raised in the audit remains the same one that prompted the original records request:
Why did the grant application tell the state the City would own the parking garage when no agreement existed to make that happen?
That question remains at the center of the State Auditor’s review.
