Club formation and response to Hurricane Matthew destruction: An example from South Carolina

Hurricane Matthew in 2016 caused approximately $10 billion dollars of damage within the United States and nearly $350 million of destruction in South Carolina. The most important reason for the destruction which occurred in South Carolina was the historic rainfall and consequent flooding that either heavily damaged or completely destroyed buildings, roads, bridges, dams and crops. Indeed, rainfall in South Carolina ranged as high as 17 inches from this storm and as a result both the Waccamaw and Little Pee Dee rivers in the eastern part of the state crested at historic levels. This paper describes how one small lake front community in South Carolina responded to the destruction of its dam and loss of its lake from Hurricane Matthew. This particular response provides a classic example of a club, which Buchanan defined in his seminal 1965 paper as a “consumption ownership-membership organization(s)”. Club theory since Buchanan has been extended and applied to analyses of terrorism (Sandler et al, 1983), pollution (Congleton, 1992,), military alliances (Olson and Zeckhauser, 1966 and Murdoch and Sandler, 1982), religious organizations (Ekelund et al, 1996, Kuran, 2001, Iannaccone, 1992, Berman, 2000, and Chamlee-Wright and Storr, 2009), and recreation areas (Fisher and Krutilla, 1972), to identify but a few, and this paper continues along these varied lines. More specifically, we detail in this paper first how the Lake Bennett Homeowners Association was legally formed and then explain the processes by which that association of members, or club, achieved the goals of rebuilding the dam and restoring the small, about twenty-five acres, body of water by adopting a constitution and by-laws and establishing initial membership fees and recurring annual dues. This voluntary group accomplished its goals when, paradoxically, rainfall from a second hurricane, Florence in 2018, refilled the lake, Lake Bennett.