Dispute at Sunset Beach: How much is too much


North Carolina’s tiny Sunset Beach barrier island is staging an outsized battle against overdevelopment.

A years-long standoff at the island near the South Carolina border has left little room for compromise. Tensions are escalating to the point that environmentalists and homeowners have brought legal action, there’s a dispute over who owns the land, and the General Assembly is poised to take land away from what they see as a recalcitrant town government.

There are several building projects in the works in Sunset Beach, but the flashpoint is a plan by Greg Gore, a third-generation member of the family that developed the island, and his business partner, Sammy Varnam. They want to build 21 beachfront homes along with a bridge, a road, walkways, a 136-foot-long pier and a 64-foot-long dock on 15 acres of marshland next to the Bird Island Reserve, a 1,300-acre protected research area comprised of salt marsh, tidal creeks, dunes, beaches, loggerhead sea turtles and other threatened species.

It’s a piece of Sunset Beach that federal law categorizes as so fragile that no public money can be spent on flood insurance, utilities or disaster assistance there.

The Southern Environmental Law Center, which says it only gets involved in the most egregious cases, agreed to represent the Sunset Beach Taxpayers Association and the N.C. Coastal Federation in their fight against the development. The SELC says the conflict reaches far beyond the island and could herald the loss of environmental protections elsewhere.

“The state has historically had very good policies that discourage building in places where eventually people’s property and lives will be endangered,” said Geoff Gisler, an attorney with SELC. “The state is moving in a direction encouraging people to make very risky investments and to build in places that infringe upon the public’s right to use oceanfront beaches and sound-side marshes.”

Varnam, a lifelong resident of Brunswick County, said the Town Council has blocked final approval of the project, Sunset Beach West, which won’t be built until the dispute is resolved in court. He blames the taxpayers association, saying they don’t want others to enjoy what they already have – a home at the beach.

“It’s total hypocrisy,” Varnam said. “That negative attitude toward coastal development has penetrated the Town Council of Sunset Beach, and that has basically stopped anyone from doing a commercial project in Sunset Beach.”

Waiting for a hurricane

The town of Sunset Beach consists of a mainland connected to an island by a sweeping bridge that arches over the Intracoastal Waterway. It has a permanent population of about 3,500. Fewer than 100 live on the island, which is only 3 miles long.

It’s a slow-moving, quiet beach town that draws vacationing families to its mix of older beach houses and newer construction, many on canals that provide a sense of waterfront location.

Kenney Pennell, a 15-year resident, says the island has become too crowded in recent years: too many no-parking signs, beach access hampered by private gates like the one at the Palm Cove development at the opposite end of the island from Varnum’s project. There, construction has begun on the first two of 10 large homes near Tubbs Inlet.

“It’s totally ridiculous,” Pennell said. “A lot of the full-time residents call it the least friendly beach on the East Coast.”

But the summer tourists don’t seem to share that complaint. The real estate website Trulia recently named Sunset Beach as the second-hottest vacation home market in the United States.

Triangle residents have long trekked to the island for summer vacations in their second homes, many of which are selling for half a million dollars or more these days. Raleigh Mayor Nancy McFarlane and her husband own one of the island homes.

There is a sense among some old-timers that the political power is on the mainland, and so they must offset that with tenacity. It’s hard to find an island resident or visitor who would like to see more development.

“I’m waiting for the next hurricane to resolve that,” said Joyce Winkler, manager of a rental shop in the heart of the island’s small strip of T-shirt and ice cream shops. She has lived there for eight years. “I don’t think they should develop any more. I understand people want a place at the beach, but there are plenty up for sale.”

Varnam’s and Gore’s Sunset Beach West project would be built at what was once called Mad Inlet, which is now comprised of marshes and dunes after nature closed the inlet a couple of decades ago. The development would be connected by a 620-feet-long bridge, 27 feet wide, that would be as little as 6 feet from high tide and shade about 15,000 square feet of wetlands, according to SELC’s legal challenge.

Because the area is considered part of a coastal barrier system designed to protect the beach’s ecology, federal law prevents the town from extending public utilities to the area. Each home would need individual water wells, septic systems and electricity generators.

Concerns about dunes

The N.C. Coastal Reserve, which manages the preservation of Bird Island, raised concerns about the project’s impact on dunes and noted that shoreline property vulnerable to storm surges and flooding increases the risk of septic system failure. Yet in June, the state Division of Coastal Management issued a permit for Sunset Beach West to proceed.

The environmental and taxpayer groups earlier this month asked the state Coastal Resources Commission to allow them to file a petition for an administrative law judge to review the permit. The commission’s vice chairwoman was to rule on the request by this weekend. If she denies it, then the groups will sue in Superior Court for the right to join the dispute as a third party.

“Here is this little piece of land that is undeveloped, connects to the Bird Island Coastal Reserve, that the state set aside because it’s such a special environmental treasure for the people of Sunset Beach and visitors,” Gisler said. “This project threatens both the reserve and the character of Sunset Beach.”

Further complicating things are disputes over who owns the land. The Town Council contends that the land belongs to it not to Varnam, citing deeds going back to 1987.

The fight has grown nasty and public.

Sue Weddle, a 27-year resident of the island and one of its leading environmentalists, calls Varnam “the worst developer I have ever encountered” and says he has tried to bully the council. “We’re not opposed to development,” she said. “We just want smart development by the rules.”

Varnam counters that the opponents have engaged in a smear campaign of falsehoods, including claiming dunes would be bulldozed. The state permit allows grading closer to the oceanfront dunes than is allowed elsewhere on the island, which is set back significantly from the ocean behind large dunes.

“It’s propaganda to confuse the public and make them think we’re doing illegal activities, which we’re not,” he said. “The regulatory agencies control and look over everything we do. Everything we do is under a microscope.”

De-annexation threat

State Rep. Frank Iler, a Republican who represents Brunswick County, said Varnam and other developers turned to him and Sen. Bill Rabon, a Republican from Southport. Earlier this year the legislators drew up a bill that would have de-annexed the land for Sunset Beach West, Palm Cove and an apartment complex on the mainland – which had asked to be annexed to the town in 2004 – and put them on the county’s tax rolls.

“They were desperate at that point,” Iler said. “They worked for years, some cases decades, to resolve some of the issues. The anti-development attitude seemed to be getting worse.”

Gore, son and grandson of the men who literally reshaped and developed the island, gave $1,000 to Iler’s campaign in February, and $1,000 to Rabon’s in 2014. Varnam gave $500 to Rabon’s campaign in 2014.

In response, the Town Council passed a resolution saying the community was “shocked” by the bill.

Iler said of the more than a dozen towns in his district, Sunset Beach seems to be the most contentious over land-use issues. He said he hopes that all involved can reach agreement on some of the concerns, noting that happened in Palm Cove. After it was agreed the project could include swimming pools, he was willing to remove that project from the de-annexation bill. The bill easily passed the Senate but languished in the House.

Iler is sympathetic to the developers, saying the town has changed the rules at times to thwart pending projects. Opponents are just looking for new ways to block them, he said. But he still hopes differences can be worked out, as the mayor of Sunset Beach has expressed optimism that they can.

If not, the de-annexation bill could be back next year, Iler said.

News researcher David Raynor contributed.

Craig Jarvis: 919-829-4576