A Columbia group said yesterday it will reimburse a European travel agency the roughly $5,000 lost when a state tourism agency refused to pay for an ad campaign to draw more gay travellers to South Carolina.

South Carolina Pride said it will seek private donations to pay the cost of the campaign, which included posters in London subway stations proclaiming "South Carolina is so gay".

After learning of the campaign, lawmakers and activists protested and the South Carolina department of parks, recreation and tourism refused to pay the bill. A spokesman for governor Mark Sanford said use of public advertising money to promote a social agenda was inappropriate.

The employee who approved the campaign has resigned.

Ryan Wilson, president of South Carolina Pride, said it was important the group pay for the ads. In addition, he said, the disagreement over tourism advertising has helped raise awareness for gay issues in the state.

"We wanted to clear the air and do the right thing and pay off the debt," Wilson said. "Our hope is that our community can step in ... take the high road and do the right thing."

The fundraising campaign will be linked to South Carolina Pride's September 20 Columbia parade and festival, featuring entertainer RuPaul.

The tag line? "South Carolina will be 'so gay'."

South Carolina Pride has received $10,000 in hospitality tax grants for the festival.

Wilson said people across the country have contacted the group, pledging both monetary and moral support. The group set up a Pay Pal account to collect donations on its website, http://www.scpride.org. Any additional money raised will help pay for the festival.

Wilson said the group will not use any public money to pay for the London advertising.

One of those who mailed off a $100 check was Harriet Hancock, a Columbia attorney and long-time activist for gay, lesbian, bisexual and transgender issues.

Hancock called Columbia and Richland County "an oasis in the middle of the desert" for the gay community, crediting Columbia mayor Bob Coble for his support.

Eventually, she hoped, all of South Carolina will be so welcoming.

"I'm sick of people asking 'How do you live there?'" Hancock said. "This is going to turn out to be a very positive thing for us."