Horry County’s parks department is in trouble. Could the private industry help?

Horry County is looking to get creative with Parks and Recreation funding — possibly through privatization or an impact fee.

On Wednesday, in an informational budget retreat, council debated how to avoid raising taxes while also making sure the parks department continues to serve residents. Privatization and an impact fee were the two options discussed.

Since November at the first budget retreat, Horry County staff has been telling council this was a reckoning year for the parks fund. Inaction would lead to mass shutdown of services provided by the parks and recreation services.

No changes to taxes would lead to the closings of dozens of parks, boat landings and even the Carolina Forest Recreation Center. Up to 33 percent of the parks offerings would close. In addition, maintenance of parks would decrease and all programs for kids and seniors would be canceled.

To avoid the closures, council initially considered a staff recommended 3.4 mil increase, which would include funds to build two new recreation centers in Aynor and Loris.

Privatization

Council Member Dennis DiSabato asked staff if it was possible privatization and could provide enough revenue to avoid a tax increase.

Interim Administrator Steve Gosnell said council could hypothetically vote to subsidize all of the parks department or just some of it like recreation center operations. However, it would likely be impossible to do that before the new budget must be approved in July.

“If that was a desire, I think that ship has sailed,” Gosnell said.

To get a private company involved with the parks department, Horry would have to send out a “request for proposal.” Then private companies could apply, detailing how they would operate the parks and how they would maintain the standard set by the county.

Council Member Paul Prince said privatization would be the county not providing services to its own people. It’s important the public has accountability over how the parks are run, he said.

Council Member Al Allen said Council previously tried to privatized General Aviation with a worldwide search for a company. Three companies responded, and the best offer required government subsidies while also wanting to keep all the profits with total control, he said.

“The same things are going to happen with these private recreation programs,” he said.

When asked how a private company would make money off taking over Horry parks, Gosnell said he did not know how it could be done.

For Council Member Tyler Servant, privatization would allow the private industry to find a way to make the parks profitable without a tax increase. An RFP would be exploratory, he said, to see if a company could come up with a better plan.

Privatization would most likely lead to more user fees for parks and boat landings, Vaught said, but he agreed there is no harm in exploring the idea.

“We’ve proven over and over again that the government doesn’t do business as well as the private sector,” he said. “It might not work, but we should look into it.”

If Council decides to send out an RFP and doesn’t get back a proposal it likes, the County would not be required to accept any of them.

Impact fees

A second related proposal looked at adopting a model similar to what Georgetown County uses to fund its parks. Council Member Bill Howard and DiSabato asked staff to look at a recreational fee levied on new construction in Horry County which would function the same as an impact fee.

“If we were to impose a fee, we wouldn’t have to raise millage on tax payers,” DiSabato said. “Our taxpayers came to the ballot box last year and were overwhelmingly in favor of an impact fee.”

Due to the limits of impact fees, like having to use the money where it is collected, a recreational fund wouldn’t solve all of the problems, but it could help, Gosnell said. Also, impact fees can only be used for infrastructure and cannot pay the salaries of the staff of parks department.

Gosnell said to his understanding Georgetown has defined the entire county as the district the fee is collected in and uses bonds to help make sure the money is legally used.

Horry County is one of the fastest growing regions in the United States. DiSabato said the influx of people and new homes being built should be able to help the parks.

“With all the growth we’re having in the county, it shouldn’t be a problem,” DiSabato said.

What’s next?

No decisions were made Wednesday. The point of the meeting was to direct Horry County staff members on what to do next ahead of the second reading of the budget. At this time no RFP will be sent out, but that could change at an upcoming meeting.

Horry County must have a new budget approved ahead of the fiscal year beginning in July. With regularly scheduled meetings, County Council must vote on the budget two more times before it’s official.

Given the time constraints, getting a private company on board or even implementing an impact fee would be hard before the budget must be approved, Gosnell said.

A 1-mil tax increase in the recreation fund for the coming year would be a “band-aid” to maintain current operations, Gosnell said, to give council another year to decide a more permanent solution.

Ideally, DiSabato is against any tax increase. He said he hopes staff can get some alternative options together before this budget is passed to avoid a hike in what residents pay.

If an alternative revenue source cannot be agreed upon or created, no action from council would lead to an underfunded parks department unable to operate as it does now.

“If we have to do something to fund current levels of service, my constituents can come back to me and let me know that’s what they want,” DiSabato said.

Ultimately, Council needs to decide if public safety is a priority for council, Vaught said. He added everyone pays for the parks, while only some use it.

“We have to determine are we willing to suck it up and say yes it is county council’s job to provide recreation services for the whole county, or is it our mission to make is a user-based function,” Vaught asked.

This story was originally published May 1, 2019 at 6:32 PM.