A controversial tax in the City of Myrtle Beach is up for renewal, and city council members plan to vote on the first reading during Tuesday's meeting.
The Tourism Development Fee, a 1-percent sales tax that is mainly used for out-of-area marketing, was first implemented in the city in 2009 by former Mayor John Rhodes.
The tax, which expires July 31, 2019, will be extended to Aug. 1, 2029 if council votes to reimpose it.
Now, members must decide if they will reimpose the tax, making it effective Aug. 1, 2019. If the vote passes a second reading it will be in effect until Aug. 1, 2029.
"Our number one industry is tourism, so we have to market to tourists because we rely on it, it creates jobs for this area and it also helps to expand our seasonality," Myrtle Beach Mayor Brenda Bethune said. "When we can advertise to people who come here different times of the year, it helps us expand our season. That is economic growth."
In order to reimpose the tax, council can vote super-majority, meaning the tax can be renewed if the majority of council votes for it, or they can put it up for a referendum, leaving it up to city voters to decide the tax's fate.
When the tax was imposed in 2009, council voted through super-majority. Now, if council votes for the tax, voters would not have a say in whether or not they want to tax.
"The entire time I was campaigning I talked with voters about it and not one person asked me to do away with it," Bethune said. "So, I look at that as a referendum because people did vote and if they were against it, I would think they would have voted against the people who were in favor of it."
However, the possibility of not putting the tax up for a referendum has left some voters angry.
"I think that anyone who votes in favor of this doesn’t have either the knowledge of what they’re doing, or they’re not representing the way they should and, frankly, I think if they vote in favor of it they ought to be ousted at the next election for sure," Ann A. Dunham, a city resident and former candidate for the council, said. "Even if it’s voted in, it’s possible for it to be rescinded, so that would be something that I would like to see happen in the future."
Concerns over the tax
After the tax was imposed in 2009, many residents voiced concerns over where the money was being spent.
By law, 80 percent of the tax must go to out-of-state marketing. That means that 20 percent can be used for tax rebates, but at least 4 percent must be used for property tax rebates. The rest of the money can go back to the city.
In the City of Myrtle Beach, 80 percent of the tax goes to the Myrtle Beach Area Chamber of Commerce for out-of-state marketing.
Fourteen percent goes for property tax relief, and six percent is used for tourism-related capital projects.
The Myrtle Beach Area Chamber of Commerce did create a website generally listing what the money was used for, the company it went to and how much money was spent.
A detailed list of what exactly the money is used for is not provided.
"In looking at the numbers, I found a 90-cent expenditure on there, I’m not sure how much smaller increments," Myrtle Beach city spokesman Mark Kruea said. "When you buy ads with a television station you may be looking at a schedule of a hundred ads over two months time. That’s a tremendous amount of information."
Bethune said the chamber does go through an annual audit, but that, "I do believe that we should do more between the city and the chamber to be more transparent about what it does."
More specifically, Bethune believes the city needs to talk about what the money is used for, such as city spending on ocean outfalls and beach renourishment.
"It has helped to bring in more airlines to the area, more direct flights, that’s very important to a market like ours," Bethune said. "It has helped fund public safety, allowing us to free up funds for our police and can be used in the future for tourist related infrastructure projects such as some of the improvements we want to make on the boulevard, the Superblock and the areas like that."
But for residents like Dunham, the TDF should not be reimplemented.
In a five-page document provided to council at the last meeting, Dunham said, "We need to focus on city business and let voters decide by vote about the TDF if council does not have the fortitude to end this tax. It is not right because taxes are not for advertising, it is exceedingly regressive, it is not working, and it is not needed. The TDF impacts every citizen in this city as well as our visitors yet only the privileged benefit."
Council will vote on the first reading during a 2 p.m. council meeting Tuesday at the Ted. C. Collins Law Enforcement Center.