What is the Horry hospitality fee and how is it helping build I-73?

Harold Worley and Mark Lazarus debate how much to fund I-73.
Harold Worley and Mark Lazarus debate how much to fund I-73.

Horry County voted to begin work for its portion of the I-73 road project, devoting $23 million annually beginning in the 2020 fiscal year. And depending on annual increases in revenue from tourism growth in the county, the funding from the county hospitality fee could increase to $25 million.

The hospitality fee brings in $41.5 million in annual revenue, the remainder not going to I-73 will be used in projects to be determined by staff, with the idea to give more money to public safety.

The Horry County portion of I-73 is between US-76 and NC-22. The $23-million will only go to build the portion of the road in Horry County.

Staff expects the county will be making these payments from the hospitality fee for about 20 years.

At the Tuesday meeting, council member Harold Worley said that he is concerned that Horry will pay for its share, but neighboring counties may not be able to. He argued making Horry County citizens shoulder the bill while neighboring counties wait for the state and federal government to pay for their shares would be unfair.

The funding

After much debate, the remaining $18 million of the hospitality fee will be used to develop a plan to help fund public safety in Horry County as is allowed by state law, the money must go to tourism-related projects. Any money from future growth after getting I-73 to $25 million will be put into funding the project.

The purpose for moving the money to the highway project is to in part show initiative to the Trump administration and to the state, Council Chair Mark Lazarus said.

The South Carolina Department of Transportation estimates that it will take between about $1.2 billion and $1.5 billion to complete the entire project between I-95 and SC-22. The estimated total cost for the Horry County portion about $375 million and $500 million.

The rest of the money for I-73 will likely come from the state and federal government, depending on infrastructure bills and direct contributions. Worley was worried other counties would wait for this money, making Horry unfairly pay its share.

Gaining momentum

Talks for building an interstate into the Myrtle Beach area began in the 1990s but has stalled over the years. Currently, the South Carolina Department of Transportation is being sued over the project’s construction.

Recently, however, the project gained more support. Gov. Henry McMaster wrote a letter supporting the highway on July 19. He said the project will create nearly 29,000 new jobs and will make entering the Myrtle Beach area safer.

Currently, travelers heading east have to wait on the traffic and stoplight heavy Highway 501 or 544 to get to the ocean.

Lazarus said it must be a pretty important moment if the governor is getting involved.

“It gets people in, it takes people out,” he said.

The Coastal Conservation League disagreed, saying that the vote is not in the citizens best interest.

“This vote represents a myopic, short-sighted move by Horry County Council that, today, put politics before priorities—like public safety, water and sewer infrastructure, drainage projects, emergency services and disaster preparedness,” said the CCL’s press release following the meeting.

The 1.5-percent, county-wide hospitality fee on prepared food and rental projects began in 1996 as a way to help pay for infrastructure projects. It has been continued to provide more funding for projects.

Seventy-one percent of the money generated from the hospitality fee comes from the municipalities in Horry County, like Myrtle Beach and North Myrtle Beach.

In addition, an infrastructure bill proposed by the Trump administration could help get needed funds to the project. Powell said that money is not expected to come this year, but funding this project will send a signal to congress that Horry is putting up a large sum of money for I-73.

“I don’t know too many communities around the country that can say that,” County administrator Chris Eldridge said. “But again it’s the federal government so there are no guarantees.”

If the federal government does not fund the project in its coming session, it would not be difficult for the county pull hospitality funding to the project. All council would need to do is make a new motion.