Horry County decides to take no action on hospitality tax
Horry County is appealing recent rulings by a judge that barred it from collecting hospitality taxes from local municipalities.
On Thursday, Horry County filed a notice of appeal in reference to Judge William Seals Jr.’s Wednesday ruling saying it was to cease collection of a 1.5 percent hospitality fee in all of the area municipalities. The county on Friday filed another motion asking Seals to stay his order until the appeal is completed.
The appeal will not stop the judge’s order from going into full effect next month, when the funds can be collected, which is why Horry County asked for the stay.
“The Court should do so to prevent irreparable harm to the County and to avoid a miscarriage of justice,” Horry County’s motion argued.
The collection of the hospitality fee has been in question since earlier this year when Myrtle Beach, North Myrtle Beach and Surfside Beach passed ordinances that allowed their staffs to begin keeping hospitality fee revenue without Horry County collecting a portion as it had done since the 1990s.
The hospitality tax was created in 1996 to fund road projects and collection was set to expire after 20 years. The county extended the collection, which the city argues was done illegally. Some of the recent funds were designated to help cover construction cost for I-73.
Under the old tax system, hospitality fees were split between county and city governments. But, now with the lawsuits and recent rulings, cities will keep all of the hospitality tax revenue until the lawsuit is resolved.
The municipalities, which have said they support I-73, claim this is a matter of home rule and protecting its citizens’ money by keeping it in the municipality it was collected in.
Horry County believes it is the best steward of these funds and would use the money to improve the infrastructure tourists take to get to the beach. It does not believe the law requires the consent of the municipalities for this type of fee.
On March 20, Myrtle Beach sued Horry County over the collection of the fee on behalf of itself and “a Class of Similarly Situated Plaintiffs,” which North Myrtle Beach at Surfside Beach believed was meant to include them.
Horry County disagreed and announced it intended to continue collecting a portion of the taxes until Seals affirmed this week that the ruling’s language was meant to include North Myrtle Beach and Surfside Beach in addition to Myrtle Beach.
Horry County is now appealing because it thinks the order creates an unfair financial burden on the county and upsets status quo.
The motion also questions if Seals’ order is forward looking. The county argued in its motion that the order does not outline what might be required of the municipalities if in the future Horry County is allowed to start collecting the fee again through the appeals process.
All of this is going on before the actual trial has begun. While Horry County wants the judge to expedite this case, a schedule set by Myrtle Beach would have the trial take place next year after mandatory arbitration.