Statehouse reps weigh in on hospitality fee dispute between Myrtle Beach and Horry County
The Horry County statewide leaders want Horry County and Myrtle Beach to stop fighting with each other.
For the second time, a bill was filed in the South Carolina Statehouse that could affect the outcome of a legal battle between Horry County and the municipalities.
The bill directly deals with “legacy hospitality fees” enacted before 1997 like the one in Horry County, according to records obtained by The Sun News. If approved, the bill would allow for the South Carolina counties to collect the fee and put it toward capital projects or initiatives related to tourism.
Essentially, Horry County would be allowed to continue the 1.5 percent hospitality fee collection as it has since the 1990s but the money must go toward construction of interstate projects that benefit the whole area. Municipalities are allowed to continue collecting local accommodations taxes and potentially get hospitality revenue back from the county in quarterly payments.
State Rep. Russell Fry said the intent of the bill is to uphold expectations of taxpayers that Horry County would be collecting this fee to get the interstate built. For him, it will be easier to accomplish I-73 with the County taking a leadership role.
“It makes it a much smoother process when you don’t have nine jurisdictions involved,” Fry said.
Fry said it is his hope that local governments settle the matter themselves so that the state doesn’t need to get involved. The people of Horry County want I-73 and local leaders need to be able to work together to accomplish it, he said.
Wednesday was a pre-filing day ahead of the 2020 legislative session. No votes were taken, but the bill could be voted on in the coming months.
County Council Member Harold Worley said the proposed bill is similar to what Horry County has wanted since the beginning of the hospitality fee dispute. Horry County, Myrtle Beach and the state are saying they’re willing to support I-73, he said, but someone needs be stand up and take charge.
“And I don’t mind us being first,” Worley said. “Horry County just doesn’t have the money to do it alone.”
During Tuesday’s debate, Council Member Dennis DiSabato said he was worried state involvement would lead to hospitality money being taken up by the state. The bill filed on Wednesday quelled his concerns, he said.
Like Worley, DiSabato called that proposed bill very similar to the spring compromise. It gets the money for I-73 and makes sure everyone gets their fair share of hospitality money. He’d love for the municipalities to agree to this deal without the state stepping in.
A similar bill was filed in May that would allow the county to be the sole collector of the hospitality fee in hopes of getting I-73.
Municipal leaders responded earlier this year by holding a news conference calling the bill a power grab. Myrtle Beach Mayor Brenda Bethune said the cities just want to protect their citizens, not kill efforts to build I-73.
“It is very disheartening that our actions to put our citizens and community first have been taken out of context,” Bethune said.
A tentative deal was reached last month that would bring an end to the legal dispute over hospitality fee collections. Neither Myrtle Beach nor Horry County have approved the deal at this time. Horry County Chairman Johnny Gardner said he is not sure what the hold-up is getting this deal approved.
Resolving the lawsuit will free up the funds Horry County wanted to use for I-73, but Worley said the deal was bad for taxpayers and requires a $6 million payout of legal fees. He believes the mediation deal is too similar to an earlier compromise proposed by Horry County that did not require the legal fees settlement.
With the money still tied up, Horry County Council canceled its contract with an 11-0 vote Tuesday night with the South Carolina Department of Transportation to complete I-73.
Council Member Johnny Vaught said if the municipalities want to formally agree to contribute to a new SCDOT contract, he doesn’t think the state agency will be against it.
“It is not possible for the SCDOT contract to get done this year,” Vaught said. “If the cities step up and do their part in building I-73, I don’t think SCDOT will be against us recalculating and making a new contract.”
Gov. Henry McMaster told The Sun News he believes I-73 is important for public safety and economic growth in the northeastern part of the state. He has been working with Sen. Lindsey Graham and other leaders to get the road built.
“It’s going to happen. It will happen. There is a lot of disagreement, but there is also a lot of agreement,” McMaster said.
This story was originally published November 20, 2019 at 2:01 PM.
