Myrtle Beach looks at request to raise fees through sports tourism

PINOPOLIS - Sports tourism is growing in Myrtle Beach. So are the costs to sustain it. But city leaders appear to be split on whether or not to start taxing its golden goose to keep the growing industry sustainable.

Sports tourism brought in $2,140,530 in city tax collections of hospitality fees, tourism development fees and local accommodations taxes in 2013. In 2015, it brought in $2,980,696 – a growth of 39 percent.

"If we didn’t have those October storms, we would be up $900,000. That’s phenomenal growth in two years," assistant city manager Fox Simons told Myrtle Beach City Council members at a budget retreat at the Wampee Conference Center in Pinopolis Thursday.

In its first three years, the industry has funneled nearly $8 million into the city’s coffers, but this year city leaders gave about $1.2 million in accommodations tax revenue to sports tourism to keep it going.

"A $1.2 million transfer from the local accommodations tax is not sustainable long-term so we have to look at different options to try and raise some revenue … and mitigate that subsidy," Simons said.

City staff looked at passing fees on to those who use the field to make the industry more self-supporting in a proposed budget for the next fiscal year. But council members were split on the idea.

"We don’t want to nickel and dime people if the model can be improved by couching these debts," said Councilman Phil Render.

Mayor pro tem Mike Lowder said that the charges would be felt by the families currently drawn to the city to play ball.

Councilman Wayne Gray, however, said the city’s fields are predominantly being rented by for-profit promoters and they would bear the charges, not the families.

"I think we’ve been more forgiving and accommodating as we’ve expanded into this business model than most of our competitors," Gray said.

He said it would be helpful to know the detailed efforts of other comparable sports tourism markets to make sure the city stays competitive.

The financial plan proposes charging athletic participation fees and admission fees and upping field rental fees to promoters that bring in groups that do not stay in hotels. Non-local teams that do stay in Myrtle Beach hotels will be offered a $50 rebate in rental fees.

A $3 take on each admission fee was proposed to bring fields like those at Grand Park in The Market Common in line with the fees charged at the Myrtle Beach Sports Center.

But Mayor John Rhodes said the city might see some blow-back if they start charging admission and athletic fees in places where they never charged before, noting the sports center opened with charges in place.

"I don’t want us to put ourselves in a situation where we’re pricing ourselves out of the market," Rhodes said.

Simons said he agreed, adding that the process won’t be easy and it will involve education and communication, but the opportunity is out there to make the industry more self-supporting.

"We have to find a way to recoup some of the investments we’ve made in these areas," said city manager John Pedersen.

Myrtle Beach Area Chamber of Commerce president and CEO Brad Dean said he could understand why fees are being discussed.

"As we evolve into more of a national sports tourism destination, fees structures will naturally change," Dean said by phone Thursday night on his way back to the Grand Strand after a week in Columbia.

"Without speaking to any one facility or any one type of group, Myrtle Beach and surrounding communities have greatly enhanced sports recreation without enhancing sports fees," he said.

But to keep Myrtle Beach’s level of service in tune with its demand as a leading sports tourism destination, Dean said he could understand how fees would be addressed as part of the equation. Small fees likely wouldn’t knock the city off of its competitive totem poll, he added.

Lowder said he doesn’t want to scare families away.

"I don’t want it to get to the point where we’re making it too expensive for folks to bring their children or grandchildren here to play ball so let’s take a look at this thing," he said during the budget discussion in Pinopolis.

Council members agreed they wanted to see what comparable cities were charging in regards to their sports tourism activities before making any decisions.

City manager John Pedersen said they would bring more information back to the board in a future meeting.

The proposed budget, which must be approved by the end of June, includes increases in taxes and water and sewer fees.

The financial plan also proposes to increase fees or begin charging people who want to rent the city’s parks or use the city’s recreation centers.

"The Construction Services departmental budget is $1.9 million and permitting services performed by Public Works result in an additional $124,000 in costs," according to the budget document. The total building permit fee revenue budgeted for next fiscal year is $1.8 million, leaving a deficit of $224,000.

City leaders recommend increasing plan review fees by 10 percent. The budget plan also proposes adding a $250 commercial stormwater review fee and a $150 charge for plan resubmissions after a project’s eighth review level, estimating $107,000 could be generated from those sources.

For the Myrtle Beach Convention Center, the financial plan proposes establishing a "high demand period" for rental rate increases to capitalize on its busiest times. It also suggests increasing the center’s utility, internet charges and rates for show security staffing.

This story was originally published April 14, 2016 at 8:20 PM with the headline "Myrtle Beach looks at request to raise fees through sports tourism."