Untold Millions

Sunday’s editorial wishes for more accountability when it comes to the tax money put to use or sought by local chambers of commerce.

 

This past Monday, the state’s deadline for putting questions to the voters on the Nov. 2 ballot came and went with little fanfare.

Other than Horry County’s question about funding The Coast RTA, no other ballot questions were filed. Unfortunately, this means that voters in neither the city of Myrtle Beach nor North Myrtle Beach will have the opportunity to express their collective opinions about the 1-cent sales tax for tourism advertising.

The North Myrtle Beach Chamber of Commerce held two information sessions on the tax just over a week ago, and chamber spokeswoman Jennifer Prince said Friday that the 100 or so attendees at each meeting seemed increasingly receptive to the idea the more they heard about it. Prince said the chamber is now preparing to ask the North Myrtle Beach City Council to schedule a first workshop meeting to begin the process of passing the tax, a timeline that Prince said does not include a referendum to the voters.

“If it went to referendum, we could almost guarantee it’s not going to pass,” Prince said. “What it would take to educate people on the tax is a lot of advertising, a lot of money, and we just don’t have that.

“We’re not trying to trick anybody,” Prince continued. “We’re being upfront, and once we get the money, we’re accountable for every dollar.”

It’s deeply unfortunate that this chamber is following the same trail blazed by their counterparts in Myrtle Beach, and we hope the North Myrtle Beach City Council will not do the same. Sadly for the voters, the only options now would be to have a low-turnout special election in the spring or wait until next year’s city elections, and the latter seems highly unlikely. Democracy would have been best served by placing the issue on the Nov. 2 ballot, especially since it seems to coincide with the planning process anyway, and it’s a shame no effort was made in this direction.

The passing of the deadline is likewise a missed opportunity in Myrtle Beach, where the sales tax was originally implemented last year as quickly as possible to stave off a feared tourism crisis at the depth of the recession and in the aftermath of the decision to end the motorcycle rallies. The city and the Myrtle Beach chamber have a strong circumstantial argument in favor of keeping the tax: Occupancy and room rates have been consistently up all summer, making total revenue between 5 percent and 10 percent higher than last year nearly every week, according to Coastal Carolina University tourism researchers.

Further, the amount actually collected by the sales tax has significantly exceeded the city’s initial projections, meaning that people are definitely spending more inside the city of Myrtle Beach than expected. Of course, how much of all this growth comes from the tax – instead of other factors, such as tourists fleeing the oil-threatened Gulf Coast – is debatable. An advisory referendum on its future would have engendered a serious conversation about all these factors, and unlike both chambers of commerce, we believe the voters capable of making the choice that most benefits them if they have all the information in hand.

But is that information even available? The chamber made grand promises that it would be, but has only half fulfilled them. On their website now are two reports, one from May 2009 to March 2010, and a second from April to June of this year. Quarterly reports were promised, yet the first report lumps more than three quarters together. The second report lacks a column describing overall spending, so it’s unclear how the use of these tax dollars has changed from quarter to quarter.

The reports break out the different sources of the tax money being spent – the sales tax, accommodations tax or state matching money – but completely omit any reporting on the private-funding side of the equation, in direct contradiction to the promises made at the time of the tax’s passage. The state gave us $5 million in matching funds last year, which is supposed to mean the chamber had to prove to the state it raised $10 million in private contributions for the same out-of-state ads. That money simply is not included in the reports, or if it is, not in any intelligible way.

The cumulative effect of these shortcomings in the report is that Myrtle Beach residents – who pay the sales tax all year, whether tourists are here to help with the bill or not – are not being presented with the overall picture. Together, the chamber should be spending well in excess of $30 million on out-of-state advertising this year: $15 million or more in sales tax money, $10 million in private funds and a $5 million match. This staggering figure is far more than the area has ever spent on these ads previously, and residents deserve the chance both to scrutinize this spending and decide at the polls whether it is justified.

 

The North Myrtle Beach Chamber of Commerce held two information sessions on the tax just over a week ago, and chamber spokeswoman Jennifer Prince said Friday that the 100 or so attendees at each meeting seemed increasingly receptive to the idea the more they heard about it. Prince said the chamber is now preparing to ask the North Myrtle Beach City Council to schedule a first workshop meeting to begin the process of passing the tax, a timeline that Prince said does not include a referendum to the voters.

“If it went to referendum, we could almost guarantee it’s not going to pass,” Prince said. “What it would take to educate people on the tax is a lot of advertising, a lot of money, and we just don’t have that.

“We’re not trying to trick anybody,” Prince continued. “We’re being upfront, and once we get the money, we’re accountable for every dollar.”

It’s deeply unfortunate that this chamber is following the same trail blazed by their counterparts in Myrtle Beach, and we hope the North Myrtle Beach City Council will not do the same. Sadly for the voters, the only options now would be to have a low-turnout special election in the spring or wait until next year’s city elections, and the latter seems highly unlikely. Democracy would have been best served by placing the issue on the Nov. 2 ballot, especially since it seems to coincide with the planning process anyway, and it’s a shame no effort was made in this direction.

The passing of the deadline is likewise a missed opportunity in Myrtle Beach, where the sales tax was originally implemented last year as quickly as possible to stave off a feared tourism crisis at the depth of the recession and in the aftermath of the decision to end the motorcycle rallies. The city and the Myrtle Beach chamber have a strong circumstantial argument in favor of keeping the tax: Occupancy and room rates have been consistently up all summer, making total revenue between 5 percent and 10 percent higher than last year nearly every week, according to Coastal Carolina University tourism researchers.

Further, the amount actually collected by the sales tax has significantly exceeded the city’s initial projections, meaning that people are definitely spending more inside the city of Myrtle Beach than expected. Of course, how much of all this growth comes from the tax – instead of other factors, such as tourists fleeing the oil-threatened Gulf Coast – is debatable. An advisory referendum on its future would have engendered a serious conversation about all these factors, and unlike both chambers of commerce, we believe the voters capable of making the choice that most benefits them if they have all the information in hand.

But is that information even available? The chamber made grand promises that it would be, but has only half fulfilled them. On their website now are two reports, one from May 2009 to March 2010, and a second from April to June of this year. Quarterly reports were promised, yet the first report lumps more than three quarters together. The second report lacks a column describing overall spending, so it’s unclear how the use of these tax dollars has changed from quarter to quarter.

The reports break out the different sources of the tax money being spent – the sales tax, accommodations tax or state matching money – but completely omit any reporting on the private-funding side of the equation, in direct contradiction to the promises made at the time of the tax’s passage. The state gave us $5 million in matching funds last year, which is supposed to mean the chamber had to prove to the state it raised $10 million in private contributions for the same out-of-state ads. That money simply is not included in the reports, or if it is, not in any intelligible way.

The cumulative effect of these shortcomings in the report is that Myrtle Beach residents – who pay the sales tax all year, whether tourists are here to help with the bill or not – are not being presented with the overall picture. Together, the chamber should be spending well in excess of $30 million on out-of-state advertising this year: $15 million or more in sales tax money, $10 million in private funds and a $5 million match. This staggering figure is far more than the area has ever spent on these ads previously, and residents deserve the chance both to scrutinize this spending and decide at the polls whether it is justified.