Yesterday, North Myrtle Beach City Council passed a resolution calling for a public referendum regarding the imposition of a Local Option Tourism Development Fee. The public referendum is set for March 6, 2018. All of the city’s registered voters may participate in the referendum. The majority vote will prevail.
Discussion of a Tourism Development Fee for North Myrtle Beach has been ongoing in the community for several years with some urging City Council to impose the one percent local sales tax by way of a super majority vote of Council (five or more of its members). However, City Council has always preferred to put the matter up for a public referendum, leaving it to the voters to determine if they want the new tax or not.
Putting the measure before the voters is a wise choice for North Myrtle Beach elected leaders. Practically every member of the current NMB City Council and the Mayor have opposed the tax in the past. “We’ve been dealing with this for the past, almost two years now, and it’s time for us to put this to bed,” Councilwoman Nikki Fontana said.
The referendum question that a majority of voters will determine the answer to is by law worded as follows:
“Must a one percent fee on the gross proceeds of sales or sales price of all amounts subject to the sales and use tax imposed pursuant to Chapter 36, Title l-2, but not the gross proceeds of the sale items subject to a maximum tax in Chapter 36, Title 12 and the gross proceeds of sales of unprepared food that lawfully may be purchased with United States Department of Agriculture food coupons, be levied in the City of North Myrtle Beach for the purpose of tourism advertisement and promotion directed at non-South Carolina residents?”
Residents and merchants we spoke with privately said it is unlikely the measure will pass in NMB.
1. The tax is regressive.
The existing tax in Myrtle Beach has proven to decrease business growth inside the city of Myrtle Beach while driving traffic to the city of North Myrtle Beach, where tourists are not required to pay the tax.
2. The Myrtle Beach Area Chamber does not want it to pass nor fail.
Rick Elliott, of North Myrtle Beach Travel– a leading NMB rental concern, said, “North Myrtle Beach hotels and property managers are currently paying millions in fees to the general fund of the Myrtle Beach Area Chamber of Commerce.” If the TDF is passed in NMB, questions remain whether these resorts will continue to participate in the Myrtle Beach Area Chamber’s pay for play marketing concerns.
Should the referendum fail, however, MBACC is concerned Myrtle Beach City Council would then be required to follow suit, (for political protection), putting the extension of the current Myrtle Beach tourist tax on the referendum ballot as well, where it might also be rejected by the citizens.
3. NMB Residents Don’t Want It
MyrtleBeachSC.com polled key NMB residents before the initiative was brought forward yesterday. Residents of NMB are currently not in favor of the tax. Tens of thousands of advertising dollars will need to be spent to encourage the residents to support the tax, unless voter turnout on March 6th is extremely low. Low voter turnout could cause the measure to pass, however, as only those wanting the tax would show up to vote.
4. The Myrtle Beach Area Tax Continues To Cause FBI And State-Wide Criminal Investigations
Currently the FBI and SLED are investigating the MBACC concerning how it has spent TDF (Tourist Tax) monies. The political consultant of former Myrtle Beach Area Chamber Board President and now U.S. Congressman Tom Rice was paid almost $25,000 in tourist tax monies in 2011. By S.C. law, the funds are only supposed to be used to purchase “out of market” advertising. Payments like these and payments to indicted S.C. Representative Jim Merrill have kept the Myrtle Beach Area Chamber of Commerce continually under investigation since the tourist tax was first implemented in Myrtle Beach in 2009.
Said Skip Hoagland, a S.C. businessman now suing S.C. Chambers Of Commerce for greater transparency, “The corruption, IRS Ubit Violations, unconstitutional misuse and abuse to ATAX public funds and fraud by Brad Dean and the private Myrtle Beach Chamber must end. I am asking for a forensic audit and FBI investigation, just like was done recently on the Berkeley County Chamber and school CFO which resulted in $386,000 of stolen funds.”
Hoagland added, “Brad Dean and The MB chamber is a huge fraud and IRS tax scam. This will end. Local Chambers need to be run like a private community chamber and the DMO like a true city DMO to do nothing but promote the entire Myrtle Beach area. The MB Chamber has turned into nothing but a for profit media, disguised as a non profit 501-C6 chamber to avoid IRS Ubit taxes. It is unfairly competing against local media as well who pay taxes, and using tax funds to further do so.“
MBACC forces 8 lanes of the highest internet traffic (Youtube, Facebook, Google, etc) into the one lane of its VISITMYRTLEBEACH.COM website. Many shoppers simply avoid that log-jammed path.
If the North Myrtle Beach Chamber continues to model brand stories about NMB across multiple platforms, and avoids the online traffic jam, as pictured above, the North Myrtle Beach Chamber may be able to avoid the many controversies that surround MBACC and its version of the tourist tax.
With a proven strong brand, such use of the tax might actually grow NMB tourism.