City of Myrtle Beach looking into making sales tax permanent, borrow money
The City of Myrtle Beach is considering borrowing money against future sales tax revenue to build a large outdoor venue next to the Myrtle Beach Convention Center. The problem is there are only six years left on the sales tax revenue that was originally designated for out-of-market tourism promotion and property tax subsidies.
The thought is it will be better to build the $10 million venue to satisfy the commitment made to the state of South Carolina to grow the convention center footprint than to pay back the $7 million the City borrowed as a part of the original convention center deal. The problem is the City will need to borrow money for the construction which has raised the discussion of borrowing against future sales tax collections. The Sun News has a really good overview here.
The tourism development fee is a 1% sales tax that was implemented after local leaders lobbied for state legislation to allow it. Many locals took issue with the fact that the sales tax was created quickly without a voter referendum and the privately operated Myrtle Beach Area Chamber of Commerce was given full control of the net proceeds. Both Governors Sanford and Haley spoke out vehemently against the tax. One of the few things that made it an easier pill to swallow was the provisions that there was a ten-year limit on the legislation. If the City executes the plan they are discussing, the 1% sales tax in the Myrtle Beach city limits will be here to stay. An online poll from The Sun News shows nearly 90% against the sales tax extension.
In many ways, the tourism tax has polarized the community. FITSNews mentions that the tourism development fee may have ties to a federal investigation. The Sun News has relentlessly kept tabs on the Chamber of Commerce spending of public tax dollars. Last year, this escalated to a barrage of aggressive public statements from both entities. To date, the tax has raked in $50 million in just under four years and other South Carolina coastal towns have explored implementing their own sales tax increases.
Want to see more? We've extensively covered the tourism development fee in the past.
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