Hilton Head panel wades through requests for A-tax funding

November 30, 2009 

Revenue from Hilton Head Island's accommodations tax will be stretched thin this year, and applicants will see reductions in funding.

That was the message Monday at a meeting of the Accommodations Tax Advisory Committee. Committee members urged those petitioning for money to state plainly how they would benefit local tourism.

Organizations that attract visitors to the island will have a strong advantage in the process, town officials said.

Revenue from the accommodations tax, a 2 percent levy on overnight lodging, dropped 15 percent to $2.27 million compared to the same period last year. Part of the drop is due to local hotels lowering their room rates to attract visitors.

More than half of the tax revenue has been promised to five organizations that asked for funding years in advance: The Town of Hilton Head Island, $892,000; The Arts Center of Coastal Carolina, $352,000; The Hilton Head Symphony Orchestra, $148,750; The Gullah Festival, $85,000; and the Hilton Head Island-Bluffton Chamber of Commerce, $68,000.

The remainder, about $743,000, will be divided among 22 other organizations, including the Coastal Discovery Museum, Heritage Library and the Lowcountry Tourism Commission.

"Everyone seemed to be cognizant of the reduced revenues available," said committee chairman Willis Shay.

Despite warnings that funds would be tight, most groups did not reduce their requests from previous years.

"Very few will get what they're asking for," Shay said.

The committee will hear all of the grant proposals this week and make recommendations Dec. 9 to the Town Council, which will make the final decisions in February.

The committee will base its recommendations on two main factors: the amount of money available and the grant-seeking organization's value to the overall ethos of the island.

Next year, the committee plans to enact a process that would require applicants to demonstrate how their organizations benefit tourism.

"In a bad economy, we need to weigh who brings the best to the community," said town manager Steve Riley.

The town wants $1.1 million of the money for fiscal year 2010-11. That would pay operating costs for the Beaufort County Sheriff's Office, which polices the island, and for improvements to pathways and the Island Recreation Center.

If the town's request is cut, it would probably scale back the capital improvements, but not police service, said Susan Simmons, town finance director.

Usually the town can dip into its general fund to help finance projects, but collections are down for most revenue sources, except property taxes, Simmons said.

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