Hilton Head likely to cut tens of millions in projects

Hilton Head Island might slash tens of millions of dollars worth of projects over the next five years to make up for falling tax revenues and other lower-than-expected incomes, town officials said Monday.

The town's effort to get a handle on its tough financial situation could even mean some projects that were supposed to get under way in the next few months -- including the major redesign planned for Coligny Beach Park and renovating the northern half of Mathews Drive -- could be put on hold.

It almost certainly means some projects the town had hoped to accomplish several years down the road never will break ground.

The town on Monday held its second workshop to discuss the structure of its capital improvements program in anticipation of a drastic reorganization of the way it goes about building public projects such as parks, roads and pathways.

The council saw a presentation that was a reality check for a town that's used to cashing big income checks. Some past revenue projections now look a bit optimistic in light of the economic downturn and other factors.

"In the next three to five years, you're talking about the need to potentially cut tens of millions of dollars," town manager Steve Riley said. "I'm suggesting we need to prioritize, jettison some projects, scale back some projects, spread some projects out over many years."

Following that suggestion might be a daunting task. The council on Monday proposed new criteria for ranking each project based on factors such as the public health and safety aspects, the economic benefits and environmental impacts. Each project then would be further broken down by costs, funding sources, long-term maintenance needs and other elements.

That system would create a much more intricate, comprehensive and complicated document than ever before. Currently, the town's capital improvements program is a fairly simple document: Projects are laid out in a list, separated by category and attached to a year. Different columns indicate whether the money will come from impact fees, bed taxes or other sources.

One proposed major change would be to give greater priority to maintenance and upkeep of current facilities. The town could decide that it's more important to maintain its existing pathways or parks instead of building new ones, for example.

"Let's understand projects' cost over many years," Scott Liggett, director of public projects, told the council.

One of the main reasons for the need to cut back has to do with tax increment financing, a special property tax district the town established in certain areas of the island to capture rising property tax revenue and funnel it into public improvement projects.

Estimates on how much the district would bring in before expiring in 2015 have changed several times over the years.

Now the town said it is unlikely to reach the $65 million cap -- the number it used to budget out projects in the district.

The town staff will try to tweak the ranking criteria and bring the proposal back to the council at its annual planning retreat, typically held in late November or early December. Some island residents underscored the tough decisions the council faces by making pleas to the council to keep certain projects on the list, including the sailing and rowing center proposed for Squire Pope Road.

"Hilton Head Island has myriad recreation facilities for people who bike, walk, rollerblade, skateboard parks, soccer, baseball -- the whole bit," said Dave Erdman, a proponent of the center. "That park is the one park that will be absolutely active ... In my opinion and my perspective, (that) would be the most active park you can put in."