Local chamber opposes state plan to send more accommodations taxes their way

Despite cries of being underfunded, the Hilton Head Island-Bluffton Chamber of Commerce will oppose a proposed change to state accommodations-tax law that would give it more money for marketing.

The chamber's board voted Tuesday not to support a proposal before a state commission that would guarantee more accommodations tax revenue for tourism marketing and less for local governments and arts and cultural organizations.

Based on last year's numbers, the chamber's amount under the statewide proposal would increase by almost $530,000, to about $1.6 million, according to town finance director Susan Simmons. The town would lose about $870,000 for grants and operations, she said.

"Even though we are underfunded on marketing, this shift is not a significant amount of money," said David Tigges, chairman of the chamber board. "We will still be underfunded (under this proposal). And it shifts money away from local nonprofits, which we think are vital to the community of Hilton Head, and does not serve our vision. We want people to have enjoyable experiences here, and we have worthy nonprofits who are key to that."

Tigges said the chamber will continue to look for money from other sources to pay for marketing. Both the Hilton Head and Beaufort chambers lobbied unsuccessfully last legislative session for a bill that would have allowed Beaufort County to impose a 1 percent sales tax for tourism marketing and related projects.

The chamber's vote this week came as welcome news to Hilton Head officials who met Wednesday to discuss the state proposal during a meeting of the town Intergovernmental Relations Committee. Town officials said they would lose control over locally generated tax dollars, and organizations that rely on the money would be threatened.

"This would raid our revenues with no way to add it back," said Mayor Tom Peeples. "We put more money into tourism marketing because of the economic downturn. But that's a local decision and ought to stay a local decision."

Hilton Head generated about $3.7 million in revenue last year from accommodations taxes, or "bed taxes," charged on overnight lodging. The town received about $3.5 million after the state took cuts for administrative fees, its 11 regional tourism groups and other expenses, Simmons said.

The town uses the money to help pay for public services, such as law enforcement, that support its tourism-based economy. It also gives money to groups whose activities are aimed at tourists, such as fireworks displays, festivals, theater and eco-tourism programs.

More than 15 groups receive state accommodations tax money from the town, accounting for 10 percent to 30 percent of their budgets, officials said.

"This will pit local services against the arts," Peeples said. "We will be faced with questions such as, 'Do we use the money to pay for EMTs to handle call volumes because of all the visitors on the island? Or do we pay for the arts?' We need more marketing dollars, but this is not the way to do it."