Beaufort Co. to Hilton Head-Bluffton, Beaufort chambers: No transparency, no money

Beaufort County officials struck down approval for funding the county’s two largest chambers of commerce, citing concerns over transparency — an issue that Hilton Head’s chamber has been battling for years.

On Monday, the Beaufort County Finance Committee denied funding for the Beaufort Regional Chamber of Commerce and the Hilton Head Island-Bluffton Chamber of Commerce, the county’s designated marketing organizations (DMOs) responsible for bringing in tourism revenue.

County Councilman and Vice Chairman Jerry Stewart, who chairs the Finance Committee, said the county has $210,000 to disperse for next year between the two DMOs, which would mean $105,000 for each chamber. The funding for DMOs comes from the 2 percent accommodations tax (A-TAX) revenue, which is a fee paid by tourists.

The funding vote failed on a 3-3 tie, with Councilman Gerald Dawson, the seventh member of the committee, not arriving to the meeting in time to vote.

Councilman Mike Covert, who voted against the DMO funding, said he has concerns about transparency, but would have considered voting in favor of funding the Beaufort Regional Chamber if the measure had been separated by chamber.

“I felt the Beaufort-Port Royal numbers — which I have but weren’t in their presentation — for what they want to do with the funding were much more transparent than the Hilton Head-Bluffton chamber,” he said.

The transparency issues stem from a state Supreme Court decision earlier this year that ruled that the Hilton Head Island-Bluffton Chamber of Commerce is not subject to the Freedom of Information Act and doesn’t have to release its receipts on how it spends its funding.

Covert said during the committee meeting that the S.C. Supreme Court decision left the responsibility on the county and towns to provide those receipts to constituents requesting that information.

“We need transparency in order to approve (chamber) funding,” Covert said after the meeting. “To them, I say, ‘you fought, you won, but now here’s the downside.’”

Councilman Brian Flewelling voted in favor of funding because he said it wouldn’t have been fair for the council to withhold money that the chambers rely on as part of their budgets.

“I didn’t want to punish the chambers,” he said after the Finance Committee meeting. “It holds them up and puts them in a bad position.”

Stewart criticized both chambers after their presentations during Monday’s Finance Committee meeting. Instead of focusing on what the two chambers planned to do with the county funds, he said the presentations focused on digital outreach and marketability, which he didn’t feel was relevant to the meeting.

“All of that information is very interesting, but this is the Finance Committee,” he said.

What’s next?

Stewart instructed the two DMO applicants to be prepared with a more appropriate presentation for the next meeting in two weeks, on Sept. 10.

When asked about the committee’s decision to postpone approval of DMO funding, Ariana Pernice, the vice president of the Visitor and Convention Bureau for the Hilton Head Island-Bluffton Chamber of Commerce, said the county’s vote was a learning opportunity for the chamber to get a better sense of how it can partner with the county.

“I think there’s an opportunity for us to all come back and look at what’s being asked and come together collectively for what’s the best practice going forward,” she said.

Hilton Head Island-Bluffton Chamber of Commerce’s 2018 budget is $7.26 million, making the $105,000 from the county just a small slice of its total budget. In comparison, for the Beaufort Regional Chamber of Commerce, the $105,000 provides the chamber an eighth of its $846,000 in projected revenues for the coming fiscal year. The county’s contributions, including other grants and hospitality fees, total 39 percent of its budget.

Robb Wells, the president and CEO of the Beaufort-Port Royal Convention and Visitors Bureau, said in a phone call Tuesday that his organization doesn’t expect to be denied again and stressed the importance of DMO funding, on both the commercial and municipal sides.

“It’s important, no doubt,” he said. “One, it’s our accommodations that collect (the tax) in Beaufort County, they expect to see it back into the marketing world bringing in guests and visitors. And two, it is public money, and we know that, for the county to sign off on that, they are putting their trust in us and we want to be able to deliver that.”

How Hilton Head and Bluffton fund the DMO

Beaufort County isn’t the only municipality to take issue with the Hilton Head Island-Bluffton Chamber of Commerce’s lack of transparency.

Earlier this month, Hilton Head Island Mayor David Bennett voted to approve funding for the DMO, only on the condition that the chamber provide spending reports to the town each quarter. Town Council voted to discuss it further in committee and the issue between the town and the chamber’s funding is still ongoing.

Hilton Head gave $2.5 million to the chamber last fiscal year, compared to the $105,000 the chamber is seeking from the county, according to its marketing plan.

Bluffton provided the Hilton Head Island-Bluffton Chamber of Commerce over $192,000 last year as part of its A-TAX revenue, according to Trisha Greathouse, the town’s director of finance and administration.

Bluffton Mayor Lisa Sulka said in a Wednesday phone call that transparency is just as important to the town, and she expects “no changes” to Bluffton’s working relationship with the chamber compared to how it’s been.

“(The chamber) never hasn’t given us what we’ve asked for,” Sulka said. “If we wanted to release the receipts from the chamber with redacted information where privacy is important, I think that’s being transparent.”

Sulka said that the town settled its funding to the chamber for the year before the Supreme Court decision was handed down. She added that the A-TAX issue could be an issue next year or the year after, depending on how the chamber makes its receipts available to the town.

“This issue this year is long-gone,” she said. “This would have been a different conversation if (chamber funding) was on the agenda next month.”

This story was originally published August 30, 2018 at 4:52 PM.