UPDATE: Hilton Head’s new plan for doling out $389K it saved for arts groups, events
Update: On April 1, the town’s Accommodations Tax committee approved an out-of-cycle grant approval process for the money reserved for arts organizations. Interested applicants should email town Finance Assistant Cindaia Ervin. The application window opens April 26 and closes May 7.
There’s $389,000 on the table for arts and nonprofit organizations on Hilton Head Island.
But no one’s touched it.
Town officials say none of the organizations has applied for the money. Organizations say that’s because no application process has been set up.
The Town Council in December set aside the accommodations tax money in reserve to help groups hurt by the coronavirus pandemic, which forced them to cancel events and shows, in some cases for more than a year.
If it’s not used, the money will be funneled back into the accommodations tax budget in July.
While the money sits untouched, the miscommunication highlights the varying processes the town uses to give money to arts organizations and nonprofits.
How did this happen?
Even though the coronavirus caused Hilton Head Island tourism to go “off a cliff” in the spring, the Accommodations Tax grant process had a surplus of money paid by tourists who visited the island this year.
Last November, the Accommodations Tax Advisory Committee set its recommendations for allocating the tax money, including awarding more than $250,000 in surplus to the town and the chamber.
But on Dec. 15, the Town Council yanked the surplus funding from the town and chamber and put it in a reserve account to be used by organizations that applied later.
Since then, none of the reserve money has been allocated to island groups because there’s no formal process to apply for it.
“I just kept waiting for the process to be created, and it’s not being created,” island resident Martin Lesch said.
Now the end of the fiscal year, June 30, is in sight, and the $389,000 in reserve for island organizations will go back into the accommodations tax budget, to be divided by the town’s accommodations tax committee.
Town Finance Director John Troyer said organizations can tell the Accommodations Tax Committee of their need and the committee will consider their request in a public meeting. But advocates worry that arts and service organizations don’t know the reserve fund exists because they weren’t contacted by the town or sent an application.
‘We always have extra cash’
The lack of communication on reserve funding comes after the Town Council approved a budget amendment that allocated $350,000 of general fund money — taxes paid by residents, not tourism taxes — to the Arts Center of Coastal Carolina and Concours d’Elegance in October.
At the time, Town Council member Bill Harkins said he and then-Town Manager Steve Riley met with Concours d’Elegance Chairman Merry Harlacher, who was asking for funding. Arts Center CEO Jeffrey Reeves said he wrote to Riley asking for money, and the town obliged.
The allocations raised questions about how public — and how tightly controlled — the process is for dispersing money when island organizations need it, not to mention which organizations have the clout to pick up the phone and ask for it.
The lack of a public process for receiving that tax money bothered Ward 3 representative David Ames, who voted against the grants.
“We do ourselves a disservice when the public perceives that we have taken shortcuts, and I think that’s what the public is thinking,” he said.
And Ward 4 representative Tamara Becker, who eventually voted for the grants, noted that the town seemed able to find money when a majority of council members wants it.
“I’m beginning to wonder if our tax rates aren’t too high that we always have extra cash for consultants and for all of these large requests for money that come across the desk,” Becker said.
The allocations passed, but smaller organizations balked at the ability of the Arts Center and Concours to privately appeal to town leaders for money. In December, the Arts Center received its full $65,000 A-TAX grant, and Concours d’Elegance received its full $88,000 grant.
“I know there are organizations that would have been interested,” Lesch said. “It can’t be that you can call up your friend on Town Council and get $350,000.”
This story was originally published March 24, 2021 at 4:30 AM.
