GOOD issues raised by Bennett, commenters and Jake Martin.
St. Johns County commissioners to revisit bed tax allocations
Posted: June 25, 2016 - 8:41pm | Updated: June 26, 2016 - 8:46am
By JAKE MARTIN
jake.martin@staugustine.com
St. Johns County commissioners plan to re-evaluate the distribution of revenues from the county’s Tourist Development Tax, or bed tax, as well as explore the possibility of tacking on a fifth cent to the assessment on short-term transient rentals.
Commissioner Rachael Bennett during closing comments at Tuesday’s commission meeting requested an item be placed on the agenda for the purpose of reviewing the county’s options.
She explained it’s the County Commission that determines the percentage split of certain money as well as whether it would be appropriate to add another penny to the bed tax.
“It’s starting to be a very significant sum,” Bennett told fellow commissioners. “Do we want to change that distribution? Do we want to initiate an additional penny? What do we want to do about the monies that are coming in from the bed tax?”
The discussion is not without its implications for the St. Johns County Tourist Development Council.
The TDC promotes tourism in the county through programs funded by the bed tax, which is paid by overnight visitors to the county in hotel or motel rooms, campground spaces, condominiums, apartments and even private home rentals that are rented for six months or less.
Revenues from the original 2 percent bed tax established in 1986 are split on a 40-30-30 basis, with 40 percent going to advertising and promotion, 30 percent going to culture and special events and 30 percent going to beaches and recreation. Of the additional 2 percent bed tax that has since been tacked on, 1 percent is dedicated entirely to advertising and promotion while the other 1 percent is dedicated to administration and special uses. This category includes debt service on the St. Augustine Amphitheatre as well as costs for fireworks displays on the Fourth of July, New Year’s Eve and other special events.
According to the administrator’s budget workbook for the 2017 fiscal year, the TDC collected $8,220,259 in bed tax revenues in 2014, an estimated $8,782,820 in 2015, and an estimated $9,233,064 in 2016.
Expenditures have increased from a little more than $4 million in 2007 to north of $11 million in 2016, according to a graph provided in the workbook.
Commissioner Jay Morris, the board’s representative on the TDC, asked Bennett to clarify the fiscal year for which she was seeking input and possible changes.
“You’re looking for some input for 2018?” Morris asked, adding the TDC had already put together its budget for 2017.
“They can’t have done their budget because we approve their budget,” Bennett replied.
“That’s right, but they’ve put a lot of work in it,” Morris said. “You’re looking to change their budget? I think if that’s the case, you better let them know pretty quickly.”
Bennett reiterated that commissioners have final say in the matter and that the TDC is supposed to be providing quarterly updates.
“I haven’t seen someone from the TDC come quarterly at all,” she said. “We didn’t get a proposed budget from them. ... If it’s in the better interest of the people of St. Johns County to redistribute the TDC allocations, the TDC should redo their budget.”
According to the county’s website, the TDC has initial responsibility for the bed tax revenues. Funding proposals are to be submitted to the TDC for review and recommendation before action by county staff or consideration by commissioners. The final authority for revenues and expenditures, however, rests with the County Commission.
County Administrator Michael Wanchick said staff should be able to bring forward some options as to how to proceed at the commission’s July 26 meeting, in which commissioners will also set the millage rate for the upcoming fiscal year.
He told commissioners the bed tax matter came up during the administrator’s budget hearings in that programs in the county’s operating department were given a 5 percent growth cap across the board, which is not projected to be the case for the TDC.
“The TDC funds are growing at such a rapid rate, some of their programs are proposed to be funded at a much higher level,” Wanchick said. “Do they really need to be funded at that higher level or could some of those funds be directed, not so much for encouraging tourism, but offsetting some of the costs to the community hosting that many different tourists?”
He said the second issue of whether commissioners want to explore adding a fifth cent to the bed tax is a whole other discussion.
Commission Chair Jeb Smith said both discussions should be had, with other commissioners speaking at least in general agreement, although Morris did express some doubts as to what those discussions will produce.
“To me, if you’re going to be talking about a fifth cent, and I’ve said this before, it’s like a Band-Aid on a sucking chest wound,” Morris said. “Let’s talk about the sales tax again.”
He said whether the bed tax is four or five cents, it wouldn’t make a dent in what he called a $745 million backlog in county projects.
Bennett said she agreed there was a need for solutions to the county’s big picture challenges but that at least some of the TDC dollars would be better spent on infrastructure before attracting even more visitors.
“Our pressures at the beach for parking, for infrastructure, walkovers, and just infrastructure in general, is phenomenal, and we have so much visitor pressure on that,” she said. “Do we really want to spend $8 million on advertising and only $200,000 on beach infrastructure?”
Wanchick clarified he was only talking about the growth in TDC revenues due to the “tremendous growth in tourism activity” within the county.
“We’re not trying to take anything away from them that they have today,” he said. “We don’t want to hurt anybody. There are just limited revenues countywide and we want to look at the allocation of those revenues in conjunction with everything else that we have coming and going.”
Also to be discussed at the July 26 meeting is a consultant’s study approved by commissioners last year on beach parking and the possibility of charging for off-beach parking.
COMMENTS
mach12.1e 06/26/16 - 08:15 am 64Here's the deal.
You keep adding taxes and you will get to the point of diminishing returns, and the animosity of local patrons. Locals want to use the B & B's too. Exempt locals (St Johns County residents) with ID from those taxes if they want to enjoy a night down town. The other monies need no longer be directed toward promotion. Everyone knows we're here and are arriving by plane and truck loads. The TDC doesn't even need to exist any more,. Dump them and their administrative costs, they are parasites. Any extra revenue should go to funding the needed infrastructure (roads) that are overwhelmed by the traffic the increase in tourist brought. No need to raise taxes if this is done. We want a little less crowding, not a little more.
sponger2 06/26/16 - 08:21 am 54I concur with Mach.
Give us a break. You've increased everything and we now even pay to park. If you choose to go down this path, throw the people that actually live here and pay local taxes here a bone, and don't continue to price them out of using our own town's amenities.
martystaug 06/26/16 - 09:31 am 31"...very significant sum,”
With 40% of the original fees going to advertising and now the fee has doubled with 100% of that increase going to advertising and administration, ie: TDC. So now, if my limited math is correct, 15% of the current bed tax money goes to beaches and culture. The vast majority goes back to the TDC advertising and admin costs. Why not end the bed tax and the TDC, let the B&Bs and hotels pocket the money as profits, and stop filling up this town with more visitors than our streets and infrastructure can handle. Why not make a little room for locals to enjoy our amenities as mentioned above by Mach and Sponger. Budget watchers may view this as "free money", but look at what it has done to our town, and you'll see it is definitely not FREE.
CameraGirl 06/26/16 - 02:01 pm 11Finally a commissioner speaks up
It's about time someone points this out. Hopefully she will make some changes happen before her time is done, as others may be too timid. They don't need to spend one nickel on advertisement for an entire year, use the funds for infrastructure and beach improvements and see if our tourism number change. If there isn't a significant drop, well there's your answer on whether or not we need to spend a fortune to bring more people here than we can accommodate. Give the residents a break from the madness!
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