Sunday, July 03, 2016

Spend Bed Taxes in St. Augustine: Dr. Leonard O. Pellicer, Ed.D.

Bed taxes are being squandered on advertising. Enough. Spend them on a new pier at St. Augustine, parking on the periphery of the city, and mass transit to solve our mobility crisis.

Leonard Pellicer guest column: Bed taxes more versatile than most thought
Posted: July 2, 2016 - 11:12pm | Updated: July 3, 2016 - 12:01am

St. Augustine Record
Thanks, to The Record for printing the article explaining the “bed tax,” along with a description of how the spoils are divided. The bed tax is likely the least understood source of revenue in our county and subject to plenty of speculation.

For example, I have been told repeatedly that up to 90 percent of the revenue is earmarked for the Tourist Development Council to be used to bring more tourists into the county. I have also been misinformed that state law dictates that the money must be used in this way to attract tourists — and that little or nothing can be done to address the situation.

However, after reading the article and the comments from our County Commissioners and County Administrator Mike Wanchick, there is clearly plenty of latitude regarding how the funds can be generated and used. Commenting on Commissioner Rachael Bennett’s proposal that 1 percent be added to the tax, Commissioner Morris termed it a “Band-Aid on a sucking chest wound,” while proposing a sales tax increase instead. If my math is close to correct, an additional 1 percent would generate well over $2 million.

I can assure our county commissioners that St. Augustine would welcome that Band-Aid on her chest. It would go a long way toward helping the city give our tourists the kind of experience they are expecting and deserve when they visit.

St. Augustine can’t levy taxes on the tourist trade, but bears the brunt of the fallout from the burgeoning hordes of tourists.

The city has no means, other than parking fees, to generate revenue to support the infrastructure required to host and care for this ever-growing throng of visitors. We don’t have needed funds for additional policing, traffic control, parking, road maintenance, etc. It’s a bit like asking Disney World to sell tickets to the attraction while giving all the receipts to Orange County.

Recent analysis concludes that St. Augustine has huge infrastructure needs and only 14,000 residents to pay for them. Our annual ad valorem tax increase is a futile effort to place Band-Aids on a variety of wounds. By the way, city residents are also privileged to pay county taxes. I wonder why county residents don’t pay city taxes, since they can also enjoy all the perks of the city (that is if they can find a parking place).

Commissioner Bennett is absolutely correct, “It’s (the bed tax) starting to be a significant sum!”

In the article, Wanchick questioned, “Do they (TDC) need to be funded at that higher level or could some of those funds be directed, not so much for encouraging tourism, but for offsetting some of the costs to the community hosting that many different tourists?” In answer to Mr. Wanchick’s questions, No, the TDC already spends far too much to attract visitors we can’t adequately accommodate. And, yes, some of the funds generated certainly need to go to the communities hosting the tourists.

I agree with County Commission Chairman Jeb Smith. He suggested that both issues — how bed tax funds are allocated and whether or not they should be increased to generate additional revenue — need to be discussed. In the near future we have several new hotels coming online and, without question, more and more tourists are going to continue to pour into our county and city annually, raising the bed tax revenue significantly.

The bottom line is St. Augustine produces a very large portion of the bed tax receipts and deserves a fair share of the revenues generated.

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