Isle Of Palms Tourism Budget Begs Questions After Split ATAX Vote

By Brian Sherman for The Island Eye News

Is the Charleston Area Convention & Visitors Bureau the only organization qualified to spend the state accommodations taxes collected on short-term rentals on the Isle of Palms? Is a million dollars no more than a drop in the bucket? Is the newly-formed IOP Chamber of Commerce chasing a pot of gold? These and other questions were left unanswered July 19, when the revamped IOP Accommodations Tax Advisory Committee failed to approve the CVB’s fiscal year 2023 budget, then segued into a contentious discussion about the possibility of seeking an alternative destination marketing organization that apparently left Committee Chair Ray Burns wishing he had never broached the subject. The ATAX Committee’s 3-3 vote – one member, Chrissy Lorenz, was absent – was largely ceremonial. The City Council, which has the final word on the subject, was scheduled to consider the CVB’s budget at its regularly scheduled July 26 meeting. The Council approved the CVB’s 2022 budget without the blessing of the ATAX Committee. Voting against the motion to approve the budget were Burns, Doug Truslow and Rebecca Kovalich, while Chas Akers, former IOP Council Member Barbara Bergwerf and Gloria Clarke, now retired but an employee of the CVB for nearly two decades, supported the measure. 

Five people recently resigned from the Committee; only Burns and Truslow were members at the start of this year. “I’d like to know what alternatives there are,” said Burns, shortly after a presentation from Laurie Smith, the CVB’s chief operating officer. “I don’t really see a lot of organizations coming forth… to solicit for that,” Clarke responded. City Administrator Desiree Fragoso explained to Committee members that the IOP Chamber would be eligible to be a DMO under state law but that the ATAX Task Force, which was headed by Council Member Rusty Streetman, determined that the Chamber “needed some time to fully develop to potentially be an option for the city.” Akers pointed out that the best option for the city would be to keep its current DMO. “We are forecasted to go into a recession. It is really in our best interest to try to shore up and repair what we have versus trying to go out and do something on a short-term basis,” Akers said.

Following the deadlocked vote, Burns initiated a discussion about issuing a request for proposals to determine which nonprofit would serve as the city’s DMO and receive the large chunk of money that must be used to attract tourists to the area. Municipalities collect the state’s 2% tax on short term rentals. After the state takes a small amount of this money, the municipalities get to keep $25,000 plus 5%. Of the remaining funds, 65% must be spent on tourism-related projects and activities, while the other 30% must be sent to a nonprofit tasked with attracting overnight visitors. 

Clarke asked Burns if there was something the CVB has not been providing to IOP, and his response was “We want to see our money spent to the benefit of Isle of Palms. We want accountability of where our money is being spent.” “Right now, there’s no competitive bidding. We’re spending close to a million dollars,” Burns added. “A million dollars really is a drop in the bucket. It might seem like a huge, big figure to you, but a million dollars is not really that much spent on a marketing campaign,” Clark responded. Bergwerf said she was surprised no one from the Chamber of Commerce attended the meeting, “just because they should show some interest.” 

“Right now, they have no employees. They have someone who’s doing a website. A Chamber of Commerce by definition is businesses working with businesses. They see a pot of gold, and they’re working toward getting part of it. That’s the reality,” Bergwerf commented. 

When Burns pointed out that there’s no interaction between the ATAX Advisory Committee and the CVB, Clarke asked him how many CVB events he has attended this year. His response was “none,” and Clarke shot back with “I guess you’re not interacting.” “I’m sorry I even brought the subject up. It seems to me there’s a need here and I guess nobody else understands that,” Burns commented. Bergwerf noted that “We’re getting the feeling that it’s our money. The tax is state mandated… We have to spend it. I just don’t see where we’re going. It makes no sense.” Smith, the CVB chief operating officer, told Committee members that “It’s all about trust. If this comes down to an RFP, we are happy to submit information. What it feels like is we’re being asked to the prom because there’s nobody else to ask to the prom. I don’t want to be that. I want you to be happy about what we’re doing for you.” In other action July 19, the ATAX Advisory Committee approved $1,000 in funding for the Carolina Coast Surf Club. 

The IOP Veterans of Foreign Wars post also requested funding, but Committee members asked that the organization “come back with specific projects to show where the $30,000 is being used.”

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