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BED TAX TO INCREASE BY HALF-CENT IN OCTOBER

May 15th, 2009 | 0

By DOTTY NIST

In an effort to establish “The Beaches of South Walton” as a fly-to destination, in six months Walton County will begin collecting an additional “half- cent” in bed taxes on rental receipts from short-term accommodations in south Walton County.
The Walton County Board of County Commissioners (BCC) approved the tourism tax increase at its May 11 regular meeting, in response to a request from South Walton Tourist Development Council (TDC) officials.
Sonny Mares, TDC executive director, and Maurice Gilbert, TDC chairman, presented the request. Gilbert commented on the “tremendous opportunity” for Walton County represented by the new Panama City-Bay County International Airport, which is now more than half-complete and scheduled to open in May 2010. The location of the 4,000-acre airport is the West Bay area, just a few miles from the Bay-Walton County line. Tourism officials and other community leaders are hopeful that the entry of at least one low-cost air carrier into the area will result from the airport opening. Gilbert said tourism officials have given pursuit of this opportunity high priority due to its potential to attract business to the local area.
The bed-tax increase was proposed as a funding means to promote Walton County’s beaches to areas outside the current market, composed predominantly of visitors who access the area by automobile, and to cooperatively market any new low-cost air service. The tourism officials reported research identifying a potential of 3.2 million households that could be targeted in such efforts by directing marketing just to four new areas. Bay County recently approved a one-cent (one percent) bed-tax increase for the same purpose.
Mares told the commissioners that Walton County needs the additional one percent in bed taxes because shifting existing funding from current marketing efforts would damage those efforts.
The resolution from the TDC that was presented to the commissioners stated the purpose of the increase as “supporting low cost air service into the region at either Okaloosa County Airport or Bay County Airport through promotion and advertising of Beaches of South Walton Tourism and such air service in new, developing markets.” However, there was no mention, either by the tourism officials or anyone else speaking at the May 11 meeting, of the Okaloosa County Airport or any specific air carrier other than Southwest Airlines.
More than two dozen people, including many tourism leaders and bed-tax collectors, stood when Mares asked for a show of support. Mares also presented the commissioners with letters supporting the half-cent increase, written by representatives of  Hampton Inn & Suites, Sandestin Golf and Beach Resort, Rosemary Beach, the Hilton Sandestin, Beach Rentals of South Walton, One Seagrove Place, Alys Beach, WaterColor, Seaside, and Resort Quest. Included was a resolution of support from the Walton County Chamber of Commerce, and Dawn Moliterno, chamber executive director/CEO commented that not one of her organization’s more than 1,300 members had indicated opposition to the increase.
Moliterno was of the opinion that the increase would result in more job opportunities in the local area. “We need to say yes to business and we need to say yes to Southwest,” she urged.
The Walton County Taxpayers Association (WCTA) had also gone on record in support of ” the initiative to partner with a low-cost airline which will open new markets and generate economic development for our entire coastal region,” as stated in a letter signed by association president Bob Hudson.
“The TDC exists to develop tourism, and a low-cost airline is a major step in tapping new markets,” Hudson’s letter added.
The WCTA’s support was the result of the recent addition of conditions to the imposition of the bed-tax increase, including the October 1 effective date, a sunset on the increase after a five-year period, and arrangements to escrow the new revenue for the specific purpose.
Hudson’s letter encouraged the TDC to “work toward eliminating this temporary tax earlier than five years, if possible.”
The letter added, “Should the low-cost airline deal not materialize, we would hope the sunset would expire immediately.”
Mares noted that more than a 54-percent occupancy rate had never been achieved for short-term accommodations in south Walton County.  He saw the efforts toward a fly-to market as a means to boost occupancy.
A number of critics of the increase voiced their opinions.
“I feared this,” said Larry Gibson of Tops’l Resort, who was concerned that any tax increase on tourists would “ruin us.”
“How many people is this really going to put in hotels?” Gibson asked.
Suzanne Harris of Edgewater Beach Resort was of the opinion that the increase would not be needed if everyone who was supposed to be paying bed taxes were made to do so. (Martha Ingle, Walton County Clerk of Courts, later commented that a person on her staff is dedicated to collecting bed taxes from property owners who have not been paying them.) Harris warned that tourists were aware of plans for the increase and strongly opposed to it.
“It’s an insult to their intelligence,” Harris asserted.
She was very much in favor of Southwest Airlines and bringing them to the area but thought there were better ways to go about it.
“We need to look for an alternative,” agreed south Walton County resident and property owner Mary Nielson,
South Walton County resident Charlotte Flynt shuddered to think what tourist occupancy of more than 54 percent would be like. “We don’t have the infrastructure to handle it,” she told the commissioners.
“We all want Southwest Airlines,” countered Michael Chouri of the Sandestin Beach Hilton. Chouri told the BCC that the airline would not come to the area “unless you entice them,” adding that it will not be possible to do that without the bed-tax increase.
Citizen Bonnie McQuiston reasoned that, if one takes the position that more tourists are not needed, then there is no reason for a TDC. She added that if these efforts double or triple the occupancy rate, it may be necessary to sunset the increase sooner than the five-year period. She was upbeat about the possibility of Southwest Airline coming to the area, saying she was tired of paying more to fly on other airlines with service that was not up to Southwest’s standards.
District 3 Commissioner Larry Jones moved for approval on the half-cent increase with attached conditions, based on the 70-percent support of the measure among bed-tax collectors that Mares had indicated.
His motion was approved by unanimous vote.

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