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Sales tax: Civic group is first to oppose referendum

By Jason Lesley
Coastal Observer

The Pawleys Island Civic Association board of directors has voted unanimously to oppose a 1-cent sales tax to fund $40 million in county capital projects on the ballot this November.

“Our position is that this will be detrimental to rentals,” said Linwood Altman, the association president. “There have been comments made that 25 percent of the tax will be paid by family vacationers. We are competing on an international level, and we do more and more advertising as the competition gets more and more intense. This tax increase will create an additional hardship that is not conducive to more business.”

Altman said businesses along Highway 17 benefit from vacationers — he never refers to them as tourists — and those shoppers are being enticed to visit the Gulf Coast in an advertising blitz funded by BP as part of its settlement over its 2010 Deepwater Horizon oil spill.

“Pawleys Island was named one of the best vacation destinations by National Geographic,” Altman said. “We don’t want to do something that would cause people to go elsewhere.”

Altman’s business, Pawleys Island Realty, had rental customers from 48 states and four countries this year. With vacation home renters already paying a 10 percent tax, he wondered how much more they would tolerate.

“There’s always pressure to add more taxes,” he said. “For most of the homeowners on Pawleys Island to maintain their property, they have to have family vacationers.”

County Administrator Sel Hemingway said that advocates of the sales tax may step forward in the coming weeks to encourage support for a particular expenditure: dredging, a fire station, park, library or paving project.

“Advocates are organizing,” he said.

Hemingway said he will offer educational and informational programs to groups or organizations before the vote.

Georgetown County’s position on the sales tax is neutral, he said.

The county web site, gtcounty.org, has a list of the projects and answers to frequently asked questions.

Opponents have been more vocal, beginning with the public hearing at this month’s County Council meeting.

Charlie Luquire, a Pawleys Island area resident who spoke against the 1-cent sales tax, said he is participating in an ongoing loosely organized group.

“It may evolve into a group with a small board in coming days,” he said. “The participants in the group are opposed to the proposed sales tax at this time but think County Council should use the existing CIP [Capital Improvement Plan] structure for the proposed projects, especially the dredging of the port.”

He said the group plans to do some campaigning against the referendum and may put out some bumper stickers.

Projections show the sales tax would raise about $5.5 million a year.

As required by law, the commission listed the projects in priority order. Dredging of Winyah Bay ($5.5 million) is at the top of the list, followed by preparation of a spoils site for dredging in Murrells Inlet ($1.8 million). Countywide road paving projects ($5.2 million), improvements to Black River Road in front of the Georgetown Hospital ($1 million) and improvements to Parkersville Road ($1.3 million) follow. Public safety improvements come next, including construction of a fire station in the Big Dam community ($750,000) and building 10 rural fire substations ($750,000). Libraries ($11.3 million) and recreation projects ($12.2 million) comprise the remainder of the list.

Some opponents of the tax questioned whether County Council would have the authority to borrow money and use collections from the additional sales tax for debt service.

The referendum provides for that authority with the wording that “net proceeds of the capital project sales and use tax, if approved, may be used to pay debt service on bonds ...”

Hemingway said that language, suggested by the county’s bond attorney, gives County Council the leeway to take advantage of low interest and construction rates now or use “pay-as-you-go” if interest rates rise.

Luquire noted that the state law that allows the capital sales tax requires the ballot question to include the amount of money that will be used to pay interest on the debt if the county issues bonds for the capital projects. That isn’t in the ordinance adopted by County Council.

Hemingway says the tax will bring in an etimated $44 million over its life, and that the balance can be used for interest.

“It’s too complicated to pick apart,” Luquire said. “Let’s just call it a tax increase; a $44 million tax increase.”

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