Boards discuss occupancy tax collection

COLUMBUS – Polk County, Saluda and Tryon have all recently discussed changing the structure of collecting its occupancy tax, with Saluda and Tryon this week agreeing to move forward with researching joining a county-wide Tourism Development Authority (TDA) with the county.

The Polk County Board of Commissioners recently had a lengthy discussion regarding the county collecting more occupancy tax in the unincorporated areas of the county and how to create a TDA.

Commissioners met Monday, Aug. 7 and discussed the next steps as well as heard a detailed presentation from county attorney Jana Berg about occupancy tax and the state guidelines.

The Saluda Board of Commissioners met Monday, Aug. 14 and the Tryon Board of Commissioners met Tuesday, Aug. 15, with both boards agreeing to move forward with a possible TDA.

Neither Tryon nor Saluda officials agreed to move forward without expressing concerns, particularly over how the money could be spent and who authorizes the spending.

 

Saluda

Saluda manager Jonathan Cannon said new laws would allow the county to collect six percent outside of the municipalities and the county has proposed to the towns to join forces with them. The county is proposing if it can collect six percent in the unincorporated areas of the county instead of the current three percent and the towns would join, the county would provide all the collections for the entire county as well as give the towns up to five percent of each town’s collections. The county is proposing to keep one percent of each town participating’s occupancy tax in order to do collections.

The county would collect six percent throughout the county as well as in each town that agrees to join the new TDA. The towns that decide to participate would then rescind their ordinances to collect their three percent tax, allowing the county to collect six percent, and negotiate an inter-local agreement for the county to disperse collections to the towns in the TDA.

Saluda currently has in legislation a bill to collect its three percent of occupancy tax for lodging. The bill has passed the first reading and has been sent to committee, then is expected to pass the second and final reading during the next legislative session.

Cannon said if Saluda does not join with the county on the TDA, Saluda will only be collecting three percent as well as paying for administration out of that three percent.

Saluda attorney Jana Berg said if Saluda is approved by the state to collect the three percent and the city decides to join with the county, the city could just leave the ordinance on the books without enacting it.

Commissioner Mark Oxtoby asked if the county would go after collecting occupancy tax from airbnbs. The answer was yes.

Oxtoby also asked if when the county board of commissioners changes, could they change the inter-local agreement and change the percentage Saluda receives.

Berg said the arrangement would be between the county and the city with an inter-local agreement and in order to change the agreement, it would take a consensus of both parties.

Saluda mayor Fred Baisden said the only issue he has with joining the county is the county TDA may dictate how Saluda spends that money.

Berg said she thinks it was understood that each municipality would have members on the TDA. For instance, Berg said, if Saluda got five percent, the TDA would dictate the areas the city could spend the money on, but she thinks the city would have input on how that money would be spent. Berg also said the city could have its own tourism board to decide how to budget the occupancy tax.

“If you have a bunch of people who own hotels,” Baisden said about members of the TDA, “they are going to want to spend it on hotels.”

Baisden said he would hope the TDA would be done in a way that the city could dictate how it spends it money.

Berg, who is also the county’s attorney, said Saluda will definitely want to have all those details before joining the county.

Cannon said when county manager Marche Pittman presented the options to managers, he explained two options. One was for each city joining to have representation on the TDA and another was for the TDA to just give the participating city/town the money and the city/town decides how it would be spent.

Berg said this year’s county occupancy tax was approximately $120,000 and that was an increase because of the Tryon International Equestrian Center (TIEC).

Baisden said he thinks it’s going to be in the neighborhood of $229,000 with the additional collection of six percent instead of three percent for the county.

Saluda agreed to move forward with speaking to the county about joining the TDA.

 

Tryon

During this week’s town council meeting in Tryon, town manager Zach Ollis reviewed the town’s options, ranging from doing nothing and continuing to collect its own three percent occupancy tax within the town, to joining the county TDA and potentially receiving five percent of its occupancy tax.

“There’s an opportunity if we wish to work with the county to make more money,” Ollis said.

Ollis also said Tryon would lose some control.

Tryon commissioners were also interested in the county taking over collections, including collecting from airbnbs.

Ollis said the county taking over collections would make life for one of Tryon’s staff members easier.

Commissioner Bill Ingham said if the increase in occupancy tax with five percent is just marginal, he doesn’t want to give up control.

Commissioner Crys Armbrust said the county formerly never served Tryon’s needs with regard to tourism, which is why the town went to the state government in the first place to ask to create a separate tourism authority.

“Personally, I don’t know that I’m willing to dissolve our tourism authority and lose oversight of that,” Armbrust said.

Armbrust also said Tryon currently receives approximately $21,000 per year in occupancy tax and that is the only money that the town has to promote the Town of Tryon.

Ollis said the town would have to rescind its ordinance to join the county but could create a committee to oversee the spending and the money would have to be spent in a certain way based on the state’s regulations. Ollis also said the county is going to have to get started on its process of changing to a TDA and collecting more outside the municipalities.

“Either way,” Ollis said, “they are going to have to go through legislation to create that tax district. They want to get started as soon as possible.”

Tryon mayor Alan Peoples said there’s no way Tryon could lose if they get the five percent, the question is, are there restrictions on the spending.

Tryon decided to further look into details of joining and moving forward.

The Town of Columbus met Thursday, Aug. 17, but did not initially have the occupancy tax discussion on its agenda.