The Berkeley Chamber of Commerce has been cleared of misspending money and its advertising budget should be restored, the director said recently.
In April 2017, County Council voted to withhold the chamber’s portion of accommodations tax money — $187,000 — because the organization was under investigation by the FBI over how it had spent about $500,000 from the tax.
As a result, the chamber was not able to advertise and occupancy rates at the county's hotels are down, officials said. On weekends, some hotels are less than half full, and their room rates are also down, officials said.
“Following the investigators’ and prosecutor’s review of the chamber’s records, the chamber was informed that it is clear of any wrongdoing,” Chief Operating Officer Elaine Morgan wrote in a Nov. 2 email to members.
The FBI does not confirm or deny investigations.
“Because there was so much discussion about the investigation, we thought we needed to make sure that the chamber membership knew where we were with that,” Morgan said Tuesday.
But county Accommodations Tax Advisory Committee Chairman Jim Rozier said he has not heard an update on the investigation.
Last year, County Council voted to withhold the chamber’s portion of the tax money until it was cleared or until Councilman Kevin Cox reviewed the chamber’s records, which he said the organization has refused to provide him.
“A cloud has been presented to us that’s a problem, and as far as I know, the cloud has not been lifted officially,” said Rozier, who is also a former county supervisor.
As a result, the commission decided to let County Council decide whether the chamber should get any money this year. Council members are expected to discuss it further on Nov. 13.
The accommodations tax is a 2-percent levy on hotel and motel rooms that brings in about $500,000 a year in Berkeley County. By state law, the money is to be spent promoting tourism. The state charges the tax, and local governments may, too. In 1994, the chamber and the hoteliers petitioned Berkeley County Council to create the tax, with the county keeping 20 percent and the rest going to the chamber.
Targeting people who would stay overnight in the county’s hotels, the chamber advertised in out-of-state magazines, on cable television and websites, Morgan said.
The system worked well for more than 20 years, and as recently as 2014, occupancy rates were as high as 98 percent, she said.
But in 2016, County Council appointed new members to the commission. In her email, Morgan said these new members “changed the accommodations funds expenditure emphasis to special interest groups, that also are linked to the new Berkeley County Tax Advisory Committee members, and far less to promoting overnight stays for our lodging industry.”
Rozier and the commission overhauled the process for divvying up the money and invited nonprofit groups to apply. The commission only makes recommendations to County Council, which has the final say.
In 2017, tax money was given to several groups that hold annual festivals, such as the Alvin Catfish Festival; high school bass fishing clubs; Daniel Island Performing Arts Center; Berkeley County Museum; Blueways Paddling Trails; a TV fishing show; and the S.C. Battleground Preservation Trust.
A vote to award $90,000 to Fort Fairlawn was taken separately because Rozier was president of the board of the Lord Berkeley Conservation Trust, which owns Fort Fairlawn.
Now that the chamber has been cleared, it hopes again to receive 80 percent of the money, as it did before 2016.
Hotelier Carol Wiggins, also a member of the commission, said she has noticed a change because of the chamber's plight. Business travelers still fill rooms during the week, she said, but fewer stay on the weekends.
“The chamber did get out and work to put heads in beds,” she said. “Now we have nobody working for us. We’ve really seen a difference.”