MYRTLE BEACH — City Council unanimously voted Tuesday to extend a sales tax that funds tourism promotion, clearing the way to send tens of millions of public dollars to the local chamber of commerce in the next decade.
At the same time, the chamber faces a lawsuit over how it spends public funds, which accounted for 84 percent of its total revenue in 2016.
The council extended the Tourism Development Fee, a 1 percent sales tax in place around Myrtle Beach since 2009. It now will be in effect until at least 2029.
Eighty percent of its revenues fund tourism promotion and most of the remaining money funds tax rollbacks for property owners in the city.
Homeowners who primarily live in Myrtle Beach can receive as much as 80 percent off their annual property tax bills, making the TDF broadly popular among voters.
City Council bypassed the possibility of putting the tax to a referendum. A referendum to enact a TDF for the first time failed in North Myrtle Beach earlier this year where the property tax credit would have been lower and 95 percent of voters declined to enact the fee.
"If it's such a great thing, if it's so good, what are you all afraid of?" said resident Peter Kalbacher. "Put it out to the public."
Myrtle Beach Mayor Brenda Bethune has said that because the city voted for pro-TDF City Council members in the fall municipal elections, the voters had already spoken.
In the initial vote two weeks ago, members of the tourism industry packed the Collins Law Enforcement Center as City Council considered the issue. Many wore "Vote yes for TDF" stickers and gave outgoing Myrtle Beach chamber President Brad Dean a standing ovation after an impassioned speech about the benefits the tax had brought over the past nine years.
In the intervening time, a city resident filed a lawsuit against the business group, claiming the chamber has improperly spent the public funds that make up the vast majority of its annual revenue. TDF funding accounted for more than $24 million of that public funding in 2016.
In a press conference earlier Tuesday, chamber officials called the lawsuit a "baseless, vindictive attack" and said the chamber often uses a bidding process to procure vendors for marketing services, such as video production and website maintenance.
Board Chairwoman Carla Schuessler said that the group is private, and therefore not subject to public procurement laws. She argued that the suit stems from a personal vendetta on the part of the plaintiff, Karon Mitchell, a former motel owner.
Schuessler said her group was prepared to defend itself in court. After the press conference, she declined to take questions from the press and walked across the street with other chamber officials to the council meeting to watch the TDF vote.