CAROLINA BEACH — With sand pumping the hearts of beach towns and with non-local moneys limited for shoreline renourishment projects, town leaders at Carolina Beach on Tuesday plan to discuss funding sources for the future.
That may mean the town setting aside its own money for the costly and recurring projects.
“The minimum that the Town should consider putting aside in a fund is 17.5 percent of the cost of an estimated project over a three year span,” Town Manager Timothy Owens wrote in a memo to the mayor and council ahead of Tuesday’s regular meeting, which will begin at 6:30 p.m. in the Municipal Administration Building, 1121 N. Lake Park Boulevard.
To consider the project area of Carolina Beach and the portion of Kure Beach’s renourishment area that is in Carolina Beach, the town may have to stash away $635,000 a year for three years, by Owens’ calculations. The main Carolina Beach renourishment was estimated around $8.5-million and the Kure Beach portion at least $2.5-million.
From where should the funds come?
“To me, it appears that either a straight ad valorem tax or a service district should be considered,” Owens wrote, though other options include exploring a change to the room-occupancy tax or sales tax.
According to the town, each penny on the current ad valorem tax rate brings in $160,000—the current rate is 23.5 cents per $100 of value—so the town would have to add a little more than three cents to generate $490,000, roughly the recommended savings-per-year amount for the Carolina Beach renourishment area alone.
In the idea to establish service districts, Carolina Beach properties would be divided into three zones, each of which would assume different tax burdens to generate the funds. The zone that would benefit most from the beach’s renourishment would pay the largest share, potentially as much as six cents additional.
The 17.5 percent figure Owens recommended saving is equal to the funding gap that must be covered in an agreement between the beach towns and New Hanover County. That agreement can provide up to 82.5 percent of a renourishment’s cost from the county’s room occupancy tax fund.
The county had estimated that for the current fiscal year it had more than $40 million in that fund, built of revenues from taxes charged to room rentals, and over the year about $2.6 million would add to it.
The New Hanover County Board of Commissioners at its September 4 meeting approved a memorandum of agreement toward beach renourishments at Carolina Beach and Kure Beach this winter. The cumulative $14-million project total will have limited state and federal aid, leaving about $9.6-million for the county to cover. The end cost could be slightly different per the bids the U.S. Army Corps of Engineers will receive for the work.
