CAROLINA BEACH – Town leaders here will appeal to state legislators in the effort to infuse a local reserve fund for beach renourishment.
Town Manager Timothy Owens told the town’s council at its Tuesday night meeting that it should raise and save roughly $635,000 a year to arm the town with enough cash for the local share of those costly and inevitable projects, which federal and state dollars may supplement.
But council members including Mayor Pro Tem Steve Shuttleworth said they wouldn’t be enthused to raise the money entirely through a property tax increase or assessments, even if they are the easiest methods to administer.
“I am not going to support laying all this burden on ad valorem tax” without a supplementary source, Shuttleworth said.
Council members agreed they should ask their local delegates in the N.C. General Assembly what alternatives might be available and whether some sort of legislative effort is in order toward an increase to the local sales tax or other source. Shuttleworth was also curious about the possibility of a special, new accommodations tax for the town.
“Call it a beach renourishment tax levied against hospitality,” he said. “But we ought to go to the state and ask how we can get that.”
But Sen. Thom Goolsby, the Republican from New Hanover County, told Port City Daily Wednesday morning he would not support new or increased taxes. He did, however, share concern about local funding for beach renourishments as state and federal support comes limited. He said he and fellow legislators were committed to finding solutions.
“We need detailed funding sources for all of these projects,” Goolsby said. “We don’t need increased taxes.”
Goolsby said he’s spoken with several coastal county and town leaders, and also with the U.S. Army Corps of Engineers, about the funding concerns. He also noted the possibility of towns using greater shares of taxes already on the books.
But, he reiterated, “I do not see the current General Assembly as it is today coming up with ways to tax people more.”
Prior to Tuesday’s Carolina Beach Town Council meeting, Owens informed the board that the town should, over a three-year period, consider putting aside 17.5 percent of the estimated cost of a beach renourishment.
To consider the project area of Carolina Beach and the portion of Kure Beach’s renourishment area that is in Carolina Beach, the town would have to stash away $635,000 a year for three years, by Owens’ calculations.
The 17.5 percent figure 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 a beach renourishment at Carolina Beach and Kure Beach this winter. The cumulative $14-million project total will have limited state and federal support, leaving about $9.6-million for the county to cover. The end cost could be different per the bids the U.S. Army Corps of Engineers will receive for the work.
Otherwise, the town’s local revenue sources for the beach are limited to ad valorem taxes and potential property assessments.
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 cost of 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—generally along the beachfront—would pay the largest share, potentially as much as six cents additional.
Owens said a potential concern with that formula “would be that some may pay the additional tax and not get any sand in front of their home during a nourishment cycle. This is likely the case for the southern portion of the Carolina Beach project that rarely gets sand and the beach remains steady over the years as a result of sand being placed at the north end of the project.”
He explained that the north end’s renourishment provides erosion protection for the south end.
As for the plan to contact legislators for support—Mayor Ray Rothrock made the motion, which passed unanimously—Shuttleworth suggested other beach governments might also be interested.
“There are other coastal counties that are fighting these same issues,” Shuttleworth said, “and we ought to join forces.”
