Continuing to use bed taxes to fund county beach restoration is unfair to businesses

BY JAY KRAMER/GUEST COLUMNIST

Jay Kramer
Jay Kramer

Hurricane Sandy came and went last year, leaving Vero Beach with $161,500 of clean up expense. The City budgeted this amount to save our parks and ocean side roadways from beach erosion that had undermined the dunes. Several private businesses along the beach also had to pay for damages caused by beach erosion from Hurricane Sandy. The question is why should they have to budget for these expenses when they already pay taxes to cover this type of damage? 

Specifically, they pay a one percent sales tax on items and services sold within the county to promote tourism, which also allows beach maintenance and dune restoration. Hotels and motels pay another one percent sales tax, also known as the Bed Tax, into a fund that also promotes tourism.

So why do these business owners still have to pay again for maintenance and nourishment of beaches? The answer requires a look back to see how we got here.

The problem of maintaining our beaches has existed for some time and researching the issue can be complex, however, it is generally accepted that two districts split responsibilities for beach maintenance, one county and one city. Vero Beach receives its fair share of the tourism tax for beach maintenance, while the county receives the balance along with state grants and interest from cash balances.

That relationship changed in the early 1990s when the PEP (Prefabricated Erosion Protection) reef was installed along Vero’s beaches. At that time, the city pledged its fair share of tourism tax money to go towards funding the PEP reef for 20 years (County Resolution 93-214). After 20 years, the money would then be spent in Indian River County District 1 or District 2.

Twenty years has passed and one could assume that Vero Beach would once again begin to receive its fair share of the tourism tax for beach maintenance. However, recently when Vero Beach asked for those funds, county commissioners said, “Let them find it in their own budget.” The reason given was that the county is still paying for the PEP reef.

This brings us to another interesting point as to who gets the money. Recently, the City of Orchid Island finished their dune restoration project and will ask the county for funds to help pay for it. Orchid Island generates very little of the sales tax that pays for it, yet their restoration project included a number of private properties. Since the original PEP reef was paid for years ago, it will be interesting to hear the reasoning as to why commissioners would approve his project, but deny Vero Beach money for its project. Perhaps they don’t know where the money comes from?

Well, over 56% of the money collected from tourist taxes and the beach restoration fund comes from Vero Beach according to the state reports in 2012. Yet, under the county’s beach restoration fund expenses, Vero Beach receive 0% of the money!

Somehow this does not seem fair. Although one could argue as to who gets the money, somewhere along the line we have to remember that someone is now currently paying for beach maintenance, paying the tourism tax and paying into the beach nourishment fund without any benefit.

Maybe it’s time to pull the plug on these beach maintenance taxes and give our businesses a break. After all, they are already paying for beach maintenance themselves. The tax just adds insult to injury.   

What makes this interesting is that the tourism and beach nourishment funds come from sales tax which Orchid Island generates very little of and their project incorporates restoration of quite a number of private properties. Since the PEP reef was paid for years ago it will be interesting to hear the reasoning as to why the commissioners would approve of this project, but yet deny Vero Beach money for their project, perhaps they don’t know where the money comes from?

When it comes to the tourist tax and beach restoration fund over 56% of the money collected from taxes comes from Vero Beach according to the State reports in 2012. Yet, under the expenses of the Counties beach restoration fund Vero Beach receives 0% of the money! Somehow this does not seam fair. Although one could argue back and forth as to who gets the money somewhere along the line we have to remember that someone is now currently paying for the beach maintenance, and they are paying the tourism tax, and they are paying into the beach nourishment fund without any benefit. Maybe its time to pull the plug on these beach maintenance taxes and give our businesses a break, after all they are paying for beach maintenance themselves anyway.  The tax is just insult to the injury.

 Editor’s Note:  Jay Kramer is a member of the Vero Beach City Council.

5 comments

  1. If there are no beaches, then there will be no businesses in Vero BEACH. The COVB’s portion of the beach is very small so it is logical that their proportion of any beach restoration funds would also be small. The tourist funds should be used to maintain the environment that lured so many vacations to come to Indian River County in the first place.. It should not be used now for the benefit of a small minority who own businesses that were negatively affected by Hurricane Sandy. Business owners should have insurance to cover any damage done to their properties.

    Also, it is important to recognize that the Congress appropriated funds for those communities inegatively mpacted by Hurricane Sandy. This is a revenue source that the COVB can and should now pursue. The residenths of the city should get some return on their investment of Federal dollars.

    Pulling the plug on beach maintenance taxes will only aggravate the situation for the COVB.

  2. Pat, would you not agree that the portion of bed tax raised within the city limits should first be used for beach and shores preservation projects within the city? Or, are you suggesting the protection of private property on the south beach is more important than the preservation of public beaches within the city?

  3. What I attempted to say is that the bed tax which was insttituted for beach preservation should be used for that purpose and that purpose only.

    The protection of private property is not more important that the preservation of public beaches. It is for this reason that I was concerned about Jay Kramer’s suggestion that the bed tax should go to business owners in the city who had sustained damage due to Hurricane Sandy.

  4. The tourist tax (bed tax) can be used for beach restoration, but it was not “instituted” for that purpose, and certainly not for that purpose only.

  5. I appreciate this reminder of how the bed tax came about and why it ended up the way it has. Appreciate the info!

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