Horry County Council members have given a resounding NO to holding secret negotiations with representatives from the municipalities about hospitality fees and possible funding for I-73.
The City of Myrtle Beach proposed discussions behind closed doors by sending a confidentiality agreement to the county and the other seven municipalities in Horry County. The city is trying to couch any discussions on hospitality fees as a resolution conference with regard to the lawsuit it recently filed against Horry County over the subject. The city said S.C. Rules of Procedure Section 408 applies to the discussions.
In the very best interpretation of the city’s position, this is a stretch.
The city filed its lawsuit against the county claiming the county’s continued collection of the 1.5% portion of the hospitality fee beyond January 1, 2017 is illegal. The complaint was structured in a way that a class action lawsuit (municipalities v the county) could be requested.
However, to date no other municipality has joined the lawsuit and no judge has certified a class action.
Therefore, any negotiations that includes representatives from other than Myrtle Beach and Horry County couldn’t truly be considered a dispute resolution conference as it would include third parties not currently included in the lawsuit.
More importantly, any discussions about dividing public tax revenues or spending public tax dollars for public projects by public agencies should be held in the open.
What appears to have happened is Myrtle Beach jumped the gun on the hospitality fee issue. It hurried a city ordinance through two readings in order to capture all hospitality tax, 2% on just prepared food and beverages, allowed under current state law, collected by the city to remain in Myrtle Beach tax coffers.
Myrtle Beach next filed its lawsuit against Horry County claiming the original hospitality tax ordinance passed by Horry County with consent of the cities in late 1996 expired on January 1, 2017. The original ordinance placed a 2.5% tax on all accommodations, prepared food and beverages and tickets sold within the county. Of that, 1.5% collected countywide was specifically designated to pay off the bonds for the Ride I projects.