| NEED TO KNOW MORE ABOUT THE ISSUE? August
4 1999 - ECONOMIC
IMPACT OF CONVENTION AND CONFERENCE CENTERS - "In many communities
throughout North America today, development or expansion of a meeting facility is being
considered as a means of creating positive economic impacts to achieve the economic
development goal... But what if they don't come?"
TDC Voting District
Precinct Maps...
- July 10 1999 - The
LMI Study Part I - Leisure Management International
("LMI") is pleased to present the "Okaloosa County Conference Center
Business Plan" to the Okaloosa County Tourist and Development Council
("Council"). The purpose of this Business Plan is to assist the Council in
developing and evaluating options regarding the development, construction and operation of
the proposed Okaloosa County Conference Center...
- July 9 1999- Referendum called for on
bed-tax issue - "I've never seen an issue in this county where so many
people are angry," King said in an interview. He was referring to the new tax, which
went into effect July 1, increasing the tax paid by tourists for short-term bed rentals.
By Leah Stratmann, Staff writer
- Bed tax, TDC face
extinction - The fountain of money that pays for beach cleaning, tourism
promotion and beach access in Okaloosa County - and is slated to one day fund an island
conference center - could soon run dry.
*By LOUIS COOPER, Daily News Staff Writer
- "...the political
machine moves inexorably toward the developers, the public be damned."
*by BILL CAMPBELL Daily News Columnist
- "The
controversy is about politicians apparently wanting one thing and the public wanting
something else..."
*by Del Stone Jr. Daily News Deputy Managing Editor
- Freedom Forum Voice
your views here!
*INTENDED FOR REFERENCE ONLY, AND NOT AN OFFICIAL OR
POLITICAL ENDORSEMENT |
Ray Sansom on Bed Tax/Conference
Center
By Ray Sansom (Okaloosa County Commissioner)
CONFERENCE CENTER: BIG GOVERNMENT, BIG TAX, BIG DEBT
President Gerald Ford once said, "A government big enough to give you
everything you want, is a government big enough to take from you everything you
have." I believe President Ford must have had the most recent Okaloosa
County conference center proposal in mind when making this kind of comment as our
President. This plan would require an increase in the Tourist Development tax by 100% and
have the county assume full financial liability associated with the proposed conference
center. This issue is not about a conference center. The public Hearing on May 11th
at 6:00 p.m. at the Fort Walton Beach Civic Auditorium is about a 100% tax increase and a
30 year debt to the taxpayers of this county. For clarity for this column, I have broken
down my concerns about the most recent proposal for the conference center in four parts
– LMI’s study, transportation, tax increase and public/private partnerships.
LMI STUDY
Last fall, the Tourist Development Consul hired LMI to do a feasibility study on
a conference center on Okaloosa Island. I reviewed the LMI study very closely and became
aware that long after studying their information that this was more a sales job instead of
marketing information. By the time I finished reviewing, in my opinion, the unrealistic
projection they provided, I asked myself why would they try to sell me on a need for a
conference center instead of providing a good marketing analysis. The answer became
crystal clear at our workshop on the proposed conference center last month. The LMI
representatives made it clear that once this conference center is built, stated they would
like to operate and manage this conference center without any financial risk to them at
all. Liability being on the shoulders of the taxpayers of Okaloosa County. I also believe
they provide some basic unrealistic projections to further raise my curiosity.
They projected 319 events for the first year (equals an event seven days a week
for the first 10 ½ months) 291,000 new people in attendance
Two major concerts with 4,500 people in attendance at each concert in a 2,016
seat auditorium (when questioned at our workshop, LMI representative stated do not be
alarmed – it’s an indoor/outdoor concert and half of the people attending the
concerts will be outdoors)
Ask yourself this question – If you were walking in my shoes on this issue,
would you approve a 100% tax increase in the Tourist Development tax, an $18 million
dollar debt for construction of this conference center over 30 years and the $635,000
annual operation and maintenance debt in the best case scenario after reviewing this
study? When asked this question to supporters of this conference center, they clearly
stated that the reason private businesses will not construct a conference center is
because they know that they are a money loser and that businesses cannot raise taxes like
governments can. While I don’t disagree that conference centers are not only money
losers and that businesses cannot raise taxes, I also have a lot of concerns that
businesses are the ones that pay taxes or they pass tem down to the consumer. I have never
been comfortable with creating a debt and then raising taxes to pay for it.
TRANSPORTATION
No one will argue that with 291,000 new visitors transportation improvements to
accommodate the traffic congestion must be a top priority. One of the Commissioners stated
at our last commission meeting that they would not support this project if it is not a
stand-alone project that would be paid for only by the Tourist Development Council and no
other taxes would be used for this project. Specifically, the commissioner stated that
they would oppose property taxes, gas taxes, sales tax, Mid-Bay Bridge tax or any other
taxes, except for the 2 cents that they are supporting to increase the Tourist Development
tax by 100%. These are good intentions, but listed below are the facts:
The LMI study allows for a one-time $600,000 expense for traffic improvements
and a pedestrian overpass.
Pedestrian overpasses are estimated to cost between $400,000 to $500,000.
That leaves $100,000 for a one-time traffic expense for transportation
improvements for the next 30 years, according to the LMI study.
To put this in perspective, there is currently a highway widening project taking
place in Niceville from the Rocky Bayou Bridge to White Point. This project is a $12.5
million dollar cost, which can be compared to the improvements that would need to take
place around this proposed conference center over the next 30 years. If you were walking
in my shoes voting on this conference center, are you convinced that the transportation
needs are a top priority and that a one-time expense of $600,000 dollars will pay for the
traffic congestion that will take place over the next 30 years? If what the other
commissioners and other supporters of this project are saying is true about only using the
additional two cents of the Tourist Development tax, I believe that it is safe to say that
transportation is not a priority for this proposal. In my opinion, the two additional
cents that will be part of the increase, cannot pay for the $18 million dollar
construction debt, operation and maintenance debt and transportation improvements without
looking at other tax sources over the next 30 years.
TAX INCREASE
Currently, the TDC tax = $.02 on the $1 in sales tax = $2 million per year
(approximately)
Proposed increase – additional $.02 on the $1 in sales tax which would
collect approximately $2 million annually.
Increase breakdown:
$.01 = $1 million (approximately) to go towards the $18 million construction
debt over the next 30 years.
$.01 = $1 million (approximately) to go towards the $635,000 annual operation
and maintenance debt in the best case scenario.
The remaining tax increase going toward advertising and promotion.
I strongly disagree that the one penny will pay for the operation and
maintenance of this annual debt based on the LMI study with unrealistic events and revenue
they believe will be produced as a result of these events. Furthermore, there is not a
commitment to look at the transportation needs that have been assured by the supporters of
this project will come out of the Tourist Development tax dollars and not the gas tax,
sales tax, property tax or any other revenues. I do not argue that one cent will cover the
$18 million construction debt provided there is not a decline in tourism or rainy summers
for the next 30 years.
The big question is will the one cent which equals approximately $1 million pay
for the operation and maintenance, transportation improvements and unexpected expenditures
for the next 30 years for this facility. If this does not cover these expenditures, the
county commissioners will be forced to "cherry-pick" from other programs or
increase taxes to pay for this debt. I am completely convinced that if this proposal
passes, that the county commissions for the next 30 years will be forced to use property
taxes or gas taxes to help fund this whole project, including operation and maintenance
and transportation.
PUBLIC/PRIVATE PARTNERSHIPS
At our workshop, the Destin Chamber of Commerce supported a public/private
conference center with business assuming full financial responsibility.
The county has past successes in public/private partnerships.
Example #1: Wayside Park on the Okaloosa Island in 1992 cost tax payers over
$100,000 to maintain a drug infested, dangerous eyesore pubic park. In the fall of 1992,
the county leased Wayside Park to a private company to improve the park and have
controlled and approved commercial businesses with public accesses. The private company
invested over $3 million dollars of their money and the county receives over $65,000
annually in lease payments.
Example #2: The same public/private-type partnership at James Lee Park in Destin
that we all agree with the success at the public park.
In closing, I have had the privilege to serve with the Tourist Development
Council from 1990 to 1992. During the early stages of the TDC, we were very mindful of our
mission since the voters in Destin and Okaloosa Island approved the creation of this
organization. We were strongly committed to providing good promotion and advertising
for family-oriented type tourism and spent thousands of dollars our beautiful beaches
clean and thousands of dollars on improving access ways to our beautiful beaches for local
residents. We strongly opposed using TDC dollars for transportation projects and
getting into the construction and transportation business. I am afraid that the
supporters of this project have gotten a blurred vision of the TDC’s mission. I
have always tried to be pro-business and have supported a conference center under the
right conditions. I believe that a pro-business minded public official is one that
believes in keeping taxes low, supporting people’s individual freedoms and property
rights. We are all elected to be fiscally responsible and any decisions we make,
regardless of the tax structure being proposed. I strongly believe that the current
proposal has a great chance of requiring the county to subsidize this facility through
property taxes some time over the next 30 years. I have always supported improving this
property with the kid’s park, additional boat ramps and a conference center if the
right kind of proposal came along that did not put the tax payers at risk of a 30 year
span. I do believe that the four commissioners supporting this tax increase are doing what
they believe is right. However, tax increases and big government programs make me nervous
for the citizens of this county. I appreciate you taking the time to read my perspective
on the most recent Okaloosa Island conference center proposal and hope that you
will
attend the Public Hearing on May 11th at 6:00 p.m. at the Fort Walton Beach
Civic Auditorium.
Ray Sansom
(Okaloosa County Commissioner)
Note: This is a dated
featured guest column on the Destin Log written before May 11th 1999.
