Right away $ 2 million loan From the county’s general fund now granted by the St. Johns County Commission, local tourism leader Richard Goldman says his organization can do more to help the industry recover.
Goldman, president and CEO of the St. Augustine, Ponte Vedra & The Beaches Visitors and Convention Bureau, said the recent County Commission vote means more dollars will be available for advertising. That will help the province’s largest industry – tourism – continue to recover from the financial impact of COVID-19.
While St. Augustine is buzzing, visitor traffic is still not normal, Goldman said.
“There is still a lot to do,” he said.
COVID hits St. Johns County’s tax revenues
The visitors and conference office provides marketing for the province as a destination under a contract with the province. The advertising is paid by the 4% bed tax, which is added to the short stay bills.
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But due to the pandemic, companies temporarily closed their doors, significantly reducing the number of visitors to the city. It was a profound change for a city struggling to cope with the heavy load of tourism prior to the pandemic.
With far fewer people staying in short-term stays, tax revenues on the bed took a big hit.
The province expected to receive about $ 7.5 million in tax revenue for fiscal year 2020 for beds, instead of the originally estimated more than $ 13.2 million. That’s why the county cut Goldman’s budget.
The tax revenues from the bed are spread over multiple money jars to spend.
In May 2020, the Commission unanimously approved the $ 2 million loan that would come from the general fund’s reserves for category 1 bed tax, which is for direct promotion and advertising expenses.
The agreement was that the province would lend itself money and pay for itself; in particular, the same pot of bed tax income, category 1, would be used to repay the general fund reserves over the course of up to five years.
That meant that the money used to repay the loan would not be available for promoting tourism.
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But Commissioner Henry Dean recently suggested changing course and instead forgive the loan so that more bed tax money can be spent on advertising and attracting tourism. The commissioners approved the forgiveness of the loan 4-1 on Tuesday. Commissioner Paul Waldron voted against the move.
Dean said, “I think our main industry – and what really makes this county rock and roll – is all the different attractions, restaurants, hotels, places to visit that are fun and draw millions of tourists. really a few., really hard-working entrepreneurs in all those endeavors.
“And I think just as Congress has provided trillions of dollars across the country in response to COVID, I think we as a County Commission should step up and cancel this debt and allow the tourism industry to move forward without taking over this burden for the next five years. “
The county may still be able to replenish the general fund’s lost dollars.
Jesse Dunn, director of the Office of Management and Budget, said the county may be able to get compensation for the tax dollars lost from the $ 1.9 trillion US federal bailout bill. The Commission has asked provincial officials to follow this option as part of the vote.
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The issue generated mixed reactions from the Commission.
Waldron said he would only support the forgiveness of the loan if the county’s general fund is repaid.
“But when it comes back from the general fund, that’s a loan they agreed to, one that comes from every taxpayer in St. Johns County, not just those who work in that industry. And I don’t think it’s right for us to forgive a loan they’ve agreed to, ”he said.
Waldron added that the county could also extend the reimbursement window instead.
Commissioner Christian Whitehurst said the problem hit him as the owner of a small business that relies on pedestrians – he owns two Fast Fix Jewelry & Watch Repair stores.
“So you can imagine how damaging it was financially to have the government say to me last year, ‘You can’t make a living. Your income drops to zero,’ while they continue to earn their full salary,” he said.
He said forgiving the loan is the right thing to help entrepreneurs.
A few entrepreneurs have asked the Commission for forgiveness of the loan.
Phil McDaniel, co-founder and CEO of the St. Augustine Distillery, cited statistics on the impact of the tourism industry on St. Johns County as the largest employer. He noted that the province competes with other popular tourist destinations for high-spending visitors.
“In order for our VCB (Visitor and Convention Agency) to compete effectively, we need as many advertising dollars as possible from the TDC (Tourist Development Council) budget … And if those visitors come here and spend their leisure dollars in the province, they are Hundreds of the small businesses that make up our tourism industry will quickly recover from the very challenging year we have already had, ”said McDaniel.
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