OCEAN CITY — A recently-passed ordinance scaling up the percentage of the town’s collected room tax dedicated to marketing in future years is being challenged with a petition for referendum.
In early December, the Mayor and Council narrowly passed an ordinance altering the formula for how a percentage of room tax generated in the resort is distributed to marketing and advertising. By way of background, Ocean City’s room tax in 2019 was raised from 4.5% to 5% with about 44% dedicated to marketing and advertising and 56% dedicated to the town’s general fund to help offset the cost of increased tourism, such as increased fire and police services, public works, salaries and overtime, for example.
There are essentially two schools of thought regarding the distribution of room tax revenue in the resort. On the one hand, dedicating more of the room tax revenue to marketing and advertising will only grow the revenue source by attracting more visitors to Ocean City. On the other hand, attracting more visitors to Ocean City, particularly in the shoulder seasons and offseason with more and more special events puts additional strain on essential services such as police, fire and paramedics, public works and other departments.
The option ultimately approved by a 4-2 council vote in December was to continue to direct 2% of the increase in room tax revenue to destination marketing, advertising, promotions, sponsorships and special events and the like for fiscal years 2022 and 2023, while scaling up the percentage for that purpose to 2.1% in fiscal year 2024 and 2.2% in fiscal year 2025.
Former Councilman Vince Gisriel from the beginning publicly challenged the ordinance on the grounds the scaled increases in the amount of room tax dedicated under the broad umbrella of marketing and advertising would exponentially grow those budgets at a rate faster than the general fund growth. To that end, in December he sent a letter and a draft petition for a referendum on the room tax ordinance to the city solicitor for approval.
Still laughing at the constant money grab Rickie. I guess its time for another of those so called “closed sessions”. Be careful RICK…everyone is watching.