SOMERS POINT — City Council adopted an ordinance April 23 that changed the wording of city code regarding use of the accommodations tax from “shall” to “may.”
Council President Kirk Gerety and Councilwoman Janice Johnston, who is liaison to the Economic Development Advisory Commission, disagree on whether that benefits EDAC.
“In reference to ordinance No. 9 … we respectfully, urgently ask you to please vote no for this ordinance,” Johnston said during the meeting. “There’s no reason for it. There’s no justification for it.”
She fears that the wording opens the door for City Council to stop funding EDAC’s efforts.
“The way this ordinance is written, they can literally give us nothing. So that’s my concern,” she said.
It states that all hotel and motel occupancy tax revenues will be deposited into general revenues and included in the budget.
Prior to the change, EDAC was to receive one-third of the tax revenue, not to exceed $50,000, which it used for marketing and other methods to boost the economy. City Council had to approve each expenditure by resolution, and the amount had dwindled over the past three or four budget cycles.
The new wording states an amount not to exceed 33.3 percent of the hotel and motel tax revenue may, at the sole discretion of the governing body, be appropriated in the subsequent year’s budget as a separate line item for EDAC.
It further states that EDAC cannot spend any of the money without authorization from City Council and does not have independent authority to spend or obligate the city to spend any funds.
“City Council finds it necessary and appropriate to clarify the budgetary control and oversight of hotel and motel occupancy tax revenues to ensure fiscal responsibility and accountability,” the ordinance states.
According to Gerety, 2021 was the last time that EDAC received $50,000. The amount dropped to $20,000 in 2022 and $15,000 in 2023 before rising to $36,800 for 2024, 2025 and this year.
“This is to clean up that ordinance and give the ability to EDAC to come in and sit with the budget committee like everybody else does and make a request, and once it gets past the budget committee and it’s in the budget where we talk about it here, then you can pass a resolution guaranteeing you’re going to get your money to spend in the deal,” Gerety said.
The measure passed in a 4-3 vote, with Gerety, Councilman Howard Dill, Councilman Sean McGuigan and Councilman Jack Shields in favor and Johnston, Councilman Rick DePamphilis and Councilwoman Morgan Slaughter against.
EDAC in limbo
City Council did not appoint members to the board during its annual reorganization meeting and later attempted to split EDAC’s functions into two subcommittees, but the measure stalled Feb. 12 when it failed to receive support.
Council members had discussed changing the mission of the volunteer body, which was formed to advise officials on future and current conditions.
Gerety said Jan. 22 “there was a severe disconnect between what EDAC wanted to do and what council thought they were going to do.”
McGuigan said at the time there may be a “more efficient or effective way to do economic development.”
The board reformed in February, short two members, and held its first meeting March 23 and second April 22.
Johnston is chairwoman, Adam Merilson is vice chairman.
“We currently have eight members and hope to appoint two more at our next meeting,” Johnston said, noting there can be as many as 12.
Johnston said EDAC spends the majority of the funds it gets for marketing and supporting new events and new programs in town. Other funds go to membership in area business associations.
She added that EDAC plans to resume welcoming new businesses to the city with a ribbon-cutting ceremony, in conjunction with the Somers Point Business Association.
They also want to resume marketing efforts via social media.
“It was doing really well for us when we had a marketing company,” Johnston said.
Johnston said the funds dedicated to EDAC were part of an agreement that City Council reached with the SPBA when it increased the occupancy tax from 2 percent to 3 percent in 2014.
“It was a unanimous vote to pass this ordinance to give us a certain amount of money from the hotel motel tax so that we could raise it. The business association made a deal with this council,” she said. “To me, in my mind, now we’re disrespecting our business community by passing this ordinance, making this change without any justification and certainly no communication with the business association.”
Max Slusher, a member of the Planning Board and EDAC and head of the Atlantic County Economic Alliance, addressed the issue during public comment.
He warned of the ramifications of a new casino opening in New York, saying “it is negative or bleak or very bleak, where the outcomes are going to be in about five years.”
Slusher said now is not the time to cut back on economic development but instead put more effort into it.
“So what I’m telling you is this is not the time for us to be pulling this one back. Actually, I would highly encourage you to slam on the accelerator, keep the momentum going, and when things get tough, and they will get tough — you’ve got 360 people in this town who work in the casino industry. In five years, 100 of them might not have jobs,” Slusher said. “We have a vested interest to try to put together a plan, fund it, and move forward to try to keep our momentum.”
– By CRAIG D. SCHENCK/Sentinel staff