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Wednesday, November 30, 2022

Beach towns, county discuss renourishment funding alternatives

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New Hanover County’s room occupancy tax revenues would come into play should the federal government stop funding periodic sand replenishment on local beaches. But a committee mulling alternatives should the federal tap turn off is still discussing how the required local match should be split.

Currently, that local match is covered by room occupancy tax revenues. But if concerns about federal money disappearing come to fruition, an inter-local agreement stipulates that Wrightsville Beach, Kure Beach and Carolina Beach would have to assume the required 17.5 percent local match out of their own budget when it’s their turn to have sand pumped onto their beach strand.

The County Commissioners appointed the group looking at alternatives after Carolina Beach and Kure Beach declared their intention to terminate the agreement. These beach towns contend the county and possibly Wilmington also should contribute, because all county residents benefit from the beach economy.

Kure Beach’s budget is small, said Mayor Dean Lambeth. A 17.5 percent share for his town would amount to about $1.4 million, based on current cost estimates for beach renourishment projects.

The cost of periodic dredging to replenish the beaches is currently split three ways, with the federal government paying 65 percent and the state and local governments responsible for 17.5 percent apiece.

Federal officials have pushed to stop paying for the projects, which coastal officials insist are needed to protect oceanfront property and keep the beaches full of sand to ensure a vibrant tourist economy.

In the event that federal money is cut off, the accommodations tax would pick up that share.

The sticking point for the committee, made up mostly of professional staff from the three beach towns, the county and Wilmington, is what constitutes a fair local split.

Another concern is how to ensure the state match will continue. Under the current scenario, state funds are contingent upon federal participation. It is vital that North Carolina continue to be a partner, officials said.

“The long pole in this tent is the state,” county shore protection coordinator Layton Bedsole told the New Hanover Port, Waterway and Beach Commission recently. “We really need the state’s 17.5 percent.”

Wrightsville Beach Town Manager Tim Owens echoed that sentiment in a recent interview.

“Honestly, a lot of this becomes more difficult if the state money is not there,” he said.

To prevent that possibility, local leaders may lobby state lawmakers for a dedicated annual beach renourishment fund, along the lines of a similar pot of money to dredge the coast’s shallow-draft inlets. The state earmarks money from the gas tax and boat licensing and certification fees for that fund.

“That would make a heck of a template for a coastal storm reduction,” Bedsole said.

With the state’s continued participation and an agreed-upon local formula, he projects the sand fund will likely be in the black at least  through 2054 — without reallocating revenues now dedicated to tourism or the Wilmington Convention Center, he told the county commissioners during their Sept. 14 meeting.

Previously, New Hanover County Commissioner Woody White, who also sits on the waterway commission, said it makes sense for coastal counties to come together rather than work independently of one another. The beaches are vital to the state’s tourism industry, and together the coastal counties represent a substantial part of the tax revenue tourism contributes to state coffers.

The commissioners did not set a specific deadline for the committee’s recommendations, but Owens and Carolina Beach Town Manager Michael Cramer said the panel expects to have at least a preliminary report by October.

The group’s discussions are based on the assumption that federal money for dredging and pumping sand is going away eventually, Cramer said. On the other hand, Lambeth said he has faith federal dollars will keep rolling in.

“As long as [David] Rouzer is our representative in Washington, I really don’t think the money is going to go away,” he said.

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