Dare board sets hearing on occupancy tax increase for July 15

The Dare County Board of Commissioners has set a public hearing on a proposed one percent increase in the occupancy tax for Monday, July 15, at 5:30 during the regularly scheduled July board meeting.

The tax increase would go to funding beach nourishment.

Three towns that are interested in nourishment – Duck, Kitty Hawk, and Kill Devil Hills — have asked for the increase, and the Dare board also wants to do beach nourishment on Hatteras Island.

The occupancy tax in Dare County is now five percent, one cent of which is dedicated to beach nourishment projects and is kept in the Shoreline Management Fund. In 2010, the General Assembly gave the county permission to levy an additional one percent.

However, the additional tax was never levied.  The money in the fund covered nourishment several years ago in the only town in the county to do a project so far.

At the board meeting on June 17, county manager Bobby Outten told the commissioners that nourishment projects in the three towns could cost between $47 and $62 million.  The estimated amount for Hatteras Island nourishment is not yet available.

Outten also said that representatives of the towns and county were to meet with the U.S. Army Corps of Engineers earlier this month to explore combining forces on some of the nourishment costs.

Figures provided at the meeting showed that $3.8 million was collected for the Shoreline Management Fund in fiscal year 2012.  If another one percent tax is levied, estimates are that the fund could have a balance of about $25 million by end of the 2015 fiscal year.

The occupancy tax is charged on all accommodations in the county – on top of a 6.75 percent sales tax.  The total tax on lodgings, including rental cottages and motel rooms, is now 11.75 and would increase to 12.75 if the additional tax is approved by the board.

The board hopes to act by Sept. 1, so that rental management companies can make plans to levy the correct tax on renters for next year.