CONWAY, S.C. (WMBF) – The ongoing battle over hospitality fees continues after a judge failed to sign off on a proposed settlement agreement between Myrtle Beach and Horry County.
Both sides came together Wednesday morning for a hearing that lasted about an hour.
Myrtle Beach filed the lawsuit in March 2019 against Horry County, claiming that the county was illegally taking millions of dollars in hospitality fees from the municipalities.
It stems from a resolution passed in 1996 that allowed Horry County to collect a 1.5% hospitality tax. The money was spent on numerous road projects throughout the county.
The resolution was slated to expire in 2017.
But in December 2016, the county passed an ordinance that extended the Sunset Provision on the 1.5% hospitality fee to Jan. 1, 2022. According to Myrtle Beach leaders, the county did not receive their consent.
It was announced earlier this summer that Horry County and all the municipalities involved in the case reached a settlement agreement.
In August the city didn’t agree to how to divide up the money, so both sides presented their case in front of a judge today.
The city of Myrtle Beach’s plan would split the money between municipalities and the South Carolina Bar Foundation 50-50. One million dollars would go to documented claims, meaning each would get $9 million. Horry County presented their plan to the judge where the $18 million to go to the municipalities, with $1 million still set aside for documented claims.
But that’s where issues arose, causing debate after the county said the plan for how the city of Myrtle Beach wants to use the money isn’t in line with how the current local accommodations tax law is written.
“This whole issue of how this money can be spent, this money based on our agreement, can only be spent on 6-1530 and 6-1730. The South Carolina Bar Foundation can’t use that money for that purpose,” an attorney for Horry County said.
“That does not require the bar foundation to use the money for that purpose. The bar foundation would be required to limit to access to justice programs within Horry County it would not be all over the state," an attorney for Myrtle Beach said in response.
The judge told both sides to submit orders within 30 days. The city spokesperson for Myrtle Beach and the spokesperson for Horry County both said they do not expect to return to the courtroom, with the decision now in the hands of the judge.
The South Carolina Supreme Court will have the final say if the lower courts fail to approve the settlement agreement.