Community organizations

Occupancy Tax Board recommends more than $600K in grants to island groups

The Island Inn/original Odd Fellows Lodge got money via the Ocracoke Preservation Society for debt relief and landscaping as part of a multi-year project. Photo: C. Leinbach

By Connie Leinbach

The Ocracoke Occupancy Tax Board recently approved more than $600,000 in grants for 2020-2021.

Appropriations for Ocracoke organizations totaling $622,057, possibly the most in the fund’s history, will be voted on at the June 1 Hyde County Commissioners’ meeting for appropriation beginning July 1.

The grant fund comes from the 5% occupancy tax levied on all island lodgings. Two volunteer community boards manage these funds.

The Occupancy Tax Board manages 3% of it and is authorized to make grants “for any legal purpose.” The 2% of that fund is managed by the Ocracoke Tourism Development Authority, which is an independent body and is mandated by state law to spend at least two thirds of their portion on marketing.

While the Occupancy Tax Board is advisory only, the Hyde commissioners typically approve their appropriations. Of the total occupancy taxes collected, Hyde County receives 10% of the 3% fund and 3% of the 2% fund for administration.

Bob Chestnut, chair of the Occupancy Tax Board, said in an interview that the reason the total appropriation was so high was because of several balances that might not be paid out this fiscal year due to the COVID-19 pandemic having forced the cancellation of numerous island events this year.

At the end of March, the Occupancy Fund balance was $720,454, and he estimated that with outstanding appropriations and balances of grants that might not be spent, the fund has an estimated $697,529 available to distribute for 2020 to 2021.

“In a normal year, we’d look at last year’s collection and guess at what the May and June occupancy tax collections would be,” he said.

But this year, with the gradual easing of pandemic restrictions, no one knows what the occupancy tax collection might be, he said. Nevertheless, the grant awards are based on expected collections from one year to the next.

“But we know (next year) will be lower than last year,” he said.

For example, according to an occupancy tax report for 2017-2018, total occupancy tax (the 3% portion) collections for May and June of 2018 was $141,016. For this year, Chestnut estimates collections might be about $83,680 for those two months, yet, if Ocracoke has a good summer and fall, he still expects the fund will have a reserve of about $300,000 next year.

Back when the occupancy tax fund was inaugurated, that board decided that they would need to have a reserve in the fund no less than $300,000 for a catastrophe, he said.

“And we’ve had two,” he said. 

Earlier this year, when the Occupancy Tax Board sent out its request for grant proposals, that aggregate amount was $581,756 from nine organizations. When the COVID-19 pandemic shutdown everything, the board postponed its decision making and allowed the island nonprofits to resubmit their proposals if they wanted.

The second round garnered two more nonprofits for a total of 11, who requested $610,957.

The board on May 20 awarded grants to the following organizations:

Friends of the Ocracoke Library: $3,925 for summer learning programs and utilities for using interim space while the main library is rebuilt from Hurricane Dorian damage.
Hyde County: $45,000 for the lobbyist team in Raleigh ($10,000) and $35,000 for tram operations this year.
Ocracoke Life Saving Church: $23,000 for a generator for the food pantry/church volunteer facilities.
Mattie Arts Center in Swan Quarter: $500 for advertising.
North Carolina Coastal Land Trust: $100,000 toward acquisition of more Springer’s Point land. While in previous years, the trust received Occupancy Tax money toward building a nature trail from the Community Park ball field to Loop Shack Hill, that project has been suspended for now, Chestnut said.
Ocracoke Civic & Business Association: $88,707 for various island events, including fireworks for next year.
Ocracoke Community Center: $39,670 for flooring and siding repair and operating expenses.
Ocracoke School: $14,930 to restore the school gym and equipment and Arts Week.
Ocracoke Preservation Society: $215,306 for two events plus landscaping/ debt service and the restroom project at the Island Inn.
Ocracoke Volunteer Fire Department: $83,019 for expenses and a replacement truck.
Hyde County Sheriff’s Department: $8,000 for two more electronic speed detectionsigns.