OCEAN CITY – Budget cuts handed down from Annapolis concerning the tourism advertising budget don’t appear to be a major concern for Ocean City, at least not for now.
Ocean City Assistant Tourism Director Debbie Travers said that the almost $2.2 million in tourism budget cuts that the state included in its $297 million across-the-board budget cut will not “directly effect the way that Ocean City plans to market the town or the money available for this year.”
The town receives $187,500 from state grants that are not included or impacted based on the $2.2 million cut recently in Annapolis. Travers did cite a potential impact on Ocean City’s tourism spending if those grants were trimmed further based on the failing economy.
“The only potential impact looming would be if the state cuts the grants program that awards money to each county/city in the state,” she said. “If further budget cuts are made at the state level, the grants program could become a casualty and therefore we would lose that funding.”
At a recent Tourism Commission meeting, the state’s idea to cut money for tourism was mind boggling for Mayor Rick Meehan.
“It just doesn’t make sense to me to cut funding for a revenue generator like tourism. It seems counterproductive,” he said.
Regardless of the numbers, Travers said that any cuts to the budget to advertise tourism in Maryland stings a bit, as it is a collaborative effort between the state and Ocean City, which becomes the state’s second largest city in summer months.
That said, the bottom line looks pretty grim in Annapolis as Comptroller Peter Franchot cited an 8.7-percent decline in the General Fund and a recent report in Annapolis showed that the state could see a $432 million budget shortfall in fiscal year 2009 and up to $1 billion in fiscal year 2010 if the economy continues down the same path.
In 2007, the state cut $280 million from the budget including $870,000 from tourism.
What seems to be saving Ocean City from immediate impact from these cuts is the revenue created from the half-percent raise in the room tax last year from 4 percent to 4.5 percent, and the obvious fact that little if any is actually drawn from the $2.2 million in cuts. The increase in the room tax generated $1.7 million in revenue that the town used to advertise regionally and nationally.
Travers said that usually, the grant money used is “never worked into the budget until we know that we are getting it, because we are never sure if we are going to. When we get it, we use it as a bonus to add advertisements in different mediums like radio, TV, newspaper and online.”