Resort Businesses Take Funding Plea To County

SNOW HILL – Ocean City’s tourism industry needs to spend major bucks on advertising, resort business leaders told county elected officials this week, while seeking their support for increases in Ocean City tourism funding.

“We don’t have a number we were looking for per se. We just wanted the county to be aware of what’s happening in Ocean City,” Susan Jones, executive director of the Ocean City Hotel-Motel-Restaurant Association (OCHMRA), told the Worcester County Commissioners on Tuesday. “We wanted to say, this is what’s happening to your life’s blood.”

Ocean City has just $1.7 million to spend on advertising this year.

The delegation is after a dedicated funding source, not just a line item in each year’s budget, according to the presentation. However, said Jones, the organization is not looking for funding from the county so much as support for their requests before the town of Ocean City.

“We want more money from the city. We want the town of Ocean City to dedicate more money to tourism,” Jones said.

The county is in no position to provide more funding this year with the budget complete.

Tourism numbers in Ocean City are standing still or falling, Shenanigans owner Greg Shockley, president of the OCHMRA, told the commissioners on Tuesday.

“The number of people coming to Ocean City is stagnant. It’s not moving forward,” Shockley said. “… We’re not attracting new people because we aren’t spending enough.”

The issue is not so simple as a stable customer pool, according to Shockley. Higher costs must be passed on to the same amount of people, but with Ocean City already perceived as an expensive destination, few business owners find this a viable alternative, said Jon Tremellen of the Princess Royale Hotel.

Jones said the increased cost to vacation is a result of the increased cost of operating in the resort market.

“The cost of doing business has risen so dramatically,” said Jones. “Their profit margin has shrunk, shrunk, shrunk.”

Energy, gasoline, insurance and the minimum wage have all gone up, she told the commissioners.

As the shoulder seasons have become more popular, businesses have seen their customers migrate from the summer season to the less expensive rates and prices of the spring and fall.

The high number of new condominiums is also bad for the hotel and rental business, the OCHMRA delegation pointed out. Many condominium owners are also renting their property during the summer.

“They used to be our customers. Now they’re our competitors,” said Tremellen.

Other nearby resorts have vast advertising budgets. Destinations cited were Virginia Beach, $8 million; North Carolina’s Outer Banks, $5 million; and Myrtle Beach, $5 million, with a stated goal of $10 million.

“Our competitors are in our backyard,” said Jones. “They’re trying to get our business.”

Commissioner Bud Church, who owns a real estate office in Ocean City, mentioned seeing a promotional booth for North Carolina vacations in the Ocean City Convention Center recently.

The delegation leaned hard on the Ocean City tourist trade’s economic impact on Worcester County.

“Without tourism, Worcester County will not survive as we have known it,” said Susan Cropper of the Embers.

The 2006 Worcester County Comprehensive Plan emphasizes expanding tourism beyond Ocean City’s beach and Boardwalk to the rest of the county.

“They will not exist without Ocean City, I don’t think,” Shockley said. “The whole county will benefit from your increased investment.”

OCHMRA would like to see more money devoted to tourism from the room tax, which was raised from 3 percent to 4 percent in 2001.

In fact, the increased tax was intended for tourism promotion, Commissioner Virgil Shockley recalled.

“There was never a guarantee to fund anything specific,” said former Ocean City Mayor and current House of Delegates member Jim Mathias at the commissioner meeting. “There was no dedication at all, none.

The Ocean City town council said it would do its best to put that money back into tourism, but no promises were made, according to Mathias, who was mayor with the room tax was increased.

“There are other line items in the budget in Ocean City that go to tourism,” he said, from free concerts to keeping the beaches clean. “It is a comprehensive package.”

It is not enough, according to the OCHMRA officials in attendance.

Commissioner Louise Gulyas, who represents and lives in Ocean City, and Church said they would meet with the OCHMRA to work on a plan.

“There’s certainly a need and the return on the investment is very good,” said Church. “We need to get caught up with surrounding areas.”

Gulyas said the solution lies in teamwork.

“We need to do a collaboration here and work it out,” said Gulyas. “Let’s face it, it’s the only economic development we have in or county.” 

Jones would also like to see promotional efforts shaken up. Ocean City needs a slogan, she said. Current advertising often uses the tag line, ‘More fun here,’ but that will not brand the destination, she said.

“I think we need to get a little more creative,” said Jones.