OCEAN CITY — With a hotel boom in West Ocean City in recent years, the lines are increasingly blurred between Ocean City and its neighbor just across the bridge, but what does it mean in terms of marketing and an equitable share of the room tax collected.
That is a question the Ocean City Tourism Committee undertook this week and the short answer is there is no clear answer.
In 2017, Worcester County collected around $17 million in room tax, of which the lion’s share, or about $16.5 million came from Ocean City proper. The remaining $500,000 came from the county at-large, but most from the growing hotel presence in West Ocean City.
West Ocean City and Ocean City proper share the same 21842 zip code, which is how the county’s room tax contributions are distinguished. As a result, the lines are blurred between the jurisdictions. What is known, however, is the resort’s own marketing efforts including its online presence and visitor’s guide include West Ocean City hotels.
A cursory Internet search of “Ocean City hotels” also list the West Ocean City hotels under the larger umbrella. For example, the Expedia website lists the top 20 best values in Ocean City, or which four are located in West Ocean City. The question remains should the town’s marketing efforts include West Ocean City at the expense of businesses on the island, and should a more equitable formula for redistributing the room tax be explored?
Committee chair Mary Knight said research into the disparity proved difficult because the jurisdictions share the same zip code.
“We couldn’t distinguish what came out of the 21842 zip code from Ocean City versus West Ocean City,” she said. “About half a million was collected in Worcester County in 2017. One new hotel reported contributing $80,000, so if you extrapolate that out, it appears West Ocean City hotels contribute about half a million dollars.”
Committee member Matt James pointed out those who stay in West Ocean City enjoy all the amenities the resort has to offer while putting additional stress on municipal services without an in-kind contribution to the room tax and the cost of shared marketing.
“How do we differentiate West Ocean City from Ocean City?” he said. “The people staying in hotels in West Ocean City are utilizing everything we have to offer including our beach and our Boardwalk. They are also using our services like police, fire, water, public works etc.”
Knight said one clear solution would be to separate the two jurisdictions by zip code, but that would be difficult if not impossible.
“It’s very difficult to get a different zip code,” she said. “The postal service is not amenable to doing that unless there is a real need.”
Committee member Michael James said as recently as a few years ago, the town’s marketing efforts did not include the West Ocean City businesses.
“Around 2010 or 2011, we made an effort to really market Ocean City and not all of Worcester County,” he said. “There was an effort to really focus our advertising dollars on the island. The whole economy was tougher then.”
Ocean City Hotel-Motel-Restaurant Association (OCHMRA) Executive Director Susan Jones said the point was likely moot if the two jurisdictions could not be separated.
“From a visitor’s standpoint, they don’t know the difference,” she said. “What’s the point of examining these numbers if we can’t differentiate one from the other?”
Jones explained the OCHMRA website breaks up its hotel listings geographically with areas like West Ocean City, the Inlet to 27th Street and so on. She said among the organization’s membership, about 20 percent of the restaurants are in West Ocean City, while just six of the 186 hotels and motels were on the west side of the bridge.
Of course, many of the visitors staying in hotels and motels in West Ocean City frequent the Boardwalk and the resort’s many restaurants, amusements and other amenities, which contributes indirectly to the town’s tax base. However, they also create a demand for more services in the form of water and sewer, police and fire protection, for example. What that trade-off is cannot be quantified, but Matt James believes it doesn’t fall in Ocean City’s favor.
“There is no real benefit for the town of Ocean City when they stay in West Ocean City,” he said. “We have what they are coming here for.”
Committee member Todd Ferrante said while most who stay in West Ocean City come for the beach and Boardwalk and other resort amenities, not all venture onto the island.
“People stay over there for a reason,” he said. “It’s a little different niche. Maybe they are staying over for the shopping and the outlets. Maybe they prefer to go the Assateague. For whatever reason, I don’t know how much time we want to spend on trying to distinguish that.”
The committee agreed to take a deeper dive into data before determining what strategy to employ, if anything.
“I say we don’t try for anything yet,” said committee member John Gehrig. “I think there might be better options. We don’t say what we want until we have all of the information.”