New Special Event Fees Move Forward In Ocean City

OCEAN CITY – A revised special event fee structure will be brought back to the Mayor and Council following a favorable vote Tuesday.

In this week’s work session, Tourism and Business Development Director Tom Perlozzo and Special Events Director Frank Miller presented the Mayor and Council with a new special event fee structure featuring several revisions that were discussed in an August meeting. Officials say the proposal includes new application and use fees, among other things.

“I think what we’re trying to do is come up with something that’s reasonable, and if its reasonable then it should be acceptable, certainly by those larger promoters,” Mayor Rick Meehan said.  “As far as charging promoters for services provided, we charge property owners taxes for services provided, and I see it some ways as the same thing. So I think as long as they’re reasonable and as long as they’re charged appropriately, according to the time of the year and the size of these event, it’s something we can definitely work out.”

As proposed, the new fee structure would divide special events into tiers. Tier one, for example, would include gatherings of up to 1,000 people and would only require a permit, while tier four would include multi-site events of more than 6,000 people with a higher impact on city resources. Tiers three and four would not only require council approval but would include negotiated agreements.

Miller, however, said changes have been made to the proposed application fee. While officials initially proposed a $570 fee, they are now proposing a $250 fee for for-profit events and a $50 fee for nonprofit events, across all tiers. Nonprofits, he noted, applied to those both in Worcester County and outside of Worcester County.

“We’re now asking for something a little bit more palatable,” he said.

Miller told the council this week that staff had also revamped the proposed use fees. For for-profits, use fees for tier-one and tier-two events would total $500 a day, both in and out of season, while use fees for tier-three and tier-four events would be determined by agreement terms. For nonprofits, use fees for tier-one and tier-two events would total $500 a day in season and $250 a day out of season, while use fees for tier-three and tier-four events would be determined by agreement terms.

“This would be per day, per block,” he said.

He added that staff were also proposing a vendor fee of $150 per event in tiers one and two. For tiers three and four, officials are proposing a per-person fee model.

“That vendor fee is a new item that you did not see in the first presentation,” he said. “So it’s not one-size-fits-all. We are trying to address scalability just like we were originally.”

Councilman John Gehrig questioned if the town would collect lost revenues for events that used the Inlet parking lot. City Manager Terry McGean said it would be evaluated for each event.

“If you are using the Inlet lot in-season, on a weekend, for whatever reason, which typically we wouldn’t allow, we would charge you $500 per day per block plus lost revenue,” he replied. “Out of season, obviously there’s no lost revenue, and it’s $500 per day per block.”

Gehrig also questioned how the town would calculate fees for labor and equipment.

“If we have people that we have to dedicate to the event and it is outside of their normal duties, they’re going to get charged for it,” McGean replied. “What we’re trying to do for the private special events is encourage as much as we can the use of outside contractors.”

For his part, Public Works Director Hal Adkins said throughout his career, the town has added Springfest, Winterfest, Winefest, OC Air Show, Jeep Week, Bike Week, and more to its special events calendar. He noted, however, that public works operates with less staff.

“I’m 100% for special events, I really am,” he said. “But you’re going to break the camel’s back if you don’t have assistance from these event organizers doing some of the stuff themselves.”

In terms of the application and use fees, Gehrig said he wanted more information on how those changes would impact existing events in Ocean City. Miller noted that under the proposed structure, fees for Ravens Parade would increase from $4,544 to $4,744, while fees for the Surfers Healing event would increase from $612 to $887, to name a few examples.

“You can see with the smaller events, the way we set it up this time around it’s much more user friendly,” he said, “especially for nonprofits.”

Officials noted that the new fee structure would allow the town to cover costs associated with special events, with a portion of use fees going back to the general fund. Gehrig said he wanted to see the town categorize funds that are brought back to the general fund.

“I don’t want to encumber the funds,” he said. “But it would allow us to know what special event fees are sitting in fund balance.”

McGean agreed.

“I will need to work out details, but I think that’s doable,” he said.

After a lengthy discussion, the council voted 5-0, with Council President Matt James and Councilman Peter Buas absent, to bring back the revised special event fees to the Mayor and Council in the form of a resolution. The new fees, officials noted, would take effect on Jan. 1.

About The Author: Bethany Hooper

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Bethany Hooper has been with The Dispatch since 2016. She currently covers various general stories. Hooper graduated from Stephen Decatur High School in 2012 and the University of Maryland in 2016, where she completed double majors in journalism and economics.