PANAMA CITY — The Panama City Commission approved a bed tax Tuesday, but commissioners were worried about who would control the spending.
The 5 percent tax will be levied on each dollar charged for the rent or lease of short-term accommodations.
City Attorney Nevin Zimmerman said the Bay County Tourism Development Council (TDC) and County Commission ultimately have the authority to decide how the money is spent. Commissioner John Kady brought up the hypothetical situation of building a sports complex with bed tax revenue. Zimmerman said the TDC could prohibit Panama City from building the complex if the TDC does not want the competition with Panama City Beach.
“There are inherent tensions on how money is spent,” Zimmerman said of similar situations with other cities. “It’s their tax; they’re ultimately responsible for how it’s spent.”
Commissioner Kenneth Brown shared Kady’s concern.
“We can do all this work and there’s a possibility it may not become a reality,” he said.
Interim City Manager Jeff Brown said the language of the tax is purposefully broad. The revenue is meant for the promotion of tourism but that could be the development of buildings such as museums and civic centers to attract tourists. It also could be used to pay employees to staff and maintain those developments.
Mayor Greg Brudnicki suggested a cap of 30 percent of funding to go to staff. Commissioners tabled that.
“Salaries can eat you alive,” Brudnicki said.
With the tax proposal, the commission will establish a nonprofit corporation to appropriate revenue. Zimmerman’s recommendation is the commission act as the board for the corporation.
Before it can be implemented, the tax must be approved by the County Commission, which likely would discuss in during its first meeting in July. Then the tax would go to a referendum countywide as soon as October. The soonest the tax can go into effect for the city would be Jan. 31.
In other action Tuesday, commissioners:
-Approved hiring attorneys Doug Sale of Panama City Beach and Mark Mustain of Tallahassee to serve as special counsel for the Panama City Marina Project.
-Approved a $27,562 additive charge for property for the Panama Marina Civic Project. Jeff Brown said the purchase is intended to move the road split further south to avoid a drainage pipe.
-Approved $2,367 for epoxy to keep sand from moving through seawalls along the marina.
-Agreed Panama City would follow the Florida sales tax holidays for school supplies Aug. 2-4.
-Acting as the Community Redevelopment Agency, approved a plan for a cultural heritage tourism district along Martin Luther King Jr. Boulevard.
