Myrtle Beach confronts budget reality: Revenue news mixed; spending could shrink

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Jan. 30--With all the nation's gloomy economic news lately, the Myrtle Beach economic forecast for the rest of this year is a little hazy.

Building permits are down 60 percent to 80 percent from 2008's second fiscal quarter, but tourism-related revenue still grew in the second half of last year, between 2 percent and 3 percent, according to city Budget Director Mike Shelton. Property tax collections were up in January, and the losses the city will see from declines in business licenses are yet to be determined.

Each year, the city holds a three-day budget retreat in late March, and in advance of that event, Shelton and other city staff members offered a pre-budget mini-retreat Thursday so there would be no surprises.

He advised caution in spending and told City Council members adjustments might have to be made as the fiscal year progresses.

"For tough times, I was somewhat heartened," Councilman Phil Render said. "The hospitality numbers are not diving off the charts, and the property tax numbers are good. There was no real doom and gloom."

At the budget retreat, city leaders will make decisions about spending and could choose to hold off on capital projects that had been on to-do lists, such as postponing some sidewalk work, saving about $100,000 -- or half of what had been budgeted.

The city could also hold off on some drainage projects on Sancindy Lane, where about $90,000 worth of lake dredging had been budgeted, and on 44th Avenue North, where a $130,000 drainage project had been listed.

Other projects, such as the new performing arts and lecture center at the Myrtle Beach Convention Center, and the milelong boardwalk between First and 14th avenues North, remain on hold because the municipal bond market does not favor cities issuing debt right now.

Council members heard a proposal to raise fees at city recreation centers and park and sports-field rental rates, but asked for more information before debating the issue. They also heard a proposal to change city employee health care systems to save money. One plan calls for partial employee contributions. The other would provide an in-house medical clinic for city employees and dependents only.

At Thursday's meeting, council members also discussed the latest layout plan for the Myrtle Beach International Airport.

They've been asked by consultants to pass a resolution giving their approval to the plan, though that resolution is not required for the designs to move forward.

But given the contentious past history between the city and Horry County over the airport, getting that resolution would help the county by showing a united front when it approaches the Federal Aviation Administration for funding.

Council members expressed concerns Thursday that the new layout plan doesn't say Harrelson Boulevard will be extended to handle the growth in airport traffic -- a road extension the county has agreed to. Council members Chuck Martino and Wayne Gray said they would not support a resolution until that language was included in the plan. Rick Ott with construction company MB Kahn, which is handling the airport expansion, said the county hasn't finished approving the funding for the extension, but the road is on the layout plan's drawings. After about an hour of sometimes tense discussion, Ott assured council members he would include the extension in the plan's text. The next time the City Council can vote on the resolution is at its Feb. 10 meeting.

Contact LORENA ANDERSON at 444-1722.

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