Thursday, March 22, 2018
News Roundup

Once the Trop is paid for, should Pinellas County's hotel tax build an aquarium?

The Clearwater Marine Aquarium's proposal for a $160 million new home poses a far-reaching question about civic finance: Can Pinellas County support both dolphins and Rays?

The aquarium, buoyed by the movie Dolphin Tale, has outgrown its aging, cramped quarters near Clearwater Beach. To build a better aquarium, it hopes to tap into various funding sources — including the county's 5 percent tax on hotel stays, known as the bed tax.

Aquarium officials note that the construction bonds for Tropicana Field that are backed by bed taxes will be paid off in 2015, potentially freeing up millions of dollars for other projects.

However, the Tampa Bay Rays want a new stadium sometime in the next decade, an endeavor that could top $600 million.

With the team and St. Petersburg Mayor Bill Foster at loggerheads, nothing concrete is in the works. But stadium backers have always counted on the bed tax as a bedrock starting point if Pinellas County has any shot at cobbling together new stadium financing.

A report by the Tampa and St. Petersburg chambers of commerce warns that time is running short. Once bed taxes going to the Trop become available in 2015, other projects all over Pinellas County may want a slice.

"It puts a premium on trying to get something done if a baseball stadium is to be done here,'' said St. Petersburg chamber president David Punzak. The report "basically says, 'Hey Rays, hey St. Pete, are you going to do a deal here or not? If not, expect other projects to line up.' ''

Pinellas County's bed tax raised $30 million last year and is expected to approach $40 million in a decade. It is doled out by the County Commission, with input from a Tourist Development Council of elected officials and hospitality industry executives.

Most of the money is plowed right back into tourism marketing. Twenty percent of it, about $6 million, goes to paying off the Trop bonds.

What happens after 2015 is anyone's guess.

In today's bond market, that Trop money could probably underwrite $80 million to $100 million in new, tourist-related construction. But officials might find it difficult to set aside cash for a hypothetical stadium.

"With the whole Rays discussion, we don't have any certainty,'' County Commission Chairman Ken Welch said. "Hopefully the Rays and Mayor Foster will get this thing moving."

'Bet your boots'

Clearwater aquarium officials say it's way too early to know how much they'd seek from the bed tax. They don't even have Clearwater voters' permission yet to build on city property. But they figure they'll need $35 million to $60 million from city, county, state and federal governments.

"We want the Rays to stay. I hope they do," said former Clearwater Mayor Frank Hibbard, who's on the aquarium's board and is a former TDC member. "But if no progress is made on a stadium, is that money just going to sit there in perpetuity? At some point you're going to move forward."

If there's no stadium deal, he said, "You can bet your boots there's going to be a line out the door."

St. Petersburg's Salvador Dali Museum is slated to get $2.5 million in bed taxes. A proposed Olympic-style BMX track in Oldsmar and the $4 million Secrets of the Sea aquarium at John's Pass Village in Madeira Beach could make a case for funding.

Then there's beach renourishment, always a priority for beach towns and local hotels. The federal government pays most of the cost, but Washington's budget woes could take out a big bite.

One-tenth of the Pinellas bed tax — $3 million a year — goes to renourishment, but pressure could mount for more.

"Beaches are the lifeblood of Pinellas tourism,'' Welch said. "The bed tax is a scarce resource, and there's a lot of competition for it. Whether it's the Rays or the Dali or the Clearwater aquarium, the bottom line is that we need to look at the return on our investment."

Heads in beds

"Return on investment" is a common refrain from county commissioners and members of the tourism council. To qualify for bed tax money, an attraction must demonstrate that it can fill hotel rooms, hence the "heads in beds" measuring stick.

County Commissioner Norm Roche thinks the bed tax will never produce enough money for a stadium deal, but he'll listen to the aquarium's pitch. "If you can tie it to true tourism return on investment, that's what the tax is for,'' he said.

Aquarium backers are prepared to oblige. They say attendance has nearly quadrupled since the movie Dolphin Tale came out. The aquarium got about 750,000 visitors last year, and an internal survey indicated that nearly 300,000 out-of-state visitors came explicitly to see Winter the dolphin, aquarium CEO David Yates said.

That compares to about 135,000 overnight visitors who came to Pinellas County in 2008 explicitly to attend a regular-season Rays game, according to one survey.

The Rays declined to comment for this story.

Geographical rivalries could push the aquarium proposal along.

With the Trop consuming a big chunk of the bed tax for years, Clearwater officials have occasionally grumbled that their city's hotels generate roughly a third of the county's bed tax without a commensurate return. Of January's $2.2 million in collections, Clearwater accounted for nearly $650,000, almost twice what St. Petersburg generated.

St. Petersburg officials are well attuned to such feelings.

"I'm into regionalism,'' said Punzak, the St. Petersburg Chamber head. "Clearwater has a great plan (for the aquarium). I hope it works.''

City Council member Leslie Curran, St. Petersburg's representative on the tourism council, said she wants to see details of the aquarium deal, "but it seems like a fair request.''

County ordinance governs how Pinellas' 5 percent tourist tax can be spent. Among other things, the percentage point that supports the Trop will sunset in 2021. Brick-and-mortar projects like an aquarium are limited to $500,000 a year for construction.

But county commissioners can change those rules with a super majority vote, as they did two years ago when they budgeted $2.5 million for the Dali Museum.

Karen Seel, a Clearwater native who was commission chair at the time, considered the impact of Dolphin Tale when the board approved the Dali request. "It was in the back of my mind that the Clearwater Marine Aquarium might come forward with a bold proposal,'' she said.

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