Recently, I had a friend ask about property taxes for IOP. This resident is pretty engaged and had a career in the financial world so our conversation surprised me a bit and made me wonder how many other residents might wonder about this information. Here’s how the conversation went:
Friend: “How much does IOP receive in property taxes?”
Me: “About $6.5 million is received from the County annually by IOP.
Friend: “That’s not possible there are over 4,000 housing units on IOP! That would only be about $1600 per unit and tax bills are higher than that!”
Me: “The $6.5 million is the portion IOP receives of the total collected by the County. IOP residents get billed by the County for approximately $62 million for property and personal taxes and then sends IOP its portion – the $6.5 million.
Friend: “Do you think that is a reasonable split between the County and IOP?”
Me: “Absolutely not but there isn’t a lot of flexibility on our part to adjust the amount we receive. Property tax bills include Charleston County operating millage, County Parks and Recreation millage, Charleston County School District millage, Residential garbage and recycling disposal fees, Charleston County stormwater program, Trident Technical College millage and IOP operating and debt millage. But again, the amount received by IOP from the total collected by the County is about $6.5 million annually.”
Friend: “So what are the other revenue sources for IOP?
Me: “Business licenses, business permits, short term rental licenses, parking fees, franchise fees, grants and tourism revenue. Tourism revenue makes up almost 30% of our total revenue, which helps keep our property taxes low.”
Friend: “Do you think residents know that’s how it works and the effect tourism revenue has on their bills?”
Me: “If you didn’t know it as plugged in as you are, I can’t imagine others would have a full understanding of our revenue mix.”
So, if you’re following the math, the tourism revenue our city receives creates a huge benefit for residents by keeping our property tax bills among the lowest in the area. If we didn’t have the tourism revenue, we would have to find alternative sources to support the services we provide. However, even with the tourism revenue, there are times we need to adjust the IOP portion of your tax bill like we did for this upcoming tax year for increased operating costs and a new fire truck. However, with that tourism revenue brings several potential pain points for residents – additional traffic, increased visitors, increased litter, restaurant reservations harder to come by to name a few.
City Council keeps an eye on the resident/visitor balance. We review monthly reports from the Fire and Police Departments detailing their activity for the month that detail livability items. We also review a monthly analysis of dwelling units and short-term rentals broken down by types of property and ownership (full or part time) which details the percentage of rental properties in our community.
The balancing act of residents and tourists isn’t an easy one but through ongoing monitoring, ordinances that try and keep behavior between the lines and strong engagement from the rental management companies, we will continue to keep our eyes on this important topic.
Thank you for the opportunity to serve!
Phillip Pounds, Mayor IOP
843-252-5359
ppounds@isleofpalms.gov