Mercantile fees scrapped, Visitors Center at a loss
Boro cuts revenue source from budget; center seeks $50K
BY LAYLI WHYTE
Staff Writer

RED BANK - The borough Visitors Center is working on a "Plan B" after losing its funding source.

Last week the Borough Council eliminated $100,000 in fees from mercantile licenses from the 2006 municipal budget, $50,000 of which would have been allocated to the Visitors' Center.

Visitors Center Executive Director Margaret Mass said last week that she is hopeful of finding another source of funding since the council amended the budget to exclude the mercantile license fees on the advice of its interim chief financial officer.

The fees were to have been collected by the Visitors Center, so there would be no cost to the borough, which is what Mayor Edward J. McKenna Jr. had previously cited as the reason the fees had not been collected the past several years.

McKenna previously explained that although the borough used to collect such fees from merchants as a way of keeping track of the businesses in town, it had become cost-prohibitive to continue doing so.

He said that the Visitors Center had approached the borough with the idea of reinstating the fees last January, with the work being done by the center.

Interim Chief Financial Officer Bruce Loversidge said last week that his suggestion to the council to remove the fees from the budget was because no ordinance had been passed, or introduced, to permit the collection of mercantile license fees.

"The state requires that any revenue in the budget either be a proven source of income, meaning that you had it last year and you've proven that you'll make that money," he explained, "or if it's a new ordinance and a new revenue source, [it] is presented in an ordinance that has been passed and some amount of revenue had already been collected."

Loversidge said that the state must approve municipal budgets, and that in order to gain that approval, a budget must be balanced and revenue streams must be proven.

"I suggested that they take [the mercantile license fees and Visitors Center funds] out of the budget for now," he said, "and go forward with the budget, because we need to get our tax bills out."

Although the council has discussed the mercantile license fees at least twice during the year, an ordinance was not introduced to re-establish the fees.

Mass said that she is still holding discussions with the mayor and council about a possible source of funding for the center.

"We recently received a grant from the state," she said.

The $25,000 grant was received from the New Jersey Commerce, Economic Growth and Tourism Commission's Cooperative Marketing Sponsorship Program.

The Visitors Center was previously funded by the two hotels in the borough, the Molly Pitcher Inn and the Oyster Point Hotel.

"Then the borough enacted the hotel tax," said Mass.

Mass said that most visitors centers are funded either directly by hotels, through hotel taxes or mercantile licenses. The hotel tax adds a 3 percent tax on every room rented out in any hotel or motel in the borough.

The Molly Pitcher Inn is owned by MPI Holdings, and the Oyster Point Hotel is owned by OPI Holdings. The two companies are under the ownership of the Hovnanian family.

The hotel tax was approved in July 2004, and at the time, there was discussion about funding the center with the collected taxes; however, the council decided to put that money toward property tax relief for borough taxpayers.

"The Visitors Center has proven to be an asset to the community," Mass said, "and since we've moved to our new building, we've had more people coming in and more people volunteering with us."

The center initially was based at the Red Bank Train Station but recently moved its headquarters to East Front Street in a building owned by downtown developer Metrovation.

"I'm very optimistic that we will come to a solution," Mass said. "The businesses like us, and I think the residents are in favor of it, it's just a question of who will pay for it."

Some business owners have previously voiced skepticism at council meetings about the need for a visitors center, specifically when the $150 mercantile license fees were being discussed.

"While we have a lot of people who don't know exactly what we do," said Mass, "we encourage people, business owners to get in touch with us. We want to help them in any way we can. When visitors to the borough come in asking where to find something specific, we can give a specific answer, a specific store they can go to."

Mass said that the center's Web site receives about 700 inquiries a day, although it's harder to pinpoint how many people come to visit the actual building.

She said that the center also creates packages on request for those who attend business meetings or weddings, who might not know what the borough has to offer.

"We supply lists of restaurants and shops," Mass said, "and maps that show where parking is. And if their visit coincides with shows at the Count Basie Theatre or Two River Theater, we let them know about that, too."

Mass stressed that the center does not just serve Broad Street, but is available to promote the whole town.

"We've been around for 4 1/2 years," she said. "We've put in significant time, and I think we've proven ourselves."