WORCESTER COUNTY, Md. - Hotel guests in Worcester County will soon see a slightly higher tax on their room bills, but local leaders say the area remains one of the more affordable beach destinations on the East Coast.
Worcester County commissioners voted unanimously this week to raise the county hotel room tax from 5 percent to 6 percent. When combined with Maryland’s sales tax on lodging, that brings the total tax on hotel stays in Ocean City to about 12 percent.
Commissioner Ted Elder said the county will still be below many competing beach markets.
“We’re the lowest on the East Coast, and we still are after that 1% increase,” Elder said. “It’ll help with the tourism, with the advertising and the other things that need to be done with that money. I think it’s a plus for everybody.”
The increase follows years of debate between the county and Ocean City, along with a required change in state law to allow the higher cap. Elder said the agreement was tied in part to ongoing talks over Ocean City’s sewer plant and wastewater needs in communities along Route 611.
Elder estimates the change will bring in roughly $300,000 a year for Worcester County and more than $5 million for Ocean City. County officials say their share will help offset inflation and maintain basic services. Ocean City plans to use a portion of its share to help fund tourism marketing and public safety.
Ocean City Director of Tourism and Economic Development Tom Perlozzo said the town’s costs have climbed along with demand.
He pointed to a renewed police contract that he said is “roughly $13 million, above and beyond the current contract,” and said the new revenue will help support clean streets, a safe boardwalk and other services visitors expect.
Perlozzo said the increase is projected to generate close to $5 million for the town, with more than $3 million going into the general fund and the rest directed toward advertising and tourism efforts at the direction of the mayor and council.
Hotel managers argue that even with the higher room tax, Ocean City and Worcester County are still priced below other beach towns.
“It’s a vast difference from the 15% higher that [Virginia Beach] is charging,” said Keith Whisenant, general manager of the Residence Inn by Marriott in Ocean City. “We’re still the local closest best option, and we’re the most economical option still.”
Local officials say the goal is to have visitors shoulder more of the cost of running a busy resort community, while keeping the area competitive for families planning a trip to the beach.