Resident: ‘Get Our Money Back From GWTIDA’

WILDWOOD – The state of city’s coffers was brought to the fore during the Board of Commissioners meeting on Oct. 12. At question, specifically, was the contribution made by the Greater Wildwoods Tourism Improvement and Development Authority (GWTIDA) to the municipality.
“I don’t know about you guys, you came into a big hole,” said resident Sandra Richardson. “It’s a big job. The first thing is to get our money back from GWTIDA. It needs to be going into our town – not into their operation.”
Richardson told the Commissioners that in Cape May, the tourism tax goes directly into that city’s general fund.
“They also collect $2 million in beach fees,” she said.
“I want you to understand something,” said Mayor Ernie Troiano. “We are not sitting on our hands. Tony (Commissioner Leonetti) has been to four different communities to look at beach fees.”
Wildwood currently collects a 2 percent tourism and hotel tax as well as a tourism development fee. The tax is sent directly to the state, which then sends a percentage back to GWTIDA. In turn, the authority issues annual payments to Wildwood, North Wildwood and Wildwood Crest as a beach offset payment. These payments range in the area of $200,000.
Kathy Mills asked the Commissioners about the mortgage payments on the land that the Convention Center sits upon.
“When we wanted to get paid we went to the state treasurer who told us that the state doesn’t have the money,” said Troiano.
The Convention Center sits on land that was once owned by the city.
According to John Sicilano, GWTIDA Executive Director, the authority purchased the old convention hall and its footprint back in the ‘90’s. The $3 million mortgage was assumed by the NJSEA (New Jersey Sports and Entertainment Authority) when it became owner of the new convention center.
“They assumed the assets as well as the liabilities,” Siciliano told the Herald.
As part of a financial package to bring the convention center to the Wildwoods, “The state asked the city to forgive the debt,” said Siciliano. Because the debt was already bonded, a referendum to forgive the debt would have to have been placed on a ballot, thereby slowing down the process of obtaining the new convention center.
Siciliano stated that in order to expedite the process, Wildwood, along with North Wildwood, Wildwood Crest, the State of New Jersey, the GWTIDA and NJSEA signed an omnibus agreement.
In that agreement revenue produced from operating income, tax revenue from the 2 percent tourism fee and miscellaneous income would be used to pay the costs of the facility.
Revenue would be used to pay for (in order of payment): 1) operations and maintenance of the Wildwood Convention Center; 2) any capital leads or reserves; 3) payments in lieu of tax (PILOT) to the City of Wildwood; 4) to the mortgage payment.
“It’s specified in the contract,” said Siciliano. “The reason it was crafted that way was intentional.”
The city has not received a payment on the mortgage in years. Payments in the range of $100,000 – $175,000 were made from 1999 up until 2003, when the building became functional and its operating and maintenance costs grew.
“As the building gets older,” he said, “there’s more capital required.”
“Revenues were available until the building became online,” said Siciliano.
According to Siciliano if there is not enough revenue to make the mortgage payment, the payment is deferred.
“This building was free,” he said. “The state built it and the state paid off the bonds.”
While the mortgage payments on the Convention Center may be deferred, the city is receiving $183,000 a year rent for the parking lot, according to Siciliano. The city also receives $35,000 a year in PILOT funding as well as $30,000 because it collects a tourism development fee.
“We are strictly surviving on our operating revenues and 2 percent tourism tax,” said Siciliano.
“It’s important to know that this is not the State of New Jersey saying we’re not paying our bill,” said Siciliano. “It’s the State of New Jersey following their agreement.”