Officials in Charleston County, South Carolina want to offer incentives to attract a major discount airline to Charleston International Airport, and they plan to pay for it through a new fee on car rentals, according to The Post and Courier.
Helen Hill, executive director of the Charleston Area Convention and Visitors Bureau, predicted that if the 5-percent rental car fees are approved, a low-cost carrier would come to the airport. Hill said she thinks a state incentive plan is still possible this year, and said the proposed county rental car fee could provide matching funds.
The fee would work like a tax on the car rental firms, which would be required to pay an amount equal to 5 percent of gross rental charges each month. The fee would apply to any passenger vehicle rented or leased for 90 days or less in Charleston County.
The funds would go toward raising $1.5 million yearly for incentives to attract a low-cost carrier, joint marketing and other initiatives. The Post article stated that all indications are that Southwest Airlines is the carrier, but local officials would not confirm that.
County council vice chairman Elliott Summey said tourists should help pay for the incentives. Summey claimed that car rental companies are on board with the plan, because a new discount carrier would mean more customers for them.
However, Enterprise Holdings and the American Car Rental Association (ACRA) are opposed to the proposed car rental fee.
"We are extremely alarmed by the proposed Charleston County car rental tax. In addition, we are confused, since no one from Charleston County has even discussed this matter with us - one of the largest car rental companies in Charleston County with an airport location as well as an extensive network of neighborhood branch offices serving thousands of local citizens throughout the region," Enterprise spokeswoman Laura Bryant told the newspaper.
Bryant also said Enterprise understood the county's desire to attract a low-cost airline, but that the proposed tax is unfair, discriminatory and arbitrary. She added that car rental customers already pay more than 20 percent in taxes and fees, and a $3.50 daily consolidated facility charge, at the Charleston International Airport.
ACRA President Bob Barton said the proposed fee could prompt existing airlines who service Charleston County to accuse it of creating unfair competition and lobby for a government subsidy.
"It is simply bad public policy for one industry to subsidize not only another industry, but in this case a specific individual company," Barton said.
Colorado-based airline expert Mike Boyd said the only way South Carolina cities will lure similar business is to have "...somebody open their wallet." He added, however, that a surge in rental car prices could turn off potential visitors.
The Charleston County Council was scheduled to vote on the fee Tuesday.
The cap on surge pricing would have been the first such law in the country.