OCEAN CITY — The Ocean City Special Improvement District was created with the idea that what’s good for some businesses on the island is good for all, but that concept is being challenged.

The district was created 17 years ago to market and beautify the city’s commercial center, made up of three different zones, including the city’s Ninth Street gateway, downtown Asbury Avenue and the retail core of the Boardwalk.

That area comprises a couple hundred shops, restaurants and attractions, all of which pay a special tax to fund the district’s promotional efforts. The worth of that additional assessment has always been debated, but even more so lately.

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“It’s understandable why,” said Walt Hohman, owner of Wards Bakery on Asbury Avenue. “There are all sorts of different businesses, and everyone has different ideas about what to do. That’s why everyone’s storefront looks different.”

Last year, business owners on Ninth Street decided to withdraw from Main Street Ocean City, the organization that supported the district along with the Boardwalk Merchants Association, because they felt they were not getting enough attention. Now they have their own group.

With less funding from those businesses and increasing expenses, MSOC laid off its full-time director in January and has yet to hire a part-time replacement.

“The most important thing to know is we are continuing with our program for all events and keeping an active focus on the downtown,” said Paul Cunningham, current president of the organization.

Still, that leaves the district more splintered than it has been since its creation just months after Hurricane Sandy permanently closed some businesses and slowed commerce for many others.

The original purpose of the entity was for all business owners there to work together. Creating a special improvement district, or SID, is a common way for commercial areas to pool resources and create ways to draw in more customers.

The state passed a law allowing their creation in 1984, and as of last year there were 87 districts in 65 municipalities and 19 counties. Locally, Atlantic City, Cape May City, North Wildwood, Wildwood and Vineland also have their own SIDs.

Ocean City formed its district in 1995 with much support from local business owners. Scores of people turned out at meetings to advocate for it and then-Mayor Henry “Bud” Knight signed the ordinance immediately after approval to demonstrate enthusiasm for the plan.

The borders encompass Asbury Avenue from Sixth to 11th streets, Ninth Street from the foot of the Route 52 bridge to Asbury Avenue, and the Boardwalk from Sixth to Fifteenth streets. That leaves the areas divided into three different corridors.

The Business and Neighborhood Development Association (BAND) is the volunteer group that technically runs the district, although the Main Street, Boardwalk and Ninth Street groups all work together to administer it.

In February, the City Council approved the district’s nearly $260,000 annual budget — more than $30,000 less than last year — of which about $184,200 comes from the special assessment and about $75,400 comes from Boardwalk fundraisers and sponsorships.

“It’s imperative for our events,” said Wes Kazmarck, president of the Boardwalk Merchants Association, during the council meeting. “We can’t get anything done without it … but it doesn’t work unless we have it collectively.”

The new budget includes $22,500 for an executive director from the tax money collected from Asbury Avenue businesses, less than the nearly $45,000 paid to former Executive Director Marcia Shallcross last year through money from the Asbury Avenue and Ninth Street businesses and BAND fundraising.

Cunningham, owner of the P. Francis gift shop on Asbury Avenue, said it is certainly beneficial to have a full-time employee handling the necessary work of the organization, but he said he expects everyone involved to be able to move forward in a positive direction.

Next month, a joint meeting is being planned to solicit opinions from business owners about what they like, don’t like and would like in terms of beautification and marketing. He said better cooperation is going to be a goal in the future.

Rosemary Kuperstein, owner of Asbury Attic, said no store owner likes to pay an additional tax, but she thinks most merchants understand that businesses have costs, and that advertising is a necessary cost.

That is something she thinks will never end, as the city is always looking to bring in new people, and the district’s leadership plays an important role in that.

“They do a lot of work,” she said. “I give them an ‘A’ for effort.”

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