Although I have no proof of this, I'd venture to say that most of the beach money goes to pay for lifeguards, maintaining the beach, and to some extent the local maintenance workers and projects pertaining to the beach. It's also possible some of that money goes toward the additional public safety in summer. And does the town take in some profit on top, sure why not?
As far as the decision, I don't really think you're gonna see a whole lot change. Ya, this is a win for closed-minded towns and the private beach clubs that want to keep out the riff-raff, tourons, and French Canucks. But on the other hand, if the exclusion got out of control, the threat of pulling state funding would go a long way to keeping most towns in line. And for the record, I surf in some towns that are notorious for having limited public beach access, and I've never really had problems getting in the water. I for the most part beach access issues are overblown, or at least I don't think it really affects surfers. The day trippers and the tourists yes, but not surfers. But it does vary town to town so really it's relative to where you surf.