Tourism industry to show support for H.B. 34 with Tourism Day on the Hill
February 21, 2014
Nan Anderson Groves, the executive director of the Utah Tourism Industry Coalition (UTIC), plans to show Legislators that the funding appropriated to the industry has been put to good use with UTIC’s annual Tourism Day on the Hill Wednesday, Feb. 26. The event is also intended to encourage legislators to support an increase in appropriations to the Tourism Marketing Performance Fund (TMPF).
H.B. 34, the TMPF Account Amendment bill, is sponsored by Rep. Brad R. Wilson (R) and Sen. Scott K. Jenkins (R – District 20) and calls for a $3 million dollar increase, should the bill pass in both the House and the Senate, for a grand total of $15 million to be appropriated for the TMPF by the Executive Appropriations Committee in the next fiscal year.
On Tuesday, Feb. 4, the bill was passed in the House with a vote of 72 yes – 0 no – 3 absent and sent to the Senate. As of Thursday, Feb. 20, the bill was placed on the Senate 2nd Reading Calendar.
According to Anderson, Tourism Day is held to highlight tourism economic development by showing elected officials and Legislators strong industry support with a gathering and exhibit every year, the goal being to make sure that the TMPF continues to receive funding.
"We support the efforts of both the private and public sectors to measure and show the return on that investment (the TMPF)," Anderson said. "Specifically, what we do is track and stay aware of tax revenue increases in specific tourism taxes."
Those include transient room, restaurant and resort community sales taxes. The increase in revenue from those three "tourism-oriented taxes," as well as in tax revenue associated with tourism and out-of-state tourists, means an increase in the TMPF.
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Anderson said from fiscal year 2012 to fiscal year 2013, the net increase in transient room tax revenues was 12.3 percent across the 29 counties in the state. The Tourism Recreation, Cultural and Convention Facilities (TRCC) tax revenue, also known as restaurant tax, increased by 6 percent. However, the TRCC tax is only imposed in 25 counties.
Additionally, the Resort Communities Tax generated a 6.7 percent increase. A Utah Foundation research report states that "some resort cities and towns are eligible to charge an additional general sales tax known as the Resort [Communities] tax," which was first approved by the Legislature in 1988. The rationale behind the tax is to allow those cities and towns to recover some of the cost of providing basic municipal services to out-of-state visitors, the report says.
According to the Park City Chamber/Bureau, tax revenue associated with tourism grew by more than 3 percent last year, and more specifically, tax revenue associated by out-of-state tourism increased by 5.9 percent.
Vicki Varela, managing director of the Utah State Office of Tourism (UOT), said every year, they must demonstrate to the Legislature that they are building Utah’s economy "beyond the pace of inflation." So sales tax generated in tourism-oriented areas must exceed 3 percent, the cost of living in the state, in order to be eligible to increase investment in tourism marketing by to up $3 million a year.
"In this last year, our performance was almost double the pace of inflation," Varela said. "We ended up with a 5.9 percent increase in tourism spending, and about 71 percent of that was out-of-state tourism."
The amendments proposed in H.B. 34 will extend from fiscal year 2015 to fiscal year 2019, "the number of years that growth in tourism-oriented sales tax revenue is calculated as part of a formula to potentially increase annual funding for the TMPF."
Anderson said the increase in funding will enable the Utah State Office of Tourism to increase their advertising and marketing efforts.
Varela said their priority is to advertise to additional out-of-state markets. being more strategic about marketing, the UOT plans to bump up tourist spending in Utah by expanding internationally into Australia and China and domestically into Dallas, Texas.
She added that with very limited marketing to Australians, there is still a significant amount of them that love Park City skiing and visit for as long as three weeks at a time.
Anderson said UTIC is hoping to maintain Legislative momentum by showing Legislators the impact of their investment in the tourism industry and its goals for the future.
"It is our opportunity to show strength and support as one of Utah’s largest economic engines, and we, as UTIC, are unified with one voice to support the TMPF and promote the fact that tourism is one of the few economic engines that is in each of Utah’s 29 counties," she said. "We have made great strides over the past several years with the TMPF, and we anticipate performing strongly in the future as well."
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