Let’s Talk About Tourism
By Martin Owen, Founder, Owen Organization – www.owenorganization.com
Last month we discussed how tourism developed and how it contributes to local economies. Over the past few weeks there have been some developments to tourism here on the Northern Gulf Coast that I thought you’d find interesting.
Tourist Development Tax (TDT), commonly known as Bed Tax, was set up to be paid only by tourists and to fund the promotion of tourism in the areas where it’s collected. Now, you may think that that just means it can only be spent on advertising a destination, but that’s far from the case. Bed tax, certainly in Florida, can be used for a whole range of projects. This ranges from providing life guards on beaches, creating museums, running convention centers, developing artificial reefs, building beach access, repairing beaches where weather or tides have caused erosion, through, of course, marketing a destination.
As TDT can generate substantial amounts of revenue, it has attracted the attention of some legislators who would like to use it for non-tourist related uses, for example paving roads in non-tourist areas for example. Consequently, proposals have been put forward in the Florida Legislature to change the rules.
At the end of the recent session, most of these proposals failed to get approval. However, an amended bill did pass. Bill HB7087, which did gain approval, mandates that TDT funds can be used for infrastructure projects if the following conditions are met.
The county receives at least $10 million in TDT dollars in the immediately preceding financial year; It is approved by a two-thirds vote of the County’s governing board (The County Commissioners).
The amount of TDT dollars used is no more than 70% of the total project cost; 40% of the TDT funds are reserved for tourism marketing efforts; and An independent analysis to demonstrate the project’s positive impact on tourism is conducted.
Of course, that’s all written in very legalistic terms, but essentially, the money generated by Bed Tax has to be used for tourist purposes. So, the amended legislation just clarified the situation.
You may also have read that there had been attempts to reduce the amount of money given by the State to Visit Florida—the State’s tourist promotion board. In fact, some lawmakers wanted to take all funding away suggesting that Florida doesn’t need to promote itself to tourists.
The Governor asked for $100 million, but after a while the legislature offered $50 million. At the end of the session, the agreement was made for $76 million, the highest amount Visit Florida has ever received, which allows The Sunshine State to continue its successful efforts to be the most popular tourist destination in the world. It’s not there yet, but it’s very close with 116.5 million visitors in 2017.
With all the visitors that are likely to be attracted, we need people to look after them. As we discussed last month, every 78 visitors drives the need for one job. With 1.4 million tourism jobs in Florida alone, you have to ask where we find people to fill the roles. Many tourism jobs are seasonal, since few places have a constant visitation rate all year round. That means seasonal recruitment, seasonal housing and a constantly moving workforce. Unemployment in Northwest Florida is much lower than the rest of the country.
Branson, Missouri is a tourist town. It suffers from a seasonal need for tourism workers and currently has over 2,000 vacancies. Regrettably, like many tourist areas here on the northern Gulf Coast, there are just not enough locals to fill all those jobs so the Branson authorities are looking to recruit people from other parts of the country where unemployment rates are higher than theirs. They are recruiting from Puerto Rico as well, which of course is still suffering after the devastation of last year’s hurricane season. That’s a solution that’s also being looked at by quite a number of hospitality companies along our coast too.
It’s an essential move to both reduce unemployment levels and to solve the need for more tourism professionals.