Public-Private Pact Eyed For State Tourism

Public-Private Pact Eyed For State Tourism
Tourism yields a big economic impact in Washington, and supports many jobs. But stakeholders say that the benefits could be even more robust if the lawmakers and the industry can leverage funding to take the budget for statewide tourism promotion back to earlier levels. One of the big draws in Washington is hiking. Seen here: the ascent of Mount Ellinor, in the Olympic Range, a 6.2-mile round trip with an elevation gain of 3,300 feet. Photo: Matt Rosenberg.

A bipartisan group of lawmakers and tourism industry advocates have come together around HB 1123. The bipartisan bill would provide up to $5 million per biennium to market the state to potential visitors, if the industry pitches in twice that amount. It would also create the Washington Tourism Marketing Authority to oversee promotional efforts. The public-private effort would seek to capitalize on the state’s abundant natural and cultural assets to build the already considerable economic impact of tourism here.

Although tourism is Washington’s 4th largest economic sector, budget constraints have led to sharp cuts in state support for its promotion since 2011. State tourism General Fund support dwindled from $7.5 million in the 2005-07 biennium to $1 million in the 2013-15 biennium. Statewide tourism got no General Fund monies for 2015-17. Since 2011, the burden has fallen upon the private sector to keep the lights on for state tourism marketing.

The prime sponsor of HB 1123 is State Rep. Cary Condotta (R-12), and it includes support from State Rep. Andrew Barkis (R-2), plus State Reps. Cindy Ryu (D-32), Steve Kirby (D-29) and Gael Tarleton (D-36). The companion measure SB 5251 has been introduced, also with bipartisan backing.

The proposed public-private alliance comes at a good time. The U.S. Travel Association this month called Washington a “chilling cautionary tale” of a state’s tourism funding gone flat.

Barkis, Ranking Minority Member of the House Community Development, Housing, and Tribal Affairs Committee, said the state funding pullback on tourism was “a classic example of what not to do,” and “a good wake up…we need to be looking at all areas where we can promote growth in business and revenues.” Barkis added, Washingtonians know “that we have an incredible state, and we need to get that word out better so people will come and visit here, and ultimately spend their dollars here.”

$21 Billion Annual Impact

Tourism is too large an industry to remain without meatier state funding, according to the nonprofit Washington Tourism Alliance (WTA). On January 18, WTA told the House community development panel that visitors are generating $21 billion in direct and indirect spending annually.

Washington’s tourism sector produces $1.8 billion in state and local tax revenue, and creates 170,500 jobs. It stimulates about $16.5 billion in direct spending, particularly in food services, accommodations, local transportation, and gas.

Last year, lawmakers introduced a Senate bill somewhat similar to this year’s tourism legislation, but there was opposition in the House. The bill cleared the Senate Trade and Economic Development Committee, and Ways and Means, but languished in Rules.

State Rep. Brian Blake (D-19) sits on House committees covering commerce, and business, and chairs Agriculture and Natural Resources. His district includes scenic sections of Grays Harbor, Pacific, Wahkiakum, and Cowlitz counties. He says tourism is an important part of the 19th district’s changing economy.

Skin In The Game

Blake said, “…the tourism folks worked on what I thought was a pretty strong proposal last year…Rep. Condotta took issue with the structure of their proposal…but in good faith, stepped up, and said he would work with them…hopefully we’ll be able to get (HB 1123) passed, and facilitate that investment in a partnership with a two-to-one match. It gives those folks some skin in the game, and gives us some skin in the game…that’s a sector of the economy where there’s definitely room for growth.”

In 2010, Washington ranked 48th in the nation for statewide tourism marketing expenditures. In 2011, it was dead last. In response, some key stakeholders formed the WTA. The Alliance’s largest partners include the Port of Seattle, Boeing, Visit Seattle, Port Madison Enterprises and the Washington State Convention Center.

The Alliance last year had a budget of about $700,000, drawn almost entirely from private contributions, website marketing and registration fees. In contrast, Oregon in 2016 had a tourism budget of $17 million; Idaho, $8 million; Montana, $19 million, and California, $62 million.

The new statewide Tourism Marketing Authority would be funded through 0.1 percent of taxes collected on car rentals, lodgings and restaurants; with the two-to-one private sector match required for those revenues to be used.

Local and regional tourism promotion agencies in Washington state have long promoted their own jurisdictions, rather than the whole state, and often draw upon dedicated shares of revenue sources such as the car rental and hotel room taxes. Visit Seattle had a $22.1 million budget (page 6) last year, while Visit Spokane spent $3,2 million. The Snohomish County Tourism Bureau’s marketing and operational costs were almost $1.3 million in 2016, and the bureau budgeted about $1.2 million for 2017.

Said Barkis, “In my district, I have Mount Rainier, one of the biggest draws for the state. We have small communities that locally benefit from regional or statewide tourism, so people will frequent these stores in and around Mount Rainier.”

Aligning Local, Regional Programs

Ryu told Lens, “The bill proposal is the best bipartisan effort” to come to an agreement. “With that, what the state can do is coordinate among the various smaller efforts that are already happening. Even more importantly” the bill would connect the state “with the U.S. effort” so that Washington would “not be the blank hole that we are, on the map of tourism funding and state programming.”

Ryu continued, “I think it’s a way of having that coordinated effort and strengthening the tourism industry that we already have, by knitting them together.”

WTA will be holding a public event in Olympia on January 24, in support of its effort to secure long-term funding from the legislature. The community development committee is scheduled to hold a public hearing on HB 1123 on January 25.

Ramping Up

If the bill passes, Ryu said the next steps include adding staff to run the new authority and a new official state tourism website, because the existing one belongs to WRA.

“Once we get the bare minimum skeletal crew going, then we can work on raising more money to match the two-for-one. When the whole program is going fully implemented, then every two years we think we can get it…robustly functioning at $5 million from the state and $10 from the industry every two years.”

Additional reporting by Matt Rosenberg.


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