By Sarah Willoughby, executive director, and William Sullivan, chairman of the board of the Greater Wilmington Convention and Visitors Bureau
Absent the efforts of the Greater Wilmington Convention and Visitors Bureau and other local tourism promotion organizations, hotel occupancy will eventually decline as will much-needed tax revenues to the State of Delaware, county, and local governments. This move is self-defeating.
The original intent of the allocation of the public accommodations tax stated the objectives were two-fold: To provide stable funding essential for a sustained destination marketing program, and to afford an incentive for increasing travel business coming into the State. Essentially, the more visitors we attract to visit New Castle County (or our peers in Kent or Sussex) and stay in hotels, the overall public accommodations tax collection increases. We are a revenue generator for the State of Delaware.
The loss of tourism marketing will directly affect Delaware businesses and families. The Greater Wilmington Convention and Visitors Bureau, along with CVBs from Kent and Sussex counties assist in bringing in over $4 billion annually to the State in visitor spending, with over $2 billion of that spent right here in New Castle County. And, visitor spending saves each Delaware household approximately $1,400 per year.
The GWCVB is also the only organization exclusively marketing and promoting New Castle County attractions, lodging, restaurants, retail shopping, and services to visitors. What the GWCVB does pays for itself several times over.
Revenues will be lost if the GWCVB stops bringing meeting planners, tour operators, travel writers, and leisure travelers to the area. Support from these groups indicates they will go elsewhere – they need local information, it is more than just knowing hours of operation.
During Fiscal Year 2017 alone, the Greater Wilmington Convention and Visitors Bureau has brought 10 major meetings/groups to New Castle County, Delaware and assisted the lodging industry with attracting 29 more. This success has amounted to over 5,600 hotel room nights and an estimated economic impact of more than $1,508,220 in New Castle County. This directly benefits the lodging industry, restaurants, retail operations and tourism attractions. These sectors of the Delaware economy are major employers, generating personal income tax, gross receipts tax, corporate income tax and property tax revenues. The recently announced bridge over the Christiana River and three new hotels will need the support of the GWCVB to continue to bring tourists, meeting attendees and business travel to the Riverfront area.
The loss of tourism is a direct loss in revenue for the state!
Tourism creates jobs, many at entry level in the hotel and restaurant business, and a reduction in visitors coming to New Castle County would jeopardize these vital jobs. Hotels have seen steady growth as New Castle County has an ever growing base of hotel room sales for tourism and business travel. The majority of the lodging tax in Delaware is generated from these successful efforts in New Castle County and the GWCVB has led that effort.
As a word of warning on the impact this could have, here is data from states who have cut their tourism budget in the past:
* Colorado legislature, in 1993, cut its $12 million tourism marketing budget…the first state to ever do this. This resulted in a 30% decrease in Colorado’s share of U.S. domestic tourism market. This decrease was the equivalent of $1.4 billion in Colorado’s annual tourism revenue and it took 7 years for the legislature to reinstate funding to $5million in 2000. Today, in acknowledgment of the critical role of tourism marketing, the marketing budget for the state has been increased by the legislature beyond $19million.
* Pennsylvania legislature, in 2009, cut its tourism marketing budget from $30 million to $7 million. This resulted in a loss of over $600 million in tax revenues between 2009-2014.
We cannot afford to be a Colorado or Pennsylvania and lose revenue. Prevent this from happening and please contact the Joint Finance Committee and ask them to reinstate the 1% Public Accommodation Tax.
