Does You Destination Need new, Stable Marketing Funding? Come to this Session!

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Elinor Pearson
5 years ago
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2 Does You Destination Need new, Stable Marketing Funding? Come to this Session!

3 John Lambeth President Civitas Susie Santo President and CEO Go Wichita CVB

4 Does Your Destination Need New, Stable Marketing Funding? CIVITAS Partnerships. Progress. Prosperity. Sacramento Los Angeles San Luis Obispo ESTO 2014 August 26, 2014 Louisville, KY

5 Overview

6 TID Structure Hotels pay an assessment Collected by the local government And managed by the DMO.

7 Characteristics of TIDs Structure Usually citywide, multiple cities or countywide

8 The TID Revolution Considering Started in West Hollywood, 1989 Slow initial growth Rapid expansion in last decade Districts Now 85 California 17 Montana 11 Washington 5 South Dakota 1 Oregon 1 Texas 1 New Jersey 1 Kansas Pennsylvania Oklahoma Wisconsin Florida Tennessee

9 Current TIDs in the United States by State

10 Five Steps to TID Formation Legislation Structure Business Plan Owner Approval Government Approval

11 A Rose by Any Other Name

12 50 State TID/BID Law Study In March of 2014 US Travel commissioned Civitas to perform a study on laws available for tourism district formation in all fifty states. Research Process 1 Identify BID/TID law 2 Review law parameters 3 Determine Home Rule

13 Ranking System A green law is tailor-made to form TIDs, it has either already been used to form TIDs or contains all necessary elements. A yellow law may potentially be used to forms TIDs, but no TIDs have been formed using the law and the law may be missing optimal TID elements. A red law cannot be used to form TIDs. Significant TID elements are not present in the law.

14 Elements of a Green TID/BID Law Business-based assessment Flexible assessment basis potentially allows for room night basis Classification or non-contiguous boundaries Nonprofit management

15 Elements of a Yellow TID/BID Law Property based Flexible assessment basis Nonprofit management or advisory board May lack flexibility in boundaries or business classification

16 Elements of a Red TID/BID Law Electorate approval No flexibility in assessment methodology Only useable by certain jurisdictions No allowance for noncontiguous boundaries or classification

17 States TID/BID Laws Red Yellow Green

18 Map of States TID/BID Laws

19 California s Green TID/BID Law 50% + 1 petition Business or property Allows for business classification Allows for Marketing and economic development and Promotion of tourism Annual report Non-profit management 5 or 10 year term, payors have opportunity to disestablish annually

20 Georgia s Yellow TID/BID Law 51% petition of taxpayers or property owners Property or business based Assessment funds may only be used for purposes authorized by the district plan Allows for advertising, promotion, and business recruitment and development Collected with other city taxes Local government may contract with nonprofit corporation to implement plan 5-10 year term

21 Alaska s Red TID/BID Law 50% owner approval Property based Limited to capital improvements only No business classification Managed by local legislative body

22 Home Rule vs. Dillon s Rule Some states have Home Rule, granting cities and/or counties the power to legislate if the state legislature has not preempted Some states have Dillon s Rule, a city and/or county must obtain permission from the state legislature before legislating in areas not specifically permitted by statute Guidelines prescribed by state constitution Taxes usually preempted Assessments usually not preempted May only apply to select cities and/or counties within the state

23 Home Rule/Charter States With Potential TID Authority Red Yellow Green

24 Map of States with Potential Home Rule/Charter Authority

25 Portland Formed a TID Using Home Rule 33% petition Allows for Promotion of commercial activity or public events Allows for Activities in support of business recruitment and development Allows for hotel only districts Assessments funds must be used according to Economic Improvement Plan

State Tourism Offices Variegated KS, CO, WA, WV, AZ, CA, LA, OK General Fund TN, NC, ND, WY, MN, PA, RI, NY, MI, MS, MA, MD, VT, VA, GA, CT SC, KY FL, NM, WI, AK, IA IN, SD, AR NH, ME OH Sales

26 State Tourism Offices Variegated KS, CO, WA, WV, AZ, CA, LA, OK General Fund TN, NC, ND, WY, MN, PA, RI, NY, MI, MS, MA, MD, VT, VA, GA, CT SC, KY FL, NM, WI, AK, IA IN, SD, AR NH, ME OH Sales TIF MO, UT Four Sources of Funding: 1) Bed Tax 2) General Fund 3) Sales Tax Increment Financing 4) Variegated * Assessment CA * Matching FL Bed Tax IL, HI, MT, DE, ID, TX, OR, AL, NE, NV, NJ, KY

27 National TID Survey Preview In May and June of this year, Civitas and SMG conducted a survey of current TIDs throughout the United States. The next few slides are a preview of the results.

28 What was the primary reason your destination formed a tourism district?

29 What was the biggest challenge in forming your district?

30 What is the assessment rate in your tourism district?

31 On average destinations increased their tourism funding by 192% after the formation of a tourism district.

32 Snapshot We have shown over 100% increase in weekend stays. Increased generated room nights by 550% since % increase in hotel stays between 2010 and Overall results of initial 5 year district (during Recession) was approximately 20:1

33 Interested in the complete report? Visit and sign up for our mailing list to receive updates on webinars offered by Civitas & SMG!

37 Questions and Comments John Lambeth, President Civitas (800)

39 Pre-TBID Funding $2.3M Transient Guest Tax $300K Partnership/ Sponsorship 100 Hotels / 8000 Rooms

AMBASSADOR HOTEL AUTUMN & ART BEST WESTERN AIRPORT INN & CONFERENCE CENTER BEST WESTERN PLUS EASTGATE INN & SUITES BEST WESTERN PREPARE WICHITA NORTH FOR HOTEL & SUCCESS SUITES BRADLEY FAIR

40 AMBASSADOR HOTEL AUTUMN & ART BEST WESTERN AIRPORT INN & CONFERENCE CENTER BEST WESTERN PLUS EASTGATE INN & SUITES BEST WESTERN PREPARE WICHITA NORTH FOR HOTEL & SUCCESS SUITES BRADLEY FAIR CANDLEWOOD SUITES-NORTHEAST CANDLEWOOD SUITES-WICHITA AIRPORT COMFORT INN EAST COURTYARD BY MARRIOTT- WICHITA AT OLD TOWN CRESTHILL SUITES DAYS INN & SUITES WICHITA EAST DAYS INN & SUITES SOUTH DAYS INN WEST DOUBLETREE BY HILTON WICHITA AIRPORT DRURY PLAZA HOTEL BROADVIEW EXPLORATION PLACE FAIRFIELD INN & SUITES MARRIOTT WICHITA Conducted DOWNTOWNYear FAIRFIELD Long INN Visitor & SUITESProfile BY MARRIOTT Study WICHITA EAST HAMPTON INN & SUITES 1-35/MULVANE HAMPTON INN & SUITES WICHITA NORTHEAST HAMPTON INN & SUITES WICHITA-WEST/AIRPORT AREA HILTON GARDEN INN HOLIDAY INN WICHITA EAST 1-35 HOLIDAY INN EXPRESS & SUITES AIRPORT HOLIDAY INN EXPRESS NORTH HOLIDAY INN EXPRESS & SUITES WICHITA AIRPORT NW HOMEWOOD SUITES BY HILTON AT THE WATERFRONT HOTEL AT OLD TOWN HOTEL AT WATERWALK HYATT REGENCY WICHITA INTRUST BANK ARENA LA QUINTA INN & SUITES AIRPORT LA QUINTA INN & SUITES WICHITA EAST MUSESUM OF WORLD TREASURES NORTHROCK SUITES OLD COWTOWN MUSEUM OLD TOWN SQUARE RESIDENCE INN BY MARRIOTT EAST AT PLAZZIO RIVERFEST SCOTSMAN INN WEST, LLC SEDGWICK COUNTY ZOO SPRINGHILL SUITES BY MARRIOTT EAST AT PLAZZIO STAYBRIDGE SUITES WICHITA SUPER 8 WICHITA SOUTH THE INN AT TALLGRASS TOWNEPLACE SUITES BY MARRIOTT WARREN THEATRE OLD TOWN WESLEY INN WICHITA ART MUSEUM WICHITA INN AIRPORT WICHITA INN NORTH WICHITA SUITES HOTEL AMBASSADOR HOTEL AUTUMN & ART BEST WESTERN AIRPORT INN & CONFERENCE CENTER BEST WESTERN PLUS EASTGATE INN & SUITES BEST WESTERN WICHITA NORTH HOTEL & SUITES BRADLEY FAIR CANDLEWOOD SUITES-NORTHEAST CANDLEWOOD SUITES-WICHITA AIRPORT COMFORT INN EAST COURTYARD BY MARRIOTT-WICHITA AT OLD TOWN CRESTHILL SUITES DAYS INN & SUITES WICHITA EAST DAYS INN & SUITES SOUTH DAYS INN WEST DOUBLETREE BY HILTON WICHITA AIRPORT DRURY PLAZA HOTEL BROADVIEW EXPLORATION PLACE FAIRFIELD INN & SUITES

41 MOST IMPORTANT FACTORS Hoteliers Support National Expert Civitas

42 WICHITA S TOURISM BUSINESS IMPROVEMENT DISTRICT Used existing BID State Statute Initial opposition from city staff Utilized both national and local experts

43 KEY TO SUCCESS CONSENSUS BUILDING Hotels City Council Local Leaders

Protest Period Planning committee submits report Notice

45 Mayor appoints district planning committee CITY PROCESS City Council adopts Resolution of Intent Public Hearing Protest Period Planning committee submits report Notice of Hearing Published Mailed Present Scope of Services

46 OVERCOMING CHALLENGES st TBID in The State Initial Opposition Local / State Requirements Boundaries Notification

47 NOTICE TO ALL 18K WICHITA BUSINESSES HOTELS 50+ ROOMS ALL WICHITA BUSINESSES

48 TBID IMPLEMENTED NOW WHAT?

49 LEISURE HOTEL GUESTS Approx. 50%: Kansas, Kansas City, MO, Oklahoma Approx. 70%: Kansas, Oklahoma, Texas, Missouri, Nebraska

51 FOUR KEY TAKEAWAYS Consensus Building Hoteliers Support National and Local Experts Research / Data

CIM & Associates 2479 Murfreesboro Road Nashville, TN Tel: Fax:

CIM & Associates 2479 Murfreesboro Road Nashville, TN Tel: Fax: Alabama AL Arkansas AR Arizona AZ California CA (Northern) CA (Southern) Paine & Murray, Inc. 13300 Violet Lane Euless, TX 76040 Tel: 817-868-9584 Fax: 817-545-1312 Email: bruce@painemurray.com Intrex