Washington Tourism Marketing Authority.
Established in 2018, the Washington Tourism Marketing Authority (Authority) is responsible for contracting for statewide tourism marketing services that promote tourism in Washington. The Authority is governed by a board of directors consisting of four members of the Legislature and nine representatives, appointed by the Governor, with expertise in the tourism industry and related businesses, including hotel, restaurant, outdoor recreation, attractions, retail, and rental car businesses. A nonvoting advisory committee advises the board and is comprised of one representative each from the Department of Commerce, the State Parks and Recreation Commission, the Department of Transportation, representatives of other state agencies as deemed appropriate by the Authority, and one member from a federally recognized Indian tribe.
Statewide Tourism Marketing Account.
Of the taxes collected on the retail sales of lodging, car rentals, and restaurants, 0.2 percent must be deposited into the Statewide Tourism Marketing Account (Account). Revenue collections may be up to $3 million per biennium and must be deposited into the Account. The deposit to the Account may only occur if the Legislature authorizes the deposit in the biennial omnibus appropriation act.
Expenditures from the Account may only be made for allowable expenses related to implementation of the statewide tourism program and operation of the Authority. The Account is subject to appropriation. A two-to-one nonstate or state fund, other than State General Fund, match must be provided for all expenditures from the Account. A match may consist of nonstate or state fund, other than State General Fund, cash contributions, the value of an advertising equivalency contribution, or an in-kind contribution. The Authority's board of directors must determine criteria for what qualifies as an in-kind contribution.
Use of Funds.
From amounts appropriated for the Authority and from other moneys available to it, the Authority may use funds for the following:
A one-to-one, instead of two-to-one, nonstate or state fund, other than State General Fund, match must be provided for all expenditures from the Account.
The amount of revenue collected from the tax on the retail sales of lodging, car rentals, and restaurants that must be deposited into the Account is increased from up to $3 million per biennium to up to $26 million.
(In support) When the state tourism office closed, there was a gap that local jurisdictions had to step up and fill. There were many small communities that could not fill this gap. The lack of state spending was a major detriment to the whole state. Washington lost ground in terms of market share in tax dollars collected from tourism. Tourism is a stable business that can build a robust economy. The work that the tourism office is doing is transformative. This industry is important to the state and is not getting the support it needs.
There has been much work done to learn what it would take to rebuild a tourism program that would benefit the people of Washington state. What is needed is a way to sustain the program and operate it year-round without cash flow issues. The $13 million in the bill is what is needed for an operational baseline. It is a small amount of money relative to the amount of sales tax collected on lodging, rental cars, and restaurants. This operational baseline will communicate to the industry that there is a future for the tourism program.
The hospitality industry has been very involved in rebuilding the statewide tourism program. But since the pandemic, convention and business travel is lagging significantly. Things are improving but they have not recovered. A tourism marketing program will help ensure a robust tourism industry throughout the years. This bill is an investment in the industry and in the state. Neighboring states make significant investments, and this puts Washington behind.
Tourism is vital to the local economy. It contributes to visitor spending and supports local businesses. Rural communities depend on the leadership of the State of Washington Tourism. It has contributed to pandemic recovery with grants, training, technical assistance, planning, and communication. It has provided tools that rural communities need. More state funding will allow expansion of the groundbreaking and visionary work. A fully funded, statewide tourism program is vital helping rural communities build their local tourism economy.
This bill is important for tourism and for the wine industry. The wine industry has a $9.5 billion impact on Washington's state and local economies. The industry is still recovering, and tourism is critical to the industry. Many wineries are located in rural communities and work is being done to reinvigorate those communities and bring in tourists. The wine industry shares many goals with the statewide tourism program.
(Opposed) None.
The Appropriations Committee recommended changing the amount of revenue collected from the tax on the retail sales of lodging, car rentals, and restaurants that must be deposited into the account to up to $9 million per biennium, rather than up to $26 million per biennium.
(In support) Washington needs to invest in tourism. Tourism promotes economic growth by creating jobs and regenerative spending. When out-of-state tourists visit Washington, they buy goods and services, which leads to increased tax revenues that can then support social services and other public goods in our state. When the Washington Tourism Marketing Authority was established in 2018, and when funding was provided on a one-time basis in response to the COVID-19 pandemic, it created momentum. The tourism marketing program is seeing great results in keeping tourism-dependent industries afloat and bringing in more visitors. The program has also focused on supporting tourism in rural and underserved communities and communities of color. This assistance has been invaluable for rural communities in encouraging sustainable tourism. Many business sectors, including hospitality industries, the wine industry, and LGBTQ+ businesses, have been assisted by this program. There is a considerable return on investment for every state dollar invested in this program.
This bill will allow the program to maintain the same level of funding as it received during the COVID-19 pandemic. If funding is not provided, many successful programs will be rolled back. Support is still needed as the hospitality industry continues to recover from declines in business and convention-related travel. Public and private partners also invest in the program through cash and in-kind contributions. The bill would increase support without raising new taxes. Other states fund tourism marketing programs at much higher levels than Washington. This bill would bring Washington in line with other states.
(Opposed) None.