House Bill Analysis - ESSB 6592, Concerning Tourism Authorities (hearing date 2/26/20)
Summary
A House Bill Analysis of ESSB 6592, concerning tourism authorities, prepared by the Office of Program Research for the Innovation, Technology & Economic Development Committee of the Washington State House of Representatives, with a hearing date of 2/26/20. The sponsors are the Senate Committee on Local Government, originally sponsored by Senators Holy, Hunt, Takko and Keiser. The brief summary says the bill allows a county with a population of 40,000 or less, or any city or town within the county, to form a tourism promotion area, and allows legislative authorities of tourism promotion areas to impose an additional charge on the furnishing of lodging. It states that the bill takes effect 90 days after adjournment of the session in which it is passed.
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“House Bill Analysis - ESSB 6592, Concerning Tourism Authorities (hearing date 2/26/20).”
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Washington State BILL
House of Representatives
Office of Program Research ANALYSIS
Innovation, Technology & Economic
Development Committee
ESSB 6592
Brief Description: Concerning tourism authorities.
Sponsors: Senate Committee on Local Government (originally sponsored by Senators Holy,
Hunt, Takko and Keiser).
Brief Summary of Engrossed Substitute Bill
Amends the definition of a "legislative authority" to allow a county with a population
of 40,000 or less, or any city or town within the county, to form a tourism promotion
area.
Allows legislative authorities of tourism promotion areas to impose an additional
charge of up to $3 on the furnishing of lodging by a lodging business located in the
area.
Allows lodging businesses to, by petition, vote to remove charges imposed by the
legislative authority.
Hearing Date: 2/26/20
Staff: Kyle Raymond (786-7190).
Background:
In 2003 the Legislature authorized the creation of tourism promotion areas. The legislative body
of any county with a population of more than 40,000, or any city or town within such a county,
may form a Tourism Promotion Area (TPA) to generate revenue for tourism promotion.
Counties with a population of 40,000 or less, and cities or towns within those counties, are not
eligible.
A TPA may include the entire jurisdiction or only a portion, and multiple jurisdictions may
establish a joint TPA through interlocal agreement. However, a county TPA may only include
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This analysis was prepared by non-partisan legislative staff for the use of legislative
members in their deliberations. This analysis is not a part of the legislation nor does it
constitute a statement of legislative intent.
House Bill Analysis -1- ESSB 6592
unincorporated areas, unless the county has signed an interlocal agreement with one or more
cities to form a joint TPA.
In a county with a population of 1 million or more, the legislative body must be comprised of
two or more jurisdictions acting under an interlocal agreement. In 2015, the Legislature created
an exception for Federal Way to form a TPA by itself.
Within the TPA, the legislative body may impose a charge up to $2 per room per night on
lodging businesses with 40 or more rooms. The legislative body may establish up to six different
lodging classifications, with different rates in each. The classifications must be based on
geographic location, number of rooms, or room revenue.
Lodging businesses with less than 40 rooms are exempt and may not be assessed, and some
jurisdictions have established other exemptions by policy.
The lodging businesses collect the charges and remit them to the Department of Revenue, which
deposits the revenues into the Local Tourism Promotion Account. The state treasurer distributes
money in the account monthly to the legislative authority on whose behalf the money was
collected.
The revenue must be used for "tourism promotion," which is defined as activities and
expenditures designed to increase tourism and convention business, including but not limited to
advertising, publicizing, or otherwise distributing information to attract and welcome tourists,
and operating tourism destination marketing organizations.
The legislative body may appoint an existing advisory board or create a new advisory board to
make recommendations on the use of the revenues, but the legislative body has sole discretion as
to how the funds are used to promote tourism. The legislative authority may contract with
tourism destination marketing organizations or other similar organizations to administer the
operation of the area.
Formation of a tourism promotion area is initiated by a petition to the legislative body of the city
or county. The petition must describe the proposed TPA boundaries, the total estimated revenues,
and the proposed uses of the revenues, and it must contain the signatures of people who operate
lodging businesses in the proposed TPA who would pay at least 60 percent of the proposed
charges. The legislative body must hold a public hearing on the establishment of the TPA.
Summary of Bill:
Counties with a population of 40,000 or less, and cities or towns within those counties, are
eligible to form a Tourism Promotion Area (TPA).
A legislative authority may impose an additional charge up to $3 on the furnishing of lodging by
a lodging business located in the area. This change is in addition to the $2 charge and expires
July 1, 2027.
The legislative authority imposing the charge has sole discretion as to how the revenue derived
from the charge is to be used to promote tourism that increases the number of tourists to the area.
House Bill Analysis -2- ESSB 6592
A "tourist" means a person who travels for business or pleasure on a trip:
away from the person's place of residence or business and stays overnight in paid
accommodations;
to a place at least 50 miles away one way by driving distance from the person's place of
residence or business for the day or stays overnight, but island communities without land
access are exempt from the mileage requirement; or
to another country or state outside of the person's place of residence or business.
If a majority of the lodging businesses assessed the charges petition to have the charge removed,
the legislative authority must remove the charge.
Each TPA must conduct a program review of the additional TPA charge. The review must be
completed and submitted to the appropriate committees of the Legislature by January 1, 2026.
The review must:
analyze how TPA charge funds were used during the period when the additional charge
was in place;
identify additional marketing and promotional measures conducted or purchased with
additional funds beyond the current $2 charge;
assess whether additional TPA charges above $2 contributed to an actual increase in the
number of tourists; and
assess the average additional cost per visit per tourist due to additional TPA charges
above $2.
Appropriation: None.
Fiscal Note: Available.
Effective Date: The bill takes effect 90 days after adjournment of the session in which the bill is
passed.
House Bill Analysis -3- ESSB 6592
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