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State of Washington Tourism Program Update

Issuer
Congressional materials
Document type
2024 09 18 A32203 D273915 Swt State Of Washington Tourism Program Update
Date
2024-09-18
Case
2024 09 18 A32203 D273915 Swt State Of Washington Tourism Program Update

Summary

A slide presentation titled State of Washington Tourism Program Update, dated September 18, 2024 and presented by the organization's CEO. It describes industry recovery programs, including a $3.5 million distribution of federal recovery funds for 2024-2025, and destination development grants for 2024 with 215 applicants and 55 grants awarded. It reports marketing campaign returns and a competitive analysis of lodging performance, international visitation and tourism-supported employment against 2019 levels. A funding history lists sources including a 2021-23 legislative proviso of federal relief funds of $12M. The presentation proposes a funding model pairing $4.5M in general fund appropriation with a $23M Tourism Improvement District, and cites projected additional visitor expenditures of $14.6 billion for 2025–2034.

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Cite this document

“State of Washington Tourism Program Update.” Original at app.leg.wa.gov, dated 2024-09-18. Archived at Pandemic Darlings, https://pandemicdarlings.com/source-documents/2024-09-18-2024-09-18-a32203-d273915-swt-state-of-washington-tourism-program-update/, SHA-256 1aa682ec1b7ae21614bf1f7829416b09743a900b368aaf05b9036ad52164236e.

Full text

STATE OF WASHINGTON TOURISM
      PROGRAM UPDATE



         David Blandford, CEO
      State of Washington Tourism
              September 18, 2024
INDUSTRY RECOVERY AND
DEVELOPMENT

Rural Tourism Support program
Technical assistance & development
 grants
DMO recovery grants
Agritourism grants
Industry co-op programs – consumer
 data and research
$3.5 million distribution of in federal
 recovery funds for Washington’s
 tourism industry in 2024-2025
 (contracted by Dept. of Commerce)
                                              2.
                            Photo via Port of Seattle
  DESTINATION
  DEVELOPMENT
  GRANTS
• 9 Programs total:
  •   Rural Tourism Marketing and
      Production Grant
  • Sports Incentivization Grant
  • Rural Tourism Data and Research Grant
  • Indigenous Marketing and Production
    Grant
  • Arts and Culture Grant
  • Technical Assistance Grant
  • Tourism Regeneration Grant
  • Rural Tourism Support Program
  • Indigenous Tourism Support Program



                                                         1.
                                            Photo via Port of Seattle
DESTINATION DEVELOPMENT GRANTS
                2024 Grants:

                • 215 Applicants

                • $4.92M in applications

                • 55 grants awarded

                • $1,062M allocated

                • $750,000 Tourism Regeneration
                  grant open in September
MARKETING
CAMPAIGN RESULTS
• 2022 launch: $33:1 ROI
• 2022-2023: $69:1 ROI
• 2023-2024: $184:1 ROI

Time in market has increased
campaign efficiency, but
that stands to be lost
without sustainable funding
RESPONSIBLE TRAVELER, ADVISORY & EDUCATION

• Balanced promotions
   • Seasons, need periods
   • Sensitive communities
   • Public and tribal lands
• Coordination
   • State agencies
   • Emergency management
• Public/traveler education
• Responsible Outdoor Travel
  Summit
                                                   TRAVEL TRADE &
                                                   OVERSEAS TOURISM
                                                   Year-round trade show
                                                    promotion
                                                   Tour operator/media
    IPW in LA                                       FAMs
                                                   Co-op programs for
                                                    industry
                                                   In-market
                                                    representation:
                                                        UK/Ireland, Germany,
                                                         Australia
                                                   Project contracts:
                                                        Japan, South Korea,
                                                         France, Benelux
FAM Visit to Nordic   Wild WA Wine Event, London
                                                                                7.
    Museum
COMPETITIVE ANALYSIS: OVERVIEW
Washington ranked 5th in lodging industry size and last in tourism office funding




                                                                               Source: State of Washington Tourism, U.S. Travel Association, STR


                                                                                                                                                   8
COMPETITIVE ANALYSIS: LODGING PERFORMANCE
Washington trailed pre-pandemic levels by 4% more than its competitive set in 2023


                       Washington
                       Competitive set average
                       United States
                                                                          99             99 98
                                                                               97
                                                                     95             95
                                                           93
                                                                88
                                                      84



                                            69
                                                 64
                                       59



Source: STR
                        2019            2020           2021           2022           2023
                                                                                                 9
COMPETITIVE ANALYSIS: INTERNATIONAL MARKETS
International visitation recovery in Washington trailed competitive set by 37%

                            Washington
                            Competitive set average
                            United States



                                                                                            79 82

                                                                                 62
                                                                           57

                                                                                      42

                                                                28   30
                                                  24 23   22 26
                                            19




Source: Tourism Economics   2019                 2020      2021           2022             2023
                                                                                                    10
COMPETITIVE ANALYSIS: TOURISM-SUPPORTED EMPLOYMENT
  Washington leisure and hospitality industry jobs recovery trailed competitive set by 5% in 2023

                  Washington
                  Competitive set average
                                                                                          104
                  United States
                                                                         100         99         100
                                                                                95
                                                                    94
                                                         90
                                                               85
                                        81         82
                                              79
                                  75




  Source: BLS
                  2019                 2020             2021             2022             2023
                                                                                                      11
                   THE ROAD TO HERE:
          COBBLING TOGETHER FUNDS TO RE-BUILD

2011       State tourism office closed in Great Recession
2018       Base funding/2:1 private/public match = $1.5M annually
2021-22    Port of Seattle recovery partnership = $1.5M
2021-23    Legislative proviso (federal relief funds) = $12M
2023-24    Port of Seattle overseas marketing contract = $800,000
2023-25    Biennial base funding increase/industry 1:1 match = $4.5M



                                                                       12.
13.
BENCHMARK
STATE TOURISM
STUDY
• SWT ROI: 29:1
• WA significantly
  under-funded
  relative to market
  size
• WA stands to gain
  $14.6 billion in next
  decade with budget
  comparable to
  competing western
  states
         SUCCESSFUL DESTINATIONS TAP USER FEES


Brand USA          $250 million annual budget
                   Fees paid by Visa Waiver country visitors to U.S.
                   Matched 1:1 by travel industry/corporations
                   Re-authorized by Congress every six years

Travel Oregon      $38 million annual budget
                   Tax paid by hotel guests via 1.5% transient lodging tax

Visit California   $164 million annual budget
                   Fees of visitors via a Tourism Improvement District
                   30-year success, 97% favorability of TID businesses
                                                                         15.
                      VISIT CALIFORNIA TID

Tourism businesses across multiple segments pass on fees at 0.2% of a
dollar (two tenths of a cent) to customers:


   • Hotels/motels ​             • Attractions​
   • Food service ​              • Amusement parks​
   • Wineries/breweries ​        • Museums/performing arts​
   • Passenger car rental ​      • Tour operators/outfitters​
   • Sightseeing ​               • Ski operations​
   • Transportation​             • Golf operations​



                                                                    16.
 SAMPLE TID ASSESSMENT FEES AT .2% OF A DOLLAR

$200 hotel folio        40 cents
$20 attraction ticket   4 cents
$400 car rental         80 cents
$100 restaurant bill    10 cents
$150 guided tour        30 cents

Administrative Ease:
DOR collects assessments in alignment
with tax collections/schedules




                                                 17.
         A SUSTAINABLE + COMPETITIVE
 STATE TOURISM FUNDING MODEL FOR WASHINGTON

$4.5M   Maintain general fund appropriation

        Critical operational base funding
        Align with Dept. of Commerce, regional resiliency programs

$23M    Tourism improvement District (TID)

        No General Fund impact
        Industry self-assessment within state BIA law (not tax)
        Nominal fees passed to visitors (0.2% of a dollar)
        Balanced across broad business segments and geographies
                                                                  18.
        RESULTS: STATEWIDE, YEAR-ROUND IMPACT




Always-on    International     Niche        Visitor    Off-season
 marketing   markets fully   campaigns    management    and need
campaigns      activated     nationwide    programs      periods




                                                                    19.
       OUTCOME: MORE BUSINESS FOR WASHINGTON


Projected Returns with a $25M budget, 2025–2034
(source: Tourism Economics):

 $14.6 billion   Additional visitor expenditures
 2.1 billion     Additional room revenue ($250M/year average)
 $1.4 billion    Additional state and local tax revenue
 $116 million    Additional lodging tax revenue



                                                                 20.
THANK YOU
ANY QUESTIONS?


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