From the May 21, 2013 edition of the Missoulian
Guest column by SANDRA JOHNSON-THARES, MIKE SCHOLZ and RACENE FRIEDE
If 2013 is like last year, Montanans can expect to welcome more than 5 million travelers this summer and close to 11 million throughout the full year. This is great news for thousands of small businesses around the state.
It’s also great news for residents. Each time travelers choose to spend their time and money in Montana, our economy becomes richer. When travelers select Montana over Wyoming, Colorado, Utah or many other options, our job market grows stronger and our tax base increases.
Montana has made major strides as a competitive travel destination – growing the number of annual visitors from 3 million in the late 1980s to nearly 11 million today. What fueled that growth? Industry members largely credit the state’s lodging tax. Since 1987 this tax paid by overnight lodging guests has funded Montana’s tourism marketing programs. Rather than leaving travel-related jobs and revenues on the table for other states to take, competitive marketing has helped tourism become a leading Montana industry over the past quarter-century. This is especially noteworthy because Montana has developed its tourism industry without tapping general fund revenues as many states do.
Last year non-resident traveler spending reached an all-time high of $3.2 billion, averaging nearly $9 million each day in new revenue for our state according to the Institute for Tourism and Recreation Research at the University of Montana.
Spending by travelers supports nearly 43,000 local jobs and a healthy tourism industry creates opportunities in many fields. For instance, the development of a new hotel generates demand for architects, engineers, bankers, construction crews, material and equipment suppliers, landscapers, lawyers, accountants and insurance brokers as well as hotel staff.
Because tourism generates 8.1 percent of all local and state taxes, travelers also help pay Montana’s bills and reduce the annual tax burden for residents by about $750 per household.
Tourism is among the state’s greatest economic development success stories in recent history, and we need help from state leaders and residents to keep a good thing going.
As industry members we’re concerned by a few proposals introduced during recent legislative sessions that would bolster government funds at the expense of programs that make Montana a competitive travel destination.
In 2011, legislation passed to redirect 10 percent of destination marketing funds to state coffers, along with legislation permanently terminating the state’s requirement to use a portion of lodging tax funds for tourism marketing and infrastructure programs supporting Montana State Parks, the Montana Historical Society and the Montana Heritage Commission. These bills, which were fortunately vetoed, signal that successful programs fueling one of Montana’s largest industries are in jeopardy when legislators seek alternative sources to balance the budget.
This year, the legislature considered a bill that would allow 41 of 56 Montana counties to fund county and municipal infrastructure projects with an additional tax on overnight lodging. On the surface the bill appeared to help eastern Montana towns affected by the oil boom, but it could have raised lodging taxes to uncompetitively high levels in the majority of Montana’s communities. The impact could have particularly hurt Billings, Great Falls and Helena by making these city’s bids for lucrative conventions and sports tournaments less competitive. We are grateful that legislators did not advance the bill out of committee, but proposals like this reinforce our concern that tourism is not as valued or understood as it should be.
We want to work more collaboratively with state leaders to protect the proven programs that allow Montana to compete for travel-related revenues and jobs. Industry members are already taking steps to realize this goal by building a coalition of tourism stakeholders called Voices of Montana Tourism. It is encouraging that more than 65 legislators and candidates attended Voices of Montana Tourism roundtables during the 2012 election season to learn more about this leading state industry. We look forward to even greater engagement during the upcoming election cycle.
As states around the country mark National Travel and Tourism Week this week, we ask Montana leaders and residents to help this part of our economy thrive into the future. Get started by visiting VoicesofMontanaTourism.com.
Sandra Johnson-Thares is chair of the Montana Lodging and Hospitality Association, and Mike Scholz and Racene Friede are co-chairs of Voices of Montana Tourism.