A representative of a recently formed group was in Havre this morning, telling the Havre Area Chamber of Commerce’s Business Development Committee the importance of letting state leaders know how vital tourism is.
“If there is one number that speaks to tourism’s role in Montana’s economy it’s this one: 2.77 billion dollars, and this is money coming from outside of our borders into the state each year, ” Voices of Montana Tourism public relations manager Mary Paoli said. “To look at it in context, this is about the net worth of Oprah Winfrey, and this is how much money is coming into our economy each year from nonresidents. ”
Paoli said Voices of Tourism, a collaborative comprising, 17 groups and organizations so far across the state, was formed as the result of two bills that passed the 2011 Montana Legislature.
Paoli said tourism is somewhat unique because it crosses so many industries. While people may think about gas stations, airports and hotels as the businesses that benefit, the impact actually crosses over into almost every industry, both directly and indirectly. Along with gasoline, lodging and food, tourists buy groceries and retail items, attend events. That provides jobs in industries like insurance and legal services for the farmers and ranchers, businesses and other services that the tourists impact.
And that impact is growing, statewide and and locally. Paoli said the $2.77 billion in 2011 was up 10 percent from 2010, and has grown exponentially since 1987.
Hill County’s share of that was $48 million, with more than $20 million spent on gasoline, $9.5 million at restaurants and bars, $4.5 million on lodging, but also more than $4.5 million on groceries and snacks and more than $9.7 million on retail purchases.
Debbie Vandeberg, Chamber executive director, said that amount is a four-time increase from a decade ago. The amount spent in Hill County by tourists in 2004-05 was $12 million, she said.
Paoli said how much of the increase is due to the marketing by Montana’s Office of Tourism is impossible to nail down, but studies have shown, in areas including the United States as a whole and in individual states, that not promoting tourism reduces the number of tourists.
State Senate candidate Greg Jergeson, a Chinook Democrat, said his experiences in Washington show the impact. He said when he would travel to the capital as chair of the Public Service Commission, people riding the subway with him would see his University of Montana cap and come out of their shell.
“They would see my maroon cap with ‘Montana’ across the front of it and, they didn’t know which animal the pawprint was but they didn’t care about that, ” he said.
“They would see Montana and start smiling, and they would say, ‘Are you from Montana? Oh, I’ve always wanted to get to Montana. ’
“There is an aura out there, I think, everywhere in this country and around the world about Montana, ” Jergeson said. “The work that tourism promotion does for Montana is connecting people to the opportunities. How they can fulfill that dream and that wish. ”
That leads to how local leaders and organizations can promote the local attractions — not all of Montana is Glacier Park and people should experience more of the state, Jergeson added.
Vandeberg said she has received confirmation that the Chamber will receive more promotion funding through the state, $24,000, through the fiscal year ending June 2013. She is working on her marketing plan for that money, including promotions to bring Canadians from Alberta and Saskatchewan to the area.
State Rep. Kris Hansen, R-Havre, tied another issue into the presentation. She asked if Paoli had data on how much money those 10.5 million tourists who came into the state could provide in revenue if they had to pay sales taxes on their purchases.
“I would like them to pay our taxes, ” Hansen said. “I would like to see them pay at least pieces of our taxes so the rest of us don’t have to, ” adding that she would like to use a tax like that to reduce or abolish state income and property taxes.
Paoli said she worked in the tourism industry in Nevada before coming to Montana, she knows that a sales tax can provide significant revenues from tourists, although she did not have the data on the impact it would have on Montana.
“I think Montana is missing out on a huge revenue source that would take a big burden off Montana taxpayers, ” Hansen said.
Paoli said that the Legislature in 1987 imposed a 4 percent bed tax on lodging in the state, which is used to fund tourism promotion. In 1994, the Legislature added another 3 percent to the tax, which goes into the state’s general fund.
The 2011 Legislature passed two bills, House Bill 316 and House Bill 317, which would have tapped the tourism promotion to shore up the general fund budget, and to remove the 1987 requirement that the 4 percent tax goes only to tourism promotion.
“Luckily, both were vetoed, but because they passed both houses of the Legislature, we had such a close call it was kind of a wakeup call for the tourism industry, ” she said. “We realized, as a group, after that experience that we needed to do a much better job of communicating our message and to let people in our communities and our leaders understand more about why this industry is so critical to Montana’s economy. ”
She said that it has been an ongoing situation that the tourism industry has to fight to save its promotion funding. In every legislative session since 1987 except one, at least one and often multiple bills, are sponsored that would take some or all of that money from tourism, she said.
Tourism meant $48 million to Hill County in 2010. This is how it breaks out:
• More than $20 million spent on gasoline
• $9.5 million was spent at restaurants and bars
• $4.5 million went to lodging
• More than $4.5 million was spent on groceries and snacks
• $9.7 million went to retail purchases.
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