Who’ll benefit from Mass.’ new hotel taxes?
The people who market the various corners of Massachusetts are watching the millions in new hotel taxes roll in, and they want a piece of the action.
Executives and board members from the state’s regional tourism councils hit the State House on Wednesday in a lobbying blitz, seeking a modest increase in the money that Beacon Hill sends their way.
This is state budget season, the time of year to expect these full-court presses. But the tourism councils’ plea isn’t just about scraping a few more dollars out of the state budget. It’s about ensuring their subsidies are reliable, dependable.
You can’t really blame them, given recent history. Tourism is a convenient target for the administration when money gets tight halfway through a fiscal year. As recently as two years ago, the tourism groups watched their funds get whacked in yet another round of dreaded “9C cuts.”
The councils received $6 million from the state in the current fiscal year, and another $4 million went to the Massachusetts Office of Travel and Tourism. Those figures are expected to rise to $7.3 million and $4.9 million, respectively, for the spending period that starts in July — a roughly $2 million increase. That’s because of new tax revenue expected from the MGM casino that opened last year in Springfield, and the Encore Boston Harbor casino slated to open in June.
The regional councils want more: $9 million. State hotel taxes have been going up every year, with $263 million collected in the last fiscal year, and more is on the way with a new short-term rental tax that kicks in this summer. The tourism officials argue they should reap more of that bounty, given the work they do to put heads on those beds.
(In some places, a portion of local hotel taxes goes toward promoting tourism, as well.)
They also seek something else, a small but important change: a promise that the state aid will be doled out by Sept. 1, rather than throughout the fiscal year. This can help the councils plan for the year ahead, and sign marketing contracts with assurance the money will be there.
Lawmakers gave them a reprieve for this fiscal year by including an end-of-August deadline in the state budget. Senator Joan Lovely and Representative Paul Tucker, both from Salem, filed bills that would make that requirement permanent.
By doling out all the grants early, there’s an added benefit that the tourism officials see: protection from the 9C ax that often swings midyear.
They came to the State House armed with facts and figures, courtesy of a recent Boston Foundation-funded report. It says the leisure and hospitality sector is the state’s third-largest industry, generating at least $28 billion in economic output each year. But Mark Melnik of the UMass Donahue Institute, the report’s lead author, says Massachusetts ranks 36th for state tourism subsidies, or 40th on a per-capita basis.
The tourism chiefs received some unexpected news this week when House Speaker Bob DeLeo announced he would push for an extra $2 million to promote the state’s restaurant scene. Some tourism leaders worried DeLeo would take this from their newfound casino funds. But a DeLeo spokeswoman says it would be new money set aside through the budget process and not from the casinos.
Martha Sheridan was among the newcomers to this Beacon Hill dance. She just took over as CEO of the Greater Boston Convention & Visitors Bureau, which gets about $2 million a year in state aid. She says that number is a drop from her last job, at the smaller tourism bureau in Providence, which receives its hotel tax funding directly.
The industry drives crucial revenue and jobs, she says, and improves the quality of life here. She’ll have to wait to find out whether the Legislature agrees with her about the need for additional support.