Tourism Leaders Call on State to Invest Portion of Stimulus Funds to Grow Tourism Jobs

Feb 23, 2009, 10:51 ET from Michigan Lodging and Tourism Association

LANSING, Mich., Feb. 23 /PRNewswire-USNewswire/ -- Speaking on behalf of a coalition of tourism and business groups, three of Michigan's leading travel and resort industry executives are calling for a portion of the $18 billion federal stimulus funds to be received by Michigan to go towards a multi-year funding package to promote state tourism.

R.D. "Dan" Musser III, president of the world-renowned Grand Hotel on Mackinac Island; Stephen Kircher, president of eastern operations for Boyne USA Resorts, including three of Michigan's premier resort destinations; and Steve Yencich, president and CEO of the Michigan Lodging and Tourism Association, one of this state's leading tourism advocacy organizations, called on the legislature to invest a portion of the stimulus package to continue current funding levels for the "Pure Michigan" campaign for the next three years.

"Tourism is the world's largest industry and is the third largest industry both in the U.S. and here in Michigan," Musser said. "Whether you think the stimulus package is good or bad, the fact of the matter is Washington missed an important opportunity to stimulate the economy by failing to direct funding towards promotion of international tourism. They missed again by failing to deliver promotion funding to state tourism departments and bureaus to promote state and regional tourism. We're calling on Michigan legislators to avoid missing the mark a third time in a row."

Last year Michigan legislators passed legislation providing $30 million in funding for state tourism promotion. Recent studies indicate over the past four years an average of $2.82 in new sales tax receipts to the State are generated by every $1 invested to promote tourism. Part of the $30M investment will fund a national cable TV buy to allow "Pure Michigan" ads to be seen in all fifty states to boost travel in the coming summer season. A second portion was used to reinstate winter sports marketing ads to the "Pure Michigan" campaign which had been missing for over 15 years. And those winter ads are already producing results.

"Thanks to the winter component of 'Pure Michigan,' we've seen a decided increase in skiers coming in from other states, and we see evidence of that increase every time we walk through the parking lot and look at plates," Kircher said. "While the Michigan resident base continues to struggle, running those winter ads in states with stronger economies has enabled us to keep more of our staff employed on a year-round basis. In turn, a strong winter season allows us to keep our employees with us as we transition to spring golf and the summer vacation seasons. And that's good news for everybody."

However, officials point out that Michigan tourism is not all woods-n-water.

"People tend to think it's all about resorts and summer, but in reality the vast majority of hotel rooms, festivals, cultural attractions and fun things to do exist in metropolitan areas," said Yencich. "In fact, Metro Detroit is this state's most popular and heavily-visited destination, and there are great attractions and popular festivals that draw thousands to metropolitan areas throughout Michigan."

"If leaders from Metro Detroit, Grand Rapids, Lansing and other cities want to generate new sales tax revenues that will support our state schools and pay for fire and police protection in our cities - then full funding for 'Pure Michigan' is their best option," Yencich added. "If urban legislators want to invest in an industry that will quickly create new jobs in their districts and never, ever pull up stakes and take those Michigan jobs to another state - then permanent funding for 'Pure Michigan' with an enhanced focus on cultural and urban tourism - is the way to go."

Michigan's tourism industry is calling for a small portion of the $18 billion in federal stimulus to be received by the State to be invested in a multi-year funding package to maintain current investment levels for the next three years. A $90 million package, metered out over the next three fiscal years, would represent just one-half of one percent of the total federal commitment to Michigan, but would return over $253 million in new sales tax revenues with the majority of those revenues being received by the state in the same fiscal year they are invested.

"Study after study shows that businesses that maintain their advertising effort during economic downturns eat market share from those that don't," said Musser. "And past downturns have shown us that those families that otherwise would have flown out west or to more distant destinations tend to vacation closer to home. Given our central location, that trend cuts to the benefit of a drive-to destination like Michigan. We are less than one or two days drive away from the majority of the US population, much of which will be seeing those 'Pure Michigan' ads for the very first time."

Unfortunately, if Michigan legislators fail to act, the state's budget will drop from this year's $30M investment which funded year-round and nationwide ads, to the $5.7M revealed in the Governor's proposed budget for 2010. Industry leaders state this is a blow from which many tourism businesses may never recover.

Musser said that state residents typically generate 70% of tourism outcomes, but that Michigan's resident base has been devastated by the impact of a multi-year downturn due to decades of economic over-reliance on auto manufacturing. Michigan's worst-in-the-country hotel occupancy levels prove that for at least the short term, the state's tourism industry cannot rely on Michigan residents for profitability.

"There's never been a more important time to take the 'Pure Michigan' campaign into states with economies stronger than ours," Musser added. "Washington DC missed on two previous attempts; let's not miss again. Maintaining funding for 'Pure Michigan' quickly grows year-round jobs, tax revenues and, as more people drive to and throughout Michigan, generates new gas tax revenues for road repairs. To be effective, Michigan's stimulus package must include funding for projects that provide both long and short term relief. Investing a minute percentage of the stimulus package into 'Pure Michigan' will almost immediately create sorely needed jobs and new sales tax revenues to fund state schools and city services. And that's a winning combination for Michigan's economic future."

Tourism Improving Michigan's Economy, TIME - is a coalition of tourism and business groups that advocate increased state investment in tourism promotion without imposition of new taxes. Each year tourism businesses pay close to $1 billion in state taxes. In addition, in 2007 hotel guests were taxed or assessed an additional $35 million to fund the destination and tourism marketing efforts of the state's 70+ convention and visitor bureaus. Other members of TIME include the Michigan Lodging and Tourism Association (founding member), the Michigan Chamber of Commerce, the Michigan Association of Convention & Visitor Bureaus, the Michigan Golf Course Owners Association and numerous other tourism and business groups. Based in Lansing, the Michigan Lodging and Tourism Association is a 104 year old trade association that educates markets and advocates on behalf of Michigan's lodging and tourism industries.

SOURCE Michigan Lodging and Tourism Association