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Arlington Business Booster Recommends Replacing Tourism Funds

by ARLnow.com | March 3, 2011 at 3:35 pm | 769 views | 44 Comments

Officials from Arlington’s economic development office asked the county board to fund the county’s tourism promotion efforts now that the hotel tax surcharge that funded such efforts is being allowed to expire.

“I think we have a great program,” Arlington Economic Development Director Terry Holzheimer said at a board work session this afternoon. “The program has value.”

“This board has been put in a very difficult position,” said board member Jay Fisette, adding that he  hope to “come up with some way to share” the cost of tourism promotion with local hotels to save money from the already-stretched county budget.

Although Arlington has developed “much, much stronger ties to the local hotel industry,” Holzheimer told the board that he did not believe hotel operators could be persuaded to make a voluntary contribution to a tourism fund from their bottom line.

“Even if we got a few to do it, I don’t think the majority would do it,” he said.

With that in mind, Holzheimer asked the board to allocate $450,000 from the county’s budget to fund the Convention and Visitor service between between Jan. 1, 2012, when the current surcharge expires, and June 1, 2012, when the surcharge could be reinstated.

Holzheimer said he believes the Virginia General Assembly, which rejected the renewal of Arlington’s 0.25 percent hotel tax surcharge last month, might be persuaded to to pass it next year.

“I do believe we’ll mount an effort next year and be successful,” Holzheimer said.

Board member Barbara Favola, however, was skeptical of the General Assembly passing an Arlington-friendly tax measure.

“I don’t think that’s a realistic position,” she said.

The board will adopt a final FY 2012 budget in April.

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  • Lou

    Has anybody actually asked any hotels what they think about all this?

    • http://www.arlnow.com ARLnow.com

      The hotels supported the tax surcharge.

      • Lou

        Well I kind of figured that. I meant now that it’s off the table, are they offering any ideas, or are they content to just sit back and wait for the money to be squeezed out of the budget for them?

        Because when you come down to it, to funnel any additional revenue towards supporting their businesses, someone needs to make the case that it’s worth the budget or tax hit. I really get the sense this is just an effort to keep a couple of people employed.

      • Hank

        Of course they aren’t complaining about it. They get to add the 0.25% as a fee to the end of the hotel bill (i.e. doesn’t hurt them) then they get free advertising from the CVB.

        The bonus is that they still get to advertise a lower rate (one that does not include the fee)

  • Arlington Independent

    Why can’t the hotels voluntarily agree to fund the effort and just add the surcharge to their bills (I suppose they couldn’t call it a “tax”?

    • Thes

      This is a great opportunity for the libertarians to test their alternative to government! I bet those free-riders will be quickly ostracized… or whatever is supposed to happen to them. Come on Mercatus Center, let’s see you address this with your free-market solutions!

      Congratulations on your opportunity to live free of government oppression. We’ll be watching for your success!

      • Lou

        What’s next? Hotels are Too Big To Fail?

      • Arlwhenever

        Sounds like you haven’t heard of Orbitz or Priceline. Hotels, motels and others in the travel and hospitality sector join in cooperative marketing, advertising and fulfillment efforts all the time, free of government direction or control.

        • Thes

          Oh, I’ve heard of those things, alright. I’m talking about the promotion functions Arlington County was doing at the request of the hotel industry, using the tax they asked the legislature for (but did not this year receive). In other words, I’m responding to Arlington Independent’s suggestion, above.

      • MW

        Thes,
        If you are interested in the economics of this particular political phenomenon you should take a look at. James M. Buchanan 1965. “An Economic Theory of Clubs.” Economica, 32, pp. 1-14

        For some reason your comment doesn’t strike me as an honest attempt to help our community solve this issue, with economics or politics. Keep it classy!

        • Thes

          Here is my honest attempt to “help our community solve this issue”: stop encouraging the troglodytes — the ones who watch FOX News, who control our House of Delegates and who wouldn’t know a confidence interval from a supply curve — to believe that there is a “scientific” basis to say that government is always, or even usually, bad.

          I specifically asked above for a demonstration, not a theory. Apparently the Arlington hospitality industry was (morally? economically?) wrong to ask to be taxed for this service. The right wing won a victory here, so they need to put up or shut up. Make it work! I have no interest whatsoever in arguing whether advertisements urging foreigners to vacation in Arlington are public goods or club goods. Instead I want those who oppose this tax to step up to the plate — today, now — and produce a better result than government did. Either show us the money or stop pretending your theory is better.

          Also, my link above seems not to have been inserted properly, so I’m trying again.

          • Lou

            This is not a “right wing victory”. You call out people who watch Fox News, and then here you are being the only one to ramp up the rhetoric to Fox News levels. Maybe you’re the one watching too much cable news.

            Even Zimmerman is not a big fan of this tax. He does not seem as concerned as you about the void left by government’s dis-involvement in helping big businesses in the County. Is he watching too much (or too little) Fox News? Get over it.

          • Thes

            Neither the Earth nor Arlington revolves around Mr. Zimmmerman. It is the *hospitality industry* that wants this tax, that asked for this tax, and was denied this tax by — yes it was — right-wingers. In response to “Arlington Independent” who asked the question, I therefore call upon these right-wingers (or, more specifically their enablers in the right-wing think tank industry) to solve the *hospitality industry’s* stated problem, which is their stated need for a collective effort to promote tourism to Arlington.

            I notice that my calls for responsibility by the right wing enablers for the real-world consequences of their followers’ actions have resulted in an amazing turnaround in who suddenly is concerned about “ramped up rhetoric” and the need for commenters to be “constructive.” I’m being serious. You puppies just caught the car bumper. Chew on it.

          • Lou

            Your problem is you still see this as problem for government to solve. Nobody here, or out there in the think-tankosphere that you keep shaking your fist at has any responsibility to solve the hotel industries problems.

          • Thes

            Nope. For purposes of my response to “Arlington Independent’s” question, I am agnostic about whether government is needed here. The “fact on the ground” now is that the right-wingers have forbidden government to act. You won that battle and so cannot ask to re-fight it.

            And thus you have made my point. The right-wing think-tank industry is happy to work deny the hotel industry a tax and service they seek, purely for ideological purposes and they have no alternative to offer. They have no interest or ability to actually make society better.

            That is why they should be ignored, or worse.

          • Lou

            You’re really better off putting this back into the realm of “Some people in Richmond hate Arlington because of the HOT lanes lawsuit”. Going to Tilt over right wing ideology and think tanks here is making you seem a bit unhinged.

          • Thes

            That would not be responsive to “Arlington Independent’s” question. Changing the subject does not mean you have provided an answer.

          • Lou

            And railing against Fox News and right wing enablers is responsive? Lol, whatever dude.

          • Thes

            My response was to hire the Mercatus Center. See above, March 3 4:40 p.m.

            Still waiting for your answer to “Arlington Independent”… (except to rail against a blog poster).

          • Lou

            You can keep waiting. I was initially responding to your comment. And it was a question, to you.

          • Thes

            My point, exactly.

          • madisonmanor

            ‘The “fact on the ground” now is that the right-wingers have forbidden government to act.’ How exactly have the right-wingers FORBIDDEN the government to act? They have removed the option to add an additional tax, but that is not the ONLY action the government can take. Maybe they threw down the gauntlet (that would be a protective glove worn as part of medieval armor that is used as a metaphor to offer a challenge for the left-winger-challenged crowd if you are being so inane [asinine or devoid of intelligence] as to generalize all right-wingers) for the benevolent Arlington County government to actually decide whether or not this was important enough to them to use general fund money or to raise taxes in another manner to compensate. To state that they ‘forbid the government to act’ is just plain ignorant

          • Overgrown Bush

            Wow! Really?

      • mehoo

        If the promotion efforts involve driving business to specific hotels, rather than just a “come visit Arlington” message, there would be an incentive for hotels to pay up. Only paying members would get that service.

        Not sure why this couldn’t be a simple Chamber of Commerce-type project.

  • Bob

    I think that’s almost half a million dollars that can be much better spent on more critical community priorities… If the industry won’t fund it themselves, then it is clearly unnecessary.

    • nonissue

      yes they should fund it themselves. and arlington should NOT give them the money out of tax payer funds to promote private business.

  • LyonSteve

    NO!

  • Dan

    Are there any studies showing that these programs to promote Arlington actually work ??

  • SeanO

    Who didn’t see this coming? I wonder what project or initiative will be sacrificed…

    • John Fontain

      Nothing will be sacrificed except the funds in our bank accounts when they raise taxes at their next opportunity.

  • Lacy Forest

    If the hotels want to continue to support this program, there is nothing stopping them from putting a surcharge for it on each hotel bill, but I will be very disappointed if the County Board chooses to use money from Arlington residents to pay for it.

  • Valerie

    Fewer trips and parties for Mr. Holtzheimer.

  • Lacy Forest

    I just sent a polite, professional email to Barbara Favola (bfavola@arlingtonva.us) noting my opposition to taking funds from the county general fund to keep the tourism promotion program running, pointing out that there is nothing stopping hotel from voluntarily putting a charge on hotel bills and that the nearly half a million dollars that is being requested would better be spent in providing services to the county residents.

    I urge everyone here who agrees to send an email to at least one county board member. We can grouse about it here, but unless they know you are opposed to it, your opinion does not matter. And you can bet the people running the tourism promotion program are making their opinions known to the board.

  • John Fontain

    I agree with you Lacy Forest. I oppose using my tax dollars to help hotels (the primary beneficiaries of these marketing funds) become more profitable. It speaks volumes that they don’t think the hotel operators could be persuaded to pay for this marketing themselves. If it isn’t important enough for the hotels to be willing to pay it, then it I should be paying for it either.

    • borf

      So you oppose all economic development efforts by the County?

    • R

      I also don’t particularly agree with using taxpayer funds for this and would have been more than fine had we been allowed to continue to have the tax added to hotel bills since generally not paid for out of Arlingtonians pockets (if we didn’t piss off our neighboring counties who’s politicians now have a vandetta against us I guess it wouldn’t even be a topic of conversation), and while I also agree with Dan above on wanting to see a study of if these programs actually work, I don’t see how this “primarily” would only benefit the hotels. Aren’t these “tourism” promotions, not hotel promotions so in theory wouldn’t it benefit all local business where tourist would spend their money, including those owned by our fellow Arlingtonians, and not just the big national hotel chains who have locations here.

      • Lou

        You raise the point that there is not a clear understanding of what we are actually getting for this program. The County has done a poor job in my opinion of communicating exactly how this promotion program works and what benefits we, or the tourism industry in general, see. Someone posted a breakdown of the spending, and I think the majority of the revenue was for salaries of a few people. I really think it’s incumbent on the County to “show their work” so to speak if they feel there is a real benefit to the program.

        • Thes

          This program is a government service provided to the hospitality industry, at their sole expense, and at their request. If it doesn’t cost the rest of us anything, I’m not particularly interested in whether the County has persuaded anyone else benefit from the program. The hospitality industry is convinced that it helps them.

          • Lou

            This *was* a program provided at their sole expense. The County is now into the phase of looking for money out of the budget to sustain the program. That would cost “us” money as citizens, and that is why I think they need to communicate the benefits much more clearly.

  • CHouse

    The tax is designed to impact those who DO NOT live in Arlington, i.e. visitors. It is a small percentage added to the hotel bill that goes to the tourism fund. It isn’t a tax that the business pays out of pocket. For more details on what the fund actually does, check out Section C of the County budget, specifically the “Travel and Tourism Promotion Fund Summary”. It does actually provide quite a bit of benefit, and hotels and businesses went down to Richmond to testify that it WAS/IS a good idea. Richmond just hates Arlington now, which is unfortunate because the state gets revenue from all the money visitors spend in Arlington.

  • JimPB

    Let the ArlCo hotels form an association (if they have not already done so) and decide whether they want to contribute to fund a collaborative effort through their association to increase tourism, and if so, how they will collect and spend the money required.

    Those hotels who contribute the designated amount can be listed/have links to in the tourism promotion material. Non-contributors are on their own. The way (collaborative or individual) that pays off best should prevail for each hotel.

  • Stop the pork

    Folks, I agree that our tax dollars should not go toward funding tourism promotion and if local hotels want to fund it, they should do it on their own. Turns out, there is ANOTHER county funded tourism promotion program that is completely unnecessary. Check out this article in the current issue of the Arlington Citizen (page 4).

    “Visit Arlington’s new Mobile Visitors Center. Guests can pick up tourism materials and learn about neighborhoods, hotels, attractions, stores and restaurants or have a staff member arrange dinner or theater reservations. For more information go to http://www.arlingtonva.us; search “visitors center.” ”

    You would think Arlington would realize that things like this are not necessary given that we have the internet!!! Article is here: http://arlingtoncitizen.wordpress.com/page/4/

    • CHouse

      Except it’s designed to help tourists who DO NOT have the internet with them as they walk to the Metro, to the mall, etc. Remember that this is for tourists, not for people who live in Arlington (though there’s nothing wrong with you stopping by for information either).

      • Stop the pork

        And I’d say that if a tourist is walking around without internet on their phone, they can ask a passerby for information, like we did before there was internet, and still do. We don’t need to spend tax dollars on this.

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