Tourists last year spent $560 million on places to sleep in Palm Beach County, pumping $27 million in “bed taxes” into the county, but slightly less than half of that money was used to lure more visitors.
“We all agree we need more money,” said Verdenia Baker, deputy county administrator who oversees the Tourist Development Council.
“You’re getting outgunned,” retreat leader Bill Geist told tourism leaders gathered for the TDC strategic planning session. And as a tourism marketing consultant who has worked with 150 destinations, he speaks with authority.
About $13 million from bed taxes goes into direct promotion each year. Broward County sells its message with about $18 million, and Miami spends at least $24 million. The Florida Keys devotes $20 million.
In Palm Beach County, some money could come from reallocating part of the “penny” that is banked for convention center expansion — tourism parlance calls each percent of bed tax a penny or cent. That fund has $12 million in it, but at least $6 million is targeted to renovate new offices for the agencies.
More money could come from a sixth cent, which county tourism officials expect to be eligible to levy in the next year or so. Under state law it is available to counties that ring up $600 million or more in temporary rental sales each year.
And the bonds for Roger Dean Stadium will be paid off in 2017, freeing about $2 million a year for another capital project.
TDC board member Jim Bronstien said before the agencies talk about where the money comes from, they need to have a plan.
“How much do we want, and what are we going to do with it?” he said. “And what do we expect the results to be?”
Palm Beach County is positioned between the top international gateway of Miami and top domestic gateway of Orlando, said Jorge Pesquera, president and CEO of the Convention and Visitors Bureau. “Our biggest challenge is letting the world know where we are.”
“We need to make Palm Beach County a must-visit destination,” said Dave Anderson, who runs the convention center. “We’re between two giants.”
“We’ve got to create the reason to come here,” said Howard Bregman, who represented the Cultural Council board at Thursday’s retreat. “We haven’t done that.”
Spend more money selling the destination, and you’ll bring in more visitors. At least that is the belief, and it is largely supported by experience here and elsewhere.
Visitors not only stay in hotels, they shop and eat and go to museums. All that spending supports jobs — an estimated 45,000 of them.
And Pesquera says raising hotel occupancy from the current 65 percent year-round figure to 70 percent would bring another $1 billion to the county economy each year.
Wooing people here takes money. The official role of marketing the county is funded by the very people who visit through tourism taxes.
The county charges 5 percent on each lodging night — that’s hotels, short-term condo rentals, campgrounds. And 48 percent of the $27 million that was collected last year was used for direct promotion of the destination through marketing, ads and grants to groups that hold festivals and sports tournaments.
Palm Beach County has a difficult message to sell, because it is Palm Beach’s luxury market for some, the golfing capital for others, smaller eco-friendly beaches like Jupiter and the most fun small-town of Delray Beach. The CVB is, in fact, unveiling a new brand identity this summer that aims to capture the complexities of Palm Beach County’s appeal in a catchy name and tag line.
And the county has several specialized groups that get a piece of the funding: the Convention and Visitors Bureau, the Cultural Council, the Sports Commission, the Film & Television Commission, the convention center and the county’s Environmental Resources Management department.
The funding formula doesn’t change very often. If reallocation of that formula was on the table, it would put agencies that usually work together in competition.
Should culture get less money? The county is known as a luxury destination where history and an appreciation for the arts is epitomized in the lavish galas at Mar-a-Lago.
Should the film commission get less money? Playing in theaters now is Parker, where Jason Statham and Jennifer Lopez galavant through the county in a crime thriller.
Should beaches get less money? As the state and feds pull back on renourishment money for beaches, more of the burden lands on the local governments and $2 million a year in tourism taxes is key to matching monies.
What about sports? Adult and youth sports tournaments help fill up hotel rooms in the off-season throughout the county.
So mostly the group last week focused on new money.
In the next year or two, Palm Beach County should move over the threshold for that super tourism, or sixth, penny.
The Keys already assesses it. Miami-Dade can’t because it tied up its allocated pennies with a convention center tax. And Broward is eligible but has chosen not to use it.
Monroe County TDC Executive Director Harold Wheeler said he pushed for the high-impact penny in June 2009, when the recession was pounding the industry. At the time, hoteliers and innkeepers agreed that more money was needed quickly, even if it added a little more to visitors’ bills. Of $25 million collected in bed taxes last year, $20 million paid for more promotion.
It worked, and the room rates in the Keys recovered faster than other Florida destinations. Palm Beach is still working to get rates back to pre-recession levels, though the gap is closing.
“I really think it saved us during the recession,” Wheeler said.
In Broward County, hotels have pushed back against assessing the super tourism penny, which would bring its tourism tax level to 6 percent, said Greater Fort Lauderdale Tourist Development Council President and CEO Nicki Grossman.
Of the $42 million raised last year in bed taxes, $17.8 million went to direct promotion of the destination, Grossman said. Two of Broward’s five pennies pay debt service on the arena. And still Fort Lauderdale earned recognition for being the lowest business tax destination in the country last year.
“There’s some marketing value in that,” she said. “We’re not quite ready to give that up” and add another penny of tax.
On the west coast Collier County isn’t eligible for the super tourism penny, but its marquee destinations of Naples and Marco Island command room rates that make Palm Beach County leaders jealous.
TDC Executive Director Jack Wert said about one-third of the bed taxes are available for direct promotion, or about $4.5 million, because half is used to restore beaches. The county collects four pennies.
Wert was in Tallahassee last week for Florida Tourism Day, and he said every county wants to find more money for promotion.
“Tourism is really driving the recovery,” Wert said. “That’s a great message, but you can’t really do it unless you have the money to promote it.”
- 2 weeks to 2 months: Strategic planning document created and approved.
- June: New brand name and tag line to be unveiled for Palm Beach County.
- 2014-15: Palm Beach County should cross $600 million threshold and qualify for 6th penny tourism tax.
- 2017: Roger Dean Stadium bonds are paid off, and partial penny is freed up for other uses.