New York, Massachusetts and Rhode Island are going to suck away Connecticut’s tourism dollars unless the state provides more support for an industry that brings in $1.7 billion a year in tax revenues, lawmakers were told Monday.
“Neighboring states … are going to eat our lunch,” Stephen Tagliatela, president of the Connecticut Tourism Coalition, warned during a meeting with legislators. “The situation is urgent and immediate.”
Gov. Dannel P. Malloy‘s budget calls for $8.3 million a year in tourism spending – an increase from the $6.5 million in taxpayer dollars spent last year but well below the $12 million allocated by the state in 2014.
Rhode Island has increased state spending to promote tourism from $750,000 a year to $5 million, said Tagliatela, who is managing partner of the Saybrook Point Inn, Spa and Marina in Old Saybrook. New York’s state tourism program is going to increase its spending to $69.5 million a year, he said.
Connecticut tourism industry officials are worried that the state’s $1.7 billion projected deficit could lead lawmakers to reduce tourism spending even below the level recommended by Malloy.
But the ultimate goal of tourism industry officials is to get lawmakers to return to a funding system that was enacted in 2010, which set aside 3 percent of the state occupancy tax on hotel rooms and other lodging to be dedicated to promoting tourism. In the first year, that generated $15 million in tourism spending.
Fiscal problems led the General Assembly to put that money back into the state’s general fund the following year, and tourism spending has been up and down ever since.
Last year, dedicating 3 percent of the occupancy tax would have meant $24 million in state money for tourism.
According to the Connecticut Department of Economic and Community Development, tourism generated $14.7 billion in business sales in 2015.
“Consistency of [state]funding is critically important,” Stonington First Selectman Rob Simmons said at Monday’s meeting with lawmakers. “One dollar invested … gets you three dollars back … Is that a deal or what?”
Andy Wood, a senior vice president of Mystic Aquarium, said his institution saw an increase in out-of-state visitors when Connecticut increased its tourism advertising in other states. “As that money was taken away … we’ve seen that growth level off,” Wood said.
Mystic Aquarium brings in about 750,000 visitors a year, according to Wood, and 60 percent of those come from outside Connecticut.
Wood said that it is hard for tourism destinations to plan for expansion without “a stable base of revenue” for state spending to promote Connecticut as a tourist destination.
Tagliatela said members of his industry “understand the challenges with Connecticut’s current fiscal budget, but limited tourism spending is not the way forward.”
He reminded lawmakers that more than 82,600 people were employed by tourism in Connecticut in 2015.
“Harnessing the power of tourism is the only way we will be able to change the tide in favor of our state’s future,” Tagliatela said.