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Tourism group in cash pinch
By MARK ALBRIGHT, Times Staff Writer Hotel tax collections are down so sharply that Pinellas County's tourist marketing agency faces cutting its budget or borrowing up to $1-million to get through the summer. The cash flow crisis has officials of the St. Petersburg/Clearwater Area Convention and Visitors Bureau talking about hitting up the County Commission for a loan. Beyond that, the bureau might lobby the commission to raise the 4 percent tax on hotel rooms to 5 percent this fall. "We cannot afford to reduce our marketing efforts," said Bud Zipin, chairman of the budget committee of the county Tourist Development Council. The alternative is eliminating the agency's $500,000 summer tourist advertising campaign and cutting back payroll. The Pinellas tourist agency trimmed its $11-million budget by $400,000 in January. Other counties in Florida are being confronted with the same dilemma. The tourist industry already was beginning to slump before it was sent reeling by the terrorist attacks last fall. The economy and the tourist industry are on the mend now, but still have a long road back to full recovery. Adding urgency to the cash shortage: Tourist taxes don't get into the county treasury for about two months. Now, the peak winter season is over, resort tax collections were down 20 percent in March and, because of an early Easter, the industry slid back into a funk in April. In revenue per available room, "we were about 10 to 12 percent behind in March and April" compared with the same months last year, said Tim Boggott, president and chief executive of TradeWinds Island Resorts in St. Pete Beach. In March, the most recent month with complete figures, the number of people who checked into a Pinellas hotel dropped 5.5 percent compared with March 2001. The number of room nights purchased slipped 7 percent. And the average room rate slipped 1.9 percent to $93.35, according to Research Data Services Inc., a Tampa company that tracks Pinellas tourism. The winter season was salvaged by domestic visitors from the Midwest. Traffic from Europe plummeted 20 percent. The number of Canadian visitors decreased 17 percent. Crowds dissipated after the first two weekends in April, so high, peak season room rates fell to off-season rates. That will cut into hotel tax collections. Facing its budget shortfall, the visitor's bureau rejected ideas such as charging membership fees or charging for some services. Its directors put off deciding their next step until they can better gauge the industry recovery outlook. While tax collections are running about 10 percent behind the previous fiscal year, Research Data Services Inc. estimates business will improve to about a 6 percent drop by late fall. Making projections, however, has been tough because 48 percent of today's frugal Pinellas vacationers are not making their travel decisions until a month before they leave. "Bookings are so last minute that we've got hotel companies trying to budget their business quarterly now instead of annually," said Russ Kimball, general manager of the Sheraton Sand Key Resort in Clearwater. Borrowing money from other county departments is one option for the tourism bureau, but it would have to pay back the loan with interest next year. Also, lower tax collection projections from this year will restrict the amount of money the bureau can budget for the upcoming fiscal year. That has led to preliminary discussions of asking the County Commission to increase the hotel tax to 5 percent. The Legislature recently agreed to allow that without a countywide vote, but Gov. Jeb Bush has yet to sign the act into law. The hotel tax also helps pay for beach nourishment projects and the debt on Tropicana Field and on spring training facilities in Dunedin and Clearwater. The pledged debt payments on Tropicana Field are affected by the shortfall, meaning the city of St. Petersburg might face making up the difference. But the other uses are not. -- Mark Albright can be reached at albright@sptimes.com or (727) 893-8252.
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From the Times Business report
From the AP
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