by Lisa A. Grimaldi | April 26, 2017
J. Ben Watkins, director of Florida's Division of Bond Finance, has penned a letter to the state's House and Senate budget chairman that warns against cutting Visit Florida's budget, according to press reports. The letter was sent as Florida's Senate and House head into conference to finalize the state's 2017-2018 budget. Earlier this year, after initially threatening to eliminate the marketing organization altogether following revelations that  the agency created controversial million-dollar marketing campaigns with hip-hop artist Pitbull, London-based Fulham Football Club and an International Motor Sports Association racing team, the House passed HB 9, a bill to lower the DMO's budget to $25 million, cap salaries at the agency and increase transparency of its spending. In late March, the state Senate proposed giving Visit Florida a $76 million annual budget. Last week, Florida Gov. Rick Scott called for a $100 million budget for the agency.
In the letter, Watkins touts the state's current top bond rating, which he says is significantly due to the strength of Florida's economy. "Investment in promoting tourism has been an important investment in growing our economy and creating jobs, contributing to healthy revenue growth," he wrote. "We are very concerned that reduced funding to promote tourism would adversely affect revenues collected at the state and local level. Even a 2 percent reduction in visitors would result in a loss of $2.2 billion in travel spending and $225 million in tax revenue."
Watkins continued: "Other states that do not rely on tourism as much as our state have reduced or eliminated their tourist development efforts and have experienced drastic revenue losses as a result. For example, Colorado lost more than $1 billion in travel-related spending in one year. When Pennsylvania cut tourism development spending from $30 million to $7 million, they lost more than $600 million in tax revenues."
"If funding for Visit Florida is reduced as much as the Florida House proposed, the credit rating on cities and counties could be negatively impacted, especially for the communities that rely heavily on tourism and tourist-related revenues… I believe it is important for policymakers to be informed about the important spending decisions and their financial and economic consequences. It is possible that any cut to Visit Florida could have negative impacts on ratings across the state."
In related news, Visit Florida president and CEO Ken Lawson has issued a new urgent request to his members to help save the Visit Florida budget by reaching out to their legislators to back Gov. Scott's proposed $100 budget for the destination marketing organization.