Legislature(2007 - 2008)
04/18/2007 03:31 PM House FIN
| Audio | Topic |
|---|---|
| Start | |
| SB61 | |
| HB147 | |
| HB205 | |
| Adjourn |
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
+ teleconferenced
= bill was previously heard/scheduled
HOUSE BILL NO. 147
"An Act relating to matching funds in state tourism
marketing contracts with trade associations."
3:53:04 PM
At-ease.
3:53:47 PM
Representative Gara asked about the private industry match
versus the state match. He wondered where the $2.5 million
that came from the non-cruise ship portion of private
industry goes. He questioned how much money goes into the
match fund for the advertising campaign.
BRETT CARLSON, VICE CHAIR, ALASKA TRAVEL INDUSTRY
ASSOCIATION (ATIA), addressed Representative Gara's
questions. The $2 million private sector portion goes into
the fund and is traded for "value", such as an ad or a
chance to participate in a media road show. Representative
Gara summarized that ATIA charges a business for access to
advertising, as a value match. He asked where the $.5
million came from. Mr. Carlson replied, "$2 million in non-
cruise pay to play, and then $.5 million comes from what
industry calls DMO's, Destination Marketing Organizations,
which would be one of three things, generally." Larger
cities would have a convention and visitors' bureau, some
smaller cities would have chambers, and a few cities might
have a department of the city.
3:58:57 PM
Vice Chair Stoltze drew attention to a letter by Chip Thoma
(copy on file.)
Co-Chair Meyer asked about the 90/10 split. He said he is
not so sure that the cruise ship contribution is going to go
away. He voiced concern about ATIA's belief that without
that contribution only $2 million could be raised. He
thought that ATIA was hoping that the state would contribute
$20 million because ATIA proposes to raise $2 million. He
thought a $20 million request was high. He wondered what
would happen if the current state contribution of $8 million
is kept. Mr. Carlson emphasized that this legislation has
no bearing on the actual amount of legislative
appropriation. ATIA does not believe that state government
should appropriate money back that ATIA is not putting in.
He explained how the fund would grow. The bill would allow
ATIA to match appropriated funds. If the bill does not
pass, ATIA has no access to the funds.
Co-Chair Meyer agreed that $5 million of the car rental tax
is tourism related and could go to ATIA. He pointed out
that it is uncertain how much money will be obtained from
the cruise ship initiative. He thought it was premature to
ask for additional money at this time. He suggested other
splits.
4:04:28 PM
Co-Chair Meyer asked if ATIA would support a statewide bed
tax or sales tax. Mr. Carlson explained that the hope is
that other forms of revenue would be available in the
future. He stressed that the discussion on the funding
level could take place another time. At stake now is the
match. Co-Chair Meyer asked if the cruise ship industry
contributed money this year. Mr. Carlson reported that that
funding will be lost beginning July 1.
4:07:19 PM
Representative Kelly pointed out that action needs to be
taken at this time. The bill in its current form would
require a match of $800,000. He spoke in support of the
bill with an amendment.
Representative Thomas asked if the cruise ship industry has
bailed. Mr. Carlson said that their funding cannot be
counted on in FY 08. Representative Thomas asked about car
rental tax money going only to tourism marketing. He
preferred to allocate it for independent travel. He
reported that he voted against the cruise ship head tax. He
said he does not know what the cruise ship head tax money
can be used for.
4:11:24 PM
Representative Gara summarized that this bill is a policy
call based on a guess about the cruise industry. The
independent tourism industry benefits if the cruise industry
does not contribute. He questioned why $2 million for pay
to play and $.5 million of DMO contributions last year
translates to only a total of $2 million this year. He
questioned why private industry's donation shouldn't be
larger this year than last.
Mr. Carlson responded that the 10/90 legislation looks to
the future to raise money for a state marketing program. He
opined that a match from the private sector makes sense. He
explained that currently $500,000 comes from DMO's, which
should be used locally. Long-term, a voluntary tax won't
work.
Representative Gara was not convinced it was $2.5 million
last year. He brought up that in Alaska tourism businesses
don't pay a state sales, income, or corporate tax. He
suggested a 3 to 1 ratio. Co-Chair Meyer agreed.
4:17:04 PM
Mr. Carlson related that 38 states have no private sector
match. Of the 11 state that do, Alaska's small industry
contributes $5 million, which is just below California.
HB 147 was heard and HELD in Committee for further
consideration.
4:18:26 PM
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