While tourism is down thanks to the struggling national economy, visits increased slightly toward season’s end and some news is good, such as 200,000 new airline seats coming to St. Thomas and St. Croix in 2012, Tourism officials said during budget hearings Friday.
Overall, year to date, revenues from the territory’s hotel occupancy tax in the Tourism Advertising Revolving Fund are down about 9.5 percent and air arrivals are down about seven percent, said Tourism Commissioner Beverly Nicholson-Doty, testifying to the Budget and Appropriations Committee in Frederiksted.
According to budget information Tourism provided the Legislature, $17.1 million in hotel occupancy taxes were collected in fiscal 2010. From October through March of Fiscal Year 2011– the busy half of the year — hotels have paid $9.4 million.
Asked by Sen. Patrick Hill what were the greatest challenges facing the territory as a tourist destination, Nicholson-Doty said last year they felt airlift was a major concern, pointing to the addition this year of JetBlue, American Airlines, Air Canada and Bravo Tours flights to the territory as evidence of progress.
"This year, the possibility of the cruise industry moving ships out of the region from May to October is a very big concern," she said. Cruise ships visit a series of destinations on every cruise, so Tourism is collaborating with other Eastern Caribbean destinations to try to ensure ships continue to arrive, she said.
"The goal is to develop compelling itineraries with the required inducement that levels the playing field and allows us to keep more ships in the region during this critical period," said Nicholson-Doty.
Nicholson-Doty and staff were before the committee to defend their 2011 General Fund budget request of $3.1 million. Of that, $2.4 million or 79 percent is dedicated to salaries and benefits. The department would also receive $650,000 from the Tourism Advertising Revolving Fund to pay for the territory’s several carnivals and festivals. The fund consists of revenues from the eight percent hotel occupancy tax.
The remaining hotel tax revenue in the fund is largely split between the national public relations agency M. Booth and Associates and the J. Walter Thompson national advertising agency, with smaller sums going to several other sales and promotions offices around the world. Some of that money went to ads in national magazines, in airports and in regional television markets. Some was used to participate in travel industry trade shows.
No votes were taken during the budget oversight hearing. Present were: Hill, Sens. Carlton "Ital" Dowe (chairman), Shawn-Michael Malone , Janette Millin-Young and Sammuel Sanes. Sen. Usie Richards, not a committee members, was also present. Absent were Sens. Nereida "Nellie" Rivera-O’Reilly and Celestino White.
