Legislature revives tourism improvement district discussions
SHERIDAN – The Wyoming Legislature’s Joint Corporations, Elections and Political Subdivisions committee may provide an additional source of funding for the state’s tourism industry.
While discussions are in early stages and ongoing, Sheridan Travel and Tourism Director Shawn Parker said he was interested in where the conversation would go from here.
“I think there’s a lot of value any time you have a business-led effort to generate funds for special projects, which is essentially what a tourism improvement district is,” Parker said.
The committee voted Tuesday to prepare a draft bill that, if passed next session, would allow counties to create tourism improvement districts. The draft bill mimics House Bill 93, a similar bill introduced during the 2019 Legislative session, which set forth the rules for creating and funding tourism districts.
The tourism industry is a key component of the state’s economy. It contributed $3.96 billion to the state in 2019; it contributed $3.05 billion to the state and supported 28,629 jobs in 2020 alone, according to Wyoming Travel and Tourism. The 2019 to 2020 decline totaled 22.9 percent in Wyoming, compared to the U.S. tourism decline of 36 percent in the same time period.
But being competitive with other states requires dollars, according to Chris Brown, executive director of the Wyoming Restaurant and Lodging Association, and that’s where the tourism districts come in.
“Tourism is a competitive business, and not just in attracting traditional vacationers,” Brown said. “But it's also extremely competitive in attracting regional sporting events, traveling rodeos, large conventions etc. And the creation of TIDs would allow local businesses to fund additional marketing and promotion of the assets and the events in their communities.”
Tourism improvement districts are different from other special districts in how they’re funded.
Rather than a tax mill levy, the district is funded through an extra fee paid by the customers of local tourism businesses, either as a percentage or a flat rate.
Only certain tourism-oriented businesses, such as restaurants, resorts, attractions and overnight accommodations would assess the extra fee, according to Brown. The activities funded with those dollars can vary depending on the priorities of each community and the businesses within it, Brown told the legislative committee.
The draft bill highlights some potential uses of the dollars including marketing, sales and other promotional programs; promoting special events designed to increase tourism; and funding projects designed to improve the visitor experience.
Any dollars raised through tourism improvement districts would supplement money raised through the state’s lodging tax, which is currently the primary funding mechanism for tourism-related activities, Brown said.
Brown said he saw value in moving forward with the tourism improvement district discussion.
“Seventy-six percent of businesses in the existing (tourism improvement) districts reported an increase in visitors from both new and existing markets when they had a TID in place,” Brown said. “We know that more visitors equates to more revenue in our communities. It also equates to more sales tax revenue for local government and state government as well. So we see this as a good versatile option for businesses and communities to take advantage of.”
Darren Rudloff, who serves as a consultant for lodging tax boards across the state, agreed tourism improvement districts could be beneficial for many Wyoming counties.
“The challenges in each county usually are somewhat different, and the strategies to deal with them are somewhat different in each county,” Rudloff said. “…The tourism improvement district concept works well with all of these situations because it really is community-led. It’s led by the local community leaders. It’s led by the tourism businesses in that county…For those communities that want a boost and want to be competitive against Billings and Rapid City a little bit more, they can take this step…to help them be more competitive.”
Tourism improvement districts are currently used in 19 states, including the surrounding states of Montana, South Dakota and Colorado, Brown said.
As the legislation moves forward, Parker said he would start a local conversation, beginning with his board, about whether Sheridan County wishes to develop a tourism improvement district. The creation of a district is typically a business-led initiative that receives final approval from the county commissioners, Brown said. Business owners have an opportunity to dissolve the district once a year if they feel it is no longer beneficial.
The draft bill will be discussed at the next joint corporations committee meeting. A date, time and place has not been set at this time.