Tourism U Primer: The Cycle of Tourism
Friday, February 16, 2024, 2pm by Andrew H. Baker, TMP, FEP
If you are familiar with GRCVB, you might have heard of or attended Tourism U, an advocacy program focused on tourism and destination education. If not, we would love to meet with you and your team. (Email us here if you're interested in setting up a Tourism U 100 session for your staff!) We aim to assist our stakeholders in understanding the importance of tourism development in Wake County, which in turn helps us as locals in maintaining and enhancing our quality of place.
To give you a sample of what to expect in our Tourism U classes, this week we're sharing and highlighting The Cycle of Tourism, which explains the basics of how tourism development works in Raleigh/Wake County throughout the year. It's a reminder of just how important outside visitation is to the county/destination.
The Cycle begins with GRCVB, which works to promote collectively Raleigh/Wake County's restaurants, hotels, retail stores and attractions to potential visitors from within the state, the region and internationally and encourage them to stay and spend money with these same partners. Our various departments and their Business Plan strategies—from our Convention Sales team to the Greater Raleigh Sports Alliance to our Marketing & Communications Department, which manages and produces content for social media and visitRaleigh.com—converge in external markets to spark new/repeat visitation (and economic impacts) for this destination.
Visitors come to Raleigh and Wake County from various places, from across the Triangle, across the Blue Ridge or across the country (or the ocean by air). Regardless of where they come from or whether they're arriving for conventions, sports or leisure getaways, they come for the day or stay overnight and spend money on lodging, food & beverage, shopping, entertainment, transportation and more.
All visitor spending is subject to state and local sales taxes, Wake County's hotel occupancy tax and prepared food & beverage tax. The occupancy and food & beverage taxes collected by our partner businesses go into the Interlocal Fund.
The Interlocal Fund revenues then are invested by local stakeholders, with a portion dedicated to GRCVB, a percentage dedicated to the Raleigh Convention Center, another percentage held for enhancements to existing attractions or venues and another held for the development of new attractions. (The most recent distributions according to this formula, totaling nearly $500 million, were approved earlier this fiscal year for major capital projects.)
Visitors pay other taxes in the destination, like the special tax collected on rental cars. Indirectly, area businesses that serve visitors almost exclusively, like hotels, contribute their property tax revenues to local municipalities (and pay state/federal corporate and excise taxes too).
Residents reap benefits of taxed visitor spending. When we add up all the tax revenue categories area visitation is generating for N.C. and Wake County, we get hundreds of millions in tax revenue collected each year ($287 million in tax revenues during 2022). This revenue resulting from visitation impacts saves the average Wake County household hundreds on their property taxes annually ($601 in 2022)! In other words, our quality of place that all residents enjoy today would have required $601 more dollars from each household to maintain, if area visitation suddenly stopped forever.
This brings us back to GRCVB. We are allotted an annual portion of the Interlocal Fund made possible by visitors, and we use it to grow area visitation and the hospitality sector tax base year over year. Thus, in so many words, area visitors themselves are investing in improving our lives each year! The more visitors are attracted sustainably, the more we can enhance the area's residential quality of life.
It's a virtuous Cycle of Tourism (and no resident dollars are required to sustain GRCVB's sales & marketing efforts).
