CVB Bed Tax

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In the Erie County fiscal crisis in 2005, funding was decimated for the Buffalo Niagara Convention and Visitors Bureau (CVB) for convention and tourism sales and marketing purposes. As a direct result, the industry in Buffalo Niagara has already begun to see a decline in future business. Especially unfortunate is that this neglect comes on the heels of substantial investment in our cultural attractions, such as the Zoo and Darwin Martin House, and that it affects one of Buffalo Niagara's largest target industries (and the 2nd largest in New York State). It's an industry we cannot afford to ignore, generating:

• $150 million in hotel revenues annually
• $650 million in direct visitor spending
• More than $50 million in sales tax revenues
• 15,000 jobs

And prior to 2005, County allocations to the CVB never really were competitive. Buffalo Niagara's peer cities, such as Pittsburgh, Louisville and Indianapolis each have tourism budgets of more than $9 million in 2005. Memphis, Milwaukee and Columbus spent approximately $6 million. The Buffalo Niagara?s CVB budget in 2005 was $1.7 million. In an industry that yields a 20-1 return on investment, how can we compete?

A solution has been in the works for nearly 20 years, and the politically-driven funding shortfalls for the CVB have put ending the lack of support for it on everyone's "to do" list. Full dedication - by legislation - of the county's hotel occupancy tax, or "bed tax," to CVB marketing efforts is the answer. To offset the funds the county would be giving to the CVB, the Bureau will take over some tourism-related budgetary costs. In future years, the additional sales tax revenue from increased tourism spending will easily make up any gaps, but due to the loss of revenues caused by the CVB cuts in the 2005 fiscal crisis (which we're realizing now), the CVB needs the Legislature's approval for a $1.1 million influx of revenue in the 2007 and 2008 budgets to get the ball rolling. Importantly, the Erie County Fiscal Stability Authority is in support of this funding from the county?s unrestricted fund balance.

In short, this is re-engineering government the way it's supposed to be done, and that?s why it was recommended by the Erie County Stabilization Project's "A Plan for Moving On"! The CVB needs this money to properly market and promote our region, and the Partnership believes it is the best use of the "bed tax" revenues. I urge you to e-mail Erie County's legislators telling them how important it is that the county restore this vital funding to our regional tourism industry.