No more cuts to Maryland tourism budget, industry pleads

(Feb. 12, 2010) Tourism officials in Maryland hope state government recognizes the value of the tourism industry and will restore the tourism marketing budget to the level it was at before the recession.

The Maryland Tourism Development Board is the state’s destination marketing wing. Its budget is used to market Maryland as a vacation destination, with a portion of the money offered as grants to the individual counties to help them with their own marketing endeavors. Ocean City receives around $180,000 annually.

According to a funding bill from 1993, the board’s budget was supposed to be $6 million, which it was for many years. But the state’s lingering fiscal woes, which only got worse as the recession hit, led officials to cut the tourism budget by more than half, down to just $2.6 million this year.

“It started the year at $6 million, but has been cut through a number of budget amendments. It was actually reduced three times. After all the cuts, the state’s tourism budget fell below Ocean City’s budget,” said Greg Shockley, owner of Shenanigan’s Irish Pub and chairman of the board.

Ocean City’s tourism budget is $3.9 million this year, though that includes more costs that the state tourism budget. The resort’s budget also pays for the tourism staff, while the state has a separate budget for those expenses. When those costs are factored out, Shockley said the two marketing budgets are about equal this year.

In the proposed state budget for next year, the tourism marketing wing is currently funded at $5.5 million. Since cuts to all areas of the state budget are likely coming, tourism officials planned a rally in Annapolis last week to highlight the importance of the industry and how it brings money into the state. Unfortunately, the snowstorm put it on hold.

“Tourism has a proven return on investment, so it makes sense for the state to put its money toward something that could actually make it money,” said Susan Jones, executive director of the Hotel- Motel-Restaurant Association.

In 2008, Maryland welcomed 30 million visitors who spent $14.5 billion dollars, generated 146,000 jobs and paid $1.8 billion in state and local taxes, according to the Maryland Office of Tourism.

As long as the state holds true to the proposed $5.5 million marketing budget for the coming year and keeps it at least that high in the future, Shockley said the bare bones budget this year might not cause any lasting damage to the tourism industry. The number of visitors was expected to drop because of that and other factors, such as a nationwide decrease in vacation travel because of consumer anxiety. But advocates say increasing the marketing again should prevent that from becoming a trend.

“It was terrible to lose that money this year, but if we’re able to get it back and start it growing again in the right direction, it may not have any harmful effects,” Shockley said.

He hopes the state will follow the lead of Ocean City and create a dedicated funding source for the marketing budget so there will always be money available. The resort sets aside a percentage of its room tax revenues to be spent on advertising, and Shockley wants to see the state initiate a similar venture.

“In the long term, hopefully, the state looks at Ocean City and sees that they provided a structure to dedicate funding for advertising and they were able to have a positive year in the negative economy. My hope is they see Ocean City as an example and move forward to find a dedicated funding source for the whole state,” he said.