🔒Tourism industry decries pending budget cuts, recommends new funding sources

Tourism and arts groups are lobbying hard this legislative session to increase the state’s spending on marketing Connecticut beyond its borders, as the falloff in pandemic-relief funds starts to bite.

Gov. Ned Lamont’s February budget proposal provides $4.5 million for tourism marketing. That is the same amount that was provided from the state’s General Fund last fiscal year.

However, the tourism industry will no longer benefit from millions of dollars in additional federal stimulus funds — including $3.1 million allocated in the current fiscal year — that are expiring.

The budget also eliminates about $8.7 million in grants for arts and culture organizations, and has reduced grant funding across the board for a wide range of tourism institutions in the state.

Tourism funding became a hotly contested topic during a recent meeting held by the legislature’s Appropriations Committee, which controls the state’s purse strings.

Kyle Abercrombie, chief administrative officer of the Department of Economic and Community Development, told lawmakers that hotel tax revenues, which support the state’s tourism spending, are down and the governor is not willing to make up the difference from the General Fund.

Legislators questioned the math, saying indications are that hotel stays increased in the state.

“We are not deemphasizing tourism and marketing as a strategy. It’s simply a tight (budget) cycle in which tradeoffs had to be made,” said DECD Commissioner Dan O’Keefe, adding his department will provide more information for lawmakers, but will not push for an increase in tourism funding.

Sen. Cathy Osten (D-Sprague), who co-chairs the Appropriations Committee, said surrounding states spend far more than Connecticut does on statewide marketing. She said the state should increase its funding to $20 million annually.

“It’s a huge industry, it’s really important,” she said.

Creative solutions

That point was amplified at a recent tourism conference hosted at Mohegan Sun by the Chamber of Commerce of Eastern Connecticut.

“Per-capita ​spend, we’re ​the ​worst ​in ​New ​England. We’re ​the ​lowest,” said Chris Regan, the owner of Olde Mistick Village in Mystic, referring to the state’s marketing budget.

According to a study from research group Tourism Economics, 68 million tourists visited the state in 2023, generating $11 billion in sales, $1.2 billion in state and local taxes and $18.5 billion in total economic activity.

Regan, who’s also chairman of the Eastern Regional Tourism District, wants to see tourism funded through a public-private partnership whereby state dollars are matched with funds from the private sector.

It’s just one of several creative solutions that are under consideration.

The Connecticut Restaurant Association in February urged lawmakers to reinvest a portion of the state’s 1% meals and beverage tax into the tourism and hospitality industries.

Another long-floated idea is the establishment of permanently funded tourism districts, like those that exist in neighboring states. Such districts frequently allow for items like hotel surcharges to be raised and spent locally.

“A ​lot ​of ​our ​competitors ​are ​doing ​this, ​whether ​it’s ​​Boston ​or Provincetown ​or ​Newport. It’s very ​prevalent ​in ​New ​England,” said Robert Murdock, president of the Connecticut Convention and Sports Bureau. “I ​think ​this ​is ​the ​future ​really.”

Murdock noted that his organization, which is funded through the Office of Tourism, will be eliminated if the governor’s budget goes through unchanged.

But self-funding tourism districts are not necessarily an idea that’s going to be an easy sell at the capitol.

“​I ​think ​it’s ​a ​conversation ​worth ​having,” said Alex Peterson, director of government affairs at the Connecticut Airport Authority. “It ​provides ​a ​stable ​revenue ​stream. ​I ​think it ​would ​be ​a ​tough ​hill to climb ​at ​this ​point ​in ​time — the ​administration ​in ​particular ​is ​very ​reluctant ​to ​take ​actions ​that ​would ​be ​perceived ​as ​increasing ​taxes ​right ​now.”

The Airport Authority has its own ask at the moment, seeking to promote a second transatlantic destination for Bradley International Airport to add to its regular Dublin, Ireland flight.

“One ​of ​our ​biggest ​pushes ​this ​year ​is ​for ​​the ​state ​to ​provide ​a ​revenue ​guarantee ​for ​nonstop ​London ​service ​at ​Bradley ​International ​Airport, ​which ​we ​think ​is ​very ​achievable ​with ​an ​incentive ​similar ​to ​the ​one ​that ​was ​granted ​to ​Aer ​Lingus,” Peterson said.

Lt. Gov. Susan Bysiewicz attended the recent tourism conference, listening to the various funding ideas. She told the crowd the governor was open to new solutions, but warned he’s not interested in bonding dollars to support tourism investments.

Many in the audience pointed out that the industry has some significant challenges coming up, including next year’s 250th anniversary of the signing of the Declaration of Independence.

“Groups ​are ​looking ​to ​come ​to Connecticut ​to ​celebrate ​250 ​with ​us,” Aisha Jones, the custom events manager at Mystic Seaport, told Bysiewicz. “They ​said, ​’you’re ​one ​of ​the ​original 13 colonies ​so ​you’ve ​got ​to ​be ​doing ​something.’ ​And ​so, it’s really disheartening to ​hear ​that ​we’re ​kind ​of ​in ​last ​place ​when ​people ​​have ​an ​expectation ​that we’re gonna do something for it, ​and ​do ​something ​big.”

Tony Sheridan, president of the Chamber of Commerce of Eastern Connecticut, also pointed to the National Coast Guard Museum, slated to be built on the New London waterfront in coming years.

“The ​new ​museum ​will ​bring ​in ​thousands ​of ​people annually ​and ​quite ​frankly we’re ​just ​not ​ready ​for ​that. ​We ​need ​more ​money,” he said.

Sheridan reminded business leaders they should continue to lobby the legislature for the funds they believe are needed to support a growing industry.

“Be ​passionate about ​what ​we ​believe in,” he said. “Without ​that ​passion, ​we’re ​just ​going ​to ​be ​an ​easy ​target ​to ​cut.”