Now that the merger of Tourism Penticton and the Hospitality Association has been finalized, the newly-formed Travel Penticton is working hard to secure the funding they need.
Speaking for the new group, Barb Haynes said they are on a tight timeline. The current five-year agreement to collect the Municipal Regional Destination Tax (formerly known as the additional hotel room tax) runs out on June 30, 2017.
The tax is returned to the city to be used to fund external tourism marketing initiatives.
In order to continue, an application has to be filed with the provincial government by Jan. 1, 2017.
The application process set by DestinationBC is lengthy and includes a number of components according to the city’s chief financial officer, Jim Bauer.
Several parts of the application require consultation with the tourism industry and demonstrated support that funds from the MRDT are incremental to other sources of tourism funding such as the city’s own investment in tourism.
That investment comes in the form of a five-year financial commitment, leading to a Travel Penticton request that council approve their funding ahead of the budget talks, which take place later this year.
Travel Penticton requested a continuation of the Tourism Penticton’s funding level of $354,000 for 2017, dropping to $300,000 from 2018 to 2021.
Haynes said there are a number of projects they need to complete in 2017 to set up the new organization and brand, including digital media, their organizational structure and a new vision for visitor services.
After 2017, they expect cost reductions from having a single tourism marketing organization to kick in.
According to CFO Jim Bauer’s report to council, city staff are confident Travel Penticton can find cost savings in their budget and reduce the level of annual funding needed. This revised funding level will represent a total commitment of $1.554 million over the five-year period and a savings for the city of about $2.2 million.
The MRDT has been in several hands over the last five year term, part of the disruption in tourism marketing since late 2011, when the council of the day stripped the contract for tourism services from the Penticton and Wine Country Chamber of Commerce and awarded it to a private organization, the Penticton Business Development Group, which collapsed in Feb. 2012.
Tourism Penticton and the PHA have been operating in separate silos. Both groups were running campaigns to market the city since 2012 when the city signed a five-year contract giving control of the additional hotel room tax funds — about $400,000 to $450,000 per year — to the PHA.
Since then, there have been attempts to align the groups or to create a single tourism marketing board, which finally succeeded with the creation of Travel Penticton this year.
Haynes said gaining a commitment from the city is just one step in the process.
“We need to work through the process of renewing that opportunity,” said Haynes, explaining that renewing the two per cent hotel room tax also requires significant engagement with accommodators.
There are two components to gaining accommodator approval: 51 per cent of the registered members, but also 50 per cent of the room accommodation inventory in Penticton.
Haynes said she doesn’t think there will be a problem gaining the needed support for the MRDT, explaining they have been laying the groundwork for the renewal while developing the new, unified organization.
“We have been very diligent going out there and engaging with our stakeholders over the summertime,” said Haynes.
Travel Penticton’s request was passed with a unanimous vote.
Once all application requirements are completed city staff will return to council on Dec. 6 with the application requirements for the MRDT and proposed bylaw, allowing adoption of the bylaw before the Jan. 1, 2017 deadline.