Kara Franker, the president and CEO of Visit Florida Keys Monroe County Tourist Development Council, joined Good Morning Keys on KeysTalk 96.9/102.5FM this morning to talk about what’s going on with tourism.
There are two bills in the legislature right now that could have a huge impact on our way of life in the Florida Keys, HB 1221 and HB 7033.
Franker said, “For weeks we’ve been watching House Bill 1221, and that is one that would force all tourism development taxes to expire every eight years, essentially like a referendum. But the issue with that is it places the tourism economy on a never ending treadmill of uncertainty. So we’ve been watching that for weeks, watching what they’ve been doing, it starts early, and then we get towards the end, and things heat up. That’s exactly what happened this week. So with less than 24 hours notice, they filed an amendment that took that threat to a whole new level. So it maintained the damaging, eight year sunset provision, and it completely eliminates the ability of counties to use TDT so tourism development taxes for their intended purpose, which is promoting tourism. Then instead, 100% of TDT proceeds would be used as a credit against county residents’ property tax bills. We can unpack that a little bit, because I know property tax is a huge issue, but what we’re talking about here is maybe statewide, I think $1.8 billion, if I’m correct, that’s how much tourism development taxes are collected statewide, but there are $16 billion in property taxes that are levied. So there would be a minimal offset of property taxes, but a huge, devastating fiscal loss, with what you would find that would happen from not getting the TDT to go to what it’s supposed to go and then one of the other scary parts, and this, I’m telling you, it was pretty crazy to find out, like the night before, that this was happening, it would also dissolve all County Tourism Development Councils, and there are more than 60 of those statewide. So they would sunset, essentially, by the end of the year, the end of 2025. So it’s a huge attack on the tourism industry.”
The impact of the Tourist Development Council and TDT funds goes far beyond just promoting the destination.
Franker said, “The timing of this is pretty crazy, because we just announced at our last Tourism Development Council meeting an economic impact study that we just had commissioned, and I believe 11,000 jobs in the Florida Keys are directly attributable to the tourism industry. So this bill is essentially a job killer. This is what we depend on.”
How would tourism exist without promotion?
Franker said, “This theory has been tested, and I like to think of it this way too, first, let’s think about an election cycle, and all of the signs that you see that line US 1 with people’s names on them, and they’re running for office. Why do they do that? If they didn’t put those signs out, if they didn’t go shake hands and kiss babies, who’s going to win those races? So even our elected officials market themselves. But this theory has been tested. So in 1993 the state of Colorado got rid of their state tourism and it cost them billions of dollars. I think the study is called the rise and fall of Colorado tourism. So they completely eliminated their tourism marketing function. They cut, I think it was $12 million promotion, down to zero, and then their domestic market share plunged, I think was like 30% within two years, they lost over $1.4 billion in tourism revenue annually, and then the revenue loss increased to well over $2 billion yearly and that’s all documented. So there’s a reason why marketing, why we have to do it and we have to compete. So if you think about a place like Broward County, where I have to double check this, but I don’t believe they have a TDC, because they’re under the county. So this might not affect them, but we compete with them for visitors, just like we do for the Caribbean and other places. If the Caribbean is going to completely still blow out their marketing, and think about what’s happening on an international and national scale with tariffs on, tariffs off, Canadians upset with us, but Canadians still want to come because of the weather. So there’s so much chaos happening anyways, so you have to compete for those visitors, and then if we just stop doing that, what happens?”
This bill advanced through committee as of yesterday. What is the next step?
Franker said, “This isn’t a done deal. The end of this legislative session is May 2 and who knows if they’re going to meet their deadlines and they have to extend farther than that, but things have to go through the Senate, but this is not a time to be silent. If this is an issue that makes people kind of be scared about their future, this is a time to contact our local representatives and to let them know, and then we’re collecting stories about how tourism affects our businesses. They’re already starting to come in. I have Crane Point, that’s an attraction in Marathon, they totally depend on tourists. So they’re saying, without tourism, or without the marketing that that drives it, they would probably be laying off 12 employees who depend on their paycheck every week at that attraction. That’s just one example. We’re spending millions every year out of the tourism development taxes to do things like coral reef restoration and beach renourishment and other items that are directly attributable to making the community a better place. I have my team working on crunching those numbers so I can show exactly what we’re spending on those kind of things. Part of the reason why I was hired in the first place, I’ve been here for about seven months, is to fix some of the previous issues of the TDC, and we are doing this huge shift towards making the resident quality of life a huge focus on the reason of why we’re doing what we’re doing. We want the economic stability for our small businesses, but we also want to promote the fact that we want our residents to have a solid quality of life, and we want to make sure that we’re preserving the land, the water, our animal life, the things that make this place so special. So all of that work that we’ve done in the last seven months to kind of clean up, what the TDC is standing for, and to do the strategic planning, it’s really kind of crazy then to be faced with an issue that’s this big, that could completely eliminate the work that we’re trying to do.”
Every $1 invested in tourism marketing returns up to $3.27 in tax revenue.
Franker said, “The TDT fuels marketing efforts that generate more than 2 million jobs statewide and $124 billion in annual visitor spending. So if we’re doing that well, if we have this huge economic driver, why mess it up? Why kill the goose that laid the golden egg? I don’t understand it.”
It would be tough to go back to how life was in the past in the Keys.
Franker said, “I recently got tipped off to read this book called Key West on the Edge. It details the different pieces of the economy that the Keys had tried, cigar rolling and these different items, and it wasn’t until tourism that really made a huge difference in the lives of the people who live and work here, and that’s a big deal. I want to emphasize hope is not lost here. There is an opportunity for change. It’s really about people sharing their stories, about why they depend on tourism to put food on the table and a roof over their heads. It’s those stories that can really make a difference that we can share with our representatives. You’ve got to think that this is the time for leadership, when people really stand up and they want to do what they can to protect their livelihoods.”
This feels kind of like the idea of consolidating judicial districts – it would take control of our own destiny out of our hands.
Franker said, “I am a former prosecutor in Miami Dade County, and it couldn’t be more different of what goes on in Miami and what goes on in the Florida Keys. I think it’s really important that we maintain that local voice, not only for that side of what we have to deal with, but we need those local voices to hold us accountable at the TDC. So there’s oversight, there’s community involvement. So these amendments would essentially replace the local governance with the forced mandates from Tallahassee and we’re very far from Tallahassee. We’re the same state, but couldn’t be farther away from what’s going on up there. Everybody that I’ve talked to is on the same page, is wanting to protect our economic driver. Everyone can have different opinions. Property taxes, and those things are definitely frustrating and there should be discussion on what that looks like, but the answer is not to abandon what’s powering our economy.”
What can people do?
Franker said, “Right now it’s about contacting our local representatives and letting them know how you feel about this legislation, and I think, also sharing stories about why tourism is important, and not staying silent. Sometimes I take this point for granted, but want to make sure that people understand that this is a tax that residents do not pay. This is all paid by visitors. They come here, and they spend time in our destination, and they pay for that, and then that money is put back into our economy, and then back into the tourism promotion to bring more folks, and hopefully high value tourists, ones that value the same things that we do. It’s not a tax that residents pay.”
In fact, about $35 million in TDC funds was given to the county that will go to workforce housing.
Franker said, “That was a one time thing that Governor DeSantis had enabled under the statute that $35 million and the TDC put that forward and said, here, take this money. Let’s invest in workforce housing. I think that there are opportunities to think about solutions like that going forward. That’s not just draining the entire budget, and that’s about what our next step is to at the TDC. We’re doing strategic planning. We’re looking at, what do the next three years look like? What do our residents need? Workforce housing is a huge piece of that and how can we support issues like that without completely draining the funds that are needed to make sure that we’re keeping the economy running like it should?”
For more information, click here: https://www.monroecounty-fl.gov/328/Tourist-Development-Council