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 San Francisco Convention & Visitors Bureau Concerned
Over the Proposed De-funding of the Bureau
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Friday, Dec. 3, 2004 

Update on Proposal to De-fund Bureau's Hotel Tax Allocation

For those of you who didn't have the opportunity to attend, or haven't heard about the Board of Supervisors' Budget Committee meeting yesterday, I'm sorry to report it didn't go well at all.  Committee Chairman Gerardo Sandoval and Supervisor Chris Daly opened the meeting by stating their support of cutting the Bureau's hotel tax allocation before public testimony was ever heard. Moreover, despite being one of the first to fill out a speaker's card and personally hand it to the clerk -- long before the hearing commenced -- the Chairman did not have the courtesy to call on me to speak during more than an hour of public testimony. 

The message that I and others at the meeting heard was that the proposal to drastically reduce the SFCVB funding is being made to help offset proposed cuts to City programs that may not have been necessary if, in the words of the Supervisors, "big downtown businesses" had not opposed other tax proposals. In other words the Bureau is being held political hostage to get the attention of the greater business community.  In essence, the tourism segment of San Francisco's economy is being asked to pay for the voters' failure to pass Propositions J & K last month, and because "big business has not stepped up to the plate" to make-up for tax revenue lost last year as a result of a lawsuit brought against the City by several major employers in the City.

These are the facts!

It's clear to me that some at City Hall simply don't understand that the Bureau represents only a portion of San Francisco's business community, and that it's role is strictly that of destination sales and marketing charged with bringing more business, taxes and jobs to our city.

  • In 2003, the tourism industry employed more than 61,300 people - people that reside in every San Francisco neighborhood, as well as throughout the Bay Area. 
  • Visitors spend more than $375 for every dollar expended by the SFCVB to promote San Francisco. Put another way, visitors generate more than $46 in City taxes and fees for every $1 of hotel tax allocated to the Bureau for visitor promotion. 
  • The money generated by tourism taxes and fees helps fund San Francisco's community and government programs. 
  • The bureau's allocation from hotel tax has already been reduced more than $1.1 million since 2001 (13%), and staff has been reduced 7%.  The way to assure more visitor generated taxes is to maintain -- if not increase -- effective sales and marketing efforts by the Convention & Visitors Bureau. On the other hand, reduced marketing efforts can lead to fewer visitors in the future and further erosion of the tax base provided by visitor spending. It's simple logic that might escape some at first.
So, where do we stand? 

The proposed ordinance rescinding half of the Bureau's hotel tax allocation, $3.66 million, is still being considered and will be presented to the full Board on Tuesday, Dec. 7, with no action to be taken. Also, the Budget Committee will meet next Thursday, Dec. 9, at 10 am to further discuss and receive testimony on the proposal.

Since it appears that the ordinance could go to the full Board for a vote by mid-month it is critical to communicate your concerns with all 11 Supervisors on this issue as to why it is important for the to City to maintain and grow the visitor economy in the absence of other tax sources at this time.

The 11 City Supervisors fax and phone numbers are on the City's Web site / click here

Thank you for your continued support of San Francisco's largest industry, and of the Bureau.

John A. Marks
President & CEO
San Francisco Convention & Visitors Bureau 

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Contact:
San Francisco Convention & Visitors Bureau
Laurie Armstrong
(415) 227-2603
larmstrong@sfcvb.org
Also See: San Francisco Convention & Visitors Bureau Rebrands itself 'Only in San Francisco.' New Theme Incorporated into Bureauís Marketing Efforts / June 2004
The 300,000 sq ft Moscone West Convention Center Expansion is Completed; 89 Pre-Opening Bookings through 2013 / June 2003


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