Hotel tax task force hears about Convention Center as a ‘loss leader’ and economic engine
The newly formed group tasked with recommending how to spend millions of tourist tax dollars held its inaugural meeting Wednesday, raising questions about future uses and a subsidy needed to run the Orange County Convention Center.
The appointed panel spent most of its first meeting learning about public-meeting laws, statutory restrictions for using the money generated by the 6% tax tacked onto the cost of a hotel room and the history of the lucrative levy.
Stephen Facella, a pizza chef and Windermere restaurant owner appointed to the advisory group by District 1 Commissioner Nicole Wilson, questioned a county tourist tax expert about how last year’s record haul of $336 million was spent.
The biggest share, about $96 million, was spent on Visit Orlando, the region’s tourism marketing arm; about $91 million went into reserve accounts, so-called “rainy-day” funds for obligations when collections sag; and $76 million to pay debts owed to build and enlarge the convention center and other public venues.
Facella noted that $14.4 million subsidized operations at the Pentagon-sized convention center.
“How many years does the convention center run in the red?” he asked.
“In its history? Most years,” said Fred Winterkamp, manager of the county’s Fiscal and Business Services Division. “But keep in mind that we’re using that money also to incentivize groups that spend hundreds of millions of dollars in the community to not be in Nashville, Tennessee, or Denver or somewhere else but to come here. So it is also sort of a loss leader to bring in the shows because, remember, what we’re looking for is that visitor spending.”
The economic impact of visitors is about $3 billion annually, Winterkamp estimated.
Often viewed as a gauge for the tourism industry’s health here, tourist tax revenues soared to record levels over the past 12 months, shattering collection records, after a crash in spring 2020 when theme parks closed amid the coronavirus pandemic.
The levy, created in 1978 by a voter referendum, is also known as the hotel tax, tourist development tax or TDT for short. Revenue spending is restricted by state law.
Officially known as the Tourist Development Tax Citizen Advisory Task force, the panel has an information web page, www.ocfl.net/TDT, but no members who are elected officials, lobbyists or representatives of organizations that get TDT funding or who are seeking a share of it.
“That does not mean that we should not hear from them. We will hear from those particular entities,” Orange County Mayor Jerry Demings said in an introduction to the advisory panel group. “We want you to take their input and to take it very, very seriously as we move forward with the work before us. ...”
The mayor picked the group’s co-chairs, former Orlando Sentinel managing editor Jane Healy and Tony Jenkins of health-insurance provider Florida Blue. Some members were selected by county commissioners, others by Orange County municipal leaders.
The panel’s future meetings are scheduled for April 17 at 9 a.m.; May 24 at 9 a.m.; June 26 at 2 p.m. and July 17 at 9 a.m. They are expected to wrap up their work in July and present a report to the Tourism Development Council and Orange County commissioners, the latter of which has the final say on TDT spending.
Demings told the task force they will help “establish priorities” for future tourist tax spending.
But he cautioned them to work within the state law, which limits how the money can be spent.
Other members include: former Orange County commissioner Pete Clarke, representing the city of Belle Isle; labor leader Eric Clinton, representing the Central Florida AFL-CIO; Thor Falk, representing the Pride Chamber of Commerce; Eric Gray, executive director of the Christian Service Center for Central Florida; Julian Johnson, representing the town of Eatonville; college student Xelayris Martinez, representing UCF student government; Chris Mueller, representing the I-Drive Resort Area Chamber of Commerce; Katie Nguyen, representing the Asian American Chamber of Commerce; Jennifer Quigley, representing the city of Orlando; Fred Robinson, representing the Orange County Mayor’s Veterans Advisory Council; Roberto Santoni, representing the Hispanic Chamber of Commerce; and Ella Wood of Unite Here Local 737, which represents about 19,000 hospitality/tourism workers.
