UNIQUE TOURISM FUNDING PROPOSAL PUSHED IN HOUSE

JEFFERSON CITY - For many years, tourism officials and some legislators have been struggling to find ways to increase state funds that are available for promoting tourism in Missouri.

Last year Rep. Herb Fallert, D-Ste. Genevieve, chairman of the House committee that deals with tourism, proposed a sales tax increase for tourist-related industries that would be earmarked for tourism.

But the industry rebelled and Fallert's bill was promptly derailed. So the veteran legislator asked the industry to come up with a plan.

Fallert said: "We basically said, `If this is not what you want, what do we need to do?' They formed a task force on tourism that has been working on this proposal for about a year."

The end result of that task force is a unique plan that does not increase taxes, but does give the Division of Tourism a share of sales tax revenue created by growth in the tourism industry.

Fallert said the bill has strong support from the tourism industry, and, if passed by the General Assembly, will generate the kind of revenue the industry has needed to expand tourism.

"Based on our research, we think that for every dollar spent by the tourism division on promotion and advertising there is a return in sales taxes to the state of Missouri of between $8 and $9.50," said Fallert.

He said those figures do not take into account benefits to the overall state economy that would be reflected in local sales taxes, sales taxes in non-tourism related industries, and income tax revenue generated by new jobs and increased pay.

Sen. Danny Staples, D-Eminence, chairman of the Senate's committee that deals with tourism, also supported Fallert's sales tax plan last year. He promised to support Fallert's HB-188 as long as it comes through the House without significant changes.

"We certainly need to do something to get more money in tourism," said Staples. However, the senator said he fears the bill will become easy prey for House members to tack on amendments.

Said Staples: "I don't disagree with the concept; we do need to fund tourism adequately. But the problem you've got is, if you have something that deals with growth in taxes and dedicated taxes, there will likely be all kinds of wild amendments offered on the floor of the House.

"I fear the wild and crazy amendments, and, if that happens and I get the bill into committee here, I will strip it down to its original intent."

Fallert's committee held a hearing on the bill Tuesday as about 300 proponents of tourism visited the Capitol to urge support for the plan. Among those walking the halls and addressing each chamber were singers Tony Orlando and John Davidson, who perform at Branson.

Among those testifying before the House committee was Jim Drury, president of Mid-America Hotels based in Cape Girardeau. Drury was one of the ardent opponents of last year's tax plan. Fallert noted that his comments Tuesday were supportive of the task force proposal.

According to the legislation, 15 industries that benefit directly from travel and tourism are singled out such as restaurants, motels, campgrounds, amusement parks and country music shows in Branson. For fiscal year 1994, which begins July 1, the bill calls for a tourism budget of $7.5 million as the core figure.

Fallert explained that each year after that, beginning in fiscal year 1995, the increased sales tax revenue from those 15 types of businesses would be compared and 25 percent of that increase would be used for additional tourism funding.

"According to our proposal, if we keep on that schedule, we think by the year 2001 the tourism budget should be around $20 million," said Fallert. "At that point, the 25 percent figure would drop back to just 10 percent of the additional dollars."

Based on discussion at Tuesday's hearing, Fallert explained two changes would likely be made in the bill. One would set a limit on the amount of funds the tourism division would get from the plan and the other would not give tourism a share of the sales tax that is due to normal economic growth.

Fallert said state tourism officials have identified two very large markets for tourism advertising the Chicago and Dallas areas and with more funding could promote Missouri in those areas. The state does little marketing to attract foreign tourists.

Although much of the tourism budget goes for advertising and promotion, Fallert said the division also needs to allocate some funds for research and training. Fallert said the bill is the top priority of his committee this session and he hopes to send it to the full House soon.

He said the new approach for funding outlined in the bill may cause concern to some legislators.

"The legislative body in the past has been very reluctant to earmark money, but I think this is a different concept," said Fallert. "All we are saying is to give us a chance to grow and we want part of that growth."

Fallert stressed this is a different type of earmarking because it identifies clearly the monetary return from an investment in tourism promotion.

Sen. Peter Kinder, R-Cape Girardeau, said he will take a close look at the bill if it comes to the Senate. "It looks to me like it has some momentum," he said. "Several people have had good things to say about the proposal."