By Bruce Hyde
It is with great interest that I follow the governor's and Legislature's proposals to fill the growing deficit. For the past four years budgets have increased by 5 percent annually while the Vermont economy has been growing at a fraction of that rate. Vermont is in the unique fiscal situation it is now simply because of overspending.
Balancing the state budget on one-time revenue and using federal money for ongoing expenses is not prudent. In fact, it has been a recipe for disaster. It has been irresponsible and reckless policy and now the same policymakers are considering cutting many areas of state government to make up the more than $100 million deficit this year. One area under consideration is the elimination of the Vermont Department of Tourism and Marketing (VDTM).
Vermont is more dependent on visitor spending than almost any other state. The return on every state dollar spent on effective marketing and promotion programs for Vermont is returned through state tax collections by many multiples. The return is quick: A dollar spent will often return 10 or more tax dollars within a few months of spending.
While commissioner of VDTM, I oversaw research on the economic impact of visitor spending. We learned that the majority of workers and owners in the tourism industry are full-time, dedicated professionals who love their work and enjoy their lifestyle. While there are some seasonal and part-time jobs, the average full-time hospitality employee makes more than the median income in Vermont within five years. These are Vermonters who start young
(washing dishes, bussing tables or housekeeping) and who have ambition and rapidly progress in their career. Not many jobs have such quick mobility and advancement.
Eighty million potential visitors live within a day's drive of Vermont. This should be the target audience of any marketing promotion as more than 90 percent of our revenue is derived from this population. But even international sales missions have a high return on a minimal investment if targeted to our core markets. More than 10 percent of Vermont's visitors are international: Canada, Great Britain, Germany, Japan and France all are worthwhile investments to lure visitors to Vermont. (On the other hand, our tourism commissioner's recent trip to Australia will return little. It's hard to believe that this multi-week trip was approved during a time of great financial difficulties for our state, particularly when the Legislature is in session.)
Of course, it is important that state dollars are spent effectively and efficiently, utilizing the latest technology. Too often grants are given out for political purposes and are of little benefit to the taxpayer; indeed, many state dollars are wasted merely filling the coffers of struggling organizations. Instead, partnerships with businesses and nonprofit organizations are excellent ways to stretch valuable state dollars and yield a higher return to the taxpayer.
Policymakers should look closely at substantially increasing the marketing and promotional budget of the state rather than cutting it. Our neighboring states have chosen to increase state marketing budgets and spend many times what Vermont does and we continue to lose market share to them. New York Governor Cuomo just announced a large marketing increase to lure winter visitors to the Adirondacks in the coming weeks. Vermont hospitality will watch and weep.
Why wouldn't Governor Shumlin increase marketing dollars now as many other states are doing? Five to 10 tax dollars could potentially be collected for every dollar spent.
Hyde lives in Fayston and is the former director of tourism and marketing for the state of Vermont.
