An additional per-night room assessment collected by hotel operators here for a tourism promotion effort launched nearly four years ago has generated about $5.5 million so far and is beginning to pay dividends, say tourism officials.


Primarily in response to the efforts of the local hotel industry, Spokane County and several of the cities in it formed jointly in 2004 whats called a tourism promotion area, or TPA, which then began assessing a per-night room charge of between $1 and $1.50 at every hotel and motel in Spokane County with more than 40 rooms.


The money is sent to the Washington state Department of Revenue, then returned to the county, says Ron Anderson, chairman of the eight-member TPA Hotel Commission, comprised of local hoteliers who determine each year how the money will be distributed here.


Harry Sladich, president and CEO of the Spokane Regional Convention and Visitors Bureau (CVB), says the TPA charge is separate and in addition to the 2 percent lodging tax thats charged to hotel and motel customers throughout Spokane County. About half of the lodging tax collected within the city of Spokane goes to the Spokane Public Facilities District to help service its debt. Most of the rest goes to the CVB.


The PFD owns the Spokane Convention Center, Spokane Memorial Veterans Arena, and INB Performing Arts Center. The rest of the lodging tax collected elsewhere in the county goes to fund tourism efforts similar to those paid for with TPA funds.


Anderson says the major goal for instituting the TPA assessment here was to infuse new money into the CVB and the Spokane Regional Sports Commission, which use the money to promote tourism here.


They are the two primary (tourism) marketing arms for all of Spokane County, and their budgets basically had been fixed for about 10 years, Anderson says.


Annual TPA receipts here have fluctuated roughly between $1.5 million and $1.7 million in the three full years the program has been in force.


All but up to $100,00 of TPA-assessment money goes each year to either the CVB or Sports Commission, usually through a two-thirds to CVB, one-third to Sports Commission split, says Anderson. The remaining funds go to organizations that submit written applications and present oral proposals to the TPA commission.


From 21 applications submitted this year requesting more than $200,000 in grant money from that portion of the TPA money, nine were funded, including $25,000 for the Spokane Lilac Festival and $20,000 for the Northwest Museum of Arts & Culture.


Like the 21 organizations that submitted those requests, both the CVB and Sports Commission also must submit annual written and oral applications to the TPA Hotel Commission.


The primary criteria for evaluating a funding request is whether the proposed funding will generate additional hotel-room occupancy here, says Sladich.


If we get a room occupied, they will go out to eat and shop, he says.


An exception to that theory came early this year when the large number of spectators attracted to Spokane for the U.S. Figure Skating Championships failed to meet the marketing projections of retailers and restaurant owners here, Sladich says.


The hotels made out like bandits, but not so much the other businesses here, he says. The figure skating fans were so fanatical they never left the arena.


Key money source


Both the CVB and Sports Commission get about half of their respective annual revenues from the TPA. The CVBs budget this year is about $2.7 million, and the Sports Commissions budget is about $900,000.


Until 2004, when the TPA was created, both groups operated on about half the budget they have now, at least in recent years, says Sladich.


Eric Sawyer, executive director of the Sports Commission, says TPA money has allowed his organization, which now has six full-time employees, to hire more people to generate more room nights here, which is our No. 1 priority. The commission generates hotel room nights by bringing sporting eventsand their numerous followersto Spokane, he says.


Sawyer says TPA money also was used to buy advertising to promote Spokane in the official NCAA tournament basketball program, which is being sold at every NCAA tournament basketball game this year.


The CVB, meanwhile, uses its TPA funds, about $1.3 million this year, in four general areas. About 41 percent pays the salaries of CVB salespeople and pays a New York City-based agency to market Spokane nationwide.


About 27 percent goes toward advertising and promotional materials. About 25 percent is spent mostly to promote Spokane at some 17 trade shows held throughout the U.S. and Canada. About 7 percent is used for administrative costs. The organization currently employs 24 people.


The CVB has set aside $100,000 in TPA money in a strategic marketing reserve fund, Sladich says.


Only used once since the TPA was adopted here, that reserve fund was instrumental in signing a February 2009 convention for the Reston, Va.-based National Association for Music Education to come here and bring 1,500 of its members.


Faced with competition from a Sheraton Hotel in Chicago, which offered that music group free use of its ballroom space if it filled the 800-room hotel there, the CVB worked with the PFD here to make a competitive offer that was accepted by the group, Sladich says.


In the offer, the PFD agreed to accept a lower rate than normal to rent the convention center to the music educators, and the CVB kicked in $27,000 from the strategic marketing reserve fund to help offset convention-facility costs for the event, says Sladich.


The CVB estimates that staging that convention here will have an economic impact locally of more than $1 million.


The relationship between the CVB and Sports Commission has changed since TPA money has become available, says Sawyer.


When we basically had the lodging tax, it was a lot more limiting, and we were in competition to get the money, Sawyer says. He says thats no longer the case.


The per-night room assessment ranges between $1 and $1.50 depending on how close a hotel or motel is to the convention center, Sladich says.


He says it took 16 months to put the TPA proposal together, get legislators in Olympia to approve the program, get it endorsed by the Spokane Hotel & Motel Association, then persuade Spokane County and the cities of Spokane, Spokane Valley, and Liberty Lake to enact it.


Sladich says that he; Anderson, whos also vice president of marketing for Spokane-based Magnuson Hotels; Dean Feldmeier, general manager of DoubleTree Hotel Spokane-City Center; and the late Jim West, who was a state senator and Spokane mayor, spent 2,000 hours between them adapting a TPA model from Sacramento, Calif., for use here.


The program went into effect in Spokane County in July 2004.


Since then, TPA programs within the state have been enacted in the Tri-Cities and Yakima.


Contact Rocky Wilson at (509) 344-1264 or via e-mail at [email protected].