Jan 12, 2023 - Business

Richmond region's big tourism funding push

A 1940s vintage postcard. Photo: Found Image Holdings/Corbis via Getty Images

The Richmond region could get a big influx of cash to help bolster tourism to the area and better compete against other cities for big conventions and events.

Why it matters: Richmond is potentially losing valuable tourism dollars to other cities with bigger budgets for marketing — and for financial incentives to attract big-deal events and conventions.

What they're saying: "What's happening is the industry is entering an arms race, and people are providing incentives to get [events] to market," Neil Amin, CEO of Richmond-based Shamin Hotels, tells Axios.

  • To be competitive, Richmond needs to offer subsidies, such as free parking, to lure big events. And it needs money to do it, he adds.

What's happening: Richmond Region Tourism is proposing an additional 2% fee on hotel stays in six areas — Richmond, Chesterfield, Henrico, Hanover, Ashland and Colonial Heights — to create a dedicated fund to promote tourism to the region.

  • If passed by each district, the fund would double the local tourism group's annual budget.

State of play: At around $8 million a year, Richmond's current budget is dwarfed by the cities it competes against for tourism, Katherine O’Donnell, Richmond Region Tourism's executive VP, tells Axios.

The group has been working for the past year to create the fund, meeting with local government officials and hotel operators to shore up support, O’Donnell said.

  • Nationwide, 19 states have similar programs, and Virginia lawmakers gave the OK for local governments to approve them in 2021.

How it works: Hotels with 41 or more rooms in the six districts would add a 2% fee to all hotel stays, which would be paid by customers in addition to the 8% transient occupancy tax each region levies now.

  • Richmond Region Tourism estimates it will bring in $8.2 million in its first year if in place by July, and the money would be controlled by a panel of local hotel operators.

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