Bill Text: CA SB285 | 2021-2022 | Regular Session | Amended

California Senate Bill 285 (Prior Session Legislation)

NOTE: There are more recent revisions of this legislation. Read Latest Draft

Bill Title: California Tourism Recovery Act.

Spectrum: Slight Partisan Bill (Democrat 25-13)

Status: (Failed) 2022-02-01 - Died on file pursuant to Joint Rule 56. [SB285 Detail]

Download: California-2021-SB285-Amended.html

Amended IN Senate March 16, 2021

CALIFORNIA LEGISLATURE— 2021–2022 REGULAR SESSION

Senate Bill

No. 285

Introduced by Senator McGuire
(Principal coauthor: Assembly Member Quirk-Silva)
(Coauthors: Senators Allen, Archuleta, Bates, Borgeas, Bradford, Cortese, Dahle, Dodd, Grove, Hertzberg, Hurtado, Jones, Laird, Melendez, Min, Newman, Nielsen, Ochoa Bogh, Portantino, Roth, Rubio, and Umberg)
(Coauthors: Assembly Members Bigelow, Bloom, Chen, Chiu, Cunningham, Davies, Cristina Garcia, Grayson, Mullin, Nazarian, Santiago, Valladares, and Wood)

February 01, 2021

An act to add Chapter 5 (commencing with Section 13999) to Part 4.7 of Division 3 of Title 2 of the Government Code, relating to economic development.

LEGISLATIVE COUNSEL'S DIGEST

SB 285, as amended, McGuire. California Tourism Recovery Act.

Existing law, the California Tourism and Marketing Act, establishes a nonprofit mutual benefit corporation named the California Travel and Tourism Commission under the direction of a board of commissioners composed of 37 members, including the Director of the Governor’s Office of Business and Economic Development.

This bill, the California Tourism Recovery Act, would require the commission to, upon a determination by the Department of Public Health that it is safe to resume travel in California, implement a strategic media and jobs recovery campaign known as the “Calling All Californians” program for the purpose of reversing the impact of the COVID-19 pandemic on the travel and tourism industry in California, as specified. The bill would require the commission to report to the Legislature, on or before January 1, 2024, regarding the cost of the program and the impact of the program on the tourism industry in California. The bill would require, only upon appropriation by the Legislature, the Controller to transfer $45,000,000 to the commission for the purpose of implementing the “Calling all Californians” program.

Vote: MAJORITY Appropriation: NO Fiscal Committee: NO Local Program: NO

The people of the State of California do enact as follows:

SECTION 1.

This act shall be known as the California Tourism Recovery Act.

SEC. 2.

The Legislature finds and declares all of the following:

(a) California’s travel and hospitality industry is one of the largest economic drivers for the state. Before COVID-19, more than 1.2 million California workers earned their livelihoods in hospitality. Visitors spent $145 billion annually at California businesses, generating $12.3 billion in state and local tax revenues. International travelers spent $28.1 billion in California, making travel the state’s largest export.

(b) The coronavirus pandemic has impacted travel and hospitality more than any other industry, confirmed by the recent report of the Governor’s Task Force on Business and Jobs Recovery. More than one-half of California’s 1.2 million travel and hospitality industry workers lost their jobs because of the pandemic.

(c) For every hospitality job lost, a ripple effect occurs. Every three travel and hospitality industry jobs support another two California jobs. Thousands of small businesses, including florists, farmers, ranchers, fishermen, bakers, brewers, winemakers, coffee roasters, print shops, launderers, cleaning services, technology providers, and a host of other producers and service providers all rely on the hospitality industry for their livelihoods.

(d) Thousands of businesses are reeling, and one of the state’s most vital tax sources has dried up. California lost $78.8 billion in visitor spending in 2020, which is a 54.5 percent decline.

(e) The transient occupancy tax (TOT) paid by hotel and vacation rental guests directly powers local communities across California. Forty-six cities rely on TOT revenue to cover at least 30 percent of their overall general fund expenditures. Cities anticipate an immediate impact to their core revenue sources due to COVID-19, with an 89 percent decline in TOT in 2020. The federal stimulus enacted in early January fails to provide additional funding to local governments, further jeopardizing the critical services they provide our communities.

(f) The California Travel and Tourism Commission, doing business as Visit California, is a nonprofit mutual benefit corporation with a mission to develop and maintain marketing programs, in partnership with the state’s travel industry, that keep California top-of-mind as a premier travel destination. Visit California operates a global marketing program in 14 markets on behalf of the tens of the thousands of California businesses who benefit from travel. The Office of Tourism collects the fees that fund Visit California’s campaigns and initiatives. Since its inception in 1997, Visit California has become the number one state destination management organization. Before COVID-19, Visit California’s programs annually delivered $14.8 billion of additional visitor spending to the state’s economy. Visit California has a record of spending money wisely. More than 90 percent of the budget goes directly to marketing and reserves with less than 10 percent going to operations.

(g) Visit California is funded by private businesses through a self-imposed assessment, which means the closure of the state’s tourism industry immediately and dramatically reduced Visit California’s revenue. These severe shortfalls have forced Visit California to cancel all existing marketing programs and close all 14 international offices, in addition to reducing staff by more than 50 percent.

(h) Without help, California’s travel and hospitality industry will not recover until 2024. Local governments that rely on TOT will have significant budget gaps for years. The federal government has failed to provide additional funding to local governments, further jeopardizing the critical services they provide our communities.

(i) For every $1 invested in Visit California, state and local governments will reap $19 in additional tax revenue. A $45 million, one-time appropriation to fund an in-state and western drive market campaign would deliver $10.3 billion in revenue to California businesses and $865 million in additional state and local tax revenue. This campaign, launched when the California Department of Public Health declares it is appropriate to resume travel, would emphasize that it is safe to travel and how to travel safely.

(j) In California, 65 percent of hotel rooms are in urban regions. Recovery for these urban centers will be critical for the overall health of the industry. Likewise, key sectors have been hit especially hard, including theme parks and restaurants, arts and culture institutions, and the performing arts industries, that will need added support.

(k) Domestic leisure travel offers the best immediate opportunity for recovery because business and international travel will lag years behind. However, as COVID-19 begins to be controlled, it will be an extremely crowded marketplace. California needs to actively market itself to prevent decay in awareness, preference, and travel intent. California is already behind as other states allocate funds to their tourism sectors in anticipation of marketing to visitors once the pandemic is under control. For example, New Mexico, with a travel economy 20 times smaller than California’s, is earmarking $25 million for tourism marketing as part of its COVID-19 recovery plan.

(l) This funding approach was successfully deployed in the aftermath of the September 11, 2001, terrorist attacks to leverage a one-time funding allocation of $8.3 million in state funds to Visit California to jumpstart California’s economic recovery at that time. With that money, Visit California was able to turn it into a $20 million campaign.

SEC. 3.

Chapter 5 (commencing with Section 13999) is added to Part 4.7 of Division 3 of Title 2 of the Government Code, to read:

CHAPTER 5. Calling All Californians

13999.

As used in this chapter:

(a) “Program” means the Calling all Californians program created by this chapter.

(b) “Visit California” means the California Travel and Tourism Commission.

13999.1.

(a) Upon a determination by the Department of Public Health that it is safe to resume travel in California, Visit California shall implement the program pursuant to Section 13999.2 for the purpose of reversing the impact of the COVID-19 pandemic on the travel and tourism industry in California.

(b) Visit California shall contribute two million dollars ($2,000,000) from its funds to produce content for the program.

13999.2.

(a) The program shall be a strategic media and jobs recovery campaign known as “Calling All Californians” and shall be targeted as follows:

(1) The first campaign shall engage in-state active travelers to fuel travel intent.

(2) The second campaign shall continue to engage in-state active travelers while expanding paid media reach into western region drive markets that border California.

(3) The third campaign shall continue to engage in-state active travelers while expanding paid media reach to a national audience.

(b) The campaigns described by paragraphs (1) to (3), inclusive, of subdivision (a) may occur concurrently.

13999.3.

On or before January 1, 2024, Visit California shall report to the Legislature regarding the cost of the program and the impact of the program on the tourism industry in California.

13999.4.

The Controller shall, only upon appropriation by the Legislature, transfer forty-five million dollars ($45,000,000) to Visit California for the purpose of implementing the program.