Tourism helps tax revenues grow in Erie County

SANDUSKY What a difference tourism makes. Although the local economy continues to str
Tom Jackson
May 24, 2010



What a difference tourism makes.

Although the local economy continues to struggle, Erie County has been able to collect badly needed revenues from the county's still-growing sales tax receipts.

Last week, county commissioners announced sales tax revenues collected in August and turned over this month were up 5.61 percent. Sales taxes also grew in the previous four months.

Although the Ohio Department of Taxation does not provide a breakdown of sources for the monthly salestaxes, other documents suggest tourism is making adifference in an otherwise-down economy.

And local tourism officials think the numbers show they did a good job of marketing the area after they persuaded county commissioners to turn over more bed tax revenue to the local visitor and convention bureau.

Every year, the Ohio Department of Taxation publishes an annual report detailing which sectors of the economy are responsible for sales tax revenues in each county.

The 2007 report shows that statewide, collections from arts, entertainment and recreation businesses accounted for only 0.4 percent of Ohio's sales tax receipts.

In Erie County, though, the category provides 10.1 percent of the sales taxes.

Statewide, accommodations and food services (which includes restaurants and hotels) provide 7.1 percent of the sales tax receipts. In Erie County, the figure is 10.3 percent.

Bed tax receipts this year also suggest visitors still rolled into Erie County this year, lured by Cedar Point and the Sandusky area's growing indoor waterpark industry.

Erie County collects a 2-percent tax on room charges in local hotels, commonly referred to as the "bed tax."

Erie County Shores and Islands, the local visitor and convention bureau, has received the first 1 percent for years and this year began receiving most of the second 1 percent.

A comparison of receipts on the first 1 percent shows that bed tax revenues were up 14 percent for the fiscal year ending Sept. 30, said Dawn Weinhardt, managing director of the visitor bureau.

For years, county commissioners used the second percent to pay the debt for the county's share of widening U.S. 250.

The debt has finally been paid off, and the commissioners agreed to allow most of the second 1 percent go to the visitor bureau. The visitor bureau got the additional money for nine months in its last fiscal year, and will receive it for a full 12 months this year.

As a result, the visitor bureau's advertising budget, which it uses to hammer home its new "Lake Erie Shores and Islands" marketing brand, went from $570,000 to $1 million, Weinhardt said. It will be $1.3 million for the current fiscal year, which includes summer 2009.

Weinhardt said she believes the hike in bed tax revenues and the good news about county sales taxes are a direct result of the hike in tourism ad dollars.

"We really do think those advertising dollars were spent wisely," she said.

Greg Hill, president of Sawmill Creek Convention Center and Golf Resort in Huron, is a member of the visitor bureau's board. State law says bed tax money is supposed to used to aid tourism, Hill said.

The hike in tax revenues are "what we predicted if you allow us to use our bed tax money," Hill said.

He said the "Lake Erie Shores and Islands" brand, which applies to a two-county area, is a description of Erie and Ottawa counties that doesn't have to be explained to potential visitors.

"You've identified geographically something that people can relate to," he said.

The tourism industry in Erie County sometimes comes under fire from critics who say that it doesn't generate high-paying jobs.

"There are jobs in all levels in tourism," Weinhardt replies. "When you have corporate headquarters like Cedar Fair, those are not entry level positions that pay minimum wage.

"Every company has general managers and heads of departments and IT people who keep them competitive in Web marketing. Those jobs are not entry level jobs."