California’s Tourism Budget Doubled For 2015

Caroline Beteta, CEO of California’s Tourism Board, has announced that California’s tourism budget has increased from $50 million to over $100 million. This is the result of increasing assessments on rental cars, hotels, restaurants, and tourist attractions throughout California. In other words, the small percentage that the California Tourism Board takes from tourism related transactions has increased.

The decision is the outcome of the Dream Big Dividend, a process led by the Visit California Board of Directors, which is designed to increase the number of tourists visiting the state of California. A December vote saw 75 percent of 9,500 participating businesses in favor of increased assessment rates, which ultimately determine their contributions to the Visit California budget.

Various businesses, including rental car services, restaurants, retail stores, accommodations, recreational services, and transportation services, agree that the extra funding to increase the tourism rate is a good investment, considering the amount of money tourists add to California’s economy.

In 2013, travelers spent a total of $109.6 billion in California and tourists directly supported 965,800 jobs. Additionally, in 2014, tourists spent over $117 billion, which created $9.5 billion in tax revenue for local industries. The fields directly linked to tourism include accommodations, food service, arts, recreation, entertainment and retail.

Since the amount of money spent to increase travel and tourism to the state has doubled, it would be reasonable to expect that the number of visitors to the state should also double. If that is the case, travelers to the state of California could spend over $218 billion, and directly support over a million jobs.

The state is already ranked the #1 tourist destination in the United States, and it’s also one of the top three international destinations. California expects to see the greatest increase in global tourism from Asian countries. The current top states for inbound travel to California include Arizona, Nevada, Washington, Oregon, Texas, and Utah. This is likely because of the location of these six states. The top countries for inbound travel to California include Mexico and Canada, followed by China, the United Kingdom, Australia, Japan, Germany, South Korea, France, Scandinavian, and India, in that order.

However, the strengthening US dollar, coupled with the weakening Euro may cause international tourists to spend less money on accommodations, rental cars, and restaurants. The exchange rate may also cause US travelers to choose to travel overseas, and take a European vacation rather than staying in the United States.

According to Visit California’s website, the California Tourism Marketing Act was enacted in 1995 with the intention of increasing the flow of tourists to the state of California. The act is renewable by industry vote every six years, and has passed the vote by extreme margins during every vote thus far.

Visit California was created as a nonprofit public benefits company, with the purpose of overseeing the marketing activities and advertising aimed at increasing the number of tourists to the state.