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June 9, 2009

America Outdoors Association Bulletin

Bill to Promote Inbound International Travel into the U.S. Marked Up in Senate.  Heads to Floor for a Vote

S. 1023 proposes to set up a corporation with a board of directors consisting of members of the travel and tourism industry to promote inbound international travel to the U.S.  A $10 fee on international travel authorizations (purportedly collected through the Visa waiver program) would contribute $100,000,000 annually to the fund managed by the corporation.  Up to $100,000,000 in matching funds would come from assessments on the travel industry segments represented on the board, which is broad and includes, hotels, restaurants, intercity rail business, attractions and recreation, small business and retail, and airlines.  State travel and tourism boards, convention authorities and immigration officials also serve on the board.  Up to 80% of the amounts collected from the travel and tourism industry may come from in kind contributions. If cash contributions are collected from a wide cross section of the travel industry, the amounts from each business would be small.  However, if some industry segments chose not to participate in the funding strategies, then the share from other segments would be more significant.

The U.S. is losing market share in international travel and tourism due to what many foreign visitors view as unfriendly travel authorization policies and the absence of adequate travel and tourism promotion abroad.  One goal of the promotional effort is to change the image of the U.S. to welcome foreign visitors. 

A briefing on the funding strategies from the U.S. Travel Association is provided below.  The briefing says contributions from the industry are "voluntary", but they appear to required and enforceable if they are approved through a referendum by  industry segments represented on the board.  If you support this legislation, contact your Senators via the Capitol switch board:  202-224-3121.


S. 1023: Travel Promotion Act
Private Sector Funding

Funding Overview

• The Travel Promotion Act’s goal is to create a $200 million annual promotion program by generating $100 million in annual contributions from the private sector and matching those dollars via a new $10 fee on travelers from countries enrolled in the Visa Waiver Program (travelers who do not pay $131 for a U.S. visa).

• The private sector is permitted to provide up to 80 percent of its contributions in the form of “in-kind” goods and services, such as advertising time, development of creative materials and marketing of the Corporation for Travel Promotion brand.

• At least 20 percent of all private sector contributions must be in the form of cash.  All private sector contributions are voluntary.

Travel Industry Can Choose to Assess Itself

• In the event that the industry wishes to explore a transparent, formal and equitable process for raising all or a portion of their 20 percent cash contribution, the Corporation is authorized to conduct a referendum among members of the industry represented on the board.

• The assessment must be approved by a majority of those voting in the referendum.

• In the event that members of the industry vote to assess themselves, each member’s fees would be proportional to their share of the aggregate international travel and tourism revenue of the industry.

U.S. Supreme Court Authorizes Congressional Role in Referenda, Assessments

• Congress has long played an active role in the creation of assessments, often referred to as “checkoff” programs. 

• The U.S. Supreme Court ruled in 2005 that these programs are permissible and that Congress retains final oversight and statutory authority of referenda and assessments.

• Nearly three-quarters of a billion dollars are collected by some of the largest checkoff programs regulated by USDA, and nearly half is paid by the dairy producers and the milk processors. Other large programs include soybeans at $88 million, beef at $81 million, cotton at $71 million and pork at $47 million.  

• Similar to what is outlined in the Travel Promotion Act, all commodity checkoff programs are monitored by a federal agency (USDA’s Agriculture Marketing Service); are mandatory when approved by referenda; and have boards comprised of the private sector contributors who make decisions on the use of the funds.

America Outdoors Association
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