Central Florida’s Anna Eskamani wants to use tourist tax dollars to fix Orlando’s lingering problems
Still, signs of recovery have yet to trickle down to the workers that are the backbone of the tourism industry and Florida’s economy. This summer, Brookings found the pandemic and related recession was felt the most by low-wage workers. Among those low-wage workers, the industry the hardest hit was Leisure and Hospitality.
In an unofficial follow-up to his groundbreaking ethnographic book The Celebration Chronicles, NYU professor Andrew Ross returns to Central Florida where he discovers the clearly quixotic promises made during the 1990s boom have, for many, turned into a living nightmare. The book, which was released late last month, covers topics that for those focused on the region shouldn’t come as much of a surprise. For Central Florida, few issues rival the economic uncertainty many are facing. While the pandemic has intensified the problem before COVID-19, Central Florida was barreling down a path with increasingly dire realities for large swaths of the population. Even after national news stories and a Hollywood film brought attention to the issue, tens of thousands across the region remain destitute, on the brink of financial and emotional ruin. But now, new conversations are occurring on how to address the problem.
The experiencing of the generational defining event that has been the past twenty months is spurring on a wave of optimism and innovative solutions to the substantial issues overlooked for decades. Locally that has meant questioning long-standing conventions on how to tackle the rising threat of income insecurity faced by those working in the state’s largest industry.
With fears of the Delta variant now becoming a distant memory, there is hope travelers will continue to return to Orlando. Much of the local economy is dependent upon these visitors and the money they spend while in town.
Funds raised via a tax on overnight accommodations have helped finance major projects across the region, including the ever-growing Orange County Convention Center and the Dr. Phillips Center for the Performing Arts. But in 2018, as Brevard County looked to spend locally raised tourist tax on a wastewater treatment facility designed to help improve the quality of the Indian River Lagoon, state politicians, at the behest of the Central Florida Hotel & Lodging Association, added a provision regarding how communities can use their locally raised bed tax. The role of the Central Florida Hotel & Lodging Association in getting the provision added was brought to light when Orange County sought to use the funds for road improvements in the tourism district.
Communities can use the funds for a wide variety of tourism-related projects, including on transit, workforce housing, and environmental remediation, but only if they spend forty percent of their funds on promotions and advertising. Otherwise, the projects funded through the tax are limited to a smaller pool of options. That threshold means millions of dollars must be spent on marketing efforts to ensure other improvements that would benefit tourists can also be made. In a city with seven of the most visited theme parks in the world, the second-largest convention center in the nation, and the state’s busiest airport, there seems to be little need to increase the amount of tax funding used on marketing efforts. That’s at least the argument being made in an effort to give local communities more say in how locally raised tourism funds are spent.
State Representative Anna Eskamani wants to remove this requirement. She has filed HB 6075 to lift the restriction and give local communities more control over how funds raised in those communities are spent. She hopes by repealing the forty percent threshold requirement, communities can better choose what tourism-related projects they want to focus on.
She points to transit projects in the International Drive tourism district as an example of the type of projects that currently can’t be funded by the tourism development tax (TDT) due to the county not meeting the marketing threshold. The long-planned pedestrian bridge over Sand Lake Road is a prime example of a clearly tourism-related project that cannot be funded through the bed tax.
In speaking with the Orlando Weekly, Eskamani expressed frustration that this project cannot be financed using the TDT. “That’s more about tourists than residents, but, right now, with that project, we cannot spend the bed tax money on that project. That makes no sense to me.”
The Kirkman Road extension, which connects to Universal’s upcoming Epic Universe theme park, is another project that local leaders funded through other means due to the restriction. It was this project that caused Eskamani to first become interested in the constraint after local leaders stated they would’ve preferred to have used the TDT funds to finance a road leading to a theme park.
Using tourism-raised funds on a broader range of tourism-related projects also frees up funds for other parts of the budget. That has caused the idea to be embraced by local organizations, including the pro-smart growth group Orlando YIMBY. Austin Valle, one of the co-founders of the Orlando YIMBY group, explained why they’re supporting HB 6075
“Tourism dollars are borne by folks who are here visiting. And so, using those dollars is less of a burden on the rest of the county. Basically, you have two options if you want to spend more money,” explains Valle. “You can do it by raising property taxes on everybody in the county, or you can use already existing money that’s being levied on people who are coming from out of town.”
Other funding sources, such as sales tax, are also not an option for Central Florida due to a lessening return of those taxes and their own set of restrictions put in place by state leaders. Eskamani says sales tax previously did help fund some local projects, but that hasn’t been the case more recently. “At a local level, we don’t see all that sales tax revenue [that’s raised here]. At the end of the day, most sales tax revenue goes to the State of Florida, and it might get reallocated towards our county, but recently it definitely hasn’t. You know, the Governor has slashed affordable housing dollars, and he has vetoed several Central Florida projects.”
Eskamani, an outspoken Democrat, may not be the typical voice of small government, but with the TDT issue, she acknowledges local communities should decide what to do with funds raised in those communities. “All [HB 6075] does is take away that cap and let’s local governments decide. If the local government still wants to spend half of their TDT on advertising, they can. We’re not saying you can’t, but we are restoring local control.”
For more than half a century, Florida has operated with a Home Rule giving power to local communities. But state politicians have increasingly sought to limit local decision-making. The TDT marketing provision is one of several examples on an ever-growing list of ways state Republicans have ensured Tallahassee can overrule decisions by local communities. Florida has a history of state Republicans increasingly taking local decision-making away from community leaders and voters. But as state politicians block efforts to protect the environment and community charm that make the Florida Keys world famous, Eskamani remains hopeful.
Valle shares this optimist partly because of his belief that local residents and community leaders understand these non-marketing focused efforts are essential at ensuring the region remains a desirable place to live and visit. “I think our citizens and our business community look at our region and know that we’re having to compete with regions who are doing things like transit and housing affordability better than we are. We’re needing to compete with St. Petersburg and Miami, and now Atlanta and Nashville, and Raleigh. These cities are making decisions on transit, and in some cases on housing, better than we are. Our leadership, residents, and business community are all looking at what these other cities are doing. They understand to remain competitive, if we don’t improve these things, we will fall behind.”
Both Valle and Eskamani seem excited with the idea that at least some of the funds would focus on improving the region’s transit systems. Proposals for mass transit options connecting the tourism district to other parts of Central Florida have been talked about for decades. The continuous expansion of the Orange County Convention Center over the past three decades has given the region one of the largest convention centers in the world. With that, the focus is shifting to ensuring the convention center and the cosmopolitan district that has sprung up around it are connected with other urban pockets across the region.
While Eskamani’s bill has become a major conversation topic around Orlando, it’s up against one of the most powerful lobbying interests in the state while also having to pass in a Legislature where Eskamani and her Democratic peers are the minority. The Central Florida Hotel and Lodging Association has so far remained steadfast in supporting the marketing requirement, with their President and CEO telling the Orlando Business Journal the group “strongly advocates for preserving the integrity of this ‘bed tax’ so that it is utilized for tourism-promotion purposes only.”
In talking about why she wants to lift the marketing requirement, Eskamani questions the need to require more funding of marketing efforts just to give local communities the ability to also use it to finance other projects. She points out there’s already plenty of advertising focused on attracting visitors to the state. “Visit Florida is already spending money on advertising. The private companies are spending money on advertising. We’re not saying part of TDT can’t go to advertising; we’re saying that there shouldn’t be an arbitrary tap of requirements for advertising.”
Eskamani is cautious when speaking of where the money from TDT collections should be used but notes that taking the burden off financing at least some projects could shift other funds to other community needs. Restrictions on the TDT funds to be used on tourism-related projects remain in place even with HB 6075. But it could fund more projects like the pedestrian improvements along International Drive. According to Eskamani, this helps locals and tourists alike. She frames the repeal as a way to meet local needs while not overburdening already struggling workers. “We need to do better by our people. We need to invest in our people in Central Florida and leverage whatever resources we have to do so, and this is a solution that doesn’t require any new fees or fine, no new taxes.”
By addressing transit, workforce housing, or other needs faced by local workers, Valle believes the hospitality industry itself would be improved. “I just think it’s so narrow-minded and myopic to think about the promotion of tourism, just meaning billboards, TV commercials, and trips overseas to go talk to tourism bureaus. If you talk to any hotelier in the world, they’ll tell you that the best way to advertise is to take the guest who’s already in your hotel, give them a great experience, convince them to come back, and share that experience with others. I do so genuinely believe it is that the best way to promote tourism is to give our guests an incredible experience. That’s going to be made all the more possible if our workers in the industry are happy and healthy and safe.”