Comments to the Honorable Bobby Payne, Chair, and Members of the House Ways and Means Committee Regarding HB 1429 – Tourist and Convention Development Taxes

My name is Dominic M. Calabro, and I am President and CEO of Florida TaxWatch, an independent, nonpartisan, nonprofit, taxpayer research institute and government watchdog which, for over 40 years, has worked hard to improve the effectiveness, efficiency, and accountability of Florida government and promote a fair and equitable system of taxation.

Locally imposed tourist development taxes (TDTs) play a vital role in Florida counties’ promotion of tourism. Over the years, the Legislature has added more and more authorized uses of this revenue, diluting the funding available for tourism promotion and advertising. The “slippery slope” warning raised by the tourism industry and Florida TaxWatch in the past has become a reality. 

In addition to the originally authorized uses, TDTs can now be used for: zoos; aquariums, beach park facilities; beach, channel, estuary, or lagoon improvements; erosion control; restoration of lakes and rivers; fishing piers; nature centers; auditoriums operated by non-profits; emergency medical and law enforcement services (coastal counties); and professional sports franchise and spring training facilities. Counties may also use TDTs for major capital improvements, land acquisition, transportation, sewer, solid waste, drainage, potable water, and pedestrian facilities, if they are “needed to increase tourist[1]related business activities.” HB 1429 would further expand the authorized uses of the TDTs.

Many of the new uses are important, legitimate uses of public funds, and the same can be said for flood mitigation, but core government functions with wide-ranging benefits lend themselves more to general government revenue than designated tourism dollars. It is akin to raiding state trust funds to balance other parts of the budget. 

The significant economic activity tourism provides is vital to the success and growth of Florida and the taxes tourists pay means less has to be taken from Florida citizens and businesses. Any business will tell you the importance of advertising to increase brand awareness and sales. This is true in tourism, as Florida competes nationally and globally for visitors. As tourism attempts to bounce back from the pandemic, promotion is more important than ever. It would be wise to “not eat our tourism seed corn” by diverting tourist development taxes to even more uses.

We look forward to working with you and your colleagues to strengthen Florida’s economy.