Local hotel managers push to designate Allegheny County a tourism improvement district | Pittsburgh City Paper

Local hotel managers push to designate Allegheny County a tourism improvement district

click to enlarge Local hotel managers push to designate Allegheny County a tourism improvement district
CP Illustration: Lucy Chen

Local hotel managers are pushing to form a tourism improvement district in Allegheny County, which they say could help boost the flagging hospitality industry following years of coronavirus headwinds.

According to a press release, leaders at prominent hotels including the Pittsburgh Airport Marriot, the Westin Pittsburgh, and seven others, have formed the Allegheny County Tourism Improvement District Formation Committee to begin the process. The goal, they say, is to generate a dedicated source of funding for destination marketing, with the goal of increasing overall tourism in the region.

"Western Pennsylvania has so much to offer travelers of all interests, with urban Pittsburgh, a multitude of unique sub-markets across the county, the natural beauty and rich rural environment right outside the city, and the airport serving the entire region," the release says. "Coming here should be a no-brainer."

Pennsylvania law currently prevents the formation of tourism districts at the county level, although earlier this year State Sen. Devlin Robinson (R-Allegheny) introduced a bill to permit them. The legislation has cleared the appropriations committee but still awaits a vote on the floor.

Currently, there are 193 similar districts across the country. The formation committee claims there is a significant investment gap between Pittsburgh and its main tourism competitors.

To generate their funding stream, the formation committee is proposing a 2% assessment on individual hotel room sales within Allegheny County, which would appear as a line item when guests purchase a room. This assessment would only apply to lodging facilities with 50 rooms or more.

Those funds would be governed by an oversight committee comprised of hotel owners and managers, which would follow a set of bylaws mandating spending is used exclusively for destination marketing, according to the release. VisitPITTSBURGH, Pittsburgh’s official marketing and promotion agency, would manage the funds under the direction of the oversight committee.

The committee say the assessment fee is distinct from the current hotel tax, which sets a standard rate of 7%. The funds generated from a hotel tax are given to various organizations, including the Sports & Exhibition Authority, VisitPITTSBURGH, and Visit Monroeville. Meanwhile, funds generated from the improvement district assessment would be handled separately from the hotel tax.

Members of the formation committee say it would be valuable to establish a district in Allegheny County because of how the area was impacted by COVID-19. There were nearly 44,000 tourism-related jobs in Allegheny County in 2019, but the pandemic caused a loss of 53% in room sales and almost 45% in tourism revenue the following year. The committee point to industry research suggesting a tourism district in Allegheny County would generate around $9 million per year.