A hotel room tax introduced on Jan. 1 will go a long ways towards marketing Red Deer area destinations and events, says a hotelier.
Gil Vallee, general manager of the Capri Centre, said he was the first to sign up with the Destination Marketing Fund (DMF) because he believes in what it will do for the region.
“To be able to market Red Deer collectively, we can be a lot stronger,” said Vallee, after attending Tourism Red Deer’s 2011 budget presentation to city council on Tuesday.
Tourism Red Deer executive director Darren Kuz said he has high hopes for what this tourism room tax will do. About eight or nine hotels in Red Deer and Gasoline Alley are taking part in the voluntary endeavor to charge a one per cent levy on their hotel rooms. That amounts to more than half of all accommodations, or about 1,200 rooms.
Vallee isn’t concerned some hoteliers haven't signed up.
“There are a lot of family-owned operations in our community and they have a different philosophy on how they market their businesses,” said Vallee.
He said the region needs to be marketed, particularly in July and August when business is slow at hotels. People come here for a variety of events, but they just come for the day, Vallee said.
Several communities including Medicine Hat and Lethbridge have had destination marketing funds for several years and with the money, they’ve been able to capitalize on marketing to Calgary and Edmonton — the same major market Red Deer is vying for.
“We’ve got a lot of catching up to do,” said Vallee said.
Kuz said that this destination marketing fund can only be voluntary because the provincial government hasn’t legislated it.
He added that Tourism Red Deer’s operating budget is small — about $550,000 in 2010 — so having this Destination Marketing Fund will be a boost. Kuz said it’s hoped that at least $175,000 could be raised through this Destination Marketing Fund. He understands Medicine Hat and Lethbridge are raising about $300,000 annually through the DMF.
A request has been made through the city’s Land and Economic Development department to boost Red Deer tourism’s marketing dollars by $175,000. Tourism Red Deer doesn’t have any specific tourism marketing dollars in its fee-for-service contract with the City of Red Deer. This money would kickstart Red Deer’s tourism marketing plans, particularly when it’s expected this new hotel tax will take about a year to generate enough dollars for a detailed marketing plan.
“We struggle with getting enough dollars in place to compete against those Destination Marketing Funds that are actively marketing through the province,” said Kuz.
Councillors questioned how Red Deer was branding itself.
Kuz said preliminary research suggests a number of people think of Red Deer as a sporting destination because of all the tournaments that take place here. He added branding Red Deer appropriately must involve Tourism Red Deer partners, including the city, Red Deer Chamber of Commerce, and Westerner Park.
Kuz also unveiled a few details from the organization’s Tourism Economic Impact Study, expected to be released next week. The study showed more than two million visitors came to Red Deer in 2008, generating about $146 million in revenue to the city and also provided the city with about $2 million in taxes.
ltester@www.reddeeradvocate.com