Industry stands with Brand USA following proposed defunding

WASHINGTON—The hospitality industry is standing behind Brand USA in the public-private tourism marketing organization’s latest battle—President Donald J. Trump’s proposed elimination of Brand USA’s existence.

“Travel and tourism is a critical driver of the American economy, generating $2.3 trillion in economic output and supporting one in nine American jobs,” said Katherine Lugar, president and CEO of AHLA. “Over the last several years, Brand USA has been a powerful force in providing America with a competitive edge and has served as a highly successful promotional program attracting millions of visitors from countries near and far without costing U.S. taxpayers a penny. AHLA has been a strong and active partner, and we are deeply committed to ensuring that the hotel and lodging industry at large is actively supporting Brand USA.”

Katherine Lugar

The budget process begins with the president’s budget request, which basically sets forth the administration’s priorities by outlining proposed changes to the federal government’s spending. It’s then up to Congress to decide on where to allocate money. Eventually, appropriations bills are drafted and then voted on. The budget process is complete after the president has signed each of the required appropriation bills.

“Government at any level is challenged to fund programs required by law and others that are priorities of a new president and his administration,” said Chris Thompson, president and CEO at Brand USA. “Finding ways to cut and rebuild a multitrillion dollar budget is a complicated process. A president’s budget recommendation is the starting point to the appropriations process. There is much negotiation which will occur over the weeks and months ahead. We look forward to communicating our value proposition.”

The 62-page document does note the elimination of Brand USA, a federally funded organization dedicated to marketing the United States as a premier travel destination; the president’s proposed budget shifts revenue from the organization to U.S. Customs and Border Protection (CBP).

“The president’s proposal is really just the beginning,” explained Chip Rogers, president and CEO of AAHOA. “As Congress takes the next steps, no program or department should be exempt from their scrutiny; however, we are confident that upon examining Brand USA, lawmakers will reach the conclusion that we have reached, which is that it is a valuable asset for creating jobs and growing our economy.”

Out of the president’s eight pillars of economic reform outlined in “The Budget Message of the President,” two suggest the reasoning for eliminating Brand USA and shifting revenues to CBP: immigration reform and reductions in federal spending. The president notes the following in his message: “The budget also meets the need to materially increase funding for border security, immigration enforcement and law enforcement at the Departments of Homeland Security and Justice. These funding increases will provide additional resources for a southern border wall, expanded detention capacity and initiatives to reduce violent crime, as well as more immigration judges, U.S. immigration and customs enforcement officers, and border patrol agents.”

More than 350 companies and travel industry associations signed a letter expressing concern over the elimination of Brand USA in the president’s budget proposal. Stamped with the U.S. Travel Association’s letterhead, the letter, addressed to the chairmen and the ranking members of several committees, reinforces Brand USA’s role in attracting international visitors: “Business and leisure travelers from abroad are critical to local economies across our nation. To help attract these visitors, Brand USA has forged working relationships with hundreds of communities—large and small, urban and rural—and leveraged their varied promotion efforts into a coherent, cost-effective and productive national marketing campaign.” Notable signatories include the following: AHLA, Caesars Entertainment, Expedia Inc., Hilton, InterContinental Hotels Group, Interstate Hotels & Resorts, Marriott International Inc., and Marshall Hotels & Resorts.

“AHLA and the hotel industry stand behind Brand USA and continue to support its critical mission,” Lugar noted. “We are optimistic that members of Congress on both sides of the aisle will once again recognize the clear ROI of Brand USA and ensure that the program remains fully intact. In addition to working with Congress, we have also engaged our 24,000-strong membership to directly weigh in to emphasize the importance of tourism to their district and underscore the value of Brand USA.”

According to an Oxford Economics ROI study, over the past four years, Brand USA’s marketing initiatives have helped bring 4.3 million incremental international visitors to the country. The same study indicated that Brand USA has generated $29.5 billion in U.S. economic output during the same time period. “Since 2011, Brand USA has worked in close partnership with more than 700 organizations to invite people all over the world to explore the virtually limitless travel destinations and experiences available in the United States of America,” Thompson said.

This isn’t the first time Brand USA has been targeted. The House voted whether to extend the Travel Promotion Act of 2009, which created the Corporation for Travel Promotion (Brand USA), in July 2014—the last time there was a vote on the organization itself. “The last time the program was the topic of an up-or-down vote, it was supported by an overwhelming and bipartisan 347 to 57,” Rogers stated. “We are confident that Brand USA has a strong and bright future for many years to come.” That particular bill didn’t become law; instead, it was rolled into a spending bill in part.

Taxpayer money isn’t funding the Brand USA program. Foreign visitors are funding the organization’s mission of supporting travel and tourism in the country. “Brand USA is a public-private partnership with revenue from a combination of proceeds from a Tourism Promotion Fund generated from a $14 registration fee paid by travelers from 38 visa waiver countries, combined with contributions from non-federal sources,” Thompson explained. “Brand USA operates very efficiently—less than 10% is expended on overhead and no taxpayer dollars are used to fund the marketing efforts.”

“Eliminating federal funding for Brand USA would effectively eliminate a major competitive edge for the United States, sending a message to the international community that we are closed for business,” Lugar explained. “Particularly at the start of the summer travel season, it is important that lawmakers fully understand the economic and societal benefits of the travel and tourism industry, and the role Brand USA plays in supporting it.” HB

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