New Orleans hotels self-impose a new room charge for tourism promotion

February 28 2014 | Latest News
Mark Waller, | The Times-Picayune

Following through on a state law passed last year allowing New Orleans hotels to impose a fee on their customers to generate money for tourism promotion and finance infrastructure projects, most of the city's hotels have voted in favor of a new 1.75 percent room charge that will become effective April 1, tourism industry groups announced Thursday (Feb. 27).

The law required representatives of more than two-thirds of the downtown hotel room inventory to vote in favor of installing the assessment. Voting finished Feb. 21 with 95 percent voting in favor, according to an announcement from the New Orleans Convention and Visitors Bureau and the New Orleans Tourism Marketing Corporation.

Most, but not all, hotels in the city will impose the charge. It will apply in all CVB-member hotels except those in eastern New Orleans.

The Greater New Orleans Hotel and Lodging Association conducted the referendum. Every hotel had a number of votes equal to the number of rooms on its property.

The convention bureau will collect .75 percent of the assessment to promote the city as a convention venue, step up international marketing and seek to attract increased air travel service to New Orleans. The tourism corporation will take .75 percent for domestic tourism marketing. The remaining .25 percent will go to city government for French Quarter infrastructure repairs and public safety.

Officials from the convention bureau and tourism marketing group had separately reported expecting their shares of the room charge to total $3 million to $4 million this year. But those numbers also considered that the revenue stream wouldn't begin until April.

Tourism officials recently have lamented having to work with smaller budgets for promoting the city than many competing destinations.

They have said for months that they expected the assessment to pass without controversy. On Thursday they issued a series of statements applauding the results.

"Our industry is committed to smart growth and is dedicated to making New Orleans one of the top destinations in the world for meetings, events and leisure as we approach our tricentennial in 2018," said Robert Bray, chairman of the convention and visitors bureau board and area general manager of the Marriott International hotel firm, in the announcement about the vote. "With this new funding source, our residents will benefit from a stronger economy, more attractions and a better quality of life, and our cultural economy will be strengthened, benefiting every local and all visitors."

Darryl Berger, board chairman for the Tourism Marketing Corporation and president of The Berger Company real estate firm, called the assessment, "a critical funding mechanism to attract new meetings and convention business, international visitors, and generally grow our industry."

"I want to thank the hotels for this visionary and unselfish gesture -- to assess themselves for the good of the city," Berger said.

He also said the measure will help maintain the French Quarter and "ensure the future of this most remarkable of American neighborhoods."

"New Orleans has so much to offer to visitors, but we can't rest on our laurels and expect them to keep coming, because competition from other cities is so fierce," said David Bilbe, president of the hotel and lodging association and general manager of the Loews New Orleans Hotel. "Tourism is fought for and earned through sales and marketing each day. It doesn't just happen.

The tourism industry accounts for an estimated 78,000 jobs in the New Orleans area. In 2012, the most recent year of available data, New Orleans reportedly attracted more than 9 million visitors who spent $6 billion in the city. Industry leaders have a goal of attracting 13 million visitors by 2018. The next visitor tally is expected to be released in March.