Tourism industry frets over Trump’s budget cut to foreign visitor promotion campaign
Published 8:30 am Friday, June 2, 2017
WASHINGTON — Hobart, in northwest Indiana, may not be considered one of America’s great tourist destinations.
But a couple of weeks ago, a group of travel agents from England were there to get a taste of Americana, riding an open wagon through a field of over 100 bison at the Broken Wagon ranch.
They stopped at the old-fashioned Valpo Velvet Ice cream stand in nearby Valparaiso and raced up the sandy white, 100-foot tall dunes on the shores of Lake Michigan.
It was something quite different to tell the travelers back home about.
Attracting tourism from abroad has become increasingly important to the nation’s multibillion dollar tourism economy. That’s why tourism leaders are upset over President Donald Trump’s budget proposal to eliminate funding for an organization, Brand USA, that promotes America as a great place to visit and shop.
Trump wants to shift the $93 million per year from Brand USA to the federal Immigrant and Customs Enforcement agency in his effort to strengthen national security along the Mexican border and elsewhere.
The money comes from the $14 visa application fee charged foreigners, and is used to lure international visitors through media advertising and promotional events such as hosting travel agents from other countries to check out what America has to offer — like the bison ranch in Indiana run by Ruth Koeppen, her husband Bud and brother-in-law Wally.
The tourism industry is required to raise a match of $100 million per year to qualify for the federal funds, and has been doing so for several years. Brand USA claims the promotion campaign has helped attract some 4.3 million new visitors and generated nearly $30 billion in additional spending in the U.S. the last four years.
The tourism industry insists it is the wrong time to reduce promotional efforts aimed at foreign visitors as their numbers are increasingly static due to the strength of the U.S. dollar and stricter travel rules.
Groups like the U.S. Travel Association warn scaling back on marketing will end up taking money away from not only airlines and hotels, but people like Bud Koeppen, a retired mechanic, and Wally, a retired UPS driver.
The Broken Wagon ranch makes about three-fourths of its money from selling bison meat, said Ruth Koeppen. But a fourth of its income flows from tourists who come from as far away as China and the Philippines to learn the history of the American buffalo, chew a stick of bison jerky and gape at the grazing animals.
“With all that’s going on in the world, unilaterally disarming the marketing of the U.S. as a travel destination would be to surrender market share at the worst possible time,” said Roger Dow, president and CEO of the U.S. Travel Association, a non-profit trade organization.
“With international visitation being the country’s No. 2 export supporting 15 million American jobs, we’re struggling to understand how cutting Brand USA squares with this administration’s stated priorities,” Dow added in a statement.
Trump, however, sees it differently. His budget narrative supporting elimination of the visa fee funds for tourism explains why:
“In these dangerous times, our increased attention to public safety and national security sends a clear message to the world — a message of American strength and resolve. It follows through on my promise to focus on keeping Americans safe, keeping terrorists out of our nation, and putting violent offenders behind bars.”
Patricia Rojas-Ungar, vice president of public affairs for the U.S. Travel Association, argues the Brand USA campaign, created by Congress in 2010 to counter foreign travel fears resulting from the 9/11 terrorist attacks, does not receive taxpayer dollars and is also fueled by private matching dollars.
She cited a 2015 study of Brand USA by Oxford Economic that concluded the campaign generates far more for the nation’s economy than it receives.
Based partly on surveys with foreign tourists about whether they were influenced by the group’s marketing, the study estimated that every dollar spent by Brand USA generates $21 dollars of additional spending by foreign tourists.
Mark Newman, executive director of the Indiana Office of Tourism Development, said loss of the visa fees for promotion could hurt states like his that do not spend as much as others to market tourism, or businesses like the Hobart bison ranch that does not advertise abroad.
Indiana doesn’t have the attraction of cities like New York of San Francisco to draw visitors, Newman said, but “we can offer something completely different” that foreign visitors from crowded urban areas prefer.
Contact CNHI Washington reporter Kery Murakami at kmurakami@cnhi.com.