Explanation
BACKGROUND: This ordinance authorizes the Finance and Management Director to modify a contract with Experience Columbus for marketing services to increase tourism and convention business for the City of Columbus and Central Ohio. The initial contract was entered into pursuant to Ordinance 0540-2020 and is funded from Hotel/Motel excise tax proceeds in accordance with Section 371.02(c) of Columbus City Codes. This initial contract was projected to be $10,839,000.00; however, due to the economic impact of the coronavirus, actual Hotel/Motel excise tax collections are anticipated to be significantly less.
The economic fallout of the coronavirus has impacted Ohio and the national economy at historic levels. Ohio’s unemployment rate has risen to 16.8%, an increase of 11% versus pre-coronavirus levels. Similarly, Columbus’s unemployment level has risen to 13.7%, an increase of 9.5% versus pre-coronavirus levels. The travel and tourism sector of the economy has been disproportionately impacted and is experiencing an unprecedented contraction in business due to the COVID-19 pandemic. Marriott, a bellwether for the industry, recently projected a 75% decrease in global revenues and a 90% decrease in domestic (U.S.) revenues. The Airline industry has been similarly impacted with domestic U.S. flights decreasing 70% over pre-coronavirus levels. The aforementioned economic impacts to the travel and tourism have resulted in a significant decrease in 2020 Hotel/Motel excise tax proceeds, which in turn has drastically reduced the contract amount for Experience Columbus.
In an effort to address the economic impact to Columbus and central Ohio’s travel/tourism industry, the City of Columbus is proposing that more than $2.2 million in Economic Recovery Funds be provided to Experience Columbus as a means to replace lost Hotel/Motel tax proceeds for the first six (6) months of 2020. These Economic Recovery Funds were provided to the City of Columbus as part of the Coron...
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