Calif. Industry Oks Self-Assessment

By Jerry Brown

SACRAMENTO -- California's tourism industry approved a referendum calling for the private sector to contribute at least $5 million toward travel promotion. The referendum to establish a California Travel and Tourism Commission to promote the state passed by a margin of almost 70% to 30%.

Beginning next March, businesses benefitting from the estimated $58 billion in spending by visitors to California will be assessed $450 per $1 million in sales. Most agents were effectively excluded from the assessment by a clause in the referendum that stipulated that only those who derive at least 20% of their business from intra-California travel must participate. Because most retailers sell vastly more travel outbound than they do within the state, few qualify under the 20% rule.

The combination of the funds raised from the industry and the state's contribution will give California about $12.3 million a year for promotional activities initially, immediately elevating it from 24th to 12th in tourism spending in the U.S. The act has the full power of the law; individual companies may not opt out.

Besides a board of directors, to be elected from within the visitor industry, the commission will hire a paid executive director and other staff. The California Division of Tourism, according to a spokesman, might be disbanded, with its activities consolidated into the commission. Passage of the referendum, which creates what is known in the state's laws as a marketing authority, has taken about four years.

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