CHICAGO -- Small towns and big cities from Virginia to Illinois to California expressed grave concern about the harm to U.S. visitor numbers should Congress make good on a proposal to axe 80% of Brand USA's federal funding.
The 2026 budget as introduced by the White House included full funding for Brand USA. But in June, as part of the budget reconciliation bill process, the Senate Committee on Commerce, Science and Transportation proposed cutting the organization's budget from $100 million to $20 million.
Geoff Freeman, CEO of the U.S. Travel Association, said during the group's IPW conference here this month that U.S. Travel was doing "everything in our power to protect Brand USA."
"And we've got more allies on Capitol Hill than we do opponents," he added.
The association is harnessing the power of its members.
"We will get folks speaking up," Freeman said. "The industry is activated in a way unlike anything I've seen before, coming to Brand USA's defense. And I'm confident that one way or another, we will ensure Brand USA's continued success."
Freeman spoke for many destinations in calling Brand USA "critical."
"If you want to get visitors to the United States, it's a three-legged stool," he said. "It's one part visas, one part customs and one part promotion. And any stool with two legs is going to collapse."
A funding lag?
Next year's budget is only one of Brand USA's funding issues.
Brand USA receives private-sector donations that are then matched by up to $100 million in federal funding provided by a $17 portion of every Electronic System Travel Authorization (ESTA) fee that is collected from international travelers.
But an industry insider familiar with its funding mechanism said that the Treasury had not given Brand USA its ESTA funds since the end of January, due to a paperwork backlog.
While it's not unusual during an administration change for there to be a lag, the insider said, this lag has gone on longer than during previous administration changes, and as a result Brand USA initiatives are being constrained by the bottleneck.
"We are hopeful that the funds will still be processed and sent to Brand USA," said Chris Heywood, a spokesperson for Brand USA, when asked about the issue.
Adam Burke, CEO of the Los Angeles Tourism & Convention Board, said he was particularly concerned about Brand USA's budget threat given its "pretty remarkable" track record, citing data showing that in the 15 years since being created, it has generated $24 in visitation for every dollar it has spent.
Burke also said its ability to promote the U.S. is critical when inbound tourism numbers are down like they are this year. Recent figures show that the $53 billion trade surplus in tourism the U.S. had in 2019 has become a roughly $50 billion deficit.
"That's a $100 billion swing," he said. "In terms of what's critical for our nation's economy and the 16-and-a-half-million people who work in this industry, Brand USA is really an example of a rising tide raises all boats. We have to support them."
Despite the funding logjam and threat of a future monetary reduction, Brand USA said at IPW that it would launch a major campaign in August aimed at boosting inbound travel numbers.
Global exposure for small cities
On the IPW floor, representatives from U.S. destination marketing organizations said that Brand USA was especially important with so many major events on the horizon in the U.S.: America's 250th birthday, the World Cup and the Olympics.
For smaller U.S. destinations that don't have budgets to market abroad, Brand USA is their main global exposure. Pittsburgh, for example, doesn't have a DMO with the same resources as Philadelphia.
"Brand USA is helpful in promoting our city that is often shadowed," said Alex Kenzakoski, senior public relations manager at Visit Pittsburgh. "Not even just budget but from a manpower perspective, Brand USA proactively promoting us is great as an extension."
Sara Harvey, director of communications for Destination Niagara USA, said that while it may have an internationally recognized name for its eponymous waterfalls, "it's absolutely crucial that we have that presence in the international market." She said a boost from Brand USA was especially critical when sentiment in some key markets like the U.K. and Germany was a little down.
Fred Dixon, CEO of Brand USA, said "the bulk" of the work the organization does is with those smaller destinations.
"And that's exciting, because that's where we see impact," he said. "We see how we're playing a role in driving travel into communities that want international visitors and then see the value in them."
Larger destinations are equally adamant about Brand USA's importance, often pointing out that the U.S. is the only G20 country without a federal tourism agency or official in charge of tourism policy.
"We're already challenged," said Kristen Reynolds, CEO of Choose Chicago, referring to tourism promotion in other Western countries. Choose Chicago, she said, is engaging with elected leaders at the federal level "to make sure they understand the importance and the value" of protecting Brand USA's budget.
"Just like smaller destinations rely on the bigger destinations like Chicago to amplify the state, we rely on Brand USA to get out there and say, 'Visit the USA,'" she said. "Once people are interested in the USA, we say underneath them, 'Visit Chicago.' Having them as an umbrella organization is really paramount to our international strategy."