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Dayton, Saxhaug propose more tourism funding

BEMIDJI – Tourism in Minnesota would get a major boost under proposals from Gov. Mark Dayton and a local legislator.

Dayton included more than $16.2 million for Explore Minnesota, the state’s tourism department, in each of the next two years in his budget proposal. That’s almost twice as much as the department will receive this year.

Sen. Tom Saxhaug, DFL-Grand Rapids, introduced a bill this week that would appropriate that same increase to the department.

“We know that bringing in new money from other states is a good way to increase our economy,” Saxhaug said.

Tourism and travel generated $11.9 billion in gross sales and $769 million in state sales tax revenue in Minnesota in 2011, according to Explore Minnesota. That included $79.2 million in gross sales and $5.1 million in sales tax in Beltrami County, where tourism is a major driver of the local economy.

But how lawmakers accomplish any potential funding increase is undecided. 

Under Dayton’s plan, an increase in the car rental sales tax by 2.85 percentage points would allow for more tourism dollars, but the increase wouldn’t earmarked for Explore Minnesota. Saxhaug, on the other hand, proposed a bill on Wednesday that would dedicate the car rental sales tax to Explore Minnesota at its current rate of 6.2 percent to the department.

He said the sales tax alone wouldn’t be able to fund the $16.2 million appropriation, but it would allow Explore Minnesota to be less reliant on the general fund, which many other state departments compete over.

Denelle Hilliard, executive director of Visit Bemidji, supports dedicating the car rental sales tax to tourism. But, she said, legislators may be “a little bit reserved” to dedicate a tax.

“We all recognize the need for Minnesota’s tourism budget to grow and be more competitive,” Hilliard said.

Joan Hummel, a spokeswoman for Explore Minnesota, said the department hasn’t taken a stance on whether it supports a sales tax dedication.

Hummel said Explore Minnesota is currently at 1990 funding levels, not including inflation. In fiscal year 2008, their operating budget was $10 million, which has decreased to $8.4 million this year.

“Our current budget ranks 30th in terms of state tourism budgets,” Hummel said.

 She said the increased funding would go to marketing, from high-priced places like Chicago as well as bolstering current campaigns in neighboring states.

“There are other areas out there that we would certainly like to get the message out there to them to travel to Minnesota,” Hummel said.

John Hageman

John Hageman covers North Dakota politics from the Forum News Service bureau in Bismarck. He attended the University of Minnesota in the Twin Cities, where he studied journalism and political science, and he previously worked at the Grand Forks Herald and Bemidji Pioneer.  

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