published Monday, November 19th, 2012

Tourism: Economic engine

Those who live and work in Chattanooga and Hamilton County do not need surveys or dry statistical analyses to authenticate the fact the community and the region that surrounds it remain a wildly popular tourist destination . Incontrovertible evidence is available every day.

There is a steady stream of traffic at downtown and area attractions. Hotels and motels often are full. Shops and stores in areas with heavy tourist traffic are busy and the roads -- sometimes to local motorists' temporary chagrin -- are filled with vehicles bearing a wide assortment of out-of-state license plates. That anecdotal evidence is backed up by a recent survey that shows that tourism spending in Hamilton County grew by more than 10 percent from 2010 to 2011.

The wave of visitors increased tourism-related spending in Hamilton County to over $893 million in 2011. That's a significant increase over previous years' spending. In 2004, for instance, tourists spent just over $601 million in the county. Despite the increase over the years, Hamilton County ranks fifth among Tennessee counties in tourism-generated revenues.

In good company

Still, the county is in extremely good company. Tennessee, after all, is a well-known and heavily visited travel destination. It's no shame to trail other counties in the rankings. Indeed, many tourists visit one or more of Tennessee's top destinations in a single trip. Why not? There's a lot from which to select.

Davidson County, home of the Grand Ole Opry and country music among other attractions, ranked first in tourism generated revenue last year with $4.2 billion. It was followed by Shelby County, home to Graceland, Elvis Presley's residence, with $3 billion and Sevier County, home to Dollywood, Pigeon Forge and Gatlinburg with $1.5 billion.

Hamilton County was next. In fifth place. Knox County, host to throngs at University of Tennessee athletic events, rounded out the state's top five destinations with $884 million in tourism generated revenue.

Hamilton County's ranking and tourism generated income should not come as a surprise. It's central location on major transportation routes and its broad variety of attractions and facilities attract and hold prospective visitors' attention.

The region's mountains, rivers and lakes provide a wide array of options for outdoor enthusiasts. For others, the Tennessee Aquarium, the related development on both the north and south shores of the Tennessee River, the Chickamauga Battlefield and other Civil War-related sites, the Bluff View Arts District, the Tennessee Valley Railroad Museum are the draw. Older and beloved standbys like Rock City, Ruby Falls and the Incline are popular, as well. The convention center can serve as the hub for meetings for all but the largest state or national groups. Taken together, the region has something to offer just about every tourist or tourism-related group.

Underwrite services

The dollars tourist spend here are an economic engine often overlooked by local residents. Sales taxes paid by visitors to the community help underwrite government services enjoyed by all. A separate hotel-motel tax is used to fund worthwhile projects that benefit the city and county without levying an additional burden on local taxpayers. Tourism provides another benefit, as well. It generates thousands of local jobs.

There's little reason to think that the influx of tourists and tourism dollars will decline significantly anytime soon. Well-planned publicity campaigns by local officials, the continued expansion and improvement of local venues and the positive opinions spread in hometowns by those who have visited Chattanooga and Hamilton County continue to promote visitation to the city.

Welcome as tourists are, the community and region cannot survive and prosper on their dollars alone. Tourism is and always will be a vital component of the local economy, but it must be buttressed by the attraction and expansion of industry and businesses if long-term economic stability is to be achieved. Community leaders know that. The successful effort to bring companies like Volkswagen, Alstom, Wacker, Amazon and others to the city, county and region is a case in point. Their presence coupled with a robust and growing tourism trade provide a sound foundation for the community's future.

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Tourism was what the Greek economy relied upon.

Be careful with that one.

November 19, 2012 at 12:31 a.m.
aae1049 said...

Mr. Austin,

A return to 2008 sales tax revenues that was obtainable prior to VW, Alstrom, and the PILOT club of industry that pays no property tax, cannot be attributed to their presence.

November 19, 2012 at 8:37 a.m.
aae1049 said...

Do you support more PILOTs for A-List Friends program?

This one is my favorite A-List PILOTs. The City obtained the property from TVA, demos the building, hands it over to River City, who we believe receives revenue off this movie theater wonder. Fun, how this works.

November 19, 2012 at 9:58 a.m.
fairmon said...

An interesting stat would be the number of businesses closed after increases in property tax, sewer and water run off fees, permits cost etc. VW, Alstrom and other businesses off set any tax break by hiring and paying people that do buy houses and make other purchases on which taxes are paid. Many of those people are new to the area and would not be here spending money if not for those employers. I rather see my tax dollars go to bringing in more new decent jobs than a Blue Rhino and other atrocities like that.

November 20, 2012 at 7:39 a.m.
aae1049 said...


VW is exempt from property taxes for 30 years, stormwater fees, and sales tax. The average life of an auto plant is about 12 years. There is no way $577 million in public investment, state and local, will amortize back to the taxpayers. The total package of State and Local public funds was $577 million.

The sales and property taxes generated from the 1,500 or so employees that actually live in Hamilton County fund their share of City and County services. The notion that spending by employees will return the capital investment to the taxpayers is based in the science of unicorn studies :-).

If there were 8,000 VW employees, the 577 million dollars would still would not amortize back to the taxpayers. The brightest CPA's state that the revenue streams do not exist to return the capital investment.

The original VW UTK study, which I have, assumed the automotive suppliers would locate to the region. The regional suppliers did NOT materialize, and the primary auto components are shipped from Mexico.

The City of Chattanooga and Hamilton County not only invested $40 million in taxpayer bond issues. They also diverted all of the local Federal Highway infrastructure funds.

Local government should not act as an economic puppeteer, and incumber the public financially to these corporations. Taxpayer dollars are not our governments play money to pick business winners.

Meet the VW brokers. Be very concerned.

November 20, 2012 at 9:08 a.m.
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