Lake County tourism: How to get the most bang out of a buck
By Carrie Napoleon Post-Tribune correspondent June 2, 2012 11:32PM
The Dancin Busias (cq) from The Dance Connection kick in sync on their walkers during the Pierogi Parade at the annual Pierogi Fest in Whiting, Ind. Friday July 29, 2011. | Stephanie Dowell~Sun-Times Media | File~Sun-Times Media
Updated: July 6, 2012 8:41AM
Tourism is a more than $1.6 billion industry and growing in Northwest Indiana.
Speros Batistatos, executive director of the South Shore Convention and Visitors Authority, would like to see local communities do everything they can to encourage that growth.
Batistatos said many local municipalities need to re-evaluate how they are spending their share of the so-called innkeeper tax they receive thanks to the events and activities that fill up Lake County hotel rooms.
“I think there needs to be a refocusing on bringing people — consumers and their money — into the communities. That should be the focus,” Batistatos said.
Meetings, conventions and sporting events were responsible for a combined 13,963 room nights in 2011, according to statistics provided by the SSCVA. That number is projected to climb to 18,512 in 2012. The more rooms booked, the more innkeeper tax collected, the more revenue to be shared among the municipalities in Lake County.
How that money is divided was determined when the Indiana legislature established the tourism bureau. The bulk of the revenues generated by the innkeeper tax, 44.33 percent, are directed to Indiana University. Thirty-five percent of the tax funds the SSCVA itself. Another 9 percent goes to Purdue University while the Genesis Center in Gary and the Hammond Civic Center each share 2.67 percent of the total innkeeper tax collected.
That means the 19 cities and towns in Lake County share the remaining 9 percent based on population. For Gary, Hammond and East Chicago, that translates to about $11,000 a year based on the amount of tax collected. The remaining 16 municipalities each get about $5,000.
New U.S. Census numbers certified in April may impact how the revenues are distributed for the second, third and fourth quarters of 2012, but the SSCVA is still awaiting a legal opinion on how it must handle the changes according to the law.
Those revenues are intended by state statute to be spent on activities that encourage visitors to come to the region, said James Wallis, board president of the Association of Indiana Convention and Visitors Bureaus.
“There could be any number of things a community needs in order to maintain and execute an effective tourism product,” Wallis said.
Batistatos said some communities generally “get it” when it comes to drawing outsiders to Lake County. Special events such as Pierogi Fest in Whiting, Festival of the Lakes in Hammond and the nighttime St. Patrick’s Day parade in Crown Point, he said, work to benefit the entire region by drawing visitors from a broad area.
Other communities don’t necessarily get it, he said. For example New Chicago, Hobart and Lake Station used the revenue to purchase Easter egg hunt supplies, cookies, juice and candy, part of a bucket truck, letterhead, an ad for a crossing guard, meals and a newspaper subscription among other items listed in the Innkeeper Tax Distribution Report for 2006 to 2011 that was filed with the Lake County Council.
“The communities who understand special events and have invested heavily are being penalized with these other communities just wasting the money,” Batistatos said.
Whiting Mayor Joe Stahura said with a distribution of just about $5,000 a year it is difficult to use the money for more significant projects that would promote tourism such as a museum, but the city tries to use it for marketing and promotion of events and the downtown business district.
He said the key to using the money successfully is finding a way to leverage the small amount to make a greater impact.
“You need to use it to get people into the community to get a greater impact and leverage it to the greater good,” Stahura said.
Batistatos said to make that happen he favors a different distribution mechanism to allocate the local portion of the innkeeper tax where it will be leveraged most successfully to promote tourism in the region, thus generating more tax dollars and pumping more outside spending into the county’s restaurants and businesses.
He would like to see legislators consider modifying the distribution plan possibly to a matching grant opportunity where communities can request dollars for an event or activity that would be good for tourism based on how much funding they plan to expend out of their own budgets.
“We can only make suggestions and share our vision (with legislators). We are not here to be adversarial,” Batistatos said.
New Chicago Clerk Treasurer Lori Reno, who has held the position since 2007, said she was unaware the SSCVA had concerns about how the city was spending its innkeeper tax allotment. Reno said she followed the precedent for how the money had previously been spent before she took office.
“It’s for beautification, the purpose of bringing people into the community. We use it when we have the Easter egg hunts because it draws people into the park,” Reno said.
The money has not been spent on things to bring people into town overnight because New Chicago does not have any hotels or motels. She said if the revenues are not being expended properly, she would like to know to avoid it from happening again.
Batistatos said he views his role, in part, as an educator. Over the years the SSCVA has had conversations with some of the communities that were not following the spirit of the law in spending those revenues, and changes have been made, but the message still needs to get out there. Not all the revenues are being spent to benefit the region, and that is a problem for those who do.
“I don’t want anyone to think we are trying to enhance our budget. We are not interested in that. The money should remain at the community level in some fashion, but what we have seen is a tremendous amount of abuse,” he said.
Batistatos acknowledged some communities may not realize they are abusing the system and wants to work with them to ensure the money is being used in the most effective way to bring in more people and more revenue to Lake County through special events.
“There are some great things bringing people from all over America to the South Shore. Those are happening at the community level. ... That’s exactly what this is designed for,” he said.