Opinion » Editorial

The argument for RMI investment to continue



The current provincial Resort Municipality Initiative (RMI) investment of $10.5 million to 14 resorts around B.C. is returned per annum to the province in taxes generated in the first 14 days of each year.

Go back and read that sentence again.

It is taken directly out of a just-released report titled RMI Funding: Building on Success, which was prepared for the RMI Resort Collaborative — the 14 resorts in B.C. that get this tourist-targeted funding.

The province has said that the RMI funding will stay in place for the resorts (Fernie, Golden, Harrison Hot Springs, Invermere, Kimberley, Osoyoos, Radium Hot Springs, Revelstoke, Rossland, Sun Peaks, Tofino, Ucluelet, Valemount and Whistler) until December of 2017.

For the last couple of years there has been much discussion about what life will look like in Whistler if the RMI is scrapped or the amount the resort gets — $6,610,547 this year — is significantly reduced.

The report makes a compelling argument, as you would expect, for the RMI funding to stay in place, or perhaps even increase.

In Whistler's Economic Partnership Initiative committee report (June 2016) we learned that Whistler is now contributing approximately 25 per cent to the provincial tourism export economy.

Another metric local MLA Jordan Sturdy points to is the $810,000/day which flows to the federal government, $380,000/day to the provincial government (for which you get health care, highways, and education among other services across the province), and the $170,000/day to the Resort Municipality of Whistler (for which you get water, fire and sewer, planning and other services) in tax contributions.

That's $1.37 million/day to municipal, provincial and federal governments combined.

The RMI money is used to fund myriad events and infrastructure — from the new wayfinding signage to the Festivals Events and Animation program (FE&A). The 2016 budget for FE&A is $3.16 million with programming coming in at $2.64 million.

FE&A programming, enhanced by RMI funds, has helped provide a boost to occupancy in the resort since 2011.

For example, 2015 occupancy compared to 2011 show a significant jump across several months: there was a 62-per-cent increase in October, a 49-per-cent increase in June and a 26-per-cent increase in July of 2015.

Since the RMI program was launched in 2006, Whistler has received $67,608,206 according to the provincial government.

The RMI Resort Collaborative report states that the 14 resort partners welcomed more than 5.34 million visitors in 2015 which represented 28 per cent the province's total tourism visitation.

"Despite having only 1% of the total Provincial population (approximately 50,000 residents), BC's 14 RMI Communities represent 29% ($265 million) of Provincial tourism taxes,..." said the report.

It goes on to discuss the importance of the quality of the visitor experience being absolutely critical to the continued success of B.C. tourism, and the report links that experience to the RMI funds by arguing the money allows resorts to offer events and experiences it wouldn't otherwise be able to do.

According to the report: "... the risk of loss from potential declines in visitor spending should RMI communities no longer deliver remarkable experiences can be predicted, as evidenced by a future scenario that postulates a 20% decline in visitor spending and an associated loss in Provincial tax revenues of $74 million and 6,000 jobs for British Columbians.

"A failure to recognize the need for tourist-based financial support for RMI communities will risk today's performance and will likely lead to reductions in provincial taxes and jobs in resort communities."

The report's researchers found that tourism spending in the RMI communities grew by just over 38 per cent as compared to the rest of the province, which saw growth of 20 per cent from 2011 to 2015.

What needs to be remembered is that the RMI and the Municipal and Regional District Tax (MRDT) are the only tourism-funded financial tools available to B.C.'s RMI communities to support tourism and keep the resorts competitive.

Vail, Colo., for example gets 40 per cent of its budget from a Resort Sales Tax. Likewise Aspen, Colo., gets 31 per cent.

For years now, though, Whistler and its resort partners have lived under the threat of the RMI being taken away by the province — it was never meant to be a long-term funding solution.

The program only came into effect after Whistler lobbied hard for several years to get "financial tools" — a recognition of the unique situation tourism-based economies face keeping their product fresh and inventive on the backs of a small taxbase.

There is little doubt that without funds of some sort flowing to Whistler and the other resort collaborative partners the experience in all these destinations will change. Does it need to be RMI? Not necessarily — it could be a taxation mechanism for resorts — and that could even come with a built-in incentive; the more successful you are the more money you get.