Arkansas Tourism Ticker: Travel and tourism sector growth continues into 2016

Editor’s note: The Arkansas Tourism Ticker is sponsored by the Arkansas Hospitality Association.
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Arkansas’ tourism industry ended the first two months of 2016 with a more than 4% growth in tourism taxes among 17 cities and a more than 5% growth in tourism jobs. The pace continues that posted by the industry in 2015.

In 2015, the Arkansas Tourism Ticker reported a 7.41% increase in hospitality tax revenue among 17 Arkansas cities reviewed for the report, an 8.31% increase in collections of the state’s 2% tourism tax, and a 5.04% increase in Arkansas tourism industry jobs compared to 2014.

The January-February report finds that $6.722 million in hospitality taxes were collected by the 17 cities, up 4.34% compared to the same period in 2015. Collections in Little Rock, the largest city in the report, totaled $2.204 million in the two months, up 5.4% compared to the same period in 2015. LIttle Rock collects a lodging tax and a prepared food tax.

Bentonville, a city that has in recent years seen a surge in travel and tourism venues, had $316,440 in hospitality tax revenue in the January-February period, up 8.5% compared to the same months in 2015. The city, home to global retail giant Wal-Mart Stores, also collects a lodging tax and a prepared food tax.

Joe David Rice, tourism director for the Arkansas Department of Parks & Tourism, said factors in the gains include low gas prices, good weather and good marketing.

“I think the positive numbers are because of a lot of things. We’re getting more people traveling and getting better ADRs [average daily rates] in the hotels – that’s helping everything,” Rice said. “We’ve had great weather, low gas prices and a great improvement in our tourism product across the state. We’ve had one hell of a good marketing campaign. We have a really good team and it’s all research-based. The money in our marketing is delivering the right message to the right people at the right time.”

Statewide monthly employment in the sector averaged 116,000 in January and February, up 5.6% compared to 109,850 in January-February 2015. The average is also 18.67% higher than the January-February 2010 period, which provides some perspective on travel and tourism industry growth in the past six years.

Montine McNulty, executive director of the Arkansas Hospitality Association, said such numbers are a product of the industry responding to consumer demands.

“The significant growth in tax revenue which reflects the spending of visitors to Arkansas has been phenomenal to see. The Hospitality and Tourism industry is ever-evolving and adapting to fit the needs of both Arkansans and visitors. The Tourism Ticker is a great resource in measuring the success of the industry. We are proud to see these numbers,” she said.

The Arkansas Tourism Ticker is managed by Talk Business & Politics, sponsored by the Arkansas Hospitality Association, and is published every two months, or six times a year. The ticker uses the following three measurements to review the health of the state’s tourism industry.

• Hospitality tax collections – prepared food tax and lodging tax – of 17 Arkansas cities (cities listed below along with collections for each city);
• Tourism sector employment numbers as reported by the U.S. Bureau of Labor Statistics; and
• Collections of Arkansas’ 2% statewide tourism tax.

Results for the January-February 2016 ticker report are:

• 4.34% increase
Hospitality tax revenue in January-February 2016 among 17 Arkansas cities reviewed for the Arkansas Tourism Ticker

• 10.72% increase
Collections of Arkansas’ 2% statewide tourism tax in 2015 over 2014

• 6.2% increase
Increase in Arkansas’ tourism industry jobs in January-February 2016 compared to the same period in 2015

HOSPITALITY TAXES
The combined hospitality tax collections in the 17 cities totaled $6.722 million in January-February 2016, up 4.34% compared to the $6.442 million in the same period in 2015.

Restaurant (prepared food tax) tax collections among the 17 cities totaled $5.198 million in January-February 2016, up 3.83% compared to the $5.006 million in the first two months of 2015. Hotel tax collections among the 17 cities totaled $1.524 million in January-February 2016, up 6.12% compared to the $1.436 million in the same period of 2015.

Four cities (Harrison, down 0.7%; Pine Bluff, down 13.9%; Rogers, down 11.1%; and Russellville, down 35%) among the 17 posted hospitality tax collection declines in the January-February 2016 period. Percentage changes among the 17 cities ranged from the 35% decline in Russellville to a 126.8% gain in El Dorado. However, collections in the cities may be impacted by the timing of tax payments from hotels, restaurants and other entities that collect and remit hospitality taxes.

During the 2015, Texarkana was the only city among the 17 cities surveyed for the Arkansas Tourism Ticker to post an annual decline in collections. Percentage changes for the cities during the year ranged from a decline of 0.86% in Texarkana to a high of 30.2% in El Dorado.

STATEWIDE TOURISM TAX
Arkansas’ 2% tourism tax generated $1.979 million in January-February 2016, up 10.72% over the $1.788 million in the same period of 2015. Collections in January and February each set new records for the tax.

Following are the top 10 counties in terms of collecting 2% tourism tax in January and February, and the percentage increase/decrease from the same period in 2015.
Pulaski: $451,411, down 1.1%
Benton: $219,926, up 6.75%
Washington: $209,954, up 53.5%
Garland: $157,237, up 17.35%
Sebastian: $84,173, up 7.79%
Carroll: $59,343, up 17.36%
Crittenden: $58,894, up 33.86%
Craighead: $58,185, up 11.7%
Mississippi: $51,353, up 60.98%
Union: $47,173, up 22.95%

Collections of Arkansas’ 2% tourism tax in 2015 totaled $14.815 million, up 8.31% compared to the $13.677 million in 2014. The record collections marked the first time the tax topped $14 million and marked the fifth consecutive year of year-over-year gains of the tax.

Following are the past six years of 2% tax collections.
2015: $14.815 million
2014: $13.677 million
2013: $12.716 million
2012: $12.404 million
2011: $12.025 million
2010: $11.492 million

TOURISM JOB NUMBERS
Monthly average jobs in January-February was 116,650, up 6.2% compared to the 109,850 during the same period of 2015.

Travel and tourism sector employment ranged from 116,000 in January  to a high of 117,300 in February. The February level, if not revised, set a new record for the sector.

Of the eight metro areas in or connected to Arkansas, the Bureau of Labor Statistics provides tourism employment data on five. All five posted January-February employment gains compared to the same period in 2015, with Northwest Arkansas posting the largest gain (11.7%). Following are comparisons of the monthly employment averages during the years noted.

Northwest Arkansas
January-February 2016: 24,350
January-February 2015: 21,800
January-February 2010: 16,900

Fort Smith
January-February 2016: 9,100
January-February 2015: 8,850
January-February 2010: 8,200

Central Arkansas (Little Rock-North Little Rock-Conway)
January-February 2016: 33,850
January-February 2015: 31,350
January-February 2010: 28,000

Memphis-West Memphis
January-February 2016: 62,550
January-February 2015: 62,450
January-February 2010: 62,650

Texarkana (Arkansas-Texas)
January-February 2016: 6,450
January-February 2015: 6,250
January-February 2010: 5,450

The monthly jobs average in the state’s travel and tourism sector during 2015 was 113,500, up 5.04% compared to an average of 108,050 during 2014. Job growth in the sector has been significant during the past 10 years. The February employment is 21.5% more than the 96,500 in February 2006.

Link here for the January-February 2016 PDF report of The Arkansas Tourism Ticker.