The Economic Impact of TIDs in California

September, 2016
Prepared for Civitas by Tourism Economics, an Oxford Economics Company

Since its introduction in 1989, the Tourism Improvement District (TID) has grown in popularity as an industry-funded mechanism for supporting tourism promotion. As of mid-2016, there are 96 active TIDs in California, and another 58 operating in ten other states. Together, California’s TIDs generate an estimated $207 million in annual revenue, a large proportion of which is dedicated directly to destination marketing and promotion efforts.

Tourism Economics has been asked to evaluate the economic impact on the California economy of TIDs through associated tourism promotion by regional destination marketing organizations (DMOs). This analysis finds that TIDs in California generate significant benefits for the state’s hospitality industry, the broader economy, and local and state governments.

Annually, the economic impacts include:  

  • $6.4 billion in gross output (business sales), including a total of more than $1.4 billion in direct hotel spending n $2.1 billion in income

  • More than 32,000 direct tourism-related jobs, and a total of nearly 52,000 jobs lost  

  • More than $460 million in state and local government tax revenues Tourism Economics also evaluated the potential economic losses associated with a future scenario in which California TIDs are eliminated, causing destinations across the state to substantially reduce investments in sales and marketing. Over a five year time horizon the cumulative economic losses would amount to:

  • $33.7 billion in gross output  

  • $11.2 billion in income  

  • An average of nearly 53,000 jobs n $2.4 billion in state and local government tax revenues

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Bryce Craig