CBRM to withhold half of tourism marketing levy to promote large sporting events

The head of a marketing organization representing all of Cape Breton Island says he has serious concerns after the region's largest municipality decided to withhold half of the money it raises through a levy on tourist accommodations.

Cape Breton Regional Municipality councillors voted 10-3 at Tuesday's meeting in Sydney, N.S., to keep what could amount to $500,000 or more a year and use that money to promote large sporting events at CBRM facilities.

Destination Cape Breton CEO Terry Smith said the change was unexpected.

"We're disappointed in the decision, because I don't think the full story was provided to council in terms of the implications of that decision," he said in a telephone interview late Tuesday evening.

Smith said he had asked for a meeting with Mayor Cecil Clarke to discuss the matter, but that never happened.

The change will reduce the marketing organization's budget by about 20 per cent and will mean budget cuts, including the possibility of staff cuts, and could lead to less effective marketing for the island, Smith said.

"I kind of feel like this is taking something that is working and trying to fix it, but it has been working," he said. "We've had major success over the last number of years."

All five municipalities on Cape Breton Island levy a three per cent tax on tourist accommodations — including hotels, motels and short-term rentals — and until now have handed over the entire amount to Destination Cape Breton.

The agency uses the money to promote tourism around the island and to attract events that will result in more tourist dollars coming into the municipalities.

Councillors said Tuesday they are not unhappy with Destination Cape Breton, but they wanted to see more emphasis on attracting large sporting events to CBRM venues.

Clarke said the levy is expected to generate over $1 million this year and while CBRM staff can use it to bid on large events, Destination Cape Breton can focus on wider tourism advertising.

"That puts a half a million dollars in each organization's pockets to do island-wide marketing and specific events … that are of a larger nature that are focused on our venues and our infrastructure in the CBRM," he said.

Clarke said the change is "about finding balance and hopefully a win-win on both sides."

Although councillors said they were not "anti-Destination Cape Breton," the mayor said more attention needs to be paid to the island's largest municipality where the largest tourist attractions and accommodations already exist.

"There hasn't been that focus on our facilities within the CBRM, specifically our signature ones," Clarke said.

Smith said Destination Cape Breton has had a hand in attracting events such as the world women's curling championship, the Scotties Tournament of Hearts Canadian women's curling championship, the Canada Soccer U17 national championships, the Mobility Cup international regatta for sailors with disabilities, Nova Scotia Music Week and more.

He said if the other island municipalities decide to carve out separate deals, the fragmentation of marketing dollars could make it more difficult to successfully attract tourists.

"We don't know where that is all going to go," Smith said.

"We're going to have discussions with folks and hopefully everybody will stay onside, but nothing is a guarantee and that really wasn't considered in this decision by CBRM."

Councillors Steve Gillespie, Steve Parsons and Kim Sheppard-Campbell voted against the motion to approve the change.

Parsons said the item was only added to the agenda on Monday and he wasn't happy making a major decision with so little notice.

He also asked questions about the amount of money under discussion and whether CBRM would hire someone to attract events.

Recreation director Kirk Durning said he didn't have exact numbers on hand but the levy brought in just under $900,000 last year and staff could handle the work in-house.

Parsons also said he wanted to know what the impact would be on Destination Cape Breton.

"I think these decisions are important and they should be taken [with] all the time and consideration and having everybody in the room to answer all the pertinent questions," Parsons said.

Gillespie and Sheppard-Campbell also wanted to hear from the marketing organization and while two staff members were in the gallery for the afternoon meeting, they were not invited to speak.

'Dialogue has been evolving,' Clarke says

They later declined to comment to reporters, saying the CEO was the official spokesperson.

Smith said he was on business in Alberta and flew into Sydney airport at 7 p.m.

Clarke said he and staff had been discussing the change in financing for months and the matter had even been raised by the previous administration, so Destination Cape Breton should not have been surprised.

He said the growth in marketing funds from room taxes presented an opportunity for CBRM to take some of the burden off taxpayers.

"This has been a dialogue that's been evolving, but also the amount of revenue has been increasing, which has changed quite frankly the opportunity for both, to maintain stability and a funding stream for Destination Cape Breton and also provide money specific to destination marketing directly within Sydney and the CBRM."

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