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ADVOCACY CASE STUDY

Laying Out the Welcome Mat Again An Award Winning Campaign to Repeal the Complimentary Room Tax

• The Indiana Hotel and Lodging Association (IHLA) has been recognized by its peers for its efforts to repeal the complimentary room tax.
• The IHLA was awarded a 2004 Award of Excellence from the International Society of Hotel Association Executives (ISHAE) in the category of best governmental affairs program among hotel and lodging associations with annual budgets under $500,000.
• IHLA was awarded the 2005 award from the Indiana Society of Association Executives for ‘Best Governmental Affairs Campaign’.

Case Study: Complimentary Room Tax Repeal
Client: Indiana Hotel & Lodging Association

Indiana’s hotel and lodging industry was blindsided in 2003 when state legislators voted to initiate a sales tax on complimentary hotel rooms. Aimed at casino hotels that regularly give complimentary rooms to key customers and VIPs, the complimentary room tax was introduced in the waning hours of the 2003 legislative session, allowing no opportunity for public debate or discussion.

Upon passage of this onerous legislation, the IH&LA and its members executed an aggressive campaign to repeal the new tax. Campaign strategy included lobbying, grassroots efforts, public relations efforts, e-mail, direct mail, fax, etc.

Process:

• Garner sponsors at House and Senate level to carry the repeal legislation.
• Secure extensive statewide and national media coverage in support of the repeal.
• Gain active involvement of hoteliers, primarily IH&LA members.
• Find allies outside of the hotel & lodging industry to support the campaign.
• Sponsors of the repeal were found in both houses.
• Active involvement of IH&LA’s membership, nonmembers and a host of industry allies including non-profit groups, convention and visitors bureaus, the Indiana Society of Association Executives, and more.
• 1,011 e-mails and letters were sent to legislators via the association’s grassroots action center website in addition to countless phone calls and one-on-one visits with legislators.
• To reach state legislators, the IH&LA’s governmental affairs staff utilized traditional lobbying efforts, meeting one-on-one with legislators to encourage them to support the IH&LA’s position.
• Several letters were sent to legislators from the IH&LA in an effort to educate the legislators about the complimentary room tax and the negative impact it would have on Indiana’s hospitality and tourism industry.
• Additionally, the IH&LA, along with the Restaurant & Hospitality Association of Indiana, hosted a lunch reception at the State House. Hoteliers and restaurateurs brought samplings from their establishments to the statehouse for an opportunity to discuss industry issues with the legislators.
• Developed “sample” letters that could be used by those individuals outside the hotel and lodging industry to communicate with legislators about the tax.
• It was critical that the IH&LA obtain media coverage and support in order for the repeal to be successful. Not only would media coverage bring the issue of the repeal to the attention of legislators, but it also served to get the general public and non- industry allies involved.
• The IH&LA issued several press releases and letters to the editor to state and national media to meet its media relations goals.
• The IH&LA utilized e-mail, fax and mail to keep both member and non-member hoteliers involved in the fight to repeal the complimentary room tax. These types of communication were utilized to not only educate hoteliers about the issue, but more importantly direct specific action. E-mail was especially helpful in generating phone calls and e-mails to legislators during critical times of the campaign.

Results:

• The campaign was successful & the sales tax on complimentary hotel rooms was repealed, effective April 1, 2004.
• Achieved regulatory victory limiting the impact to only the sales tax and excluding the innkeepers tax. This reduced the fiscal impact of the repeal.
• 3 separate Senate bills containing repeal language were written
• A unanimous vote of support for the repeal by the State Senate
• Despite having no hearing in the House, the repeal was successfully inserted into a House Bill that made its way out of Conference Committee.
• Extensive media coverage in support of the IH&LA’s position was achieved.
• The repeal of the complimentary room tax not only affected the lodging industry, but it also positively impacted many other industries.
• Generally speaking, Indiana’s entire hospitality and tourism industry benefited as the repeal ensured that Indiana will remain an attractive destination for business, leisure and convention visitors, all of which generate economic activity for the entire state as well as local communities.

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