Richmond Region Tourism Improvement District
The purpose of the proposed Richmond Region Tourism Improvement District (TID) is to drive visitation and hotel occupancy in the Richmond Region via a dedicated fund for marketing and sales activities to benefit area hotels, the Region and the entire community.
What is the TID?
- The TID will provide supplemental and protected funds exclusively for tourism promotion activities.
- The TID is, in effect, a self-assessment by the Region’s hotel industry. A 2% assessment would be levied on lodging businesses with 41+ rooms within Chesterfield, Hanover, and Henrico Counties, the Cities of Richmond and Colonial Heights and the Town of Ashland.
- Richmond Region Tourism manages and directs the spending of funds on behalf of, and with oversight from, the industry via a committee representative of the assessed lodging businesses.
- Funds will be used only for specific purposes associated with driving visitation and hotel occupancy – in turn, benefiting the assessed business, the Region and the entire community.
- Assessed lodging businesses may pass the assessment (not a tax) on to customers. The assessment is aimed at overnight visitors, not residents.
- The TID would begin collection July 1, 2023
Is the TID a tax?
No. It is an assessment. Hotels opt in through petitions. By law, the funds must benefit the hotels. Unlike a tax, assessments cannot be diverted to other government services. A committee of hotel owners and operators has oversight of the funds are spent.
Who will charge the TID fee?
Lodging businesses with 41+ rooms within Chesterfield, Hanover, and Henrico Counties, the Cities of Richmond and Colonial Heights and the Town of Ashland.
Who will pay the TID fee?
Hotels may pass the TID fee along to their customers.
How is the assessment collected?
Hotels will collect the assessment via the room folio and remit to their respective jurisdictions. The jurisdictions remit the assessment to Richmond Region Tourism to execute the programs and activities in accordance with the Service Plan, annual workplan and budget.
Is it permanent?
The initial term is 10 years, followed by a renewal process.
What will the funds be used for?
The funds are dedicated to sales, marketing, promotions, and special events programs that will increase demand for overnight tourism and market hotels as visitor, meeting and event destinations, thereby increasing demand for room night sales. TID funds shall not be used for capital or infrastructure improvements.
Who will govern the TID?
A subcommittee of Richmond Region Tourism’s Board made up of hotels representing all sizes and localities in the TID. The TID Governance Committee will work with RRT yearly to approve a budget, work plan and process for measuring success.
Who administers the TID?
Richmond Region Tourism is the administering nonprofit and will execute the annual work plan.
How do the hotels approve the TID?
Hotel owners or their representatives sign petitions in favor of the TID. Petitions are required for each jurisdiction where hotels are located. The law requires support from more than 51% of hotels in each jurisdiction based on contribution to the TID fund (based on hotel revenue).
How is the TID enacted?
After the hotel petition threshold is met, each locality must pass an ordinance to enact the TID.
What legislation created a pathway for the TID?
During the 2021 General Assembly, lawmakers passed Senate Bill 1298 to allow any Virginia locality a pathway to establish a local TID. Since that time, Richmond Region Tourism has been working with hotel operators within our region to create the TID.
Why are we doing this? Why now?
The region is at a competitive disadvantage. Our competitor destinations have more resources than Richmond Region Tourism to drive overnight stays. By enacting the TID now, funds will be in place to recruit new business for new facilities like the Henrico County Sport Complex and GreenCity being developed around the Region. The hotels and tourism industry are still recovering from COVID, and in the face of a potential recession, the Region needs more resources to drive visitation.
