March tourism tax revenues set new record

The month of March provided a historic rebound for the local tourism industry, as Pinellas County coffers collected $14.6 million in bed taxes following a prolonged downturn.

Tourist tax revenue – a 6% surcharge on overnight stays – was down 8.25% in October 2023 and nearly 7% in December compared to the previous year. A slight decline persisted through February.

The $14.6 million generated in March, an 8% year-over-year increase, represents the highest monthly total in the county’s history. Local government and business leaders comprising the Tourist Development Council (TDC) celebrated the feat and looked to a bright future this week.

“It was the greatest month we’ve ever had in this county, and I think that’s very important,” said board member Chuck Prather, owner of the Birchwood Hotel. “In my mind, it shows a reversal of this almost year-long trend.”

A graphic showing how tourism taxes collected in March compared to previous years. Screengrab.

Proponents of the new Tampa Bay Rays stadium will also welcome the news. If approved, Pinellas officials will contribute $312.5 million in bed taxes to the $1.3 billion project and retain ownership of the roughly 13-acre site.

County commissioners dedicate 60% of tourism revenues to destination marketing and 40% to projects that increase visitation. The bed tax generated nearly $100 million in 2023.

Those numbers will likely increase as a preponderance of new hotel projects complete. Eddie Kirsch, director of digital & data for Visit St. Pete-Clearwater, said the county has 3,900 new hotel rooms in the pipeline.

He expects over 1,600 to open in 2026, with the majority in St. Petersburg and Clearwater. The average hotel rate increased by $11.23 year-over-year to $274.41. Kirsch said visitor surveys showed the average person spent about $150 daily, a nearly $20 jump from March 2023.

He noted Clearwater Beach is “performing better than it has been” and that St. Petersburg continues “to be part of that growth.” Short-term rentals contributed $5.1 million in local bed taxes.

Prather credited the VSPC team for attending nationwide and global trade shows to lure additional visitors back to Pinellas. “In my opinion, it’s working.”

A graphic showing the number and location of hotel rooms in the local pipeline. Screengrab.

However, multiple stakeholders expressed the need for expansive sports facilities to host tournaments, like those found in neighboring counties. A lack of conference space was another common concern.

City Councilmember Copley Gerdes, referring to the Tropicana Field site, said St. Petersburg officials are working to meet the demand for large-scale event space “in an empty parking lot right now.” He added that the Rays hear those requests “loud and clear.”

“I think that’s why you see it (event space) in Phase A right now rather than Phase B or C,” Gerdes said. “I really do think it’s their intention to close that gap quickly, by 2028.”

Caleb Peterson, senior manager for VSPC’s Sports Commission, reiterated that sentiment. He said the Rays are “bullish” on their ability to attract additional baseball fans and host prominent events, like the World Wrestling Entertainment’s Royal Rumble.

The Jan. 27 Royal Rumble generated a $47.05 million economic impact from a $500,000 VSPC investment, and attendees accounted for 17,811 room nights. Peterson noted that in 2023, every dollar spent on event incentives supported $1.81 in direct spending.

“The goal this year is to do a little better,” he said. “We hope to see a two-to-one ratio from that perspective.”

Brian Lowack, CEO of VSPC, also presented a $41.8 million fiscal year 2025 budget, with $31.7 million allocated for promotional expenses. It also includes $350,000 for a Rays stadium consultant.