Marketing and More

In the months after the COVID-19 pandemic began to recede and Florida relaxed protocols that included a ban on short-term rentals, visitation soared and with it, bed tax collections.

In 2022, both Walton County and Panama City Beach collected record amounts of what is formally known as the tourist development tax (TDT), and in 2023, collections fell off only very slightly, suggesting that they may have plateaued at a very high level.

Collections in southern Walton County, where the bed tax is 5% and the county’s tourism is concentrated, totaled $62.69 million in fiscal year 2022 and $60.01 million a year later. In Panama City Beach, collections in FY 2022 and FY 2023 stood at $37.74 million and $37.36 million. (In both locations, the fiscal year runs from Oct. 1 to Sept. 30. A TDT of 3% is collected in Walton County north of Choctawhatchee Bay; it was introduced at a rate of 2% in March 2021 and raised to 3% effective with the start of FY 2024.)   

While bed tax-funded organizations such as Walton County Tourism and Visit Panama City Beach are thought of as marketers primarily, growth in collections has permitted them to engage in other noncustomary activities.

Matt Algarin, Walton County Tourism’s director. Photo courtesy of Walton County Tourism Department

“We’re doing a lot of great things with our revenues,” said Matt Algarin, who became Walton County Tourism’s director in July 2022 after joining the organization as a content writing specialist in May 2017. “We’re doing things with our money that other counties in the region don’t do.” He noted as an example the county’s beach safety (lifeguards) program.

“When you bring millions of people to the beach each year, there is an obligation to try to keep them safe,” Algarin said, “no matter if they are visiting a public beach or a private one.”

Visit Walton County also pays for maintenance activities that typically would be handled by a public works department funded by property tax dollars.

“We have a maintenance department of more than 70 employees that falls under the tourism budget,” Algarin said. “They handle everything from trash removal along the beach to maintaining our 19-mile multiuse path to maintenance and construction of beach boardwalks and accesses. It’s incredibly important when you are a high-end destination that the aesthetic is consistent with the experience that people are looking for and paying for.”

Walton County Tourism maintains entryways to the beach areas of South Walton and has spent more than $40 million to acquire property for beach accesses and parking areas.

“We spend only about 27% of our budget on marketing activities,” Algarin said, making Walton County Tourism something of an anomaly among TDT-funded destination marketing organizations (DMOs). “People might expect that percentage to be higher, but it is still a lot of money when you look at the total amount of money we collect. If you are spending 27% of $60 million, that’s a pretty good chunk of change.”

With the establishment of the 3% taxing district, Walton County’s DMO altered its identity.

“We have transitioned ourselves away from calling ourselves Visit South Walton,” Algarin said. “We are Walton County Tourism. South Walton is a brand, and we are calling the county north of the bay Authentic Walton. The two brands correspond to our two taxing districts.”

Dan Rowe, Visit Panama City Beach president and CEO. Photo courtesy of Visit Panama City Beach

At Visit Panama City Beach (VPCB), the bulk of TDT dollars are devoted to marketing, but the recent wealth of collections has enabled the organization to bank and carry forward dollars that it plans to devote to the construction of a 130,000-square-foot multipurpose building at the Publix Sports Park on Chip Seal Parkway.

“While our revenues have grown dramatically, we have not increased spending proportionately,” said VPCB president and CEO Dan Rowe. “We are still very prudent in how we spend our dollars.”

Known variously as the Sabre Center, the Western Region Resiliency Center and the Indoor Events Center — “Pick the one you like,” Rowe said — the new building will cost an estimated $60 million. Visit Panama City Beach will cover a portion of that cost. The project also will be supported with a grant from the Federal Emergency Management Agency and a contribution from Bay County. VPCB is also seeking a grant from Triumph Gulf Coast.

The diversity in funding sources and the occurrence of multiple names for the center reflect the collection of purposes it will serve.

The center will be constructed to withstand 200 mph winds, Rowe said, and “will have high-speed internet connections no matter what happens with the cellular networks.” It will be employed as an emergency operations center and shelter during big blows, or what Rowe calls “gray sky days.” And, it will house a business resource center in the aftermath of destructive storms.

“Post Hurricane Michael in 2018, businesses had no place to go,” Rowe said. “It took a while for SBA and other agencies to get their act together. Eventually, they erected a tent in the parking lot next to the library on Middle Beach Road. Now, as soon as the wind stops blowing, we’ll be able to respond to the needs of our business community and get them what they need to stand back up.”

The center will be equipped to accommodate classified briefings for up to 200 people among entrepreneurs, innovators and military officials. It will be a place where businesses can collaborate and advance ideas.

The advent of the Publix Sports Park on Chip Seal Parkway in Panama City Beach has enhanced the destination’s attractiveness as a host of regional baseball and softball tournaments. Rendering depicts an indoor sports facility and emergency operations center, plans for which are nearing completion. Visit Panama City Beach has been carrying forward surplus revenues for use in building construction. Rendering courtesy of Visit Panama City Beach

“We expect that the genesis of many projects will occur there,” Rowe said. “Zoom is one thing, but getting out of your office and participating in face-to-face meetings tends to inspire a lot.”

Rowe envisions that the center will host dinners and graduation ceremonies along with athletic competitions ranging from wrestling to cheerleading.

Jayna Leach, Visit Panama City Beach vice president of marketing. Photo courtesy of Visit Panama City Beach

“We have seen what sports (baseball, softball, soccer, lacrosse) have done for the destination,” said VPCB vice president of marketing Jayna Leach. “Indoor sports is really going to be a great addition.”

In January, Leach attended the International Media Marketplace event held at the Javits Center in New York City. So, too, did Nicole Barfield, the communications director at Walton County Tourism. For representatives of DMOs, the IMM can involve the equivalent of speed dating among journalists, bloggers, influencers and tourism industry counterparts.

Both VPCB and Walton County Tourism view New York and the Northeast as emerging markets.

“Northeast markets started popping up on the radar as COVID restrictions were lifted by Gov. (Ron) DeSantis, and people there were looking for new destinations in Florida,” Leach said. “But for that region, we are still something of a hidden gem.”

Both DMOs are courting St. Louis and Chicago. Walton County Visitation is focused on Charlotte as a source of business meeting visitation. Rowe said that the southern tier of Midwestern states, including Indiana and Kentucky, is becoming more of a factor for Panama City Beach. Surprisingly, Rowe said, so, too, is Orlando.

“It’s because our world-class beaches are second to none,” he said. “And travelers may come to Orlando and want to see New Orleans, and they discover us along the way.”

Panama City Beach, Rowe likes to say, “is an all-American beach town where everyone is welcome.” Leach has made accessibility a priority with a “Fun for All” initiative. In concert with Bay County, VPCB has provided Mobi-Mats and specially designed walkers and chairs at the M.B. Miller County Pier so that “people who never thought they would be able to put their toes in the sand are able to do that,” Leach said.

For Walton County Tourism, the target audience is relatively narrow.

“Our mission has always been to attract the affluent traveler,” Algarin said. “If we can bring in fewer people who will spend more money, that’s going to be the winning formula for us. Our marketing agency knows who our target is. We want people who are willing to spend 20 grand a week.”

Fewer people means less wear and tear on roads and public amenities and less congestion.

“We are always trying to find that balance — how do we support our tourism-related businesses without making it difficult for people to get around?” Algarin said. “Our residents want to enjoy the same things that our visitors do.”

As good as business has been in the past couple of years, there is no opportunity to relax, Algarin said.

“To maintain those levels, we have to replace the 15% to 20% of the visitors who do not return in consecutive years. We can never rest on our laurels. Coca-Cola has been around for a long time, but it still spends billions of dollars a year to make sure you remember who they are.”