Luxury Hotel Accommodations

[i_am_the_swammi]

Much has been made in other threads and publicly about corporations overspending on luxury items such as hotel rooms. Timely, as attached is a copy of the letter the AH&LA (American Hotel & Lodging Association) will be sending to President Obama in the coming days. Perhaps all of you that feel we should "boycott" upscale hotels will think a little harder about the impact of said boycott on potential job losses, more commercial loan failure, and decreases in tax base for your local economy:

 

March 3, 2009

 

President Barack H. Obama

The White House

1600 Pennsylvania Ave., N.W.

Washington, D.C. 20500

 

Dear President Obama:

 

At a time when employment is the leading topic of concern for the nation, the owners of thousands of large and small American lodging businesses signing this letter strongly applaud you for rejecting a recent policy suggested by your Transportation Secretary to fund infrastructure projects by replacing today’s gasoline tax with a tax on motorists based on mileage. This mileage tax would have further hurt the U.S. lodging industry, which has already seen nearly 200,000 travel-related jobs lost in 2008 and faces an additional 247,000 losses in employment this year.

 

As representatives of America’s large and small lodging properties we are eager to help your Administration find the best solutions to our nation’s economic woes. However, the American lodging industry recently has been labeled by members of your Administration as a luxury that has been misused by recipients of emergency government lending. Nothing could be further from the truth. Our industry is an integral part of the nation’s

travel and tourism economy and a major source of jobs. The business events your Administration reference that are held by American companies at our facilities serve an essential purpose: our properties bring together businesspeople that use our facilities to improve and grow their companies. From seminars where sales techniques are discussed to immense trade shows where thousands of companies come together to exhibit their

goods, to an ordinary business committee event held in an airport hotel conference room where the final details of a contract are negotiated, through a incentive program held at a resort that rewards a company’s top salesperson—each of these occasions serve a vital purpose in American

business, and each likely takes place at one of our nation’s 48,062 lodging properties.

 

In 2008, hotel guests spent $536 billion on rooms and hotel goods and services related to events, conferences, and meetings. This sizeable figure also includes the revenue generated by sponsors and attendees attending conventions or meetings at hotels: food purchases, equipment rental,

exhibit space and meeting room usage, conference transportation, and hospitality suites. Our facilities, which include five-star corporate hotels employing hundreds, small family-owned bed & breakfasts, and independently owned and operated franchises and unbranded properties, are in every city and county across America. All of our businesses generate jobs, income, and taxes for every region and state. Most of the 48,062 lodging properties in America have less than 75 rooms. Only 1,597 properties have 300 rooms or more, with the remaining 19,255 between 75 and 299 rooms.

 

We are a small business industry as much as an industry whose larger properties cater to corporate clients in major American cities such as Chicago. Ours is a job-creating engine reaching into every sector of American business. The American lodging industry employs over 1.8 million workers and directly supports 7.5 million additional jobs, all of whom depend on business and leisure travelers for their livelihood. In 2008 alone, the hotel industry generated nearly $116 billion in tax revenue for federal, state, and local governments. Our industry’s economic multiplier across the nation’s economy is vast. The spending last year by guests supported 15.1 million full- and part-time jobs, whose presence ripples

throughout local economies as hotels purchase services from area suppliers and their employees use their salaries and wages for housing, food, and clothing. Overall, the guests in our industry last year helped generate in some way about $1.5 trillion in sales for firms in every industry in every region of the United States.

 

America’s $139 billion lodging industry stands with you as you work to rescue our faltering economy and provide incentives for companies to create new jobs. America’s hard-working lodging industry owners and employees—and the millions of Americans working in travelrelated industries—provide the new jobs and increased revenues your economic stimulus programs seek to create. But the more you discourage business travel through your Administration’s statements and policies, the harder the economic recovery will be for our industry and our nation.

 

Signed,

 

The American Hotel & Lodging Association’s Members

 

CC: Vice President Joseph Biden

House Speaker Nancy Pelosi

Senate Majority Leader Harry Reid

Senate Minority Leader Mitch McConnell

House Majority Leader Steny Hoyer

House Minority Leader John Boehner

435 Members of the U.S. House of Representatives

100 Members of the U.S. Senate

[detlef]

Listen, my industry depends on people spending a bunch of money in "team building efforts" like getting plowed together over dinner. That doesn't change the fact that I feel good about my tax dollars (or, as it were, the obligation of my future tax dollars to service debt associated with) going to bail these guys out only to have them spend that money on making sure the execs still get to party. It's a matter of principle.

 

If you try hard enough, you can rationalize nearly every dollar spent, regardless of what is spent on, as priming the economy.

 

None the less, a few dozen people spending insane money at a super lavish place doesn't do as much as hundreds spending the same amount in more places.

 

I believe that the most hands the money passes en route to the top (because it all ends up at the top), the more good it does to kick starting the economy. When someone books a package at the nicest place in town, their money gets to the top a whole lot faster than it would otherwise. That's what is going on here and it is not a wise way for our collective money to be spent.

Edited February 25, 2009 by detlef

[i_am_the_swammi]

Det, I appreciate your thoughts, and your are spot-on in a number of your points.

 

However, our industry as a whole has no been labled a "luxury" by many detractors on Capitol Hill, and many businesses are cancelling or curtailing ordinary conferences/trade shows so as to not be considered "misusers". Even companies that have not received one dime of bailout funds are nervous that there will be shareholder revolt if they don't cease/curtail what are vital and important events needed to run their everyday business. This is wrong. These detractors should be using such a broad brush to label every company that hosts an event as "lavish spenders".

 

Suppose their ire was directed at the restaurant industry. Suppose folks on the Hill publicly stated that consumers who frequented upscale restaurants should be banished because the government is considering tax cuts/rebates to everyone, and those receiving them could and should eat more frugally at home. Wouldn't this governmental decree anger you?

 

We gave stimulus checks to almost 90% of the American population last year, with the idea that they would go out and spend it to spur the economy. Corporations are now seeing their stimulus check, but are being flagged for spending it...interesting paradigm.

[Kid Cid]

Swammi, I understand you industry's concern about lost revenue due to public perception and that public figures such as Congressmen can exacerbate that problem. However, that should be adressed outside of the context of the public bailout of the financial institutions. Simply put, these companies were about to go under, the gov't offered to bail them out and they accepted. Then they promptly looked at their balance sheets and said, "Oh, we've now got cash reserves, business as usual". The reality was as far from usual as it gets. The perception of these companies to the American public was that they did NOTHING to rectify the situation that got them and us into this mess with the money we gave them to do just that.

[dmarc117]

the american way of life will be changed forever. from spenders to savers. ask the children of the depression.

[CaP'N GRuNGe]

March 3, 2009

 

President Barack H. Obama

The White House

1600 Pennsylvania Ave., N.W.

Washington, D.C. 20500

 

Dear President Big Ears:

 

Stop trying to interfere with my trust fund. That's NOT hot.

 

Love Always,

 

Paris Hilton

 

CC: Vice President Joseph Biden

House Speaker Nancy Pelosi

Senate Majority Leader Harry Reid

Senate Minority Leader Mitch McConnell

House Majority Leader Steny Hoyer

House Minority Leader John Boehner

435 Members of the U.S. House of Representatives

100 Members of the U.S. Senate

 

fixed

[MojoMan]

Swammi, I understand you industry's concern about lost revenue due to public perception and that public figures such as Congressmen can exacerbate that problem. However, that should be adressed outside of the context of the public bailout of the financial institutions. Simply put, these companies were about to go under, the gov't offered to bail them out and they accepted. Then they promptly looked at their balance sheets and said, "Oh, we've now got cash reserves, business as usual". The reality was as far from usual as it gets. The perception of these companies to the American public was that they did NOTHING to rectify the situation that got them and us into this mess with the money we gave them to do just that.

 

Very well said Kid Cid.

[Big John]

CC: Vice President Joseph Biden

House Speaker Nancy Pelosi

Senate Majority Leader Harry Reid

Senate Minority Leader Mitch McConnell

House Majority Leader Steny Hoyer

House Minority Leader John Boehner

435 Members of the U.S. House of Representatives

100 Members of the U.S. Senate[/i]

So the congressional leaders get 2 copies each as they are also a member of the House or Senate?

[detlef]

Det, I appreciate your thoughts, and your are spot-on in a number of your points.

 

However, our industry as a whole has no been labled a "luxury" by many detractors on Capitol Hill, and many businesses are cancelling or curtailing ordinary conferences/trade shows so as to not be considered "misusers". Even companies that have not received one dime of bailout funds are nervous that there will be shareholder revolt if they don't cease/curtail what are vital and important events needed to run their everyday business. This is wrong. These detractors should be using such a broad brush to label every company that hosts an event as "lavish spenders".

 

Suppose their ire was directed at the restaurant industry. Suppose folks on the Hill publicly stated that consumers who frequented upscale restaurants should be banished because the government is considering tax cuts/rebates to everyone, and those receiving them could and should eat more frugally at home. Wouldn't this governmental decree anger you?

 

We gave stimulus checks to almost 90% of the American population last year, with the idea that they would go out and spend it to spur the economy. Corporations are now seeing their stimulus check, but are being flagged for spending it...interesting paradigm.

I meant to respond to this and never got around to it. First off, are you certain that the hotel industry as a whole is being targeted by congressional vitriol or are some in your industry simply guilty of playing the, "if we don't take a stand now, we'll be next" card. I've got to say that the letter you posted came off very poorly and didn't likely earn much sympathy from anyone. I don't need to hear that it is vital to our economy that AIG continue to spend a ton of money on executive retreats and that is exactly how that letter sounded. It is certainly vital to the well being of luxury hotels, but that's their problem, not mine. Hell, part of why my business is doing well right now is that I'm priced a notch below other high end options, so many business dinners that were going down at the pricey steakhouse next door are happening at my place instead. Sucks for them, not for me.

 

In general, our country seems to lack the ability to see any gray areas in anything. So it doesn't surprise me that businesses are afraid that they'll be lumped in with AIG if they even hold a modest conference somewhere. However, unless congress is implying that nobody leave their office or that nobody ever sleep in any bed other than their own unless it's on their personal, non-business related dime, then perhaps this is a lot to do about nothing.

 

What I take from the harsh words the government is levying against those getting bailed out and then blowing mad jack on golf junkets is simply that. Don't freaking spend our tax dollars on chit you don't need. That if anyone is going to rape the tax payers, it should be the same people that always have, the government itself.

[Ursa Majoris]

the american way of life will be changed forever. from spenders to savers. ask the children of the depression.

This is interesting. I've been thinking the same thing but I also know the public has a short memory.............

 

If what you say does turn out to be true, we will eventually be in great shape as a nation.

[i_am_the_swammi]

However, our industry as a whole has now been labled a "luxury" by many detractors on Capitol Hill, and many businesses are cancelling or curtailing ordinary conferences/trade shows so as to not be considered "misusers". Even companies that have not received one dime of bailout funds are nervous that there will be shareholder revolt if they don't cease/curtail what are vital and important events needed to run their everyday business. This is wrong. These detractors shouldn't be using such a broad brush to label every company that hosts an event as "lavish spenders".

 

Hmmm, maybe I AM the swammi...I posted my thoughts two weeks ago.

 

Now from yesterday's Travel Weekly::

 

Bailout backlash causes companies to cancel meetings

By: Bill Poling

March 05, 2009

 

About one-fifth of meeting planners are canceling events because of media backlash against the reported travel expenditures of some companies receiving federal bailout funds, according to a new survey by Meetings & Conventions.

 

M&C, published by Northstar Travel Media (Travel Weekly’s parent), surveyed 135 meeting planners in the last week of February, 91% of whom work with or for companies that were not receiving federal bailout funds.

Twenty-one percent said they had canceled events as a “direct result of the bailout backlash,” and 15% said their companies or clients had canceled events, but they were unsure of the reason.

 

Of the total respondents, 41% are engaged in the incentive business. Of those, 58% said they had canceled some incentive trips.

 

Among other findings:

 

• 52% said the “mass-media backlash against meetings” has been “extremely” or “moderately” influential.

 

• 41% said they have changed a meeting or event destination, or have changed venues within the same city, “to appear more economical.”

 

• 38% said their companies decided to avoid luxury or upscale hotels and 30% are avoiding cruises;

 

• 24% said their companies and clients are developing new meeting policies to demonstrate “good faith and intelligent spending.”

 

Click here for the full report.

 

The U.S. Travel Association, working with a coalition of industry groups in the lodging and meetings sectors, cited the results as further proof that the industry needs to get more aggressive about putting the meetings industry in a positive light.

 

To that end, it has launched national ad campaign in USA Today, Politico and other print and online outlets under the theme “Meetings Mean Business,” emphasizing that the meetings business supports 1 million jobs and that meetings-related travel generates $16 billion in state and local tax revenue.

 

At a press briefing unveiling the national ad campaign, U.S. Travel President Roger Dow said even casual remarks by politicians, from Obama on down, are having chilling effect on legitimate business activity.

 

He called the backlash against business meetings an "unprecedented crisis" that justifies a broad, national campaign to "defend our industry." He said, "It’s crazy out there," and likened the situation to a "witch hunt," with news reporters "staking out luxury hotels," hoping for a "gotcha" story.

 

Geoff Freeman, US Travel’s senior vice president for public affairs, told reporters that the industry’s national campaign has three goals:

 

• Push for Treasury Department adoption of industry’s recently published guidelines on responsible meetings.

 

• Stop any "punitive legislation" in Congress that would restrict meetings or travel.

 

• Get politicians and commentators at all levels to "tone down the rhetoric

Edited March 6, 2009 by i_am_the_swammi

[Whiskey Pimp]

The company I work for sells packages to major sporting events and we've definitely seen the hit in companies not attending these. We used to see companies take 20-40 people mixed of clients, executives, incentives, etc and now they're simply not even calling. Anyone need to bring 20 people to something like the Olympics, Super Bowl, World Cup or anything like that just give me a shout. I'm not exactly busy on the phone or anything these days.

[Ursa Majoris]

I have to say that most of the conferences I've attended have been grotesquely overpriced. Typically, conference attendance costs around $500 / day for the conference itself, then there's hotel, air fare and (maybe) rental car on top. That's $2,500 + $1,000 + $800 + $300 = $4,600 for an employee to spend a week out of the office.

 

Is it any wonder companies are canceling these and not sending people to them?