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US Travel Promotion Act

Airlines to play active role in travel promotion

Andrew Compart  Mar 03, 2010

U.S. airlines are expected to be “active partners” in a new partnership between the federal government and private sector to boost international travel to the U.S., a leader of that effort said.

Geoff Freeman, U.S. Travel Association senior VP, said he does not expect the airlines to contribute out of “goodwill,” but rather self-interest. For example, he said, they could make in kind contributions by purchasing advertising space on the Web site, after the new public-private partnership has increased the site’s traffic.

“It’s incumbent on this corporation to prove value to the airlines,” he said.

It was just last week that Congress passed the Travel Promotion Act, about four years after the Travel Industry Association, forerunner of the U.S. Travel Association, began to push for it. Proponents of the legislation argued it would boost tourism and create jobs — and match similar efforts made by other countries, which have been capturing an increased share of international travelers.

President Obama is expected to sign the bill into law. Assuming he does, the law will create a Corporation for Travel Promotion, an independent non-profit, to run the travel promotion campaign. The corporation will be partially funded by a $10 fee paid by travelers who do not have to acquire and pay for a visa to visit the U.S., and it would promote not only the recreational and business value of the U.S. as a destination, but also spread information (and counter misinformation) about U.S. security and entry requirements.

The U.S. commerce secretary will appoint an 11-member corporation board that must include memmbers with expertise in various segments of the industry, including airlines. The board has to approve a marketing plan at least 60 days before the start of each federal fiscal year, which is Oct. 1, and cannot even hire an executive director until the fee collection starts and the corporation gets its startup funding.

Because all of that will take some time, Freeman said he expects it will be a year or more before the corporation begins its marketing efforts.

From fiscal years 2011 through 2014, the corporation will receive up to $100 million per year from the collected fees, provided it can match half that amount with private funds in 2011 and the entire amount for 2012 through 2014. The legislation states that the “fair market value of goods services (including advertising)” can be included in the matching donation calculation, as long as cash still accounts for at least 20% of the match.

The law would let the corporation collect that cash via an annual assessment, if approved by “members of the industry” in a referendum. But Freeman and U.S. Travel Association President and CEO Roger Dow said it is highly unlikely the corporation would try to raise the cash that way.

Airlines to play active role in travel promotion
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