Natchez CVB budget spent on convention center debt, marketing, personnel

Published 12:05am Sunday, May 12, 2013

NATCHEZ — The Natchez Convention and Visitors Bureau’s total budget is approximately $1.3 million, of which the majority is spent on marketing, paying off the Natchez Convention Center debt, personnel and contracts.

The CVB’s budget is funded mainly by the city’s 3-percent lodging tax, 1.5-percent restaurant tax and the $2 hotel and bed-and-breakfast occupancy, or heads on beds, tax.

All of the $2 occupancy tax money — approximately $310,500 for this fiscal year — must be used only by the CVB for marketing purposes.

The CVB keeps 2 percent of the 3-percent lodging tax, and the remaining 1 percent goes toward paying of the convention center debt.

The CVB, however, does not keep the 3-percent tax for the Natchez Grand Hotel. Two percent goes toward paying the tax increment financing bond set up by the city and county in 2006 as an incentive for the hotel’s developers, and 1 percent goes toward the convention center debt.

The CVB gets 1 percent of the 1.5-percent food tax, and the remaining half-percent goes toward paying off the Natchez Convention Center’s debt.

The CVB has budgeted approximately $280,000 in tax money to come in this fiscal year to pay off the convention center debt, which totals approximately $10 million. The $12 million bond was issued in 1999 to build and furnish the convention center, as well as renovate the Natchez Community Center and City Auditorium.

All of the $2 tax money is allocated for marketing, per the legislation that created the tax. The CVB has a marketing advisory committee made up of tourism and related industry professionals that meet quarterly and decide how the spend the marketing dollars, Natchez Tourism Director Connie Taunton said.

Advertising and promotion

Taunton said she and Carol Ann Riley of Riley Creative, the CVB’s advertising agency of record, present recommendations for publications, websites and other ways to market the city at those meetings.

The committee, Taunton said, also contributes marketing ideas, and the final say comes from the Natchez Convention and Promotion Commission, or the CVB board.

The advertising and marketing efforts are typically outlined ahead of time in the CVB’s annual marketing plan, Taunton said.

Each department within the CVB, which would include the manager of tourist services, director of sales, marketing assistant and the CVB media/film liaison, makes notes throughout the year about what they would like to see happen with the next year’s marketing efforts.

“They all submit a rough draft of what they would like to do, and we present it to the marketing advisory committee and then make whatever adjustments are necessary (based on the committee’s feedback),” Taunton said.

The draft plan is then submitted to the CVB board, finalized then sent to the Natchez Board of Aldermen for approval, Taunton said.

The CVB’s target market, Taunton said, is a 250-mile radius. She said the CVB decides in which markets and publications to advertise based on research on where visitors come from and the reach of publications.

“We do research on the circulation of the publications and through feedback from other people who have advertised of what kind of return on investment they have had,” she said.

Taunton and Riley also attend a summit each year with the Mississippi Division of Tourism and meet with advertisers.

“We have one-on-one meetings with people in advertising,” Taunton said. “It’s eight-minute meetings with each advertiser in a day-long session.”

Throughout the year, other advertising opportunities usually arise, Taunton said, whether the state has purchased ad space and offers it to its city partners at a discounted rate or another publication is running a discount.

“Whenever we buy … we do some of the same research,” she said. “We call and talk to them and see if we can get some editorials as well as advertising, and what the overall return on investment will be.”

The publications the CVB consistently advertise with include “Southern Living,” “Reader’s Digest,” “AAA Southern Traveler” and travel websites, Taunton said.

The “Southern Living” 2×4 ad runs six times a year in the back of the magazine in the travel planner section and costs approximately $7,000. Despite the fact that it is in the back of the magazine, Taunton said the ad is worth it.

“A lot of loyal ‘Southern Living’ readers look at that travel section,” she said. “We would love to do a half-page or a full-page ad, but you’re talking about $100,000 almost.”

Approximately $7,500 each year is spent on gifts and souvenirs that are given to special guests at CVB meetings and events.

For example, Taunton said, the CVB partnered with Natchez Inc. to give legislators gifts at the annual Natchez Day at the Capitol.

“Last year I think we gave them umbrellas, and this year we gave them an accessory or shaving kit bag that matched the hang-up bag the state was giving them,” she said.

The items that are used for gifts are chosen, Taunton said, based on what other cities are doing.

“Those things we decide based on what some of the other cities are doing at the conferences we go to,” she said.

The gifts and souvenirs have the Natchez logo on them, Taunton said, and help get the city’s name out there.

“All of our competitors are out there doing the same thing,” she said. “We would look bad if we showed up to a show, and they all had stuff to hand out and give away, and we had nothing.”

Souvenir items that are purchased to give away and are not used are often resold in the visitor center logo shop, Taunton said.

Salaries and contracts

Approximately $370,000 is spent on salaries for nine full-time and six contract employees, as well as contracts for grass-cutting, landscaping and advertising services from Carol Ann Riley of Riley Creative.

Riley’s compensation averages $2,000-$3,000 each month, depending on the work she does for the CVB, Taunton said. When Riley places an ad for the CVB, Taunton said, she pays for the ad then rebills the CVB. If Riley designs an ad or does other creative work for CVB marketing and advertising, her fee is $50 an hour, Taunton said.

Approximately $27,600 is budgeted for retirement, $21,500 for employee insurance, $14,260 for FICA and $3,200 for Medicare.

Other expenses

The CVB pays the city approximately $60,000 each year to rent office space at the Natchez Visitor and Reception Center.

Approximately $30,000 is budgeted for repairs and maintenance at the visitor center and approximately $15,000 for grounds maintenance.

Approximately $55,000 is budgeted for electricity, $21,000 for telephone service, $10,000 for gas and $5,400 for water.

The National Park Service pays approximately 52 percent of operational costs for the visitor center, Taunton said, which includes utilities, property maintenance and a maintenance staff member. NPS share of the costs averages approximately $7,000-$10,000 a month.

The CVB spends approximately $45,000 for security services at the visitor center, which is reimbursed to the Mississippi Department of Transportation.

The CVB budgets approximately $40,000 for the purchase of logo shop goods, which are resold in the shop.

Other expenses include:

-$18,000 for professional fees, which include annual audit services, legal fees and similar expenses.

-$15,000 for rentals, which includes any equipment that has to be rented for events. For example, Taunton said, the CVB may have to rent chairs for an event or a pressure washer for outdoor cleaning at the visitor center.

-$12,000 for operating supplies, which include coffee, light bulbs and other similar items.

-$12,000 for additional advertising, which includes required legal ads, weekly newspaper ads and similar advertising.