A recently formed non-profit dedicated to making Morgan Hill a tourist destination has already agreed to support its first major event.
In January, the city council created the Morgan Hill Tourism Business Improvement District, which collects 1.5 percent of revenue from hotels and other lodging businesses in the city. Revenue from the assessment, which went into effect on March 1, is then used to support major events in Morgan Hill, with the goal of increasing occupancy in the city’s hotels.
The district is managed by Visit Morgan Hill, a non-profit led by a board of directors that includes hotel, government and business representatives.
The board approved a financial contribution to the 2018 and 2019 Amgen Tour of California, which roared through Morgan Hill, as well as a contract with the city at its April 29 meeting. The council approved the contract on May 15.
Per the agreement, Visit Morgan Hill will retroactively contribute $27,500 for the 2018 Amgen TOC, and another $27,500 for the May 14 race. It also agreed to pay $45,000 in start-up fees for the district.
The payments will be made to the city over the course of a year.
Morgan Hill Economic Development Director Edith Ramirez, who serves on the Visit Morgan Hill board, said events such as Amgen are what the non-profit wants to attract.
“This race is definitely at the level of the type of events the Visit Morgan Hill group would want to support and attract to the community,” she said.
Michael Meredith, general manager of the Hampton Inn in Morgan Hill, serves as chair of the Visit Morgan Hill board. He said hotel operators had been in discussions for a number of years about how to increase stays in the city as that number had begun to drop off.
“Various obstacles, finding ways to create a majority and, of course, funneling that to a positive direction to see growth for all those involved in tourism took a long time,” he said. “It is very easy to say, ‘Hey, we need more tourism,’ but getting consensus on the approach and how it would be financially sustained is far more diverse.”
In 2017, the idea of a tax on the hotels was formed, with the goal of using the revenue to better the tourism industry and increase accommodations.
With voters approving a 1 percent increase in the city’s transient occupancy tax in November 2018, bringing the total TOT to 11 percent, and the 1.5 percent TBID tax recently going into effect, Meredith said the overall 2.5 percent raise is a “tremendous increase to the occupants of the hotel and the owners operating them,” and anticipates about $30,000-$50,000 in revenue going to the city’s coffers every month.
But hotel operators, after reaching consensus, knew that boosting tourism would increase revenues for not only hotels, but other businesses in Morgan Hill in the long run, Meredith said.
“That money through tourism growth would not only create those dollars but even more from increases of room nights to hotels, families eating out in our downtown, and travelers spending their money on locations and services in Morgan Hill,” he said. “Sparking and maintaining this growth in tourism is something we knew we could drive for our community.”
Meredith added that the Amgen event, one of the most prestigious professional cycling races in the world, increased demand for hotel stays in Morgan Hill.
“Events like this bring what I call ‘tourism street cred’ to our community and create an exposure to the entire travel industry that cannot be measured in room nights alone,” he said. “That ‘street cred’ opens doors in the travel world for communities that want a larger piece of the pie for what is coming into the Bay Area and California as a whole. We have already had conversations with larger tourism initiatives because of our participation, and we look forward to more growth from the successes in just two years’ time.”
In addition to Meredith and Ramirez, the Visit Morgan Hill board includes Andrew Firestone (La Quinta Hotel), Karen Mendez (Marriott Hotels), Bina Roy Desai (Holiday Inn Express), Chris Ghione (Morgan Hill Public Services director), David Eadie (San Jose Sports Authority), Gene Guglielmo (Guglielmo Winery) and Frank Leal (Leal Vineyards).
“While we are still getting our legs under us, the board and the collaborations we are already beginning are really exciting,” Meredith said. “The people are out there, they want to come to Morgan Hill and they need what we offer in their lives. We just want to connect that passion to those out there that want to hear from us.”
For more information, visit www.visitmorganhill.org.