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                                                       Calendar No. 551
104th Congress                                                   Report
                                 SENATE

 2d Session                                                     104-341
_______________________________________________________________________


 
                UNITED STATES TOURISM ORGANIZATION ACT

                               __________

                              R E P O R T

                                 OF THE

           COMMITTEE ON COMMERCE, SCIENCE, AND TRANSPORTATION

                                   on

                                S. 1735



                                     

                 July 31, 1996.--Ordered to be printed


       SENATE COMMITTEE ON COMMERCE, SCIENCE, AND TRANSPORTATION
                      one hundred fourth congress
                             second session

  LARRY PRESSLER, South Dakota, 
             Chairman
ERNEST F. HOLLINGS, South Carolina   TED STEVENS, Alaska
DANIEL K. INOUYE, Hawaii             JOHN McCAIN, Arizona
WENDELL H. FORD, Kentucky            CONRAD BURNS, Montana
J. JAMES EXON, Nebraska              SLADE GORTON, Washington
JOHN D. ROCKEFELLER IV, West VirginiaTRENT LOTT, Mississippi
JOHN F. KERRY, Massachusetts         KAY BAILEY HUTCHISON, Texas
JOHN B. BREAUX, Louisiana            OLYMPIA J. SNOWE, Maine
RICHARD H. BRYAN, Nevada             JOHN ASHCROFT, Missouri
BYRON L. DORGAN, North Dakota        BILL FRIST, Tennessee
RON WYDEN, Oregon                    SPENCER ABRAHAM, Michigan
  Patric G. Link, Chief of Staff
Kevin G. Curtin, Democratic Chief 
    Counsel and Staff Director


                                                       Calendar No. 551
104th Congress                                                   Report
                                 SENATE

 2d Session                                                     104-341
_______________________________________________________________________



                 UNITED STATES TOURISM ORGANIZATION ACT

                                _______
                                

                 July 31, 1996.--Ordered to be printed

_______________________________________________________________________


      Mr. Pressler, from the Committee on Commerce, Science, and 
                Transportation, submitted the following

                              R E P O R T

                         [To accompany S. 1735]

    The Committee on Commerce, Science, and Transportation, to 
which was referred the bill (S. 1735) ``A Bill to establish the 
United States Tourism Organization as a nongovernmental entity 
for the purpose of promoting tourism in the United States'', 
having considered the same, reports favorably thereon with 
amendments and recommends that the bill, as amended, do pass.

                          Purpose of the Bill

  The bill, S. 1735, as reported, seeks to establish the United 
States Tourism Organization (USTO) as a nongovernmental entity 
to promote travel and tourism to and within the United States.

                          Background and Needs

  The tourism industry is the nation's second largest employer 
and ranks third in retail sales at $417 billion. In 1994, 
tourism was the United States' number one export with receipts 
exceeding $77 billion and a trade surplus of over $21 billion. 
Tax revenues from international visits are estimated to be $7.5 
billion for 1994.
  Between 1990 and 1995, the United States share of the world 
tourism market declined. Arrivals, as a share of the world 
total, decreased from 8.61 to 7.89 percent and total receipts 
declined from 16.25 to 15.70 percent of the world total. The 
United States currently ranks third as a tourist destination 
behind France and Spain. There is no permanent organization, 
public or private, currently working specifically to increase 
the United States share of the world tourism market.
  In February 1996, the United States Travel and Tourism 
Administration (USTTA) failed to gain further funding and 
closed its doors. This agency was charged with promoting travel 
and tourism to the United States, but even industry supporters 
believed a public/private partnership would be more effective 
at fulfilling this goal.
  On October 30 and 31 of 1995, the White House held the White 
House Conference on Travel and Tourism. The Conference brought 
together 1700 industry representatives to explore, among other 
issues, ways the industry and government could create a 
``public/private'' partnership to help increase international 
visits to the United States.
  S. 1735 would create a privately managed entity, the United 
States Tourism Organization, to fulfill the task of promoting 
the United States as a tourism destination. The USTO would be 
given fund raising and promotional tools in the form of 
intellectual property rights and trademark protection over the 
USTO's logos, name, and symbols. This aspect of S. 1735 is 
similar to the intellectual property rights protection extended 
to the United States Olympic Committee over the use of the 
Olympic rings, torch, and Olympic name.
  In addition, a National Tourism Board would be given two 
years to develop and implement a long-term financing plan for 
the USTO.

                          Legislative History

  On May 8, 1996, Senator Pressler, along with Senators Bryan, 
Warner, Burns, Stevens, Hollings, Inouye, Ford, Kerry, Breaux, 
Dorgan, Akaka, Johnston, and Coverdell introduced S. 1735, the 
National Tourism Organization Act.
  Since then, a number of additional Senators have become 
cosponsors of the bill, including Senators Snowe, Rockefeller, 
Wyden, and Exon from the Committee on Commerce, Science, and 
Transportation. On June 6, 1996, in open Executive Session, the 
Committee ordered S. 1735 reported with amendments.

                            Estimated Costs

  In accordance with paragraph 11(a) of rule XXVI of the 
Standing Rules of the Senate and Section 403 of the 
Congressional Budget Act of 1974, the Committee provides the 
following cost estimate, prepared by the Congressional Budget 
Office:

                                      U.S.Congress,
                               Congressional Budget Office,
                                     Washington, DC, June 21, 1996.
Hon. Larry Pressler,
Chairman, Committee on Commerce, Science, and Transportation,
U.S. Senate, Washington, DC.
    Dear Mr. Chairman: The Congressional Budget Office has 
reviewed S. 1735, the United States Tourism Organization Act, 
as ordered reported by the Senate Committee on Commerce, 
Science, and Transportation on June 6, 1996. Assuming the 
appropriation of the necessary amounts, we estimate that 
enacting this bill would result in increased discretionary 
spending of between $1 million and $3 million annually 
beginning in fiscal year 1999 for tourism-related initiatives. 
Enacting this bill could also affect the type of activities 
financed by fees collected by the Department of State, but 
there would be no net impact on direct spending over time and 
no effect at all until fiscal year 1999. Thus, the bill would 
not be subject to pay-as-you-go procedures, which apply only 
through fiscal year 1998.
    Bill Purpose.--S. 1735 would establish a United States 
Tourism Organization (USTO) as a not-for-profit organization 
chartered by the federal government. The USTO would be 
authorized to undertake a wide range of activities to promote 
tourism under the guidance of a 46-member Natural Tourism 
Board. This charter would be contingent upon the implementation 
of a long-term financing plan for the USTO within two years 
after the date of incorporation.
    Although the USTO would be a nongovernmental entity, the 
Under Secretary of Commerce for the International Trade 
Administration would serve as an ex-officio member of the 
Board. The bill also would require the Secretary of State and 
the Director of the United States Information Agency (USIA) to 
coordinate with the USTO and to place a high priority on 
implementing the organization's recommendations.
    Federal Budgetary Impact.--This bill would authorize the 
USIA and the Department of State to fund activities recommended 
by the USTO. CBO assumes that the USTO, like the 1995 White 
House Commission on Travel and Tourism, would propose that 
these agencies implement a variety of measures to promote 
tourism. The 1995 commission, for example, recommended that the 
federal government upgrade the technologies used for visitor 
entry, make electronic information and transactions for 
tourists available worldwide, and take steps to ease other 
barriers to international tourism. Because S. 1735 would direct 
the agencies to make such initiatives a priority, we expect 
that some programs that are not being funded under current law 
would have a higher probability of being implemented if this 
bill were enacted.
    For the purposes of this estimate, we assume that the USTO 
would be established during fiscal year 1997, but that any 
costs resulting from USTO's recommendations to federal agencies 
would not be incurred until the beginning of fiscal year 1999, 
because of the time needed by the USTO to develop 
recommendations and by the two agencies and the Congress to 
review them.
    Based on information provided by the agencies, CBO 
estimates that USIA would spend between $1 million and $3 
million annually in response to the recommendations of the 
USTO, assuming appropriation of the necessary amounts. We 
expect that USTO recommendations for new initiatives by the 
Department of State would pertain to border security and visas, 
which are financed by fees charged for machine-readable visas. 
CBO estimates that enacting this bill would have no net impact 
on direct spending over time, because it would not change the 
amount of the collections or the expenditures of those 
collections. We estimate that other provisions of the bill 
would have no significant budgetary impact.
    Mandates Statement.--S. 1735 contains no intergovernmental 
or private-sector mandates as defined in Public Law 104-4, and 
would have no direct impact on the budgets of state, local, or 
tribal governments.
    If you wish further details on this estimate, we will be 
pleased to provide them. The CBO staff contact is Kathleen 
Gramp.
            Sincerely,
                                              James L. Blum
                                   (For June E. O'Neill, Director).

                      Regulatory Impact Statement

    In accordance with paragraph 11(b) of rule XXVI of the 
Standing Rules of the Senate, the Committee provides the 
following evaluation of the regulatory impact of the 
legislation, as reported.

                       NUMBER OF PERSONS AFFECTED

    The purpose of the bill is to create a privately managed 
corporation to promote international tourism to the United 
States. The number of persons affected by the creation of this 
organization would depend on how well it is operated and 
financed through the efforts of the travel and tourism 
industry.

                            ECONOMIC IMPACT

    In 1994, tourism was the United States' number one export 
with receipts exceeding $77 billion, which generated a trade 
surplus of over $21 billion. The United States Tourism 
Organization created by this bill, would be charged with 
promoting tourism to the United States. Any increase in the 
number of foreign tourists visiting the United States would 
have a positive impact on the nation's economy. The total 
economic impact of this legislation would depend upon how 
successful the promotional efforts of the USTO created by this 
legislation prove to be.

                                PRIVACY

    This legislation would not have any adverse impact on the 
personal privacy of the individuals affected.

                               PAPERWORK

    This legislation would create a privately managed 
organization, it is not a federal agency. No federal paperwork 
requirements would be necessary.

                      Section-by-Section Analysis

Section 1. Short title

    Section 1 states the short title of the bill, ``United 
States Tourism Organization Act''.

Section 2. Findings

    Section 2 shows the findings of Congress. This section 
highlights the important contributions the travel and tourism 
industry makes to the nation's economy. The most important of 
these are that travel and tourism services ranked as the 
largest export for the United States in 1995 and that direct 
travel and tourism receipts make up 6 percent of the United 
States gross national product.

Section 3. United States Tourism Organization

    Section 3 creates the United States Tourism Organization. 
The USTO would be a not-for-profit corporation. The USTO would 
not be considered a government agency and no laws pertaining to 
government agencies shall be applied to the USTO.
    The USTO's primary function would be to increase the United 
States share of the global tourism market by marketing the 
United States as a tourism destination on an international 
level. The USTO would maintain a databank of travel and tourism 
information and conduct market research necessary for the 
effective promotion of the United States travel and tourism 
product.
    The USTO would have perpetual succession and represent the 
U.S. in its relations with international tourism agencies. The 
USTO would have the rights and responsibilities of a not-for-
profit corporation, including the ability to sue and be sued, 
make contracts, acquire real and personal property, accept 
gifts, provide financial assistance to other not-for-profit 
corporations working to enhance the purposes of the USTO, and 
adopt and amend its own constitution and bylaws.
    The USTO would be nonpolitical in nature. It would not 
promote the candidacy of any person seeking public office.
    The USTO would not be permitted to issue stock or to engage 
in business for profit.

Section 4. National Tourism Board

    Section 4 creates the National Tourism Board (Board) which 
would govern the USTO.
    The National Tourism Board would be elected or appointed by 
various travel and tourism-related interests based primarily on 
the model developed during the White House Conference on Travel 
and Tourism held October 30-31, 1995 which represents a 
consensus of over 1,700 travel and tourism representatives.
    The Under Secretary of Commerce for International Trade 
Administration would serve as a member ex officio.
    It is the intent of the Committee that Board members 
represent organizations which participate financially in the 
USTO or represent certain specific tourism industry segments 
which are not otherwise represented. These members should be 
senior officers of a travel or tourism industry organization 
and, when feasible, have international marketing, marketing 
and/or fundraising responsibilities for that organization.
    After the initial election of the Board, it would be self-
perpetuating.
    Terms of the Board members and the Chair would be 
determined by the Board and made a part of the USTO's bylaws.
    The Board would be responsible for developing a travel and 
tourism strategy to increase tourism to the United States, and 
for advising the President, Congress, and members of the 
industry on the national travel and tourism strategy.
    The Board would serve without compensation but could be 
compensated for expenses incurred in carrying out the duties of 
the Board.
    The Board would be allowed to present testimony, findings, 
and recommendations to the President and Congress.
    The Board would meet within thirty days after the date on 
which members of the Board have been appointed. Coordination of 
the USTO's first meeting should be performed by an industry 
representative familiar with the creation of the USTO. The 
travel and tourism industry has established a national 
organization, the ``USA National Tourism Organization, 
Incorporated'' (USA NTO, Inc.) to promote international tourism 
on an interim basis. Because of USA NTO, Inc.'s demonstrated 
interest in establishing a permanent United States Tourism 
Organization, its existing national facilities and its relevant 
experience, as a practical matter, the USA NTO, Inc. chairman 
appears best suited to convene the first meeting of the Board.
    Members of the Board would not be personally liable for any 
action taken by the Board or the USTO.

Section 5. Symbols, emblems, trademarks and names

    The USTO would design its own symbols, emblems, trademarks, 
and names. The symbols, emblems, trademarks, and names would be 
protected so that unauthorized use could be prosecuted through 
the civil court system.
    The USTO could authorize contributors and suppliers of 
goods and services to use the trade name of the USTO as well as 
any symbol, emblem, insignia or trademark in advertising that 
the goods or services were approved, selected, donated, 
supplied or used by the USTO.
    The USTO would have the exclusive right to the use of the 
name ``United States Tourism Organization'' along with any 
emblem, symbol, insignia, or trademark developed by the USTO.

Section 6. United States Government cooperation

    The Secretary of State would be directed to place a high 
priority on implementing the recommendations of the USTO and 
cooperate with the USTO in carrying out its duties.
    The Director of the United States Information Agency would 
be directed to place a high priority on implementing the 
recommendations of the USTO and cooperate with the USTO in 
carrying out its duties.
    The Chairman of the USTO would be a member of the Trade 
Promotion Coordinating Committee.
    It is the intent of the Committee that government offices 
and agencies provide the USTO ready access to travel and 
tourism-related studies, data, statistics, surveys, and all 
other relevant information ordinarily prepared by those offices 
and agencies.

Section 7. Sunset

    If the USTO has not implemented a plan for long-term 
financing two years after incorporation, the USTO and Board 
would terminate.

                        Changes in Existing Law

    In compliance with paragraph 12 of rule XXVI of the 
Standing Rules of the Senate, the Committee states that the 
bill as reported would make no change to existing law.