A Victory for Hospitality

Dale Venturini
President/CEO, RI Hospitality Association

A collective sigh of relief was exhaled by hospitality professionals across Rhode Island recently. Late in the night on Thursday, May 31st, the powerful House Finance Committee revealed the new Rhode Island State Budget.

For four long months, the RI Hospitality Association (RIHA) and our allies have been waging a full-scale campaign against a proposal by Governor Lincoln Chafee to raise Rhode Island’s meals and beverage tax from 8% to 10%.
The impact of this tax increase would have been disastrous. Rhode Island’s fourth largest industry, employing more than 60,000 people, is hospitality. Yet a 10% meals and beverage tax would scare away conventions, force families to vacation elsewhere, and even encourage Rhode Island residents to make the short drive to Massachusetts or Connecticut for a meal out because their respective meals taxes are already significantly lower. Layoffs would be unavoidable.

For a state still saddled with double-digit unemployment, this proposition was simply too risky. We did everything in our power to help lawmakers realize the catastrophe which would ensue, and I’m happy to report that the leadership in the General Assembly agreed. When the newest version of the budget was released, the meals and beverage tax increase was noticeably missing from the $8.1 billion spending plan.

Over the last several months, I’ve repeatedly written in this space about our campaign. I’ve talked about what RIHA was doing to rally public support; shared the fears of local hospitality professionals if this tax passes; and the importance of a vibrant hospitality sector to a healthy state economy.

Now, I’d like to use this space to say “thank you.”

Thank you, House Speaker Gordon Fox.
Thank you, Senate President Teresa Paiva-Weed.
Thank you, House Finance Committee Chairman Helio Melo and Senate Finance Committee Chairman Daniel DaPonte.

A cornerstone of our campaign was a call to action for restaurants and hotels, their employees and guests to contact their legislators. We asked and they responded enthusiastically. To the members of the General Assembly who patiently listened to the concerns voiced in tens of thousands of phone calls and emails: thank you.

I’d also like to thank the RIHA Board of Directors, our members, and those who donated to the campaign in the form of money, volunteerism, or other resources. There are far too many to list, but if it were not for your support this campaign may not have ended with the same result.

A few days after the meals tax increase was removed from the budget, I had the opportunity to spend time with Nancy Johnson, the Chair of the American Hotel & Lodging Association and National Restaurant Association Chair Roz Mallet, who had traveled to Rhode Island to be our keynote speakers at RIHA’s annual Women in Hospitality Luncheon.

This incredible event celebrates the contributions women make to the hospitality community, and it is a wonderful reminder of the opportunity available in our industry. Our keynote speakers personify those opportunities.

Ms. Johnson began her career as a server in a hotel restaurant. Today, she is Executive Vice President of Carlson Hotels and the Chair of the American Hotel & Lodging Association. Ms. Mallet is the President and CEO of PhaseNext Hospitality, a franchise operating group and the former President and Interim CEO of Caribou Coffee Company. It’s no exaggeration to say these women are important power-players in our industry.

Speaking with them, I feel even more fortunate that the meals and beverage tax increase will not take place. If it had, I would have been left to wonder what young person just beginning a career in hospitality would have been shown the door because of the drop in business. It would have made me wonder if the hospitality community would now miss out on the next Nancy Johnson or the next Roz Mallet.

Instead of wondering, I’m happy to say “thank you” to all of those who agreed that 10% was simply too much for Rhode Island.