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Interim Joint Committee on Tourism, Small Business, and Information Technology (7-16-26) — Transcript

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0:00Thank you. We are at the uh meeting two
0:03of the interim joint committee on
0:05tourism, small business and information
0:07technology. Um we have got some very
0:11special guests today and uh in a lot of
0:14ways it's a great continuation of this
0:17morning's economic development committee
0:18meeting. So um are there any folks here
0:22today that have friends in the audience
0:24they would like to introduce? Any
0:27special announcements? Thank you very
0:29much, Senator Fermmy. I would just like
0:30to introduce Addison Newman Newman who's
0:32with me today. Um, he's about to be a
0:34senior at the Craft Academy in Morhead
0:36State University. He's shadowing me and
0:38helping out as an intern this summer.
0:39So, just want to introduce him. Thank
0:41you.
0:41>> Wonderful. Welcome, Addison. Any other
0:44special guest recognition?
0:47And yes, Senator Girdler, we're happy to
0:49see you.
0:51That's my [clears throat] intern.
0:54[laughter]
0:55>> It looks like he was promoted, sir.
0:59>> All right. Well, with that, um, Madam
1:01Secretary, will you please call the
1:02role?
1:04>> Senator Boswell,
1:06Senator Clemens,
1:09Senator Funky from Meer,
1:10>> present.
1:11>> Senator Girdler,
1:12>> here.
1:13>> Senator Howell,
1:15Senator Maiden,
1:16>> here.
1:17>> Senator Nun
1:18>> here. Senator Thomas,
1:21Senator Wilson,
1:23Senator Weise,
1:25>> Representative Baker
1:26>> here,
1:27>> Representative Chester Burton,
1:30>> Representative Dodson
1:31>> here,
1:32>> Representative Fister
1:33>> here,
1:34>> Representative Fugat
1:35>> here,
1:36>> Representative Gber,
1:38Representative Gracel,
1:41Representative Hodgson
1:42>> here,
1:43>> Representative Kc Carney
1:45>> here,
1:46>> Representative Lawrence,
1:48Representative Layman,
1:51Representative Lewis
1:52>> here,
1:53>> Representative Marzian,
1:56Representative McFersonen
1:57>> here,
1:58>> Representative Moore
1:59>> here,
2:00>> Representative Pollock,
2:02Representative Tacket Laferty
2:04>> here,
2:05>> Representative Tate,
2:07Representative Thompson
2:08>> here,
2:09>> Representative Truit,
2:12>> Representative Watkins,
2:14>> Representative Wesley
2:16>> here,
2:16>> Representative Whitaker, here.
2:18>> Representative White
2:20>> here.
2:20>> Representative Wilson,
2:23Representative Whitten,
2:25>> Cochair Wheeler,
2:27Co-Chair Gordon, and Co-Chair King
2:30present.
2:34>> Thank you. And with that, I'd like to
2:37look for a motion in a second for the
2:39approval of the June minutes.
2:42>> All right, we got a got that. Wonderful.
2:46All those in favor signify by saying I.
2:48All oppose. Nay.
2:50>> I.
2:51>> Nay.
2:52>> All right, that passes. Wonderful. Well,
2:55today we have guests from uh Senator
2:58Nun's neck of the woods, but for many of
3:01us, it's an easy place to find. Please
3:04come to the table. Our guests are here
3:06from the Ark Encounter um impact 10
3:09years. So, um I believe happy
3:12anniversary is in due. Yes.
3:16>> Uh, and if you would introduce
3:18yourselves, um, and each of you
3:21introduce yourselves and then you may
3:23begin your testimony.
3:24>> All right. Very good. Um, thank you for
3:26having us first off. I appreciate the
3:27opportunity uh to come and share with
3:29you. Um, it's an honor. Um, my name is
3:32Eddie Lutz. I am the director of
3:34attraction and resource um, sales um, at
3:38both the Ark Encounter and the Creation
3:40Museum.
3:41>> Then I'm Anna Katherine Scalf. I'm the
3:43business development coordinator.
3:45Okay.
3:47>> All right. So, um yeah, as uh Senator
3:51Fromer said, um we actually just
3:55celebrated uh last week our 10-year
3:57anniversary as the Ark Encounter last
3:59Thursday, a week ago today, which is
4:02exciting. Um so, I wanted to just share
4:04a little bit about the impact that the
4:06Ark has had on Kentucky tourism. Um, in
4:09addition to my role um, at the Ark, I
4:12also serve on the board of directors of
4:13the Kentucky Travel Industry Association
4:16and uh, in the middle of my second term
4:18of that. So, I really want to talk not
4:20just about the Ark, but how it's
4:21impacted all of Kentucky tourism. We um,
4:24we actually opened.
4:28See, there we go. This was July 5th,
4:332016.
4:34Um, that was our ribbon cutting day. We
4:36opened to the public two days later. I
4:38used I used to joke that back then all
4:41we had was the ark and dirt and uh well
4:44and a lot of people as you can see um
4:46and that was even before we actually
4:48opened
4:50today it looks like this. That's a lot
4:53of development in 10 years. I'm going to
4:56just kind of point a little bit just to
4:58give you an idea of the scope. Um some
5:00things some of you have certainly I'm
5:02sure been there some may not have been
5:04but just give you an idea. First off, up
5:06in the top right corner is the ark
5:08itself. The largest timber frame
5:10structure in the world by far. Nothing
5:12else is even close. Uh 510 ft long, 85
5:16ft wide. Um 51 ft high, stands about 15
5:19feet off the ground. Um there's a large
5:22zoo behind the ark, which is not in the
5:24picture because the ark blocks it. The
5:26building that you see to the left
5:29is our restaurant. It's called Msara's
5:32Buffet. Um little known fact even for
5:35from from for people who have eaten
5:36there um that is actually believe it or
5:39not the second largest restaurant in
5:41America. Um and we fill it up. Um also
5:46uh you see the building in the top left
5:48and the smaller buildings to the right.
5:50One thing that you can barely make out
5:52right behind it is the massive
5:54playground for kids to enjoy. There's a
5:57carousel in one of those buildings
5:58imported from Italy. There's a virtual
6:01reality experience where people can go
6:03back and experience the flood. The
6:06building with the blue um images on the
6:09front is called Answer Center. Answer
6:12Center is our 2500 seat theater um which
6:15I'm going to talk a little bit about
6:16later and some of the activity that
6:18takes place in there. The structure in
6:21the front um actually recently opened
6:24two months ago. That's our brand new
6:26welcome center and of course the huge
6:28bus circle in front of it which is about
6:30four sometime between four to six times
6:33bigger than the one before it. Um but
6:36our welcome center very Mediterranean
6:38feel to it. Um our guests have their
6:40welcome to the park. The left side of
6:43that building um is future development
6:46and I will talk about that towards the
6:48end of the presentation. But half of
6:50that building, the building's ready, but
6:52what's going inside it um has much work
6:55to be done. But uh in that time we have
6:59been open for 10 years and in that time
7:03we have seen 9,256,753
7:07guests. Um this is on a day when we are
7:11having a major concert um and people
7:13getting ready to go in. But um it's
7:16amazing to see the impact that the Ark
7:18encounter has had on Kentucky tourism.
7:21The visitorship um we see about a
7:25million visitors a year at the Ark. And
7:28um when you couple that with the
7:31Creation Museum, and I'll I'll add some
7:34detail to that as well, we see 1.5
7:37million uh visitors to the art um every
7:41or to the to attractions every year. So,
7:44it's definitely having an impact. And
7:46again, I'll explain why as we go on. So,
7:499,256,000
7:51guests. We've also have in that time
7:5516,871
7:57bus groups. So these are um almost
8:00exclusively all from out of state. Um
8:04and uh you know not totally but almost
8:07exclusively from out of state. New money
8:10coming into the Commonwealth. Um the Ark
8:13Encounter coupled with the Creation
8:15Museum has become one of the premier um
8:18group travel destinations in the
8:20country. Um it's amazing to see and this
8:23is you know a fairly typical day looking
8:27at that photo of the buses and again we
8:30see them at both attractions daily
8:34and this is something I think is very
8:36valuable for you to know. Um 92% visit
8:40from outside of our region. Now how do I
8:43define region? Um to the best of my
8:46knowledge um the way we've defined
8:48region is outside of a 200 mile radius
8:53of the ark encounter. So some of that
8:55will be in Kentucky. Most of it will
8:57not. So outside of a 200 mile radius. So
9:01again that is new money, tourism money
9:04coming into the commonwealth, not money
9:06being spread around the state. All
9:08right. And u and it has just a massive
9:11impact as a result.
9:13I want to share this quote um from
9:15somebody I admire quite a bit. Um Julie
9:18Kirkpatrick is the president and the CEO
9:20of meet NKY. Um basically the three
9:24northern Kentucky counties are one
9:26convention and visitor bureau. She's the
9:28president of that organization and very
9:30supportive of what we do because of the
9:32impact that it has on that region. Um
9:36this is a quote that she put out
9:38coinciding with our anniversary. The Ark
9:40Encounter's 10-year anniversary is also
9:43a milestone for Northern Kucky's visitor
9:46economy. With more than 90% of its guest
9:50coming from outside the region, the Ark
9:52continues to draw new visitors who stay
9:55at our hotels, dine in our restaurants,
9:59explore nearby attractions, and generate
10:02meaningful sales tax revenue for the
10:04Commonwealth of Kentucky. It has become
10:06a powerful economic driver and an
10:09important part of how Northern Kentucky
10:12welcomes the world. As you've looked um
10:15over coming years or the past years, I'm
10:17sorry. And um the record setting years
10:20that Kentucky tourism has had three
10:22years in a row. Northern Kentucky is a
10:25massive part of that. In fact, mass, you
10:27know, they're number two right behind
10:29Louisville now as far as a region for
10:31tourism in in our state. Um, the ark
10:34obviously is a huge huge part of that.
10:39We did a little research. Um,
10:42I was looking at hotels that have been
10:46built in Northern Kentucky specifically
10:49to meet the arc demand. Okay, there have
10:52been a number, by the way, the number
10:5420, the number 20 is an actual number.
10:56That's not a rounded number. the 20 plus
10:59adds some stuff that I know has been
11:02built beyond that. But but the key that
11:05as I looked these up was hotels that
11:08have been built specifically to handle
11:10the arc traffic. Anna and I partner
11:15right now with 51 hotels from um
11:19Lexington
11:21till just over to the river in
11:23Cincinnati. There's one Cincinnati
11:25property right near downtown, but 51
11:28hotels, the vast majority of those are
11:31between the Ark Encounter and the
11:33Creation Museum. Um, my slide says since
11:372016,
11:39um, just to to cover in case I'm wrong,
11:41but all of these, to the best of my
11:44recollection, have been built since
11:452019.
11:47Okay, 2019. Six of them have been built
11:52within a fivemile radius of the Ark
11:55encounter. We have one, the Hampton Inn
11:58and Suites in the top left screen. Um
12:01132 room hotel right next door to the
12:03Ark uh that was built several years ago.
12:06Um there's another uh Spring Hill going
12:08in across the street being built right
12:10across the highway being built right
12:12now. There have been three properties
12:14built in Dry Ridge just five minutes
12:16away or five miles away, I'm sorry. Um
12:19the comfort suites in the bottom left,
12:22the home two and the Holiday and Express
12:26have all been built um since 2020.
12:30Um the Hampton in um in the top right is
12:35Richwood, Kentucky, 15 to 20 miles away.
12:39Hilton Garden in is Florence. Almost all
12:42of these have been built specifically to
12:44handle the ark traffic. That's important
12:46to know. You know, some of them are
12:48mixed use like at Hilton Garden.
12:49Certainly, they do a lot of corporate um
12:52you know, they have the Amazon and near
12:53the airport. I get that. But all of
12:56these are partners that we've worked
12:58with that I've had one-on-one
13:00conversations. And when you look at
13:02that, you see the the impact in these
13:05communities, especially if you look at
13:07Williamstown and Dry Ridge, rural
13:09communities, and to see, you know, one,
13:12two, five hotels built within a five
13:15mile radius over just a course of a few
13:17years, you can see the the impact,
13:24the ark encounters impact. Um, I'm going
13:27to focus on northern Kentucky, but it's
13:29interesting to know that the Ark isn't
13:32in northern Kentucky. You know, it's
13:34actually a little bit further south than
13:36northern Kentucky, but it's northern
13:38Kentucky that benefits the most from
13:40this because they have the the hotel
13:43space, they have the um the other
13:46activities, attractions, restaurants, so
13:49much more. Um but you know uh obviously
13:53like I said Williamstown Dry Ridge
13:55benefit greatly and will continue into
13:57the future but Northern Kentucky we see
13:59a huge impact. Um what happens is when I
14:02when I teach on tourism I I teach a lot
14:05about the anchor attraction. Okay. Not
14:08not all states not all regions have what
14:12you would consider an anchor. The ark
14:15most certainly is an anchor. Okay.
14:17Tourists aren't coming to Williamstown,
14:20Kentucky for any other reason than to
14:23come to the Ark. Now, they're going to
14:24take in other things, but they're coming
14:26for the Ark. It's the anchor. So, um,
14:28same thing here. So what happens is as I
14:30travel with these these named
14:32attractions, BB Riverboats, Newport
14:35Aquarium, Hoffra House, we all actually
14:38travel together to many of our uh
14:41tourism shows um promoting the group
14:43market and um and we sell it in
14:47different ways. So as I meet with tour
14:50operators, I talk about come to the ark,
14:52come to the ark, come to the ark. Each
14:55of them the way they sell their product
14:58is since you are coming to the ark
15:03take my riverboat cruise
15:05two boats one day that's a hashtag
15:07Newport Aquarium
15:09come and tour the aquarium eat at the
15:12Hofb house and many of our groups do so
15:15um one of the things that um our region
15:19does that that northern Kentucky region
15:21we actually collaborate as attractions
15:25better than just about any region in the
15:27country. I can make that statement
15:29pretty strongly because I've seen it.
15:30I've worked with them. Okay? Not only
15:32with Northern Kentucky, but with these
15:34other regions. Um, sometimes people
15:37think of tourism as a zero some game. If
15:40you're if you're if they're going to
15:41you, they're not coming to me. And
15:43that's just not how tourism works.
15:45That's not how tourism works. So,
15:46they're coming to the Ark. So what
15:48happens the BB river boats since we've
15:50opened BB river boats has seen a
15:53significant increase in their guests
15:56driven by overnight stays stronger
15:57visitation in the region a typical day
16:00in the summer she's going to have 10
16:03boats or 10 buses parked at her boat
16:07that were at the ark earlier that day.
16:09That's common. That's that's normal.
16:11Newport Aquarium, same thing. Their
16:13attendance has grown. Newport Aquarium
16:16um kind of like a zoo is very strong
16:18locally, right? People want to come and
16:20hang out at the the zoo or hang out at
16:22the aquarium. They certainly capture the
16:24group market as well. Biggest part of
16:27that is because we're bringing them to
16:29the region so they can benefit. Hoffbrow
16:31House um the first uh the modeled after
16:35the the Hoffbrow House in Germany, the
16:37first one in the nation um does a
16:40phenomenal job with very large groups.
16:43And as I said, I'm bringing 16,000 of
16:45them to the to our region. So, we all
16:48benefit collaboration. Um, I'm actually
16:52going to be teaching a session um in
16:55November for the Kentucky Travel
16:56Industry Association on that topic of
16:59collaboration. How do we collaborate
17:01together as a region and everyone
17:04benefits?
17:05Um,
17:08and it's not just Northern Kentucky,
17:10though. It's the entire Commonwealth.
17:13So, as you see, the Ark is situated
17:15right there in that beautiful triangle
17:18of Northern Kentucky, Lexington, and
17:20Louisville. And um
17:24all all three of those markets benefit
17:27greatly from the visitorship, but it's
17:30not just that, it's the entire state. So
17:34I I again I have great opportunities to
17:37talk to representatives from all over
17:39the Commonwealth and uh Eastern
17:42Kentucky, Bowling Green, Owensboro as
17:44just as examples and they all say the
17:47same thing to a person. All right? They
17:51say they're either coming to you or from
17:55you.
17:56So no matter where you are in the state
17:59of Kentucky, you will see our guest.
18:02Look for the t-shirts, okay? You will
18:05see Ark guests. And it's not And just
18:08because they're coming to the Ark
18:09doesn't mean they're necessarily on a
18:11faith-based tour. People want to have
18:14fun. They want to they want to see
18:15something new. They want to see
18:16something they can't see anywhere else.
18:18They do that at the Ark, but then they
18:20travel through the state either to get
18:22there or on the way from here, and they
18:25take in everything that we have to
18:26offer. Um,
18:29let's see. Yeah, let's keep going. I
18:32want you to know about this. We we do a
18:34lot of uh events at the Ark. Um I
18:37mentioned the uh answers center. It's a
18:4123 to 2500 seat theater and uh that
18:45theater um we do a lot of daily
18:47programming certainly in there, but we
18:49also host all of our national
18:51conferences. We have men's conferences,
18:54women's conferences, homeschool
18:56conferences, um so much more. In fact,
19:00um I think the number that I saw um I
19:02forget how many events it was like 75
19:04events. I might be mistaken on that, but
19:07the number I do remember is to those
19:09events. Now, these are just our events,
19:11not rented. Our events, 280,000 guests,
19:16welcome to those conferences over the
19:18years. But I did want to point this one
19:20out. This is actually launching in a
19:22couple weeks. And this is the fifth
19:24annual um um occurrence of this event.
19:29And it is 40 days of Christian music. It
19:32is the world's largest Christian music
19:35festival. Um the the sheer number of
19:38people that will be here and not only
19:40the main conference or the main concert
19:43that takes place in the afternoon um in
19:46that answer center, but we also have an
19:48outdoor venue where we'll have upand
19:50cominging artists throughout the day. By
19:52the end of that 40 days, we have will
19:54have held over 120 different counts.
20:00Okay, which is pretty amazing. That top
20:02line, uh some of you may be familiar
20:04with the some of those names. Um th
20:06those would be the the primary
20:08contemporary Christian artists that are
20:09come. Those will usually be on the
20:11weekends on Saturday nights. Um some of
20:14those names will be familiar. Um, and
20:16then, uh, some of others of you may
20:18recognize some of the ones on the bottom
20:20because that's kind of a who's who of
20:22southern gospel music. Um, the names
20:24that you see there. And then of course
20:26this is Kentucky, so we also need
20:28bluegrass. We'll have bluegrass, too.
20:30So, so, but but the the key here is this
20:33is an annual event that just continues
20:35to build more and more and more
20:38momentum. And what happens is they come
20:42and many of them will come for more than
20:44a day. they will come. I've I know of
20:46some who have bought a season pass and
20:48stayed for the entire 40 days. Um some
20:50who will come for a week. What happens
20:53then is they spend money in the state.
20:56They stay at the hotels, they eat at the
20:58restaurants, and they take in the other
21:00attractions. So that's that's an
21:02important key.
21:04This is an example of what that concert
21:07looks like. Um you can see just the
21:09sheer number of people and a lot of
21:11excitement going on there. And it's just
21:13a a huge beautiful facility that we have
21:16there at the Answers Center. Um couple
21:19different events
21:22and there's more to come, right? There's
21:24a lot more to come. So what I want to
21:26show you is really the next big thing.
21:29So as you saw on that first slide, we've
21:32built a lot over the last 10 years. It's
21:35fun. My office isn't at the Ark. My
21:37office is in Hebrin or Erlanger. Um, my
21:40office is in Erlanger, but I get down
21:42there once, twice a week, and every time
21:44I go down, I see something new that I
21:46didn't see before. And, uh, so it's been
21:49an exciting 10 years to watch that that
21:51rapid growth. The next big thing is
21:54this.
21:56We are building in that left side of
21:59that welcome center, which is basically
22:01its own building. We are building one of
22:04the world's largest scale models of
22:06first century Jerusalem which will be an
22:09attract the attraction in and of itself.
22:12The entire building as you can see is
22:15the model that is obviously a mockup. Um
22:17the entire building is is the model and
22:20you'll be walking through the three
22:22sections and we're working um yeah we're
22:26working to prepare that right now. Um,
22:29just to put in perspective for you,
22:33there will be 15,000
22:373D printed and handpainted
22:40people in that exhibit.
22:42So, you can imagine the buildings, the
22:44temple, and so much more. But 15,000
22:483D printed, hand um painted people.
22:54the uh in addition to the people that
22:57you see 3D printed, you also see the
23:00models. So, they're doing a lot of work
23:02on the modeling right now. The walls,
23:04the brick, all of that is being 3D
23:06printed. We actually have a bay. I
23:08didn't don't have this photo, but I we
23:10actually have a bay of 150 3D printers
23:14running pretty much 247
23:17to prepare for this right now.
23:22more work that's already been done.
23:24Okay.
23:26So,
23:28bring this up. So, anyway, the the
23:31bottom line that I just wanted to share
23:32with you is Kentucky is the Ark
23:34Encounter is a vital part of Kentucky
23:39tourism. Um, we we I I I well, we as a
23:43as a as a company, but me personally, I
23:46work very closely with the tourism
23:48community, with the Kentucky Travel
23:50Industry Association, with individuals
23:52from all over the state. Um, not only in
23:55uh as serving on that board, but also in
23:58very much in a mentorship um kind of
24:00relationship as well, helping others in
24:03the region to to capitalize on the great
24:06opportunities that we have. and there's
24:08such an impact that it makes. So with
24:10that, I'll I'll go ahead and close my
24:11statement, but u also welcome any
24:14questions on anything.
24:16>> Thank you so much Eddie and Anna. Thank
24:18you for being here. And um I just wanted
24:21to kind of open with one of the
24:22questions of the um amount of Kentucky
24:27tax revenues that were paid into the Ark
24:31Encounter to help you get open.
24:34>> Okay. the uh I mean we were as well as
24:37far as money. Say that one question one
24:40more time. Make sure I have it right.
24:41>> So were there um Kentucky tax incentives
24:44or were there some taxpayer dollars
24:47spent to build the arc encounter?
24:49>> Those are two different questions.
24:50That's why I wanted clarity. So um as
24:52far as uh taxpayer money, absolutely
24:54none. Zero um at any point. As far as
24:58tax incentive, yes, we were a part of
25:00the Kentucky tax incentive, which by the
25:03way is a is a wonderful program and and
25:05something that uh the state actually
25:08should should continue for other future
25:10attractions. The u as I understand it,
25:13and I don't know the actual numbers
25:15because it's kind of a different area
25:17for me, but as I understand it, that tax
25:19incentive ends right here at this 10
25:21year. Um but yes, it was definitely
25:24something on a tax a rebate on taxes
25:27spent within the bark.
25:30>> And do you know Eddie in the time that
25:32um this particular location was
25:35selected, was there another location
25:37outside of Kentucky that was considered
25:39and maybe why was Kentucky chosen?
25:42>> Um well that my previous answer was is
25:45the answer to that one. Um yes, there
25:47was uh some conversations um in Indiana.
25:50There were some conversations in Ohio. I
25:53don't know exactly where the locations
25:54were. Um but yes, there were they were
25:57both looking at um bringing the ark to
26:01that area. And the biggest reason is
26:04that it would remain in Kentucky. But
26:06first off, it's a perfect plot of land.
26:08Uh you can't find right off of I75 850
26:12acres. You don't get with beautiful
26:14rolling hills. You don't get much better
26:15than that. but um the land itself, but
26:18also the Kentucky um tax. Um that's the
26:21that's the whole intent of it is to
26:23bring tourism dollars to the state and
26:26um and it did. Um I will also say this
26:29um I talk a lot about this from a
26:32tourism perspective.
26:34Um I've been with our company for a long
26:38long time, you know, 17 years. So the
26:40Ark opened 20 years ago. I'm sorry, the
26:43Creation Museum opened 20 years ago. Um
26:46I've been there 17 and a half years now.
26:49The interesting thing though is um
26:54when I first started with the
26:55organization I would bring group bus
26:58groups. I had a lot of bus groups. All
27:00right. The problem is this.
27:03These groups would go, they'd spend the
27:05day at the museum. They'd have a
27:07wonderful day and then they would drive
27:09out of market.
27:12All right? They might go to Louisville.
27:13They might go to Lexington. They might
27:15go to Dayton, all right, but they would
27:17spend the day with us, have a wonderful
27:19day, and then drive out of market. There
27:21was no reason for them to stay.
27:23Then we built the ark. Now, if we had
27:26just built the ark, apart from the
27:27Creation Museum, we'd have the exact
27:30same problem, probably a bigger problem
27:33because there was even less down there,
27:35right? But because those two properties
27:39are only 40 miles apart,
27:42okay, they are close enough that you
27:46could do them in the same day, but
27:48they're far apart enough uh far far
27:51apart enough and the fact that there's
27:52so much to do at each one that doing
27:55them in one day is a really bad idea.
27:58Right? So, what that does is that
28:00necessitated the overnight stays. That
28:03was what launched the hotel boom in
28:05northern Kentucky is the fact that now
28:07they had to spend the night and they do
28:10right. So that so having the ark only 40
28:14miles apart certainly the tax incentive
28:16is is a big part of that but also being
28:19in close proximity to the museum so they
28:22can we can sell that as a combo.
28:25>> Thank you. And with over 10 million
28:26visitors, you more than uh reimburse the
28:29state
28:30>> for the incentive dollars. And I'd like
28:32to turn it over to Senator Nun, who is
28:35the host of the Ark Encounter.
28:38>> Thank you, Madam Chair, and thank you,
28:39Mr. Les, for being here today.
28:41Appreciate your your time. I always
28:43enjoy when I get to see Mark Ly. I don't
28:44know if you and I have ever met before,
28:45but
28:46>> I don't think we have.
28:47>> Look forward to talking.
28:48>> Mark told me to look for you.
28:49>> Absolutely. [laughter]
28:49And glad to hear that he's on the men.
28:51Yes. Um, very proud to have the Ark
28:53exhibit in my Senate district. Uh,
28:57number one, because I support the
28:58mission, support your ministry, what
28:59you're all doing. It's very important.
29:01But it is a huge economic driver, as you
29:04explained. I mean, down in Scott County,
29:05where my wife and I live and and own a
29:07own Irish pub, we see a ton of visitors
29:10and the hotels talk about the visitors
29:12they see from the Arc counter and the
29:13Airbnb host. I mean, so it is it is a
29:15powerhouse throughout the region. Uh,
29:17Senator Fromire, Funky From, excuse me,
29:19touch on this just just briefly. Uh, are
29:22there any other uh, strengths that
29:25Kentucky has when we think about how we
29:27can have a climate to attract more
29:29private investment and large-scale
29:31tourism or any challenges that you
29:33experienced past or currently that maybe
29:35would inhibit our ability to attract
29:38large-scale private tourism investments?
29:40>> Well, um, as far as strengths, Kentucky
29:42has a lot of strengths. um you know um
29:45one of the one of the slide the slide
29:47that I had there with the in fact let me
29:49go back to it real quick I think this is
29:50valuable hold on a second
29:54with northern Kentucky Lexington
29:56Louisville um one of the points that I
29:58wanted to make there that I think is
30:00valuable here is all three of those
30:03regions understand the economic power of
30:07the ark okay they do they're they're
30:10CVBs I work with all of them all Right.
30:13And and beyond. You mentioned Scott
30:16County. Um many of those hotels that I
30:18referred to are in Scott County that my
30:20partners um and I know um old friends,
30:25the groups from the Ark go to old and
30:27more and more, right? So um yeah, we
30:30have a when we look at Louisville for
30:33example, you have all of the iconic
30:36museums, right? Um, in fact, Louisville
30:39started a program about eight years ago
30:41with me. Um, actually, it's something
30:43they do. They just got my me to sign off
30:45on it. And they call it two by two. It's
30:48a it's a group promotion. And, uh, the
30:51idea is the first two are the
30:53attraction. So, you couple a visit to
30:55the Ark Encounter and one of the iconic
30:58Louisville museums, Slugger Museum,
31:02Frasier Museum, you know, whatever it
31:04might be. And then the second two is the
31:07reward, which is uh a a rebate on room
31:10nights and also a welcome reception for
31:14your group when you come in. Well, why
31:15do they do that? Because they see the
31:18economic benefit of the ark, but they
31:21want to capture those room nights in
31:22Louisville. And they do. Yeah, they do.
31:25Lexington.
31:27Um earlier this year, Lexington reached
31:29out to me and said, "Well, we are
31:31hosting RCMA, the religious uh
31:34conference and meeting association. Big
31:36big event. We're hosting that. Can we
31:39bring them to the ark?" Yes, you can.
31:42So, we brought 225 of the which was
31:44their largest um excursion that they did
31:47from the show. 225 of them um on a day
31:51we were closed. So, they had a private
31:53experience. So, They they get that,
31:56right? So to answer your question more
31:58directly, I think um there's Kentucky
32:02has so much I mean obviously horses, the
32:05bourbon history, the bourbon culture. Um
32:08you know, people will sometimes say,
32:09"Well, those don't fit the ark and the
32:11bourbon." The reality is um people want
32:14to come and they want to see the history
32:16and they want to see something unique.
32:17And both of those things are unique in
32:20Kentucky, right? So we we have that
32:23obviously the horses, the bourbon, um
32:25the outdoors is a big focus of our our
32:29Kentucky Department of Tourism. That's
32:31their the three legs of their um their
32:33their marketing, their promotion.
32:35There's a lot um there that we have to
32:38offer. Also, I would I would point to
32:40some of the rur rural communities as
32:43well. There's a lot off the beaten path
32:46that Kentucky has that we need to do a
32:48better job of communicating. Here's
32:50here's why. Here's why. And again,
32:53they're not going to be the destination.
32:56And I don't want to say this in an
32:57arrogant way. The ark is the
32:59destination. People come from all over
33:01the world to come to the ark. But when
33:04they come to the ark, they want to take
33:06in everything else that our state has to
33:08offer and and it's abundant.
33:13>> Thank you, uh, Chair King.
33:17>> Thank you, Madam Chair. Mine is more of
33:19an observation, a good observation, a
33:22firsthand experience. The last time
33:24granddaughter, three of five and were at
33:27your facility, uh this is kind of how my
33:30brain works being so interested in
33:32tourism. On our way out, I we just kind
33:35of walked through the parking lot and
33:37counted license plates that weren't
33:39Kentucky and we counted 15 15 different
33:43states. So, we were like cheering on. Oh
33:45my gosh, there's another. There's
33:47another. So, it got to be a game. And
33:49then the second observation is the the
33:51national news channel I watch when it
33:53was spring break time, one of the news
33:55anchors from New York City when she got
33:58back to work, she said, "We went to this
34:00place called the the Ark Encounter in
34:02Kentucky and she bragged on it for two
34:04or three minutes." So, u we were
34:07cheering in the in the living room about
34:09that as well. So, we're just so thankful
34:11you all are located here. And you've
34:13also touched on that multi-day
34:16um kind of [clears throat] invitation
34:17and goal that we're all looking for.
34:19Once we get them here, we want to hold
34:20on to them. That's right.
34:22>> And get at least a night or two stay and
34:24some gas and restaurant purchases and
34:27and kind of hold on to them, let them
34:29spend a little bit more money here in
34:31Kentucky. But thank you all for being
34:33such a wonderful benefit to our
34:34Commonwealth. We all we all appreciate
34:36it.
34:36>> Thank you so much. you know, um there
34:38was a opening day the uh the individual
34:42who was at that time the commissioner of
34:44tourism for Kentucky
34:46um did exactly the same thing. She
34:48walked through the parking lot and she
34:51took pictures and then she blacked out
34:54all the numbers, you know, and then she
34:56posted on Facebook, I think it was a
34:58total of three
35:01full page things. So it probably had
35:03eight to 10 different license plate on
35:05each page opening day and that's a
35:09typical day at the art. So thank you.
35:11Thank you.
35:11>> Thank you.
35:12>> So exciting. Um Representative White,
35:16he was first on the list by the way. He
35:18said I want to talk about them as sort
35:20of but that was before the meeting
35:22started. All right. Been so enthused.
35:24>> Thank you madam chair. Uh I want to
35:28share a little experience. Uh we just
35:30got out of a southern legislative
35:32conference, 15 states was representative
35:36and at our banquet Tuesday night, I had
35:38the honor of sitting with a group from
35:41Alabama.
35:43>> And uh the main topic of the
35:45conversation during our dinner was the
35:47Ark encounter. And uh this lady said,
35:50"You know, several of my friends have
35:53been there and and they talked about and
35:57shared it. and a lot of my other friends
35:59have this on their bucket list to do.
36:02She said, "I've extended my stay in
36:03Kentucky to Friday to spend some two
36:06days at the Ark encounter." And she had
36:10uh more knowledge about it than I did.
36:12It was I was a little embarrassed about
36:14that fact, but I was very proud to say I
36:17was from Kentucky also. And she brought
36:21up the tax incentives and uh talked
36:24about that. And a good point is you all
36:28receiving that incentive and what you
36:29have done for Kentucky.
36:31>> But uh Kucky's benefited 10 times fold
36:36with your incentive because of the
36:38people that's paid taxes that supports
36:41coming to see your art encounter who
36:45don't get the incentive. That's really a
36:48lot more money also coming to the state.
36:50uh you know that's a factor that's
36:51that's overlooked and uh I just say I'm
36:55proud to say that you all are in
36:57Kentucky and thank you.
37:00>> Thank you very much. Appreciate that.
37:02>> Thank you uh Representative Co Carney.
37:06>> Thank you Madam Chair. Thank you all for
37:07your presentation. Um I think a few of
37:10my questions have already been an
37:11answered. Um but very quickly I'd like
37:14and you can get back to me at another
37:15time. would like to know um how much the
37:18incentives or rebates totaled um and
37:20this was 10 years ago I think you
37:22mentioned and was it used primarily for
37:25land or building or just kind of what
37:27that primary purpose was.
37:29>> Yeah, I assume I can get that
37:30information. Um I've only seen it once
37:32in the 10 years but uh I can uh um ask
37:35and see um and that may actually come
37:38from the government as opposed to the
37:39ark but um but we can certainly try to
37:42get that for you.
37:43>> That would be great. And just quick
37:44followup, um I understand how major a
37:48driver of tourism revenue, faith-based
37:51tourism is, not so much in Kentucky yet,
37:53but I know there are massive kind of um
37:56pilgrimages almost to like Hindu temples
37:58and other states and and other um there
38:01and they're involved in different ways.
38:02So the states are involved in different
38:03ways. Maybe it's incentives, maybe it's
38:05rebates. I was curious if you could tell
38:07me about the structure. So are you all a
38:09C3? how closely you work with the
38:12Creation Museum, which I assume is also
38:14a C3. Um, and then how do you how do you
38:18make your money? Like is it fees, ticket
38:20sales? Okay. Donations.
38:21>> Yeah, I'll take a shot at that. Um, so
38:24there are actually
38:26minimum of three organizations involved
38:28here which are just naming the companies
38:32etc. So the parent company of both the
38:36Creation Museum and the Ark Encounter is
38:39Answers in Genesis. So we're teaching
38:41ministry, publishing ministry, um on and
38:45on. There's a lot of stuff that we do.
38:47So that's the parent organization that
38:49is a nonprofit. Okay. The Creation
38:53Museum, which opened 19 plus years ago,
38:56is also a nonprofit.
38:59The Ark Encounter, as I understand it,
39:03is a for-profit owned by a
39:05[clears throat] nonprofit, and I don't
39:07know all the details of tax issues with
39:10that other than there are some. So, for
39:12example, when I sell a ticket to the
39:14Creation Museum, um, based on Kentucky
39:17tax law, I don't charge sales tax. When
39:20I sell a ticket to the Ark Encounter
39:22based on Kentucky law, I do. Right. So,
39:25how do how do we make money? Um it's
39:28actually, you know, ticket sales, um
39:30ticket sales, um event sales, um things
39:33like that that keeps the lights on,
39:36keeps Anna and I employed. Um all that
39:38development, however, that you saw is
39:41all private donation.
39:44>> Okay. All right. Thank you very much.
39:46>> Thank you. And that did lead me to
39:49another question about um the number of
39:51employees um and do you pay occupational
39:54tax for those employees that are
39:57employed by the Ark or Answers in
39:59Genesis?
40:00>> Um I
40:01>> the Creation Museum.
40:02>> Well, as far as number of employees, I
40:04know it fluctuates seasonally. I mean it
40:06might go and this would be the Ark
40:08Encounter, Creation Museum, Answers in
40:10Genesis, our design center in Heburn and
40:13you know all together. Um I know we will
40:16at some times of the year balloon up to
40:18about 1,400 employees. Um that probably
40:23ranges from you know 1100 to 1400 and
40:26I'm not in HR so I don't know that for
40:28sure as far as the occupational tax.
40:31I'll be honest I don't know the tax law.
40:32I don't know I don't know the answer to
40:34the question.
40:36>> We we'll uh we'll ask our finance
40:38cabinet to help us with some of these
40:40numbers. But I do like your question
40:42Rep. Karnney [clears throat] because I
40:43think it's meaningful. We we had such a
40:46meaningful conversation this morning
40:47about economic development, but
40:49recognizing the entrepreneurial spirit
40:52that we have um really thrives on new
40:57energy coming into our state perhaps
40:59coming to see the ark encounter and they
41:02want to stay and but now they need a
41:04reason to uh or a way to develop some
41:07cash flow to stay. So maybe they'll in
41:10inspire them to start a business or
41:12something else to We have we have a uh
41:16glamping site right near the ark and uh
41:20not not owned by us, not operated by us,
41:22but it sounds exactly I'm sorry. Um it
41:26it sounds exactly like what you're
41:28talking about is this guy had done
41:30glamping sites in Pennsylvania
41:33over you know several of them very very
41:35very successful came to Kentucky and was
41:38like yeah I need it here. And uh so
41:40beautiful um some of them are like
41:43platform tent glamping sites and some of
41:46them are big domed igloo kind of
41:49gorgeous room just one example but yeah
41:52you get a lot of that um not just with
41:54the ark though though that's what I'm
41:56here to talk about but but whenever
41:58people are going to look at an area they
42:01they want to go where they're going to
42:03be able to raise their family where
42:04they're going to enjoy their life you
42:07know you take in the Kentucky outdoors
42:09for example, um how many will will come
42:12see um you know, one of the one of the
42:16gorgeous lakes and say, "Yeah, I want to
42:18I want to live here, you know, and yeah,
42:21they then they they look they say,
42:22"Okay, how do I make my living here? Do
42:24I go ahead and and uh apply for a job
42:27somewhere or do I make my own?" You
42:28know,
42:29>> yeah, you might have helped Williamstown
42:31Lake uh double the prices and values of
42:33the homes around that lake,
42:34>> I would think. So,
42:35>> yeah. Uh, Representative Baker.
42:38>> Thank you, Madam Chair, and thank you
42:39all for being here. I appreciate the pre
42:40the presentation. I visited a couple
42:43times, and it's been a number of years
42:44since I visited the Ark the first time,
42:46>> but uh, three years ago, I visited for
42:48the Christmas lights,
42:50>> and had no expectation of what that may
42:52look like, but it was it was fantastic.
42:54And honestly, I look forward to visiting
42:56again for for both things. Good
42:57>> and would encourage other people to do
42:59so as well. Uh, Chair King hit on one of
43:02my thoughts was all the different
43:03license plates in the parking lot. I've
43:05noticed that both times.
43:06>> Uh just all the different states
43:08represented.
43:10>> Um
43:11>> do you know how many different countries
43:13that people have come from? Because I
43:14know that it's not just a US thing.
43:16>> I'll be honest, I don't have a number of
43:19but it it's daily.
43:21>> I mean, we will see guests from all over
43:22the world daily in the at the ark.
43:25There's no real good way for us to
43:27track, you know, where they where they
43:29come from. They buy a ticket, right? Um
43:32but yeah, we we see that literally daily
43:34at the Ark.
43:35>> Well, it it's fascinating just all the
43:37different people from from different
43:38backgrounds. May I have [clears throat]
43:40a follow-up, please?
43:41>> The um the average looks like uh 9.2
43:45million guests over over 10 years, about
43:47920,000 a year.
43:49>> I imagine a lot of that was frontloaded
43:50because the the excitement when you
43:52first built, people are just anxious to
43:54get there. But with all the attractions
43:56that have been built over the years, are
43:58those those numbers growing? Um
44:01>> well um a little bit frontloaded but not
44:04by much. Okay. Um why is it under 10 10
44:08million? Because we had 2020 in there.
44:11[laughter]
44:11>> Oh yeah.
44:12>> And uh we were closed for three months
44:14and um one of the first major
44:16attractions in the country to to open
44:18back up. So but no what we see is pretty
44:21consistent um about a million a year um
44:24as we see that very consistently and you
44:27know and also you see fluctuations in
44:29the e the economy right um I always talk
44:32about whenever there's economic
44:35uncertainty
44:36no matter who's in control and power at
44:39the time whenever there's economic
44:41uncertainty tourism is affected
44:44>> right and you know we we've had economic
44:47uncertainty so Those numbers aren't
44:50growing exponentially by any by any
44:52means, but they're very very very
44:54consistent across the board.
44:55>> Well, thank you.
44:58>> Just have two more questions. Um,
44:59Senator Maiden.
45:01>> Thank you, Madam Madam [clears throat]
45:02Chair, and thank you for the
45:04presentation.
45:05>> I just want to ask you, are you familiar
45:06with Frank Allen and David Leopard from
45:09the Appalachia Wildlife?
45:10>> I am not.
45:11>> I have not. So, we have a project in
45:13Bell County, Appalachia Wildlife, uh,
45:16Foundation's got deer, elk, uh, bear,
45:19lot most of those are all natural except
45:21the the elk, of course, were brought in,
45:22but they he live, Frank Allen lives in
45:25Northern Kentucky, and he's the one that
45:26spearheaded this project and started
45:28about seven years ago, supposed to open
45:30this spring in 2027. It's about a
45:32hundred million dollar project, and
45:34their projections on their visitors are
45:35around a million dollars. But he has
45:37spent many days in the parking lot
45:40trying to decide where to spend his
45:41money.
45:42>> Mhm.
45:42>> To and and and one of the ones that I
45:45remember most of uh about was the day he
45:48said he counted 32
45:50>> license plates from different states in
45:52the parking lot.
45:53>> So I'm not familiar with the names, but
45:55I am if it's the same project and I
45:57believe it is I am um familiar with the
46:01project. I know they're going to try to
46:03get with you and do some
46:05>> They have they they um my uh direct
46:08manager had talked to me about this
46:10project and um she was very very aware
46:13of it and wanted to pull me into it to
46:15help him on a marketing perspective. Um
46:17that hasn't happened yet, but uh yeah, I
46:20am familiar with the project.
46:21>> I just wanted to make sure they
46:22>> It looks gorgeous.
46:23>> Yeah, they [laughter] it is really nice.
46:24It's going to be really nice, but
46:25they're planning on working with you all
46:27to do something similar what you talked
46:28about with Louisville there and try to,
46:30you know, my biggest concern though is
46:32what you touched on there. They're going
46:33to build
46:34>> a hotel up there, but we're limited on
46:36hotels. We've got a state park there, of
46:38course, but
46:39>> u in Middlesborough, which is 10 minutes
46:41from us. They have three hotels, but it
46:43sounds like with a million visitors a
46:45year, we're going to need a few more
46:47>> Absolutely. hotels. Um and that was one
46:48of the biggest um hurdles that the early
46:53um years of the ark had right is there
46:56was such a demand there were there were
46:58not the hotels.
46:59>> Yeah.
46:59>> You know I remember one call in
47:01particular a tour operator who told me
47:04the closest room I could get was
47:05Winchester.
47:06>> Wow.
47:07>> Okay. Well stay in Winchester come over.
47:09[laughter] you know, but um so that
47:11hotel development is absolutely
47:14necessary to just sustain that kind of
47:16growth.
47:18>> One final thing and I will tell you
47:19that's where Senator Nun's from county.
47:22So he's got connections to yours and the
47:24one in
47:24>> wonderful.
47:27>> Great. Uh Chair McFersonen.
47:30>> Yes. Uh thank you, Madam Chair.
47:33>> So I'm from the Bowling Green, South
47:35Central Kentucky area. Talk about those
47:37anchor businesses. is we've got a
47:38Corvette plant. Y
47:40>> it's definitely an anchor business
47:41people the uniqueness of just like the
47:43uniqueness of the arc uniqueness of
47:45>> the Kentucky Corvettes. Uh I did some
47:48work this last session on those tiff
47:51tiff areas and the one thing most of
47:53these and what we might need to kind of
47:56understand in here most of these were
47:57tied to our Kentucky tax rate
48:01>> and as these tiffs were agreed to and
48:03bonded out a few years ago they were
48:06done on the premises of 6% tax on our
48:09income tax
48:10>> as our income tax has come down we've
48:13had to try to make those whole and do
48:16some work on those. But so just remember
48:18when looking forward if if this is a
48:21good project uh to put tiff areas in
48:24that we need to anchor it to something
48:26because our intention in the next few
48:29years is to get sale to get our income
48:31tax to zero.
48:32>> Okay. but tie it to something that's
48:34tangible and will stay there and you can
48:36kind of count on because that is
48:38something that I looked at all the tiffs
48:40in the whole state and to see which ones
48:43were producing the most and the best and
48:46>> and all of those were somewhat tied to
48:48our income tax and and so just remember
48:51that. But I appreciate what you've done
48:52and like you say, it's such a reciprocal
48:56approach, you know, it's holistic and
48:58once you get something and it anchors
49:00it, it it it mushrooms on itself and
49:02creates so many other jobs that kind of
49:04like throwing a big rock into a pond and
49:06watching the ripple effect.
49:07>> That's exactly right.
49:08>> So, I appreciate it and thank you, Madam
49:10Chair.
49:10>> Thank you.
49:11>> Thank you for sharing that, um, Rep.
49:13McFerson. And I I think um we've puzzled
49:16through we've had a lot of challenges
49:18even in the last 24 months as a
49:20legislature. thinking about how we keep
49:22our beautiful Kentucky culture um and
49:25this is a great example that faith-based
49:27attractions um can be quite impactful
49:30and can mushroom and we can keep our
49:34Kentucky identity in the meantime
49:36>> and really build some meaningful
49:38revenues and a great place to raise your
49:40family still and you didn't necessarily
49:42have to have a large manufacturing
49:45environment. It was a, you know,
49:47faith-based attraction that is
49:49continuing to strive. And I, and I
49:51wanted to just close by saying, um, it
49:53was only two Saturdays ago that the
49:56Funky From Meire family had 10 of our
49:58grandchildren ranging in age from three
50:01months old to 9 years old. And they did
50:03have Nana tumbling down the uh, little
50:06tunnels and tubes and everything. That
50:08is the coolest playground I have ever
50:10played in for three hours.
50:12>> It was so much fun. There you go. Um,
50:14but everything about it was so much fun
50:16and um and and we did spend a small
50:19fortune because I said uh please no
50:22discounts other than he did give us this
50:24phenomenal camel experience and each one
50:27of the grandkids got to feed a camel a
50:29piece of lettuce and they have not
50:31stopped talking about this camel that
50:33tried to kiss them because he came right
50:35down there for the piece of lettuce.
50:36>> Um yeah, Senator Nun, you wrap it up.
50:38>> Yeah, Madam Chair, one more thing. and
50:39you you kind of sparked a thought that I
50:41had and it's something we've heard about
50:42before so I'm I'm kind of preaching to
50:43the choir so to speak here but you
50:45talked about manufacturing.
50:47Don't underestimate how tourism can lead
50:50to manufacturing. Manufacturing
50:52manufacturers who are looking to locate,
50:54they care about quality of place because
50:56guess what? Their workforce cares about
50:58quality of place. So let's not
50:59underestimate tourism's impact on our
51:02ability to recruit manufacturers.
51:04>> That's exactly right.
51:04>> Thank you.
51:06>> Thank you. Uh thank you Eddie. Thank
51:08you, Anna, for being here today. We
51:11really do appreciate your testimony.
51:13That was very helpful.
51:14>> Wonderful. Thank you so much.
51:15>> And then for the committee, I would like
51:17you to know that uh before we adjourn,
51:19our next meeting is August 27th at 2:00.
51:22It will be the joint tourism and
51:24economic development at your Kentucky
51:27State Fair. So 2:00 on August 27th as
51:31the next meeting. Um yes.
51:34>> Would you please record my attendance,
51:35Madam Chair?
51:37You you have been recorded. Thank you.
51:40>> Thank you.
51:40>> All right. Thank you.

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