BRAND USA BOARD OF DIRECTORS Stephen J.

Cloobeck Chairman, Brand USA Chairman & CEO, Diamond Resorts International Caroline Beteta Chair-Elect, Brand USA President & CEO, Visit California George Fertitta Vice Chair, Brand USA CEO, NYC & Company Randy A. Garfield Executive Vice President, Worldwide Sales & Travel Operations, Disney Destinations; President, Walt Disney Travel Company Daniel Halpern President & CEO, Jackmont Hospitality, Inc. Tom Klein President, Sabre Holdings David Lim Chief Marketing Officer, Amtrak Mark Schwab CEO, Star Alliance Services GmbH Diane Shober Director, Wyoming Office of Tourism Roy Yamaguchi Owner and Founder, Roys Restaurant Lynda S. Zengerle Partner, Steptoe & Johnson LLP

June 27, 2012 VIA Electronic Transmission The Honorable James W. Jim DeMint SR-167 Russell Senate Office Building United States Senate Washington, DC 20510-4004

RE: Brand USA June 14, 2012 Information Request Dear Senator DeMint: I am writing pursuant to my letter from June 20, 2012, in response to your letter dated June 14, 2012, requesting information from Brand USA (the Corporation for Travel Promotion). As a public-private, nonprofit entity created by Congress to promote the United States abroad, we take our mission and programmatic responsibilities seriously. We applaud the commitment by Congress to call for the highest standards of transparency, performance, and accountability.

Brand USA was established by the Travel Promotion Act in 2010 to spearhead the nations first global marketing effort to promote the United States as a premier travel destination, communicate U.S. entry/exit policies and procedures, and identify and correct misconceptions about those policies. It is funded through a combination of industry support and fees on travelers from visa waiver countriesit is run at no cost to taxpayers. The Congress and the travel industry came together in an unprecedented effort to create the Corporation for Travel Promotion (Brand USA) in order to effectively compete globally for Americas fair share of international visitors. While nations like Canada, UK, Mexico, and even Turkey outpaced us by spending upwards of $100 million - $200 million per year, the United States saw our share of international arrivals decline by 37 percent between 2000 and 2010. The cost to the U.S. economy of lost market share is estimated to be 78 million visitors, $606 billion in spending, and support for 467,000 jobs annually. Brand USA is well positioned to be a key catalyst to reverse these declines and bring in new spending to create jobs in all 50 states and throughout the travel and tourism supply chain. Every 33 overseas travelers to the United States support one U.S. job.

It is with great appreciation that I provide you the information you requested on Brand USA and its promotional activities to date. In doing so, I hope to provide you a clearer understanding of the operational framework of Brand USA. First, I note that the U.S. Department of Commerce has transmitted Brand USAs FY11 annual report to the Congress, as mandated by the Travel Promotion Act. The annual report goes beyond FY11 and reviews a timeline of Brand USA activity through May 2012 and lays out the organizations FY12 objectives. We encourage all interested parties to review the report, which Brand USA has posted to its corporate website. In addition, our IRS Form 990 is due August 15, 2012, and we are happy to deliver it immediately upon its completion.

1. All documents associated with the production of the Launch Party held at the British Maritime Museum, including all costs associated with the event, menus, transportation, swag given to guests, invoices from contractors, and museum rental charges. 2. A comprehensive list of all Brand USA employees and Board members who attended the World Travel Market and Brand Launch Party at the British National Maritime Museum in London.

With regard to World Travel Market, key international media and buyers of North American travel product hailed Brand USAs global launch into the market as highly compelling and successful in an extremely competitive environment. WTM is the worlds largest English- speaking travel trade show. The week-long event draws over 55 countries and approximately 50,000 senior travel industry professionals showcasing their destinations to prospective buyers and media covering travel product distribution. 2011 was the first time in 32 years of the show that the United States presented itself under a unified banner and attracted significant attention on par with competitors that spend as much as a $1 million - $3 million or more on their WTM presence. Brand USA and partnering organizations used this impressive forum to launch its brand identity and communicate its plans for the campaign launch in 2012. Attachment 1 provides details related to the special brand launch event at WTM. Brand USAs presence at WTM and production of the launch event were both carried out at costs well below fair market value thanks to robust support from industry partners. Visit California staff alone contributed 259 hours of volunteer time to put the brand launch together (approximately $50,000 value). In addition, Visit Californias London-based UK offices over $200,000 of staff time free of charge to the brand launch over the 4.5-month preparation period. 3. The salaries and benefits of the top five most highly compensated individuals employed by the Corporation. 4. An itemized listing of all expenses incurred by the Corporation since its founding current through the date of this letter. 10. A detailed and itemized breakdown of all the costs associated with the contract with JWT, including costs associated with retaining talent, the production of videos, and other multimedia items.

With respect to your budget management inquiry, please see the attached itemized expenses list which details Brand USAs outlays since its founding current to June 25, including expenditures for costs associated with development and execution of the marketing campaign, including costs associated with our work with JWT. Brand USA dedicates approximately 85% of its operating budget to programmatic activities and manages general and administrative costs to approximately 15% of the operating budget. The salaries and benefits of Brand USAs officers are a reflection of the value the organization places on optimizing its expenditures on human capital. Many partners have contributed executive talent to Brand USA free of charge, including two of the five most senior executives currently under the organizations employ.

It is worth reiterating that the Brand USA board of directors decided to accept no reimbursement for travel, time, or any other duties even though the Travel Promotion Act permits reimbursement.

Board members have dedicated long hours crisscrossing the globe to promote the United States without reimbursement of any kind. In fact, board members are proud of the time and resources we have contributed because Brand USA is a cause that the united travel industry strongly supports.

5. An itemization of all cash and in-kind contributions made to the corporation current to the date of this letter. 6. Copies of all in-kind advertising contributions made to the Corporation including the claimed value for the contribution by the Corporation. 7. Request for information on correspondence between the Departments of Commerce and Treasury 8. Request for information on correspondence between the Departments of Commerce and Treasury

On the partnership development side, industry and communities across the country have stepped up in unified support of Brand USA. The attached itemization of all cash and in-kind contributions to Brand USA shows a top-line level of support submitted to date. Brand USA has already met its FY12 cash contribution goal of $10 million and its in-kind pipeline of more than 250 entities brings it close to its FY12 in-kind goal of $40 million. While requests for documentation on correspondence between the Departments of Commerce and Treasury should be directed toward those agencies, attachment 3 highlights the total amount submitted for matching funds in sequence of the five submissions made to date. Each submission for drawdown of matching funds is certified by the independent accounting firm KPMG. 9. The number of webpage hits to www.discoveramerica.com identified by country of origin. 11. Copies of print advertisements placed overseas by Brand USA and a listing of the publications in which the advertisements were placed or location of outdoor advertising placement.

The integrated marketing campaign we launched in Canada, Japan, and the UK was guided by quantitative and qualitative research conducted in 11 markets. This research helped us develop a multi-faceted marketing program, comprised of television, out-of-home, print, digital, and interactive social media elements. It also allowed us to determine the optimum markets to launch the campaign and the timing for each launch. It will continue to guide our marketing as the campaign expands to new markets. The response to Brand USAs creative has been overwhelmingly positive from industry and consumer alike. High impact print and out-of-home media was used in our three launch markets to drive awareness and create inspiration through our varied creative executions. In Canada, Dundas Square is the biggest intersection in Canada with a high association with tourism. Brand USA also leveraged the largest Canadian national digital network through OOH boards with more than 2.5 million in daily circulation. Run of schedule transit posters in Canada provided efficient market coverage and again allowed for multiple executions. In London, Underground posters provided high quality, frequent messaging. Special outdoor builds like Cromwell Road and Battersea Power Station generated high impact and creative flexibility. Print advertising in the Japanese market allowed Brand USA to deliver more detailed destination information to supplement shorter TV advertising formats. The Yamanote line train takeover was a high impact placement that allowed for both the print and video assets to be showcased. Travel trade print advertising in all three markets allowed us to build awareness and relationship with local travel agents and tour operators. Attachment 4 describes the location of our current print and out-of- home advertising and provides visuals of some of the placements.

In just the first two months since the launch of DiscoverAmerica.com (April 23-June 24) there were 1.2 million page views nearly and 500,000 unique visitors to the site. Attachment 5 shows these metrics and presents a breakdown of unique visitors by country of origin. The results reflect the early impact of Brand USAs consumer launch in Canada, Japan, and the UK. The success of the site will ultimately be measured most the quality of visitors, which is measured principally by time on site and number of pages viewed per session. Additional measures tracked include unique visits, return visitation, inbound links, and source of traffic by country and language. DiscoverAmerica.com does not attempt to divert traffic from partner and destination websites.

12. A short justification of expenses, results we expect from the expenditures, and metrics we will use to measure the success of the expenditures.

Finally, attachment 6 is an outline of the metrics Brand USA is establishing to measure the results of its campaign for the country. Brand USA has already established an advisory group comprised of key industry, academic, statistical, and government leaders to develop and support a methodology to track key performance indicators and metrics. Brand USA is working with the group to create a statistical-based econometric model to provide authoritative analyses of incremental visitor volume change due to Brand USA marketing. During the initial launch phase, Brand USA is conducting statistical benchmarking.

The Brand USA board of directors takes its charge very seriously. We strive in all instances to ensure prudent and optimal use of federal and partner funds and to abide by the letter and the spirit of the Travel Promotion Act. All information contained in this letter is complete and accurate as we know it today. If there are any changes, we will keep you apprised of any and all updates. Integrated, international marketing campaigns are complicated endeavors and our leadership looks forward to following up in person to further explain the information contained in this letter. Thank you for your consideration. Sincerely, Caroline Beteta Chair-Elect of the Board Enclosed Attachment 1: All documents associated with Brand USA attendance at World Travel Market and the Launch Party at the British National Maritime Museum

Attachment 2: An itemized listing of all expenses incurred by Brand USA since its founding through the date of this letter and the salaries of the top five most highly- compensated executives at Brand USA

Attachment 3: An itemization of all cash and in-kind contributions made to Brand USA current to the date of this letter

Attachment 4: Copies of print and out-of-home advertising and locations of those advertisements

Attachment 5: The number of webpage hits to www.DiscoverAmerica.com identified by country of origin

Attachment 6: Brand USA metrics in FY12


cc:

The Honorable Thomas A. Tom Coburn Email: michael_schwartz@coburn.senate.gov The Honorable Dr. Rand Paul Email: doug_stafford@paul.senate.gov The Honorable Jefferson Beauregard Jeff Sessions III Email: rick_dearborn@sessions.senate.gov The Honorable Michael S. Mike Lee Email: spencer_stokes@lee.senate.gov The Honorable Charles E. Chuck Grassley Email: david_young@grassley.senate.gov