ANNAPOLIS – John Stowell sees dollar signs when he thinks about gay marriage becoming legal in Maryland.
Stowell, the director of sales and marketing at The Intercontinental Harbor Court hotel in the Inner Harbor, says the hotel’s reception hall is booked now about 35 weekends a year — mostly for weddings.
If same-sex marriage legislation survives a likely voter referendum this fall and becomes law, he thinks that number will go up.
“It is a big part of our business,” Stowell said of weddings. “If you have an opportunity to gain a new opportunity for revenue, that’s always a positive. We would be open to hosting it.”
Should Maryland become the seventh state, plus Washington, D.C., to allow same-sex marriages, it could reap economic benefits in the form of business activity and taxes on wedding-related expenditures.
It’s who would be the driver of those purchases – and what they would mean in actual dollars – that is up for debate, according to local experts and economists.
Anirban Basu, chairman and CEO of Sage Policy Group, Inc., a Baltimore-based economic and policy consulting firm, said there would certainly be some impact on the state economy.
“There are a number of impacts both short- and long-term,” Basu said. “There’s a lot of pent-up demand for same-sex marriages in this country. … So, it strikes me there will be couples who will come to Maryland to hold their wedding, and those weddings will be held, in many cases, among great fanfare. So, it is good for the wedding and hospitality industry — there’s little question about that.”
A 2007 study conducted by the Williams Institute at the University of California Los Angeles School of Law said legalizing gay marriage in Maryland would result in an additional $3.2 million in state revenue gains a year, largely related to hotel taxes and other wedding-tourism-related activity.
Nearly 8,000 same-sex couples in Maryland would get married, the study estimates, but the largest state revenue gains would come from out-of-state couples traveling to Maryland to wed.
Non-residents could generate $218 million in wedding spending in the first three years of same-sex marriage, the study said.
Other tax revenue – such as estate and transfer taxes, which are not applied when property goes to spouses – would be diminished if more couples are married in the state, but gains in sales tax through the tourism industry would more than make up for those losses, the study said.
A gay-friendly state
Sam Rogers, executive vice president and chief marketing officer for Visit Baltimore, the city’s tourism agency, predicted that the city and state would “absolutely” see an uptick in the wedding and hospitality spending should the legislation signed by Gov. Martin O’Malley survive an opponent-promised voter referendum this fall.
It helps that Maryland is already considered to be a gay-friendly state, Rogers said, with Baltimore playing a starring role in that reputation. Marketing agents at Visit Baltimore have been directing a campaign aimed at attracting more homosexual tourists for the last three years, Rogers said.
“Baltimore is gay friendly and has a number of things for people to do, gay or not,” Rogers said. “There are a number of gay-friendly establishments. This helps to reinforce that message. If you are portraying yourself as a gay-friendly destination … it [legalizing gay marriage] sends another signal, and reinforces the message that we’ve been putting out for three years.”
“It’s a great opportunity for our hospitality industry,” he added.
There also could be more positive long-term impacts, Basu said, because marriage is associated with greater household stability.
“That could be good for the housing market for instance, or anything else that requires a long-term commitment,” Basu said. “From a purely economic standpoint, household formation is a good thing for economies.”
‘It adds up’
Mark F. Scurti, an openly gay attorney in Towson whose practice includes lesbian, gay, bisexual and transgender law, said it was not a stretch to suggest that couples who live near Maryland could come to the state to get married, pumping money into the local economy.
Scurti said he and his partner drove to Massachusetts for nuptials once that state legalized marriage between same-sex couples in 2004.
“When I got married up in Massachusetts … the money we spent in just the restaurant, in travel, in lodging friends and family that were involved in the ceremony … it adds up,” he said.
Scurti said he chose to get married because civil unions and domestic partnerships – which are allowed in lieu of marriage in nine states and Washington, D.C. (which also allows same-sex marriage) – don’t work.
“It’s a second-class status, from a social standpoint,” Scurti said. But he also said the law is not equipped to handle civil unions in many states, causing trouble for couples when it comes to benefits and insurance.
“There are a lot of challenges in the insurance area, in workers compensation, where people have been denied access or benefits,” he said. “The law was not equipped to handle a civil union partner. Insurance companies define policies based on marriage.”
Because of that, Scurti said Maryland could see an influx of matrimony-minded couples from Pennsylvania, Delaware, West Virginia and some western areas of Virginia, even though same-sex marriage is already allowed in the District.
“My friends that have gotten married in D.C. … they’ve gone because … there wasn’t another option,” Scurti said.
‘Creative class’ appeal
But not everyone is convinced legalizing gay marriage would lead to an influx of money for the state.
Richard Clinch, director of economic development at The Jacob France Institute at the University of Baltimore, said any economic impact felt by the state could be minimal.
The question is whether same-sex couples getting married would bring any new money to the state, Clinch said. A couple not planning or not able to get married might save money to buy a new car, a better house or something else that would pump money into the Maryland economy.
With marriage suddenly an option, those couples may just choose to spend that saved money on the wedding — creating no net increase in the amount of cash getting spent in the state.
“I don’t think you do this for economics. You do it for a moral question,” Clinch said. “I don’t think the economics of this are compelling. I think we’re talking about small dollars here.”
The better argument, Clinch said, is that by passing the legislation and creating a more tolerant state, people identified by economist and author Richard Florida as part of the so-called “creative class” are more likely to settle in Maryland.
There is a positive correlation, Clinch said, between open societies and economic performance.
“Areas that have a more welcoming environment … attract more of what’s called the ‘creative class,’ and they have economic effect,” Clinch said. “The reason to do this is equality, if you’re going to do it. Economically, the more strong argument is that areas that are open attract more knowledge.”
While Basu felt there would be economic impact regardless, he agreed with Clinch’s assessment of the legislation’s potential impact on the so-called creative class.
“Regions that are more gay-friendly tend to be more innovative, with faster business formation, more business growth and more shared prosperity,” Basu said. “I think this makes Maryland more attractive to the creative class, whether these people are straight or gay. More progressive, welcoming, diverse communities tend to prosper.”
A go-to state?
That does not mean there wouldn’t be immediate winners on a smaller scale should same-sex marriage survive referendum and become law, Clinch said.
The wedding industry — planners, florists and clothing stores — should benefit from any increase in the number of Marylanders suddenly getting married.
But Clinch wasn’t sure the impact would go any further than that, and he doubted Maryland would become a go-to state for gay couples looking to wed.
“Yes, downtown [Baltimore] will benefit, but that spending comes from somewhere,” Clinch said. “It comes from savings, it comes from vacations. It’s not going to create huge amounts of new spending.
“Many states are grappling with this thing. … Are people going to flock to Baltimore or Ocean City for weddings? I don’t think they’re marriage destinations, anyway. I don’t see us becoming the gay marriage Mecca.”
Stowell, the hotel marketing and sales director, could not quantify exactly what would happen should gay marriage become legal. But his staff would be looking forward to any uptick in wedding-related business.
“We’re a small hotel. I think this opens up another opportunity,” he said. “We could always do more.”
Rogers, the marketing chief for Baltimore tourism, wasn’t certain there would be a large influx of gay couples coming to the state, either, but he did say there would be some impact on the city, created by other state residents coming to Baltimore to get married.
“I think most people get married where they live,” Rogers said. “There certainly should be an uptick in hotel business, restaurant business and catering business as a result.
“It may turn up in some of our research down the road. ‘Why did you come to Baltimore? To get married.’”