XXII. MEZINÁRODNÍ KOLOKVIUM O REGIONÁLNÍCH
VĚDÁCH. SBORNÍK PŘÍSPĚVKŮ
22nd
INTERNATIONAL COLLOQUIUM ON REGIONAL
SCIENCES.CONFERENCE PROCEEDINGS
Place: Velké Bílovice (Czech Republic)
June 12-16, 2019
Publisher: Masarykova univerzita (Masaryk University Press), Brno
Edited by:
Viktorie KLÍMOVÁ
Vladimír ŽÍTEK
(Masarykova univerzita / Masaryk University, Czech Republic)
Vzor citace / Citation example:
AUTOR, A. Název článku. In Klímová, V., Žítek, V. (eds.) XXII. mezinárodní kolokvium o regionálních
vědách. Sborník příspěvků. Brno: Masarykova univerzita, 2019. s. 1–5. ISBN 978-80-210-9268-6.
DOI.
AUTHOR, A. Title of paper. In Klímová, V., Žítek, V. (eds.) 22nd
International Colloquium on Regional
Sciences. Conference Proceedings. Brno: Masaryk University Press, 2019. pp. 1–5. ISBN 978-80-
210-9268-6. DOI.
Publikace neprošla jazykovou úpravou. / Publication is not a subject of language check.
Za správnost obsahu a originalitu výzkumu zodpovídají autoři. / Authors are fully responsible for the content and
originality of the articles.
© 2019 Masarykova univerzita
ISBN 978-80-210-9268-6 (online : pdf)
 
 
 
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DOI: 10.5817/CZ.MUNI.P210-9268-2019-63
EVALUATION OF DESTINATION MANAGEMENT
ORGANIZATIONS FINANCING IN BANSKÁ BYSTRICA
REGION
Hodnotenie financovania organizácií cestovného ruchu
v Banskobystrickom kraji
ĽUBICA ŠEBOVÁ 1
RADKA MARČEKOVÁ 1
VERONIKA BELIČKOVÁ 1
JÁN ŠEBO 2
1
Kat. cestovného ruchu a společného stravovania
2
Katedra verejnej ekonomiky a regionálního rozvoja4
Ekonomická fakulta
UniverzitaMateja Bela v Banskej Bystrici
1
Department of Tourism and Hospitality
2
Depart. of Public Economics and Reg. Development
Faculty of Economics
Matej Bel University in Banská Bystrica
 Tajovského 10, 975 90 Banská Bystrica, Slovak Republic
E-mail: lubica.sebova@umb.sk, radka.marcekovaa@abcd.cz, veronika.belickova@umb.sk, jan.sebo@umb.sk
Annotation
Currently, there is one regional and seven local destination management organizations in the Banská Bystrica
Region. The aim of the paper is to explore and evaluate the financing of destination management organizations
operating in the Banská Bystrica region. We have obtained the materials from individual organizations as well as
from various institutions' websites. We have focused on exploring the sources of organizations funding in the years
2016 and 2017. The financing of tourism organizations is secured from public and private sources, while the
funding sources of the organization according the Law Act No. 91/2010 about the tourism support as amended
may include membership fees, grants from the state budget, voluntary contributions of municipalities, natural and
legal persons, income from activities, sales of products and services, rewards for mediation, income from the
activities of tourist information centers, income from the sale of advertising space, non-repayable financial
contributions from domestic and foreign sources and other sources of income. We have found out that destination
management organizations operating in the Banská Bystrica Region received in 2017 total grants of € 299,685,
which represents only a 6.9% share of state grants paid to local destination management organizations in Slovakia
(€ 264,655 in 2016, which means 7% share). Organizations are mostly funded by state grants and membership
fees. Own income forms only a small part of their financial resources.
Key words
Banská Bystrica region, destination management organization, financing
Anotácia
V súčasnosti v Banskobystrickom kraji pôsobí jedna krajská a sedem oblastných organizácií cestovného ruchu.
Cieľom príspevku je preskúmať a zhodnotiť financovanie organizácií cestovného ruchu pôsobiacich v
Banskobystrickom kraji. Materiály sme získali od jednotlivých organizácií ako aj z webových stránok rôznych
inštitúcií. Zamerali sme sa na preskúmanie zdrojov financovania organizácií v rokoch 2016 a 2017. Financovanie
organizácií cestovného ruchu sa realizuje z verejných a súkromných zdrojov, pričom zdrojmi financovania
organizácii podľa zákona č. 91/2010 Z.z. o podpore cestovného ruchu v znení neskorších predpisov môžu byť
členské príspevky, dotácie zo štátneho rozpočtu, dobrovoľné príspevky samosprávy, fyzických a právnických osôb,
príjmy z činnosti, z predaja produktov a služieb, odmeny za sprostredkovanie, výnosy z činnosti turistickoinformačných
kancelárií, príjmy z predaja reklamnej plochy, nenávratné finančné príspevky z domácich a
zahraničných zdrojov a ostatné príjmy. Zistili sme, že oblastné organizácie pôsobiace na území Banskobystrického
kraja získali v roku 2017 dotácie vo výške 299 685 €, čo predstavuje iba 6,9 %-ný podiel štátnych dotácií
vyplatených oblastným organizáciám cestovného ruchu na Slovensku (v roku 2016 to bolo 264 655 €, t.j. 7 %-ný
XXII. mezinárodní kolokvium o regionálních vědách Sborník příspěvků Velké Bílovice 12.–14. 6. 2019
 
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podiel). Organizácie sú pritom do veľkej miery financované práve z dotácií a členských príspevkov. Vlastné príjmy
tvoria iba malú časť ich finančných zdrojov.
Kľúčové slová
Banskobystrický kraj, financovanie, organizácia cestovného ruchu
JEL classification: Z32, L32
1. Introduction
The success of the destination is influenced by a number of factors from the current state of the world economy,
through globalization, current trends to individual requirements of visitors. The presence of a primary and
secondary offer at the destination does not represent an exclusive advantage compare to other destinations.
Strategic planning, quality of product, targeted marketing and cooperation of private and public sector subjects in
the destination are even more important. The public-private partnership is a positive contribution to tourism. In
order to establish and operate a destination on tourism market successfully, it is important to create a destination
management organization that would effectively coordinate the activities of all stakeholders. Ensuring sufficient
sources of funding is a necessary aspect of the functioning of such an organization and the fulfillment of its
objectives.
Several domestic and foreign authors are involved in the theoretical definition of the target site (Pompurová, 2011;
Lednický, Pyka, 2011; Nejdl 2011; Holešinská, 2012; Gúčik et al., 2012; Malachovský, Pěč, 2015; Maráková,
Šimočková, 2015). The World Tourism Organization (UNWTO) characterizes the destination as a physical place
where the visitor can stay overnight (www.unwto.org). Pompurová (2011) has explored theoretical approaches to
destination research and has found out that authors interpret the destination from a geographical, organizational,
marketing and economic point of view.
Szpilko (2017) claims that the development of tourism is closely linked to the functioning of destination
management organizations and the products they offer. For the development of the tourism product, there is a
specific need for cooperation of several subjects. A precondition for the development of the destination is to ensure
cooperation between the public and private sectors, in which everyone has their own tasks to fulfill. Foreign authors
also pay attention to destination management organizations. They perceive it as an essential component in the
process of sustainable development and increasing the competitiveness of the destination (Buhalis, 2000; Ritchie,
Crouch, 2003; Raich, 2006; Volgger, Pechlaner, 2014).
2. Aim and methodology
Tourism organizations in Slovakia are established on the basis of Act no. 91/2010 Coll. on Tourism support as
amended. The law defines local and regional destination management organizations. In individual parts, in relation
to local and regional organizations, it regulates the establishment of a regional organization, the rights and
obligations of a regional organization, the demise of a regional organization, the establishment of a local
organization, the rights and obligations of a local organization, local organization bodies, membership in a local
organization, rights and obligations of a member of local organization, budget and accounting of local
organization, establishment and demise of regional organization, concept documents, registration of destination
management organizations as well as financing of tourism development and grants.
There are currently seven regional and thirty-seven local destination management organizations in Slovakia, with
one regional organization and seven local tourism organizations operating in the Banská Bystrica Region. The aim
of the paper is to explore and evaluate the financing of destination management organizations operating in the
Banská Bystrica Region. We have obtained the material from individual organizations, from their websites, from
the Ministry of Transport and Construction of the Slovak Republic as well as from the register of accounts of the
organizations. We have focused on examining the funding sources of organizations in 2016 and 2017 (data are not
yet available for the year 2018). Since the regional destination management organization Banská Bystrica Region
was established on December 17th, 2018, information on its financing is not yet available. A similar case is the
regional organization Gemer, which was established on June 29th 2018.
Banská Bystrica Region is situated in the south of central Slovakia, with the area of 9,454 km2 the Banská Bystrica
Region is the largest region in the Slovak Republic. As of December 31st 2017, the population number was
649,788. Based on the statistical findings, it can be stated that in 2017, there were 516 accommodation facilities
in the Banská Bystrica Region, which represented a 14.8% share of the nationwide number of accommodation
XXII. mezinárodní kolokvium o regionálních vědách Sborník příspěvků Velké Bílovice 12.–14. 6. 2019
 
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facilities (3,495 facilities). There were 21,587 beds available. In 2017, 569,164 visitors, who spent 1,680,911
overnight stays, visited the facilities. The average number of overnight stays per visitor in Banská Bystrica Region
was approximately 3 nights (www.slovak.statistics.sk). Compared to the previous year, it is an increase in the
number of visitors in accommodation facilities as well as an increase in the number of overnight stays. We can
consider the average number of overnight stays for stable.
3. Results
There are four tourism regions in the Banská Bystrica Region, two of which are completely located in the region
(Horehronský and Pohronský regions) and two of them reach the defined territory of the region with partly (Ipeľský
and Gemerský Region). There are currently one regional and seven local destination management organizations
in the Banská Bystrica Region.
3.1 Organizations characteristics
The regional destination management organization Banská Bystrica Region was established on December 17th
2018 (www.zahoramizadolami.sk). Its foundation was initiated by the Banská Bystrica Self-Governing Region
with the aim of developing tourism in the region and supporting the activities of its members in the creation and
implementation of the concept of tourism development on the territory of Banská Bystrica Self-Governing Region.
Founding members were also local DMOs Central Slovakia Tourist Board, Region Horehronie, Gron, Tour
Novohrad and Podpoľanie, Banská Štiavnica Tourism and Dudince Tourism.
There are currently seven local destination management organizations in the Banská Bystrica Region: Dudince
Tourism, Central Slovakia Tourist Board, Tour Novohrad and Podpoľanie, Banská Štiavnica Tourism, Horehronie
Region, Gron and Gemer.
Tab. 1: Basic characteristics of local destination management organizations in Banská Bystrica Region
Destination management
organization
Date of establishment Number of
establishing
members
Location
(tourism region)
Number of
employees (2017)
Dudince Tourism February 15th
2012 5 Ipeľský 3
Central Slovakia Tourist
Board
March 6th
2012 6 Horehronský,
Pohronský
1
Tour Novohrad and
Podpoľanie
March 8th
2012 36 Ipeľský,
Pohronský
1
Banská Štiavnica Tourism December 15th
2011 6 Pohronský 2
Region Horehronie (former
Low Tatras South)
March 15th
2012 9 Horehronský 3
Gron Decemeber 27th
2012 7 Pohronský 2
Gemer June 29th
2018 14 Gemerský 1
Source: Own elaboration according to www.mindop.sk, www.finstat.sk, www.registeruz.sk, 2019
Destination management organization Dudince Tourism was established on February 15th
2012 (www.dudince.sk).
To date the organization employs three employees. It belongs to the organizations founded by only one
municipality - Dudince. When established, the condition of 150,000 overnight stays in accommodation facilities
located on the territory of the founding municipality was fulfilled. Founding members were the city of Dudince,
Spa Dudince, Balnea Cluster Dudince, Spa Diamant Dudince and Hotel Flora Dudince. The organization focuses
on the development of tourism in the destination Dudince and its surroundings (Ipeľský region), whose main
product is spa tourism. The main tasks of the organization are to increase the attractiveness of the city of Dudince,
prepare organized events, promote the destination and operate a tourist information center.
Destination management organization Central Slovakia was officially registered on March 6th 2012 at former
Ministry of Transport, Construction and Regional Development of the Slovak Republic (www.centralslovakia.eu).
Two employees are employed in the organization (1 employee in 2016 - 2017). Founding members are the cities
Banská Bystrica, Zvolen, Sliač and business entities operating in the field of tourism: Spa Sliač, Hotel Kaskády
and Airport Sliač. The organization is located in the districts of Banská Bystrica (Horehronský region), Zvolen
and Detva (Pohronský region). The main objectives of the organization are to promote the region of Central
Slovakia (Banská Bystrica, Zvolen, Detva), increase the number of visitors and the number of overnight stays,
support members' activities.
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Tour Novohrad and Podpoľanie is a destination management organization which was established on March 8th
2012 as the result of the initiative of thirty-six entities, of which twenty-seven were municipalities, nine business
entities and civic associations (cities Lučenec, Veľký Krtíš, Fiľakovo). One employee - executive director of the
organization is employed in the organization. When setting up the organization he carried out his activities on a
voluntary basis (www.tournovohrad.sk). The organization started to operate in the districts of Lučenec, Poltár,
Veľký Krtíš (Ipeľský region) and Detva (Pohronský region). Their goals are to represent the destination, creation
of hiking, biking and cross-country trails, creating a calendar of organized events (their time alignment).
Banská Štiavnica Tourism was established on December 15th
2011 (www.banskastiavnica.travel). The founding
members were Banská Štiavnica, the municipalities of Baďan, Počúvadlo, Pohronie, Svätý Anton and Štiavnické
Bane. The organization currently employs two employees. Its activities focus on the development of tourism in
the district of Banská Štiavnica and partly in the regions of Žarnovica and Žiar nad Hronom (Pohronský region).
The tasks of the organization are the presentation of the primary and secondary offer of the destination, the creation
of promotional materials, the realization and maintenance of cycle routes and tourist educational paths.
Date of establishment of the destination management organization Rregion Horehronie, formerly called Nízke
Tatry South (change of name was in 2018) is March 15th
2012 (www.horehronie.net). Nine members participated
in the foundation: the municipalities of Brusno, Myto pod Ďumbierom, Bystrá, Osrblie and Čierny Balog, Klaster
Horehronie Association, business entities of Tatry mountain resorts Tále and hotel Partizán. The organization has
three employees. It operates in the districts of Banská Bystrica and Brezno (Horehronský Region).
Destination management organization Gron was registered in the Register of local destination management
organizations on December 27th
2012 (www.regiongron.sk). Organization office is located in Žarnovica. The
organization has created two work positions. Founding members are self-governments of Nová Baňa, Žarnovica,
Horné Hámre, Župkov, Ostrý Grúň, Repište and business entity Blanc. The organization focuses on the
development of tourism in the districts Žarnovica and Žiar nad Hronom (Pohronský region).
The youngest organization is Gemer (www.visitgemer.sk). The organization was established on June 29th
2018.
Founding members are cities Hnúšťa, Jelšava, Revúca, Rožňava, Tornaľa, two smaller municipalities, five
business entities, the State Nature Conservation of the Slovak Republic and the Development Agency of the
Banská Bystrica Self-Governing Region. The purpose of the organization is to manage the development of tourism
in Gemer and to develop and promote the region while fully preserving the cultural and natural heritage. The
organization has currently one employee.
3.2 Organizations financing
Destination management organizations financing is made from both public and private sources. Sources of
financing for the organization are: membership fees, grants from the state budget, voluntary contributions from
the municipality, natural and legal persons, income from own activities, sale of products and services, awards for
mediation, revenues from the activities of tourist information centers, revenues from the sale of advertising spaces,
non-repayable financial contributions from domestic and foreign sources, including contributions from the
European Union and other revenues. The amount of membership fees is the result of an agreement between
individual members of the organization. Each member of the membership is entitled to attend the general assembly
meeting, where each representative has one vote. The terms and conditions for the selection and maturity of
membership fees are therefore determined by the general assembly. “The main motivation for subjects association
into regional and local destination management organizations is the possibility of obtaining a state grant, which
together with member contributions, is intended to finance activities to support the development of tourism”
(Vaňová, 2013, p. 16). The state grant for local destination management organizations is in the amount of collected
membership fees, however, no more than 90% of the collected accommodation tax in previous years. This
restriction ensures that membership fees are not artificially raised to achieve the highest possible state grant. The
limitation is also a motivation for business entities providing accommodation services, to pay accommodation tax
to the general municipality budget and thus to increase the budget of municipality as one of the members of the
organization. The amount of the state grant for the regional organization is the same as the membership fee of the
self-governing region, while the maximum grant to the regional organization is limited to 10% of the collected
accommodation tax of all member municipalities of local destination management organizations which are
members of the regional organization.
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Tab. 2: Financing sources of the local destination management organizations in Banská Bystrica region in
the years 2016 and 2017
Local destination
management
organization
State grants (€) Membership fees (€) Incomes from
own activities (€)
Total amount (€)
2016 2017 2016 2017 2016 2017 2016 2017
Dudince Tourism 44 503 71 730 98 443 122 217 34 243 36 342 177 189 230 289
Central Slovakia
Tourist Board
75 060 76 868 128 235 130 840 14 198 - 217 493 207 708
Tour Novohrad
and Podpoľanie
15 956 18 312 18 779 18 900 - - 34 735 37 212
Banská Štiavnica
Tourism
48 490 58 777 39 799 39 896 7 964 5 976 96 253 104 649
Region Horehronie 72 590 63 500 91 400 68 090 2 11 151 163 992 142 741
Gron 8 056 10 498 17 451 22 126 10 062 6 713 35 569 39 337
Note: Local destination management organization Gemer ad regional destination management organization Banská Bystrica
region were established in 2018, Region Horehronie was former called Low Tatras South (to the year 2018).
Source: Own elaboration based on information from www.finstat.sk, www.registeruz.sk, 2019
The destination management organization Dudince Tourism had a budget of €230,289 in the year 2017. Of this
amount, the sum of €71,730 represented the state grant. Membership fees are received from the public and private
sectors. Both sectors shared approximately 53% of the overall budget. State grants are expressed as a 31% share
of all financial sources. Other financial resources (16%) come mainly from the commercial activity of the tourist
information office. The rate of contributions from individual members is following: the town Dudince contributes
€5 per inhabitant. Accommodation facilities are classified into five categories according to the number of beds.
Accommodation facilities with a capacity of up to 20 beds contribute €200, up to 50 beds €500, up to 100 beds
€800, up to 200 beds €1,000 and over 200 beds €6,000. Members' contributions fully cover the operating costs of
the organization and partly the costs of activities of the organization.
In 2016, the destination management organization Central Slovakia Tourist Board had a budget of €217,493. The
organization received a state grant of €75,060, which means 35% share of the total budget (in 2017 the subsidy
was only €1,808 higher compare to 2016) in order to realize the activities which mean the main focus of the
organization. The remaining 65% of financing sources is split 25:40 between the public and the private sector. The
membership fees, which amounted to €128,235, sufficiently covered the operating costs of the organization and
partly the costs associated with the organization's activities.
Destination management organization Tour Novohrad and Podpoľanie had the smallest budget among the tourism
organizations surveyed. The organization's budget for 2016 was €34,735. The state grant accounted for 46% of the
total budget (€15,956). Public sector membership contributions account for 50% of its budget and the remaining
4% has been received from the private sector. The amount of the membership fees are set out in the bylaws of the
organization. The municipality contributes €0.20 per inhabitant. Entrepreneurs pay a single membership fee of
€300. Members' contributions fully cover the operating costs and partly the costs of the organization activities.
Destination management organization Banská Štiavnica Tourism had a budget of €104,649 in 2017. 56% of that
amount was a grant from the state budget (€ 58,777). The 38% share of the total budget is represented by member
contributions of municipalities and entrepreneurial entities operating in the territory of member municipalities,
while the contributions of the public sector prevail. The amount of the contributions is sufficient to cover the
operating costs and partly to cover the costs for the activities of the organization.
Budget of the destination management organization Region Horehronie fornthe year 2017 was €142,741. This
organization has reported a total decrease in funding in 2017 compared to the previous year (a decrease of 13%).
The amount of membership contributions decreased as well as the amount of state grant allocated. The grant of
€72,590 for 2016 accounts for almost 44% of the total budget (the share remains the same in the year 2017). The
remaining 56% of the budget is represented by membership fees from municipalities and business entities
operating in the territory of the municipalities, which are divided in a ratio of 20:30. The minimum contribution
rate for municipalities is €1,000. The membership fees cover only the organization's operating costs.
In 2017, the destination management organization Gron operated with a budget of €39,337. The state grant was
€10,498, which accounted for approximately 27% of total financial resources. Membership contributions from
municipalities and business entities accounted for about 56% of all resources. Municipalities contribute to the
XXII. mezinárodní kolokvium o regionálních vědách Sborník příspěvků Velké Bílovice 12.–14. 6. 2019
 
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organization 50% of the amount of accommodation tax collected and €0.30 per inhabitant. The uniform rate for
businesses and other entities is €100. Contributions cover both operating and organizational costs.
The amount of the financial sources of the local destination management organizations in Banská Bystrica region
divided according the source of financing in the year 2017 can be seen in the graph 1. We can see, that the highest
amount of the money was gained by Dudince Tourism, the second most successful organization in the sense of
gathering financial sources was Central Slovakia Tourist Board.
Graph 1: Financing sources of the local destination management organizations in Banská Bystrica region in
2017
Source: Own elaboration based on information from www.finstat.sk, www.registeruz.sk, 2019
Share of state grants received by the local destination management organizations in Banská Bystrica region in
2017 is displayed on the graph 2.
Graph 2: Share of state grants received by the local destination management organizations in Banská
Bystrica region in 2017
Source: Own elaboration based on information from www.mindop.sk, 2019
The total amount of state grants given to the local destination management organizations in Slovakia in 2017 was
€4,329,583 (in 2016 it was €3,781,641). Destination management organizations operating in the Banská Bystrica
region received a grant of €299,685 in 2017, representing only a 6.9% share (€264,655 in 2016, which means a
7% share).
0
20000
40000
60000
80000
100000
120000
140000
Dudince
Tourism
Central
Slovakia Tourist
Board
Tour Novohrad
and Podpoľanie
Banská
Štiavnica
Tourism
Region
Horehronie
Gron
State grant in € Membership fees in € Own income in €
Dudince Tourism Central Slovakia Tourist Board
Tour Novohrad and Podpoľanie Banská Štiavnica Tourism
Region Horehronie Gron
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4. Conclusion
Destination management organizations in Banská Bystrica region are widely funded by grants. Own income
creates only a small part of their financial resources, the most significant share in financing activities by own
resources is only in the DMO Dudince. As far as we take into the consideration the regional DMO, which has to
be established by self-governing regions, such an organization was established in the territory of the Banská
Bystrica self-governing region only at the end of the year 2018, which means that in the years 2016 and 2017, as
well as in the previous period of time, it did not receive any resources for the development of tourism at the regional
level (grants to the regional destination management organizations were €570,618 in 2016 and €725,830 in 2017.
The membership fees of organizations are differentiated, each organization sets a different rate of membership
fees. Their amount is published in the bylaws of the organizations. The operating costs of all organizations are
fully covered by membership fees.
The problem is in getting data about organizations. Despite the statutory obligation to publish account statements
(these are non-profit organizations), it is often almost impossible to find the required data, or the financial data of
same indicator is different in various sources (for example the amount of the grant from the Ministry of Transport
and Construction varies on the web page of Ministry and on the financial statements register, or in the information
given by the organization itself on its webpage). Some organizations criticize the system of obtaining state grants.
Their view of the redistribution of state grants is that if the maximum amount of grant depends on the amount of
membership fees collected, organizations operating in regions with a low number of accommodation facilities and
overnight stays do not have the opportunity to obtain sufficient funding to undertake activities related to the core
business of the organization.
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