EU tourism funding: governance and implementation dynamics in Spain’s Tourism Sustainability Plans

European Union funding has long been a key driver of regional and tourism development, shaping destination trajectories and investment priorities. The Recovery and Resilience Facility (RRF), introduced under Next Generation EU, represents a new model of performance-based public investment, linking financial disbursement to predefined milestones and targets. This paper examines the implementation of Tourism Destination Sustainability Plans in Spain, focusing on 38 plans in the Valencian region that received over €80 million under the 2022 and 2023 funding calls. Drawing on the analysis of procurement data, the study investigates how policy objectives are translated into concrete actions at the destination level. The findings reveal a gap between planned and implemented interventions, shaped by administrative capacity constraints, procurement requirements and time pressures associated with fund disbursement. Implementation has been strongly oriented towards infrastructure-related investments, while capacity-building and social sustainability measures remain comparatively limited. These patterns suggest that performance-based funding frameworks may prioritise measurable outputs over longer-term strategic alignment. By examining EU tourism funding as a performance-based governance instrument, the paper contributes to understanding how funding design interacts with territorial capacity and project-based delivery structures to shape uneven implementation outcomes. The findings are particularly relevant for smaller and rural destinations, where limited administrative capacity constrains the effective translation of funding into sustained development pathways.