What's wrong with ignoring tourism? Just ask Italy

Now that Washington no longer has a tourism budget, private interests are taking the reins on the promotion of the Evergreen State and the Emerald City. But will it be enough?

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The SKCVB, in partnership with Seattle Center and the Seattle Downtown Association, has this "snow globe" truck cruising the streets of Spokane, Vancouver, B.C. and Portland, along with a ground crew handing out brochures to promote Seattle as a holiday shopping destination.

Now that Washington no longer has a tourism budget, private interests are taking the reins on the promotion of the Evergreen State and the Emerald City. But will it be enough?

In the coming year, the Seattle Convention & Visitor Bureau expects to spend 40 percent of its admittedly modest budget for tourism promotion online. Along with the Port of Seattle, the Visitor Bureau will actually double its spending to bring tour operators and journalists here "to see for themselves." For its part, the Port maintains marketing offices in Beijing, Tokyo, London, Frankfurt, and Paris to tell the Seattle story.

One out of every five visitors to Washington these days flies into SeaTac from outside the United States, and the foreign visitors are responsible for a third of all tourism revenues. Emirates will begin nonstop flights to and from Dubai in March, 2012. All told, tourism is a $15 billion industry in Washington, the fourth largest sector of the state's economy, according to Tom Norwalk, president of the SCVB.

So how did it come to pass that Washington's legislature voted, in the last session, to eliminate all state funding for tourism promotion? With a paltry, $2 million budget, Washington's funding was already 48th out of the 50 states. "It's somewhat embarrassing," Norwalk says.

But it's far from the first time that cost-cutters have taken the ax to tourism's Golden Goose. They did it in Colorado some years ago; Colorado's tourism revenues plummeted 30 percent. You'd think state legislatures would learn. Wrong.

In Austin, Texas, this summer, as the legislature was debating budget cuts, the knives were out for the state's Economic Development & Tourism Division. A million here, a million there, and funding for tourism promotion in the Lone Star State was trimmed to $5 million. It looked as if the tourism promotion campaign, "Texas: It's Like a Whole Other Country," was in danger of disappearing altogether in Gov. Rick Perry's austerity budget. Yet, by coincidence, the governor's wife, Anita Perry, had been invited to address the Texas Travel Industry Association's annual convention.

She told the 800 assembled delegates that she'd become convinced of the spiritual and emotional benefits of travel. "That's the story I'm taking home," she said.

She was preaching to the choir. "State tourism promotion is a program that lawmakers and budget writers should cherish, nourish and protect, because it's a self-funding program that generates far more revenue that it consumes," the tourism association's president, David Teel, told local reporters. He said that for every dollar Texas spends on tourism marketing, $7 comes back in state tax revenue.

Anita Perry's line of thinking eventually met with approval at the spiritually aware Perry household. And so funding was restored: over $31 million in 2012, $33 million in 2013.

Bob Lander, president of the Austin Convention and Visitors Bureau, was happy. "We're extremely excited," he said. "Here in Texas, the Legislature understands the return on investment that tourism provides.”

Now compare the enlightened legislature in Texas to the wimps in Olympia. Washington's tourism promotion budget ranked close to the bottom of the 50 states with a paltry $1.8 million, now trimmed to zero. Oregon spends $10 million, Idaho $7 million, Montana (Those Metro bus boards! Those mountain goats!) over $9 million. California spends $56 million to promote tourism. British Columbia's budget is a whopping $60 million, paying to promote tourism to Vancouver, to Vancouver Island, to the Okanagan wine country, and other destinations.

Ed Murray, chairman of the state Senate's Ways & Means Committee, which cut tourism promotion out of the state budget, told Crosscut writers and editors recently that he does believe the state should invest in tourism, "but not when the alternative is cutting teacher salaries." Yet that's a false choice.

You don't pay for tourism promotion with money that could have gone for teacher salaries, it's the other way around: you pay teachers' salaries with tax dollars you raise from tourism.

Tourism is big business. King County Executive Dow Constantine points out that 50,000 jobs in the county depend on tourism. Nine million travelers visited King County last year, spending $5.5 billion and generating $440 million in local taxes. In fact, it's Washington's fourth largest industry, generating 150,000 jobs and a billion dollars in tax revenues statewide.

David Blandford of the Seattle-King County Visitor Bureau (the marketing arm of the state Convention Center) points out those tax revenues, the billion dollars associated with tourism, are paid by visitors, not local taxpayers. Taxes generated by tourism lower the tax bills of in-state households by nearly a thousand dollars a year, Blandford says.

And yet, this seeming no-brainer is a hard sell.

City Councilman Tim Burgess, an ex-officio member of the Visitor Bureau's board of directors, laments that it's an uphill battle to persuade budget-writers that promoting tourism makes economic sense. In an interview earlier this year, he told me, "We're talking about 50,000 jobs locally, and many of them are what you can call first jobs." Entry-level positions in the hospitality industry, not particularly glamorous, but jobs nonetheless. In fact, these make up one out of every 9 non-farm jobs and 7.5 million total jobs nationwide.

Business travel accounts for only ten percent of tourism traffic to Seattle. Leisure travel is the name of the game. Half the visitors to Seattle arrive by air, a full 20 percent come from outside the country. Sure, half of all travelers come to visit friends and family and don't stay in hotels, but they go out to eat, too; they visit museums and attend local theatrical productions. The Picasso show at SAM last year generated $66 million for Seattle; half the museum-goers were from out of town. The last King Tut show, at the Pacific Science Center, was 30 years ago; it's coming back for a nine-month run next May and already has local hotels and restaurants salivating at the anticipated million visitors the Boy King will attract.

There's also a Gauguin exhibit coming to the Seattle Art Museum, and a big push this year, a new team effort by the Convention & Visitors Bureau and the Washington Wine Commission, to promote Taste of Washington at the end of March.

"If we're going to compete with other west coast cities, we've got to spend more," says Burgess. Los Angeles and Vancouver, BC, spend the most, $12 million a year to promote themselves as vacation destinations. Seattle, Portland, and Anaheim (Disneyland) spend about $8 million each. But on a statewide basis, nothing.

True to the new economics, now that government has abdicated its responsibility and walked away from the table, the private sector has stepped in. The Washington Tourism Alliance was created earlier this year, bringing together the players with a direct stake in the tourism industry.

And now, to bolster shoulder-season and off-season travel, a coalition of 41 Seattle hotels has started adding a $2 per room-night tax. Not your neighborhood bed & breakfasts, but hotels with more than 60 rooms. Much as a neighborhood might create a Local Improvement District, the hotels have created a Tourism Improvement Area. The tax, which the city collects, is expected to generate $30 million a year. Having passed all the statutory hurdles, the new tax has been in effect since November 1st.

As Darryl Brian of Clipper Vacations pointed out, the competition for his business isn't the Coho or Washington State Ferries — it's other destinations.

Surveying the damage here in Washington, a Seattle travel writer named Charyn Pfeuffer tried to start an interactive website called GoWAState.com to promote Washington tourism, but the $50,000 project raised only $350.

More successful was the Washington Tourism Alliance, which has a statewide board of directors from a variety of fields (lodging, transportation, wineries, government). Longtime travel pro Suzanne Fletcher was named executive director last month. For now, the privately funded WTA has taken over the official functions of Washignton's tourism agency. Fletcher has a two-year window to work out a funding mechanism that doesn't put the whole financial burden on hotels and a marketing plan that makes efficient use of a limited budget.

On the national level, there's a similar effort. In the past ten years the U.S., as a destination for international travelers, has lost 17 percent of its popularity. In an attempt to make up lost ground, the former Corporation for Travel Promotion has been renamed "Brand USA," complete with an attractive website.

By themselves, ads that feature mountain goats or powder snow or Mickey Mouse don't get people making plans to visit specific destinations. Another important piece of the marketing plan is known as "fam tours," trips to the region for both tourism professionals (who have to know the destination in order to sell its attractions) and for journalists. Some travel agents and writers treat fam tours as junkets or free vacations, but serious journalists and professional travel agents recognize the important advantages of feet-on-the-ground research.

The Seattle TIA will have $6 million a year, give or take, to spend on tourism promotion. Their first effort, now underway, is a campaign to bring visitors from major cities around the Northwest to Seattle for the holiday shopping season, an effort undertaken in conjunction with the Downtown Seattle Association and Seattle Center. It's called a moving billboard, like a snow globe on a truck, and it's making the rounds in Vancouver, BC., Spokane, and Portland, while "ambassadors" hand out brochures promoting Seattle as a shopping destination for the holiday season. So far, says Tom Norwalk, results are encouraging.

On the east side of the mountains, legislators are skeptical about assessments to promote the tourism industry. "I don't think you can expect the state to put an assessment tax on anybody," said state Rep. Norm Johnson, R-Yakima, told the Associated Press in relation to a proposed statewide tourism levy. There's a sentiment that tourism benefits only the Seattle economy, and ignores the fact that big cities are the gateway to rural attractions, that rural areas are actually more dependent on tourism than the more vibrant, economically diversified big cities. (Assessments to promote agriculture don't seem to have the same problem; the state's wine industry just voted a self-assessment to help launch a wine science center on the WSU campus in Richland.)

Perhaps the Washington legislature feels tourism is "expendable." Perhaps they would trade Ichiro and Felix because the Mariners are losing.

A good example of private-sector initiative comes from the 30-year-old Greater Seattle Business Association, the country's largest LGBT chamber of commerce. GSBA runs its own promotion, Travel Gay Seattle, with the slogan "Where Out Is In," which is responsible for moving Seattle from 19th to 9th place as a destination for the closely watched gay travel sector. "Ahead of Philadelphia!" the GSBA's Rene Neidhart told the Seattle City Council.

But is it enough? Enough to make a difference? City council member Jean Godden, who chairs the budget committee, calls even the modest TIA assessment "a good thing, a step in the right direction."

An instructive example from Europe. Italy was once the most-visited country in the world, until, in 1993, in the midst of an austerity crisis, its citizens voted to eliminate the country's cabinet-level Ministry of Tourism. The thinking was, Italy has everything, from La Dolce Vita to the Sistine Chapel, and it's on everybody wish list, so there's no need to spend a bundle on telling our story. Wrong!

Within a decade, Italy had fallen from first to fifth in both international arrivals and tourism revenues. They're trying desperately to catch up, with a new tourist board and a new tourism minister, but it's a tough battle to claw back once you've been deposed.

France, on the other hand, invested heavily in tourism promotion and did a decent job of overcoming its reputation as hostile to foreign visitors. Sunny Spain, which has an even more positive image, sees fewer visitors than France but earns more from tourism than any European country. France wants to wring a few more euros from its 77 million tourists; they've started by moving tourism into the Finance Ministry. Poor Italy: all those priceless art treasures, all that delicious pasta, all that magnificent scenery, and they're stuck in fifth place.


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About the Authors & Contributors

Ronald Holden

Ronald Holden

Ronald Holden is a regular Crosscut contributor. His new book, published this month, is titled “HOME GROWN Seattle: 101 True Tales of Local Food & Drink." (Belltown Media. $17.95).