San Diego Business Journal

Budget Cuts May Pinch S.D. Tourism

Staff Writer

A tourism advocacy group opposing Gov. Gray Davis' proposal to eliminate funding for the California Department of Tourism has appealed to a group of international tour operators for help.

"To eliminate state funding essentially shuts down the tourism department and the marketing it does for the state as a destination," said Terri Taylor-Solorio, president and chief executive of the California Travel Industry Association. "It also sends a negative message to international tour operators because it means the governor wants to cut advertising and promotions that help them sell (tour packages) and remain competitive post-9/11."

The Sacramento-based advocacy group sponsored the California Travel Market, which drew tour operators and press from all over the world. And it used the event as a platform to launch a public relations campaign to defeat the governor's proposal.

Hosted by the San Diego North Convention & Visitors Bureau, the annual event was held at the La Costa Resort & Spa in Carlsbad last week.

The 120 international tour operators were asked to help by educating their industry on the issue and contacting California's politicians to urge them to oppose the cut, Taylor-Solorio said.

"We also want to assure them that we will survive should the elimination of the tourism department go though," she added.

Last year, the state spent $7.5 million to fund the tourism department. Another $6.8 million came from an annual assessment on tourism and hospitality companies. Only those with revenue in excess of $1 million contribute, and the money is spent on advertising and marketing. The state's funds operate the department and pay for staff.

In 2002 tourism generated $5.5 billion, "just from sales tax alone," Taylor-Solorio said. "That doesn't include what cities got from transient occupancy taxes."

Facing an estimated $35 billion budget deficit, the governor earlier this year proposed a variety of cuts, including the tourism department. But Taylor-Solorio argues that without the state money, there would be no office or staff to process the responses and take calls generated by the advertising and marketing.

"The effect would be that California would lose its share of national and international tourism markets and the trickle-down effect that is generated," Taylor-Solorio said. "Ultimately there would be jobs lost."

She mentioned Florida, Hawaii, New York and Colorado as states that stand to gain California's share of the tourist trade if it fails to remain competitive.

"We took over Colorado's ski travelers a few years ago," she said. "The governor of that state responded by infusing the tourism budget with another $10 million in addition to what it normally spends. So Colorado would love to have the ski market back."

Cami Mattson, president and chief executive of the San Diego North Convention & Visitors Bureau, said of the $75 billion that poured into the state last year from visitor spending, 14 percent came from international tourism.

"Even though the international visitors only comprise 3 percent of all visitors, they stay longer and they spend more," Mattson said.

Sal Giametta, a spokesman for the San Diego Convention & Visitors Bureau, said the governor's plan "would deal a devastating blow to the state's marketing effort.

"This (the marketing) is aimed at an audience outside the state, which brings dollars into the state . Whether it's Los Angeles, San Francisco, Anaheim, or San Diego, we all certainly rely on the marketing initiatives at the state level."