At the request of the Yosemite Sierra Visitors Bureau, the Madera County Board of Supervisors will hold a public hearing at 10 a.m., May 6, in Madera to discuss the continuance of the county's agreement with the bureau to collect and distribute funds raised by the lodging industry for tourism promotion.
A second hearing will be held June 3, at which time the supervisors will vote on the extension of the Tourism Business Improvement District (TBID) that was established by the bureau in 2009, and ends Dec. 31. The bureau is asking for a 10-year renewal that would run from Jan. 5, 2015, through Jan. 4, 2025.
An alternative funding source, the TBID was established after the county cut the bureau's $260,000 annual funding during January, 2010 budget hearings. Prior to the cut, the county provided funds to the visitor's bureau marketing efforts for more than 20 years marketing efforts that enable Madera County to compete in the highly competitive tourism industry.
The TBID provides a stable funding source for county tourism promotion and the funds can not be used for any other programs.
At the time the bureau's funding was cut, Dan Cunning, CEO of the bureau, said the bureau was not a liability to the County of Madera.
"We are truly an asset to the county a revenue-producing organization," Cunning said.
Cunning referenced statistics from the California Travel & Tourism Association that show Madera County received close to $16 million in sales tax and occupancy tax during 2007 from tourism. He said for every dollar invested in the bureau, the county gets back $66.
At the time, Madera County District 5 Supervisor Tom Wheeler made a motion to reduce the visitor bureau budget by 25%, but that proposal was defeated by a 3-2 vote. A second motion, by then Supervisor Ronn Dominici, to cut the bureau's funding, passed 4-1, with Wheeler being the lone vote against the cut.
The Tourism Business Improvement District allowed the lodging industry located in the unincorporated areas of the county to add a 2% assessment to the then 9% county hotel transient occupancy tax (bed tax), with the additional 2% earmarked exclusively by the bureau.
The county approved the TBID, and agreed to collect and distribute the funds for the bureau for five years.
"Without supervisors' approval of the tourism district, Madera County would have had no agency to promote its $200 million tourism industry, which supports more than 3,000 jobs in the county, according to the California Travel & Tourism Association," Cunning said.
Funds from the TBID, which includes nearly 70 hotels, motels, resorts, B&Bs, campgrounds, vacation home rentals, RV resorts, and conference centers, have provided the bureau with about $450,000 a year over the past five years. The bureau's current annual budget is $550,00, with the additional $100,000 raised by the bureau through memberships, visitor center gift shop, advertising opportunities, and other revenue sources.
If the renewal is approved, funds will be used for sales and marketing (80% - $360,000), administration (17.5% - $78,750), contingency (2% - $9,000), and county collection costs (2% - $2,250).
Sales and marketing efforts to attract overnight visitors to the county include print and online advertising, attendance at tour and travel shows, maintenance of a social media presence, maintenance of web page, promotion of special events, operation of the visitor's center, and international and national sales efforts.
By comparison, tourism budgets in other Yosemite gateway communities include Mammoth Lakes ($4.7 million), Mariposa County (nearly $2 million), and Tuolumne County ($850,000).
Because the TBID funds are paid by lodging guests, there is no fiscal impact to the county general fund, although when the bureau went without funding for almost a year (2009-2010) when the budget was cut, it was the first time in the history of the county that bed tax revenue was less than the previous year.
"Lodging businesses lost an estimated $1.5 million in room sales that year and that loss did not include the loss to restaurants, gas tax, bed tax, sales tax from visitor shopping, and other expenditures when the bureau was not able to compete with the other Yosemite gateway communities," said Rhonda Salisbury, marketing director for the bureau.
The county is paid a .05% fee of the funds collected by the visitor bureau to collect and distribute the funds.
The bureau is asking that the county renew the TBID for 10 years.
The first Tourism Business Improvement District in California was implemented in West Hollywood in 1989, and there are now more than 80 TBIDs in California.
Wolin challenges the effectiveness of the visitor bureau
Although Dave Wolin says he supports the TBID concept, he feels there is a perception of inappropriate operations of the bureau, feels approving the TBID for 10 years is way too long, and would like to see a committee formed to oversee the bureau and its spending.
In a letter sent to the supervisors prior to last week's board meeting, Wolin suggested there are some important questions to be asked prior to approval of the TBID and that drastic changes need to be made to the agreement before approval, including the appointment of a non partisan, independent board to "provide oversight and supervision and some explanation of the differences between the proposal and the actual expenditures."
Wolin said when the original business improvement district was approved five years ago, the board (of supervisors) provided no required supervision or reporting.
"The bureau does have oversight," Salisbury said. "It is our 12-member board of directors including lodging, tourism, and community leaders such as Steve Welch (Bass Lake Realty), Bill Putnam (Best Western Plus), Michele Miller (Miller's Landing Resort), Merylyn Whited (representing the arts), Max Stauffer (Yosemite Mountain Sugar Pine Railroad), Betty Linn (Sierra Star publisher), Ray Krause (winery owner), Dave Martin (U.S. Forest Service), Scott Gediman (National Park Service), and Supervisor Tom Wheeler."
Wolin said the bureau's proposal from five years ago shows substantial discrepancies between what was promised and what was actually spent by the bureau, and he would like to see the bureau produce some evidence of the advertising and promoting of the area that they say they have done.
"The original (visitor bureau) plan substantially misrepresented the amounts that would be spent on advertising and promotion," Wolin said. "The Yosemite Sierra Visitors Bureau has shown that they have not done a good job, not only in the past five years, but in the past 15."
Salisbury was quick to challenge that statement.
"The bureau was just recognized by the State Office of Tourism and the Western Association of Convention and Visitor Bureaus for marketing excellence," Salisbury said.
"As an expert, I'm not impressed with attending trade shows and advertising equivalency comparisons," Wolin said after the board meeting.
Wolin said over the past five years, the bureau has doubled its paid staff from two and a half people to five people ... leaving little money to promote the area.
Although Wolin said Business Improvement District renewals in California typically run one to three years, Verna Sulpizio, an authority on TBIDs with Civitas Advisors, authors of the TBID law, said the law allows renewals up to 10 years.
"TBIDs typically renew five to 10 years," Sulpizio said.
Wolin serves as chairman of the Eastern Madera County Emergency Preparedness Committee, is co-chair on the Oakhurst Area Chamber of Commerce Economic Development Committee, and heads the Madera County Film Commission. He said he was speaking to the board as an individual.
Wolin said the bureau is kind of the ultimate in disregarding operating in a transparent fashion.
Cunning said the bureau provides the board of supervisors and the county auditor with monthly financial statements and all supporting documents on bureau activity.
"Mr. Wolin has no idea how the TBID is funded, and believes we are supported by tax dollars, which we are not," Cunning said. "He has no concept of what an assessment of lodging properties is all about and how it works and has never asked us about our marketing plan."
Cunning said he would gladly share what the bureau does with anyone that would like to lean more about the visitor bureau's operations.
"We must be doing something right since almost all of the petitions sent to lodging properties asking for support of the TBID renewal were in favor of the renewal."
Lodging sales have grown in the county from $759,940 in 1977-1978 to $22.7 million in 2012-2013. Bed tax from those sales have provided the county $38,000 in 1977-1978 and more than $2 million in 2012-2013.