Hotel Online  Special Report

The 6-year-old Orange County (California) Tourism
Council May be Victim of Budget Cutbacks
By Sandi Cain, June 2004 

In an effort to reduce costs to offset state budget cuts, OC supervisors are looking to trim the overall budget to $4.6 billion for the 2004-2005 fiscal year, down from $5.4 billion this year.

The budget is set for release later this month.

County officials say they need to make cuts somewhere as the state grapples with its budget deficit.

“With the hits we’re going to take from the state, something’s got to give,” said county Supervisor Tom Wilson. “All non-essential programs are at risk.”

Cuts to county-funded economic development programs likely would hit the Tourism Council, Arts OC, the Film Commission, Business Council and Office of Protocol.

The 6-year-old Tourism Council received $575,000 from the county for 2003-2004, down 23% from the prior year. The proposal under consideration would eliminate all funding for the agency.

“We’re prepared to share in cuts with everyone else,” said Doug Traub, chief executive and president of the Huntington Beach Conference & Visitors Bureau and current chair of the Tourism Council. “We just don’t want to see (the council) walk the gangplank.”

The move to eliminate tourism funding comes on top of a similar action at the state level shortly after Gov. Arnold Schwarzenegger took office.

Supervisor Wilson, who supported funding for economic development programs last year, said each program will be examined individually, but state funding cuts have put a damper on the county’s 5-year planning process.

The Tourism Council and other economic development programs slated for cuts will have a chance to make their case this week in meetings with county supervisors.

Local governments are under a great deal of pressure to offset the loss of state funds through other means, but governments need to exert care when they eliminate programs, said Jack Kyser, senior vice president and chief economist of the Los Angeles Economic Development Corp.

“Tourism is big business and an important business,” he said.

In some eyes, a decision to shutter the Tourism Council would be shortsighted, “considering the enormous economic impact tourism has on the region in terms of tax revenue and direct employment,” said Caroline Beteta, executive director of the California Travel & Tourism Commission.

Traub said the Tourism Council, a partnership of the county’s tourism venues and visitor bureaus, is especially helpful to nonprofits and members such as Mission San Juan Capistrano that have small marketing budgets.

Mark Feary, executive director of the Tourism Council, said funding cuts immediately would impact several programs, including:

  • Funding for more than 300,000 brochures about OC stocked at area hotels and John Wayne Airport.
  • Closure of the California Welcome Center at Westfield Shoppingtown MainPlace in Santa Ana.
Tourism-related businesses employ about 150,000 people in OC, making it one of the largest industries here.

More than 42 million people visited Orange County last year, generating $6.8 billion in spending.

Some critics of the Tourism Council and other economic development programs say the county is better marketed by the private sector—through Walt Disney Co.’s Disneyland, for example.

OC Supervisor Chris Norby says that tourism promotion groups are better off if they are independent from government.

But Feary said relying on private enterprise isn’t the best way to approach countywide promotion.

“The Disney message is not the Orange County message,” he said.

Visitor bureaus, he said, are set up to promote cities, not the entire county.

Today’s emphasis on the regional traveler also intensifies competition for tourist dollars. Los Angeles, San Diego and OC—along with other cities across the Southland—work to lure visitors away from Las Vegas, Arizona, Northern California and other regional destinations.

“We’re all in the same markets trying to get people to come here,” Feary said.

Las Vegas alone has a marketing budget larger than the total budgets of all the visitor bureaus in Southern California combined. And Arizona just bumped its marketing budget from $9 million to $11.6 million—with California travelers as one target.


Sandi Cain is a freelance writer and contributor to the Orange County Business Journal and meetings industry publications. She specializes in hospitality, tourism and travel. Cain holds bachelor’s and master’s degrees in education from Kent State University in Ohio, where she majored in social studies. A former high school teacher, she has written for niche-market sports publications in the U.S., England and Australia and formerly worked in both the printing and high-tech industries. A Cleveland, Ohio native, Cain hasbeen a resident of Laguna Beach since the late ’70s. She enjoys travel, gardening, reading and spoiling her three cats.


Sandi Cain
Laguna Beach CA

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