Tourist States Suffering But Hopeful

 

Las Vegas and Reno were reduced to ghost towns the weekend after the attacks of September 11. Hotels that rarely see weekend vacancies were left wondering if they could even fill every other room.

The next weekend, Las Vegas' hotel occupancy rate was up to 80 percent, not far from its usual 95 percent mark, and Reno could boast a 100 percent occupancy rate. This weekend? Well, no one knows what to expect. But Bruce Bommarito, the head of Nevada's Commission on Tourism, thinks the safe bet is on continued improvement.

"We're on a steady track to recovery," said Bommarito. "We have opted at this point to continue with our long-term plan with the hope that this growth will continue and that things will continue to get better."

Despite Bommarito's confidence in Nevada's prospects, the post-attack downturn in tourism has many Nevadans worried. Thousands of card dealers, cocktail waitresses, baggage handlers and restaurant workers have been let go or furloughed. And nervous casino owners are avoiding public comment and refusing to reveal their financial hands.

Gov. Kenny Guinn has asked his advisers to determine the impact of the attacks on the state's tourist industry and the tax revenues it generates. With sales taxes comprising 34 percent of the state's general fund revenue and gaming taxes another 37 percent, according to the National Conference of State Legislatures, any downturn figures to hit the state hard. Lower tax receipts will mean less money for unemployment benefits, schools and healthcare.

Nevada, the country's most tourism-dependent state, has not been alone in taking an immediate and deep hit from the terrorist attacks. Hawaii and Florida, numbers two and three respectively, also saw business plummet.

"Following the attack on our country, people have canceled or postponed their trips to Florida," said Gov. Jeb Bush in a press release.

"There's been talk of layoffs and furloughs, but there have been no statewide layoffs," said Tom Flanigan, spokesperson for Visit Florida, a public-private partnership that functions as the state's main tourism organization. And "we are hearing some stories of recovery," he adds.

The key variable for these states is air travel. Roughly half the visitors to Florida and Nevada fly there, and Hawaii, as an island state, is almost completely dependent on air travel.

When will people start flying again? When will businesses feel comfortable scheduling conferences in far away states? Analysts say only time will tell, but Florida, Hawaii and Nevada aren't waiting around to find out.

Gov. Bush has asked the Florida Legislature to return for a special session to address the state's economic and fiscal standing. The St. Petersburg Times reports that Bush also may fly to Boston and Chicago soon to personally deliver a message to wary travelers: "Don't forget Florida."

Before the attacks, the state was staring through a $673 million dollar budget hole. But now, with tourism down, the deficit could top $1 billion in a $48 billion budget.

Florida depends on sales taxes for three-quarters of its general fund revenue. With no statewide income tax, the state's fiscal status depends greatly on how much money out-of-towners are willing to spend.

The week after the attacks, Hawaii Gov. Ben Cayetano convened an emergency economic summit. Top leaders in business and government proposed a series of measures, including the waiving of landing fees at all state airports, a special session of the Legislature, and a joint public-private marketing effort. Cayetano said Hawaii is facing its "greatest economic crisis and our most serious challenge."

A recent estimate says visitor spending in Hawaii could fall by $1 billion for the year, a 9 percent drop from last year's $11 billion total. Tourism accounts for roughly a quarter of all economic activity in Hawaii.

On Thursday (9/27), Nevada Lt. Gov. Lorraine Hunt convened the first meeting of the state's Tourism Stability Task Force, which is charged with creating a plan to bring people back to the state. "Nevada is known as America's 24-hour recreation destination, and we intend to encourage people to visit, relax, and have some fun," said Hunt.

A handful of tourism-heavy states, such as Vermont and New Hampshire, are bucking this trend a bit. They too have had many vacationers cancel, but they've been able to recoup some of this business by tapping the Northeast's big cities.

"Initially there was a big jolt, and that big jolt resulted in a number of immediate cancellations. People didn't want to do anything right away," said Dave Kaufman, president of the Vermont Tourism Network, which markets Vermont to the package tour industry.

"But for people in Boston, New York, Philadelphia, and as far as Washington, D.C., Vermont is a very easy choice."

The Vermont Chamber of Commerce reports anecdotal evidence that the state's accessibility has helped it maintain a decent level of business even as more distant locales have been suffering.

"I have heard from some of my members that they have been losing business from distant domestic markets and overseas, but they've been picking up business from metropolitan areas," said Sue Kruthers, the Vermont Chamber's vice president for travel and tourism.

"Vermont is holding its own," said Kaufman.

 
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