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Less Than the Sum of Its Parts
Governor's plan to save money by consolidating arts and tourism bureaucracies draws mostly jeers from those on the front line
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Business New Haven
5/12/2003
By: Susan E. Cornell
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Like many other departments, programs and services, Connecticut's 11 tourism districts are by no means immune to the ravages of Gov. John G. Rowland's proposed budget package. The 11 tourism districts may be consolidated into five districts via Bill No. 5858. Further, Bill No. 5729 proposes to establish a new Commission on Arts, Culture & Tourism by consolidating the Commission on the Arts, Film Commission, Historical Commission and the Office of Tourism. Efficient, economy of scale-achieving proposals, or shortsighted and fiscally irresponsible?
Explains Connecticut Commission on the Arts Executive Director Douglas C. Evans said, "Considering things are much different from what they were in 1992 when the last consolidation happened, this situation with the economic downturn, the way businesses continue to evolve and change, this situation is forcing everybody to look differently at the way business is done."
Both bills go hand in hand, explains Evans. "I believe this will accomplish a couple of things. It will make us take a look at increased accountability and how tax dollars are used and invested in furthering the roles of tourism in the state. And, by increasing accountability and everybody working together on a long-term strategy, we'll hopefully increase tourism in the state of Connecticut and increase the efficiency in the way we go about it."
"As far as agency consolidation, this is an unprecedented opportunity to bring together assets that before have never worked together. By that I mean the arts community, the tourism community, the historical community, and the Office of Film to really create a synergy and a stronger product or package than we've ever had before."
Under the present structure, he adds, "There's no reason for any of us to communicate with each other."
Evans acknowledges that "People have voiced concerns that, 'Well, if Doug Evans is the director of this new agency, it's the arts agenda.' I think it's quite the opposite. I think we can find a way to continue to grow the heritage or historical community's presence, which I think they totally deserve, working together with some kind of infrastructure. Nobody likes change. It's not about the arts. It's quite frankly people saying we all have something wonderful to bring to the table. How can we make this even stronger for all of us individually and all of us collectively? I know people are concerned that it's going to be the tourism agenda or the historical agenda or the arts agenda. Yes, I'm head of the Arts Commission, and yes, I work for the governor, which is a fact, but as a person who is concerned with the future of the state. Everybody needs to put aside his or her own individual agendas to find a way to work together in this very difficult time. That's not a PR answer," he says, "That's the truth."
But John W. Shannahan, who serves as both director of the Connecticut Historical Commission and the State Historic Preservation Officer representing the National Park Service on historic preservation matters in Connecticut, expresses concerns about disbanding the Historical Commission and "incorporating our programs within an agency whose name does not even include history, heritage or historic preservation."
Adds Shannahan, "We also were concerned that the funding that was being recommended for cutting in our programs was quite excessive."
Shannahan says that when he testified before the Appropriations Committee on March 10, a suggestion was made that an alternative to the bill's proposal could be developed "that would ensure that the identity of Connecticut's heritage is not lost, while providing for a much greater measure of parity with the arts." He adds, "As a result, we identified an alternative model that existed in Maine called the Maine State Cultural Affairs Council. It is a way in which the private and the public sectors could come together to address the question of the parity between the arts and heritage, at the same time ensuring that we don't lose those programs that we have currently."
This new entity, or Cultural Affairs Council, he says, "would oversee a coordinated, integrated system of cultural resource programs and projects including both public and private sector support for cultural activities in our state."
Shannahan says that the Historical Commission and the Heritage Coalition have proposed substitute language creating "a new 'Connecticut Cultural Affairs Council' comprised of the Connecticut Commission on the Arts, the Connecticut Humanities Council, the Office of Tourism of DECD [the state's Department of Economic & Community Development], the Connecticut Historical Commission and the Connecticut Trust for Historic Preservation."
However, Guy Ortoleva, executive director of the Connecticut Film, Video & Media Office, believes that "Any time you get a consolidation, whether it be an economy of scale combining services, you get more for the same amount of dollars.
"We have companies that are coming from out of state into Connecticut to hire crews and to use locations," says Ortoleva. "That's certainly a tourism element: They rent an awful lot of rooms and they spend a lot of money here. So, we have a balance between the in-state, which is economic development, and we have the visiting companies, and that's a lot of tourism stuff.
"When people in this industry get up in the morning and they're buying millions of dollars of equipment and hiring people and producing television shows and animation, they often don't think of themselves as tourism engines. They're not getting up in the morning and attracting competitors into the state with their jobs. On the other hand, we work with out-of-state companies that are coming here all the time that are hiring crews, buying services, renting cars, staying in hotels, hiring catering companies - what you would consider tourism-type work," he says.
"What I've learned is that there are lots of cultural aspects of Connecticut which are really good selling points. Anything that we can do to improve our ability to market those and to bring people to the state both for production and for tourism I think is a great idea."
The only downside to the proposed marriages, he says, would be the "the startup issues of getting something off the ground."
Ortoleva said that his small staff (three, included himself) bring in "a good chunk of change." He adds, "If we can be more efficient with that and to share what we do - we do a lot of stuff in-house, we burn the CD-ROMs, we create the production guide in-house for a cost savings. We do our Web stuff. We really can handle a lot of stuff in-house. I've seen that some of the things we've learned are helpful to people in the arts community. Shared databases with tourism is always a great idea. There are things that I see that they are doing that are really slick. Looking at some of the print material that the arts community and the historical groups have put out, and it's like, 'Wow, show me how you did that.' I think there's a good synergy."
Will the possible consolidation of districts impact Ortoleva's bunch? "We're still going to be able to get the contacts at the local level that we're going to need anyway."
Explains the executive director of the Connecticut River Valley & Shoreline Visitors Council, Jennifer Wislocki: "The tourism districts are currently funded from a small percentage of the hotel occupancy tax - paid by visitors, not local residents - which supports local tourism marketing to encourage leisure and business travel to the diverse regions within our state, travel that generates dollars and jobs for Connecticut.
"The Governor's plan to consolidate the Office of Tourism, the Historical Commission, the Commission on the Arts, and the Film Office would eliminate the regional tourism districts' funding in favor of a statewide effort under this new commission," Wislocki adds.
Connecticut's tourism districts are the "first point of contact for many individuals interested in visiting the state or holding a meeting here," she points out. "In fact, the districts responded to more than 1.4 million requests for leisure-travel information in the last year alone, serving as an excellent resource and marketing representative for the state.
Connecticut's district system ensures the effective marketing of local destinations and attractions and provides a localized voice on tourism issues that would be lost in a state-based approach."
Coastal Fairfield County Convention & Visitors Bureau Executive Director Steve Paganelli says he has heard three options for his locale, "one that would leave our region intact, one that would add Redding, Ridgefield, Trumbull and Shelton, and one that would encompass almost all of Fairfield County."
From a marketing standpoint, any of the options are manageable, he says. "It probably could be marketed relatively successfully, although the character of lower Fairfield County is somewhat different from the character of upper Fairfield County.
"The real question is what the funding will be for those five regional tourism districts," says Paganelli. That's the greatest concern at this point because the potential is to have five inadequately funded tourism districts, and I would argue that five is actually too few tourism districts for the state of Connecticut. So, when you have only five and then inadequate funding, you really put the whole state at a competitive disadvantage in the marketplace."
On the plus side, Paganelli says: "Our district has been a proponent for some consolidation and I think that the benefit would be fewer and stronger tourism districts, and I mean stronger in terms of available resources. You also achieve economies of scale through larger organizations, and some reductions in overhead."
Regarding the impact of H.B. 5729, says Paganelli, "It remains to be seen because it is not totally clear how the regional tourism districts will fit into the larger plan." He adds,
"Anything that serves the purpose of coordinating activities among different sectors is beneficial. The challenge will be that cultural heritage sights and arts organizations and travel and tourism industry - that those don't get lost in this consolidated agency, where one ends up dominating and the others take a back seat. That's always a concern in any type of consolidation.
"My concern is that a lot of decisions are being made in a black-and-white fashion based solely on dollars and cents. The reality is that when it comes to tourism and tourism marketing, it's a revenue center for the state, and with the state's financial plight, you don't typically cut your revenue centers; you cut your cost centers. But what has happened is that the General Assembly and the administration are in such a difficult position financially that frankly I don't think they're thinking clearly on the subject. The reality is that if they reduce funding for marketing efforts, they're going to reduce revenues, which means other programs are going to suffer because it's the revenues for travel and tourism that fund other programs like education and health and human services. Either they don't believe the connection exists, or it's not being thought through. That's the real detrimental outcome or potential that exists."
Says Paganelli, "We're at a time where the travel and tourism industry is suffering nationwide and to put our state at a disadvantage in what is an increasingly competitive environment - that's shortsighted."
Says Karolyn Kirchgesler, executive director of the Greater New Haven Convention & Visitors Bureau, "On the surface, the governor's plan to create the Commission on Arts, Culture and Tourism could certainly benefit the industry, especially in New Haven where arts and cultural activities are such a major staple of our visitor product. While there are definitely synergies that exist between these groups, there are also unique characteristics to each, and it is important that these characteristics don't get lost in a merged effort. Our biggest concern is that the state, through the hotel occupancy tax, continue to allocate adequate dedicated funding specifically for regional tourism promotion."
Central Connecticut Tourism District Director Eileen Sweeney believes that, "If the argument of several legislators in leadership is to save money, the point is undermined by the funding consideration given to those in H.B. 5729 at the expense of equal representation of valuable resources for maximizing economic community development for our communities and state. The plan for consolidation of the Connecticut Office of Tourism and the Connecticut Historical Commission under the consolidation of the Connecticut Commission on the Arts, as well as super-sizing the tourism regions, will cost taxpayers twenty years of marketing identities, local partnerships and consumer contacts."
Adds Sweeney, "The proposed consolidation of Connecticut's tourism industry supports a bigger, bloated government with less accountability than the current statewide checks and balances in the grassroots system, will centralize control and limit oversight. The current system involves municipal board members and industry representatives, marketing and financial reporting/annual audits go to town clerks, the Department of Revenue Services, DECD, the Office of Tourism/CT Tourism Council, and OPM [the Office of Policy & Management]. The time-consuming process of throwing out the old and establishing new organizations and to develop new marketing strategies, programs and collateral will cost taxpayers in revenue and time during the disruption, as well as confuse consumers looking for immediate information to enable them to plan trips to our state. Small businesses and non-profits will lose recognition and have diminished exposure in mega-districts, harming their ability to attract out-of-state business and leisure visitor dollars. This will be to the detriment of travel and tourism expenditures growth that is critical needed for Connecticut's
General Fund in this time of deficits. The millions lost in out-of-state revenue will have to come from Connecticut's taxpayers to pay for Connecticut's programs like education, human services, etc."
The support for small businesses, museums, and small attractions will be lost, Sweeney fears.
"All of this is about fiscal responsibility to the taxpayer," she says. "If you reduce the staffing in a hospitality/customer-service business, you can't service the constituents in the region and deliver the services and you have to go to the taxpayer to make up for the deficit. To ignore a resource is fiscally irresponsible."
Janet Serra, executive director the Litchfield Hills Visitors Bureau, a 26-town tourism district that represents over 400 businesses, explains that "The proposed merger is complicated as it proposes to consolidate four districts - three cities (Danbury, Waterbury and New Britain) with a rural 1,000-square-mile, 26-town region known as the Litchfield Hills.
"We are concerned about losing our identity that has taken 20 years to develop and we are concerned about the mixed messages that the proposed merge will send to our visitors," Serra adds. "The proposed merger is the most complicated in the state as each of the regions markets to different audiences and appeal to different visitors."
Serra points out that recent studies have shown that regional tourism districts are "the centers for marketing innovation in the state and that for every dollar invested in regional tourism, $27 is generated in state and local taxes." She adds that tourism districts are not an expense but rather are "an investment and they are self-funding as the receipts collected on lodging facilities have grown over the years.
"In terms of the impact, in my professional opinion, this merger will not save money; it will cost money for the following reasons: 1) the time it will take to organize a transition; 2) the time it will take to develop an identity that incorporates the new region - over one-third of the state; 3) the time it will take to implement marketing programs for the new region; and 4) the time it will take for the visitor to understand and respond."
Like Sweeney, Serra is concerned that "all the little businesses that are represented now and benefit from tourism district marketing will be lost in this new centralized superstructure.
"As for the proposed merger of the Tourism Division, Arts, Film Office, Historic Commission, they are all related. However, the arts, the film office and the historic commission are facets of the tourism industry; they help create a sense of place. These entities have vastly different missions. Attracting out-of-state visitors is not their primary mission."
In testimony before the Appropriations Committee and the Commerce Committee in March, Serra said: "Several years ago, the federal government did away with our National Tourism Office. In a few short years (pre-9/11) the U.S. lost 35 percent of its international inbound travel market share. To disband tourism districts, and leave the industry promotionless and consumers confused about where to call for information - as all our advertising campaigns are in place will result in the same thing: a loss of Connecticut's travel market share. This year, the federal government has allocated $50 million to reestablish a National Tourism Board."
Adds Serra: "Tourism is more than the arts, culture, history and the environment. As a new study by the National Geographic Society/Travel Industry Association has defined tourism, or rather, 'geotourism,' as a sense of place - and this is exactly what Connecticut's Regional Tourism District System delivers. All of you know when you are in Litchfield Hills surrounded by our lakes and hills or touring a National Heritage Corridor in the Quiet Corner [northeastern Connecticut], shopping in Danbury's Mall, exploring an apple orchard in central Connecticut, sailing on the Connecticut River, visiting Mystic Village or our Gold Coast, touring the Air Museum, and enjoying our cities - New Haven and Hartford - all of these give the visitor a sense of place, and these encompass our regional districts."
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