BCTDA outlines COVID-19 tourism impacts, response

Tourism COVID-19 impact graph
COME BACK NEXT YEAR?: Marla Tambellini, Explore Asheville's vice president of marketing, referenced an Oxford Economics study projecting U.S. tourism revenues would remain below normal through the rest of 2020. Graphic courtesy of Explore Asheville

In a normal month, said Marla Tambellini, all of the graphs she collates for the Buncombe County Tourism Development Authority point up. In March 2020, not a single one of them did.

The vice president of marketing for the Explore Asheville Convention and Visitors Bureau, which manages the 6% occupancy tax collected by the BCTDA, was the bearer of unprecedentedly bad news at the authority’s April 2 board meeting. In the wake of local and state restrictions to slow the spread of COVID-19, Tambellini said, Buncombe County’s previously booming travel industry had essentially evaporated over the previous two weeks.

In the first weekend of March, said Tambellini, hotels throughout the county were at roughly 90% occupancy. By March 27-28, only about 15% of rooms were filled, and the average price for those accommodations was approximately half its usual rate — $80 instead of $160. Visitors to the Explore Asheville website March 12-30 dropped by nearly 60% compared with last year’s traffic for the same period.

To the board members, consultants, Explore Asheville staff and members of the public tuning in to the remote meeting held using the Zoom online platform, Tambellini remarked, “‘It’s been a year this week,’” quoting host Kai Ryssdal of the public radio business program “Marketplace.” “I think we can all relate to that right now with the devastatingly rapid pace of change that we’ve seen occurring over the past few weeks.”

While acknowledging the dismal prospects for area tourism in the immediate future, Stephanie Brown, president and CEO of Explore Asheville, said the BCTDA should keep its eyes focused on the long term: “The priority is readiness for a strong and swift recovery at the end of the pandemic crisis.”

(Later on April 2, a press release from Explore Asheville announced that Brown would be leaving the bureau at the end of June “for a new opportunity in the private sector.” In that release, Brown said she had been offered the job last September and did not mention the current status of the local tourism industry.)

We have reserves

Stephanie Pace Brown
EYES ON THE FUTURE: Stephanie Brown, Explore Asheville’s president and CEO, said the Buncombe County Tourism Development Authority should conserve its resources to ensure “a strong and swift recovery” after COVID-19. Photo courtesy of Explore Asheville

To ensure strength for that recovery, said Brown, Explore Asheville had canceled all paid advertising and employee travel through the end of the fiscal year, expenses totaling approximately $6.7 million. Over the same period, she added, the BCTDA should expect no additional revenue from lodging taxes.

But even without that usual cash flow, Brown explained, the authority was far from broke. As of the end of March, the BCTDA’s undesignated fund balance — the “checking account” used to pay for budgeted expenses — stood at $7.2 million. Its designated fund balance, which she called a “savings account” reserved for revenue shortfalls, held an additional $4.9 million.

With approximately $3.9 million in budgeted expenses remaining through June, Brown continued, the BCTDA would start the next fiscal year on July 1 with roughly $8.2 million in operating cash on hand. Of those reserves, she recommended that $3 million be kept in the wings to kick-start a new paid advertising campaign once COVID-19 travel and business restrictions had been loosened.

The authority also has access to nearly $4.7 million in unbudgeted assets through its Tourism Product Development Fund. This pool of money, supported by 25% of occupancy tax revenues, is required by state law to be spent on capital projects with the potential to generate new tourism for the county. In 2019, the BCTDA temporarily paused awards from that fund and embarked on a Tourism Management and Investment Plan to reconsider its expenditures.

Tambellini noted that even with industry experts expecting the worst of the COVID-19 crisis to pass by the end of the summer, Explore Asheville still anticipated less business than usual for the remainder of 2020. She cited an Oxford Economics study projecting national tourism revenues would remain at least 15% below normal as late as December.

“The real issue is people’s perception of risk, and that is going to have to be mitigated much further down the line,” Tambellini said. “I think it’s going to be slow, baby steps forward during that time period; I don’t think it’s going to be like, one day those restrictions will be lifted and everybody will be back in the marketplace.”

‘A light touch’

Staff members with 360i, the marketing agency retained by Explore Asheville to manage its advertising efforts, presented early plans for how tourists might be coaxed back to visit the region. Instead of the previous tagline of “Let Your Spirit Run Free” — which 360i strategist Angie Arner admitted “isn’t quite right” under the present circumstances — a new social media campaign would be branded as “Together in Spirit.”

“We’re really working to evolve that message and be sensitive and make sure that we can put that message out with a light touch,” Arner explained. She offered a “short manifesto” about the campaign, outlining how Asheville should be considered “a state of mind” instead of simply a physical destination.

Arner said posts from Explore Asheville accounts would convey hope and stability to address what she identified as a “consumer pain point” of a “frustrating loss of control.” The messaging would establish “how the destination is handling the situation and supporting the economic hit to its community in a grounded, logical manner.”

Although 360i will not employ paid advertising such as television spots for the campaign, the agency will still receive a monthly retainer of $113,000 through the end of the fiscal year for its work. That fee was reduced from $141,000 per month after the cancellation of previously scheduled advertising.

Do you hear the people sing?

Members of the public, who submitted 85 pages of written comment prior to the board meeting, had decidedly different ideas about how the BCTDA should spend its money. Without exception, every commenter asked for the board to directly support community members who were suffering financial setbacks due to COVID-19.

“This is not the time to hold out to rebuild tourism,” wrote Franzi Charen, director of the Asheville Grown Business Alliance and co-owner of Lexington Avenue boutique Hip Replacements, in a representative comment. “This is precisely the time to invest everything we can in our neighbors and our locals who are suffering and in healing and helping those that the tourism empire was built on.”

Neither BCTDA board members nor Explore Asheville staff made any mention of those comments during the meeting. Brown did note that her organization had donated $50,000 in advertising revenue earned from its online event calendar to the One Buncombe Fund, a county-organized rapid relief effort for individuals and small businesses.

Meanwhile, BCTDA Chair Gary Froeba read a note from Jim Muth — a former chair of the authority and current president of the Asheville Buncombe Hotel Association — saying that the ABHA was “actively pursuing a variety of options to address the crisis” and hoped to share further news the week of April 6. Muth did not submit his comment via the email address advertised for that purpose to the general public.

Asheville City Council member Julie Mayfield, who serves on the BCTDA as a nonvoting, ex officio member, said the board wanted to support the community but was hampered by state law from deploying occupancy tax revenues to do so. She said the authority could be sued for misappropriation of public funds if those dollars were not used to promote the area as a tourism destination.

Board member Andrew Celwyn, however, urged his colleagues to think creatively about supporting the community within legal bounds. He suggested that the BCTDA could immediately pay $3 million from its Tourism Product Development Fund to hire out-of-work creatives to make public art that would attract visitors, as well as spend $1 million to pay locals for their stories of COVID-19 resilience to use in a later advertising campaign. The board did not move forward with either proposal.

Other community members called for even more drastic action. “Prove to us, the backbone of Asheville, that you aren’t f***ing vultures,” wrote Rik Schell, co-owner of Purl’s Yarn Emporium on Wall Street. “If you break the law to provide for the working people of Asheville, you’ll be hailed as heroes, believe me.”

04.02.20 BCTDA Mtg Public C… by Daniel Walton on Scribd

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About Daniel Walton
Daniel Walton is the Assistant Editor of Mountain Xpress, regularly contributing to coverage of Western North Carolina's government, environment and health care. His work has previously appeared in Capital at Play, Edible Asheville, and the Citizen-Times, among other area publications. Follow me @DanielWWalton

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10 thoughts on “BCTDA outlines COVID-19 tourism impacts, response

  1. bsummers

    “If you break the law to provide for the working people of Asheville, you’ll be hailed as heroes, believe me.”

    Hallelujah! If the TDA has 3 or 5 million in an account somewhere, find a way to support tourism-related workers who are now unemployed. And then turn that into an Asheville sales pitch!

    “Here in Asheville, we care about the thousands of local workers who keep the lights on and the food and drink flowing for our tourist visitors. We’ve put our dollars behind that sentiment and made sure that any restaurant, hotel or related hourly worker has the resources to weather the current storm. When the COVID-19 crisis passes, and you want to travel to a place that’s about more than just the bottom line, come to Asheville. We’re about people, not profits.”

    • Lulz

      LOL whatever. The only thing that will end up happening is more property tax increases to make up for the lack of sales tax revenues. Can’t expect fat cat cronies to go without when there’s a huge population of cult believers willing to pay any costs without so much as a whimper.

  2. Brooke Heaton

    BCTDA has removed all the letters from Scribd. The lack of transparency and arrogance is astounding. Shame on them.

    • Lulz

      LOL no. Shame on local government for allowing them to continue to operate. And shame on the people who refuse to hold local government to any standards of accountability simply because they are democrats. TDA is around with complete cooperation of the local cronies in government. Not in spite of it.

  3. Bright

    Instead of looking at the negative lack of the “wonderful” tourist’s wonderful money, howza bout looking at how clear the air has been, the roads unclogged, since their detritus is no longer here? Tourists are trouble is the new slogan. Smile.

    • Lulz

      I’m in total agreement. For what actual little tourism does for the residents, the industry is responsible for most of the problems the residents deal with.

  4. Mike R.

    Asheville is going to be in a severe economic depression for at least the next two years or until an effective/widespread vaccine is available.

    This will result in widespread business failures and permanent closings of marginal businesses that have grown up around the latest tourism resurgence.

    We’re only in the first half of the first inning on this thing.

    • Lulz

      And the town deserves it. A bunch of liars, cons, and gimmicks don’t make up for pushing out industry and high paying jobs once here. What’s even more eye opening is people who expect handouts because they play music or paint art instead of looking for work. But most are so arrogant that they refuse to do the jobs available to them. They’re too good for them. So in a way the economy will rid itself of these people because they rely on a tourists centric system to survive. Growing up here in the 70s and 80s was 1000 percent better than the current city of transplant snobs have made it into. That was a nice place that wasn’t so tourism focused to throw its other industries and people under the bus for it. Like has been happening for years now.

    • Big Al

      I actually hope you are right. Maybe a recession or depression will bring some housing costs down to an affordable level. Maybe smaller crowds will make downtown more available to local residents.

      I am not holding my breath. Once the Great Orange Hairpiece declares the economy open for business, the masses will flock back to their breweries and the economy will recover. The decimation of old folks and chronically ill will be accepted or ignored as just a necessary part of the cure.

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