New TDA boss sketches post-pandemic tourism plans

Leftover promotional surfboards from Asheville’s 2020 Maui Invitational basketball tournament notwithstanding, no one would mistake Western North Carolina for a tropical island paradise. Yet Victoria “Vic” Isley, the new president and CEO of the Explore Asheville Convention and Visitors Bureau, says the area has much in common with the last destination she was in charge of promoting: Bermuda.

Tourism in both places, Isley points out, is closely linked to their geography, whether that be the Blue Ridge Mountains or sparkling Atlantic beaches. Both, she says, are home to “very creative and passionate communities.” And both depend on visitors as a major driver of jobs.

Isley took the reins of Explore Asheville, which manages occupancy tax revenues on behalf of the Buncombe County Tourism Development Authority, on Dec. 1. Her arrival from the Bermuda Tourism Authority came at the end of a year that saw the biggest dip in local travel since 2009. Due to the COVID-19 pandemic and its accompanying economic recession, overall Buncombe County hotel occupancy averaged 50% throughout 2020, down from 73% in 2019. Room sales for the year, roughly $291 million, were at their lowest level since 2015, with sales of just over $2.4 million in April.

But signs of a recovery are already stirring. In October, before any COVID-19 vaccine had been approved for use in the United States, Buncombe County recorded its best-ever month of room sales: over $53.7 million. And according to survey data presented at a Jan. 27 meeting of the BCTDA board by Marla Tambellini, Explore Asheville’s vice president of marketing, nearly 60% of people are excited for leisure travel in 2021.

Isley will now be paid at least $245,000 per year to shepherd that recovery. She faces pressure from the area’s business leaders to resume strong growth in a vital economic sector — as well as from community members who feel they haven’t reaped adequate benefits from that growth in the past.

Back at it again

Key to Isley’s strategy will be the resumption of paid advertising for Asheville as a destination, which the TDA almost entirely paused in May in light of COVID-19. That campaign is currently scheduled to begin sometime in the spring, with ads distributed over streaming video, web display, social media and other platforms.

The two-pronged target audience for the new plan is much narrower than that outlined in late 2019, when Atlanta-based agency 360i first began developing local tourism ads. Messaging will aim at roughly 14 million high-income “established explorers,” older travelers seeking a premium experience, and about 8 million medium-income “diverse adventurers,” primarily millennials who are “invested in pop culture and trends.”

Visitation to the area, Isley acknowledges, hasn’t dropped proportionally with ad spending. While the BCTDA’s marketing expenses from July through December were down over 55% compared with the same period in 2019, year-over-year room sales for the same period decreased just 11%. She says that difference comes from Asheville’s momentum as a destination, especially as coronavirus concerns led many travelers to actively seek outdoor options.

“Places like Asheville, Lake Placid [N.Y.], Palm Springs [Calif.] and Aspen [Colo.] have certainly been able to ride on the coattails of that popularity of those open spaces and fresh air that people are longing for,” Isley says. “We’re not going to be able to sustain that well into the future, so that’s where you see the efforts that we’re starting in terms of reentering and engaging and inviting visitors to the community.”

To those who suggest Asheville might rest on its laurels, Isley gives the example of San Diego, which cut tourism marketing funding by 83% in 2013 following political pressure. A case study by the U.S. Travel Association tied that decision to $63 million in lost room revenues and $24 million in lost local taxes before the city restored the original funding levels.

“They pulled the plug, and it was sustainable for a while,” Isley says. “And then they lost ground, and they scrambled to get back in the marketplace and with a concerted destination messaging effort.”

Home sweet hotel

One part of the tourism sector is emerging from the pandemic stronger than it entered: short-term vacation rentals, which saw sales rise by more than 50% from June through November 2020 compared with the same months in 2019. Roughly a third of all occupancy taxes collected in Buncombe County now come from stays at STRs, with less than two-thirds coming from hotels.

Isley says she recognizes the role STRs play in the area’s lodging mix and is committed to giving their operators more support from the TDA. While conversations are in the early stages, she’s reached out to Jackson Tierney, co-founder of the Asheville Homestay Network, to build stronger connections and get a handle on local needs. She adds that she’s previously worked with national STR platform Airbnb on matters of both marketing and public policy.

That attitude, says Tierney, is a welcome change from the approach of Isley’s predecessor, Stephanie Pace Brown. He says all STRs have previously been barred from advertising on the tourism authority’s website over concerns that some might be operating illegally, even the 700-plus homestays that are explicitly permitted by the city of Asheville. TDA staff, he continues, has also rejected the possibility of booking rooms for those attending conferences and other group events at vacation rentals instead of hotels.

“I think there has been this culture of teaming with the hoteliers, who have been the primary source of the money over so many years. We’re just coming in strong and hard, and maybe they’re not able to react as quickly and be as accepting.” Tierney suggests. “With [Isley] being new, there’s an opportunity to reset the culture.”

Also at play is the composition of the TDA board, whose nine voting members currently include no STR owners or managers. Tierney says that setup creates “taxation without representation”; he’d like to see two new seats, one specifically designated for an Asheville homestay operator and the other for a short-term rental entrepreneur in the outlying areas of the county.

Legal matters

Isley can seek to shift the tourism authority’s attitude toward vacation rentals on her own, but changes to the makeup of the board must come through new legislation by the N.C. General Assembly. “We fully expect that to happen this year,” she says, although the precise details remain under discussion.

Julie Mayfield, the Democratic state senator representing Asheville and the western two-thirds of Buncombe County, confirms that legislative adjustments are on track to meet that schedule. She expects to introduce a bill regarding the TDA in conjunction with Republican Sen. Chuck Edwards, who represents the remainder of Buncombe County, by Thursday, March 11, the legislature’s deadline for new locally focused laws to be considered in 2021.

Mayfield emphasizes that the board’s membership won’t be the only item included in such a bill. “My primary goal is to get more of the occupancy tax dollars put back into the community in a way that makes people in our community feel more supported by the tourism industry,” she says. “My constituents are demanding a change to this legislation, and I will do my best to deliver it.”

Local government officials and tourism industry leaders, Mayfield says, are in “universal agreement” that more occupancy tax revenue should be put toward community needs. State law currently requires 75% of that revenue to pay for tourism advertising, with 25% for local capital projects that attract visitors; the new split would be 66%-33% along the same lines.

There’s also a general willingness to expand how that third of the room tax could be used, Mayfield continues. Instead of just supporting capital projects, she suggests, those revenues might prop up Asheville’s transit system, which would help tourism industry workers reach their jobs and free up city taxes for other purposes.

“We are supportive of conversations around occupancy tax allocation adjustments that afford balanced recovery for tourism to support jobs for local residents and businesses — as well as shared benefits for the community as a whole,” Isley says about the TDA staff’s stance toward those proposals.

But Mayfield says other uses for occupancy tax revenue, particularly affordable housing, are off the table thanks to lobbying by the powerful N.C. Restaurant and Lodging Association. She notes that the statewide industry group watches any changes to Buncombe County’s tourism laws closely because the region’s visitor economy is so large. Additional flexibility in tax spending here, she explains, could pressure other state tourist destinations to follow suit.

“The precedent that we set matters a lot. A lot of people will have their eyes on this bill in ways that they don’t on other TDAs,” Mayfield says. “It’s just not our decision. Ideally, it would be.”

People power

Even if those changes go through, Buncombe residents will likely still call for a bigger slice of the tourism pie. In recent months, that discussion has revolved around the Tourism Product Development Fund, the pot of funding supported by the 25% portion of the occupancy tax. As of Dec. 31, the fund contained nearly $3 million in unallocated money.

TDA board member Andrew Celwyn and many community members have called for that money to be distributed in a manner similar to a $5 million COVID-19 relief program authorized by the legislature last summer. But Celwyn’s colleagues have said such a move is both politically infeasible and unwise in the face of continued uncertainty around the pandemic.

“That is not my decision as staff,” says Isley, when asked for her professional opinion on the use of those funds for coronavirus relief. “I do not have a position on that, nor is it my role to have that.”

Long-term plans for use of the product development funds are also on indefinite hold. Isley says she’s “taking in perspectives” regarding the Tourism Management Investment Plan, a roughly $440,000 project to establish new guidelines for community spending originally scheduled for completion in April 2020. She would not provide more details or a revised timeline.

Meanwhile, anti-tourism sentiment continues to circulate among residents who feel exploited by the industry or harmed by its impacts. Roughly 60 people gathered downtown on Feb. 8 to protest new hotel construction, with “Abolish the TDA” among their rallying cries. And a recent satirical video attacking the organization for encouraging visitors during the pandemic was removed from social media over copyright violation claims at the authority’s request.

Isley says her approach to those dissatisfied with the TDA starts with listening. “I think listening is one of the most powerful tools we have as humans. And you can’t find common ground if you don’t listen,” she explains. “There are reasons that people have the feelings that they do, and to be open to hearing that is the start of the process.”