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    Home » Opinion: Selling Sedona – One Year Later
    Editorials/Opinion

    Opinion: Selling Sedona – One Year Later

    April 25, 201613 Comments
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    logo_sellingsedonaBy [Concerned Sedona Resident]
    (April 25, 2016)

    Last week we examined the day-tripper tourist flood that is diminishing the quality of life and experience for both residents and tourists alike.  This third part looks ahead to explore consequences of having more tourists than city infrastructure and the local environment can sustain, more than Sedona residents will tolerate and examines the question of whether Sedona’s tourism economy has become an unsustainable bubble.

    Part 3

    We begin with one of the questions we left you with last week:  What return are we actually getting for our tax-funded advertising and how many tourists really needed to subsidize our city operations?

    Kegn Moorcroft, Chamber of Commerce public relations manager, in an article in the Red Rock News last February, reported on a Chamber-funded “analysis” by Yavapai College Regional Economic Development Center of the city’s $1 million expenditure in 2015 for tourism marketing.  In quoting the Center’s report, Moorcroft states that every $1 spent by the city for tourism advertising resulted in $39.65 in direct tourist spending.  Like the false $1.9 million increase in sales and bed tax for a city expenditure of $.5 million discussed in Part 1, this figure sounds impressive also.  Impressive, that is, until one looks just below the surface.  Then everything changes. 

    The basic problem with the Center’s report is the age-old adage of “garbage in equals garbage out.”  The “garbage in” part begins with the Chamber’s long history of exaggerated numbers and inflated data.  For example, the Chamber claims tourism generates over $400 million in annual expenditures in Sedona.  City data shows that number is well under $300 million – actually closer to $270 million last year.  That’s still a lot of money, but the Chamber figures are nearly 50% overstatement of the truth.  The Chamber also likes to tell us that tourism accounts for 65% of the city’s general fund budget.  City data shows it just over 50% of general fund budget and barely over 20% of the city’s total budget for 2015.  Use of these and other inflated numbers along with the Center’s failure to account for things like the outside economic factors noted in Part 1, rising room rates and spending by local residents results in the “garbage out” report.  And remember, the Chamber paid the Center to produce the report, not an independent third party.  And so the garbage numbers go in and come out. 

    But, let us just suppose for a moment that $1 million in public tax money spent on tourist advertising actually did stimulate people to come to Sedona and spend almost $40 million.  What would that mean to Sedona residents?  With a 3% sales tax, it takes over $30 million in tourist expenditures to just replace that $1 million of public tax money spent on advertising.  The other $10 million in tourist spending would produce about $300,000 in additional tax revenue.  So residents would give up one million dollars that could have been used on city benefits and tolerate the tourist-caused problems outlined in Parts 1 and 2 just to gain an amount equal to about half of 1% of the city’s overall budget.  It’s not surprising that more and more residents are asking if the extra tourist-caused congestion, traffic, crowded facilities and environmental degradation is really worth it. 

    City data shows that last year, about $457 million total was spent in Sedona for goods and services in all seven tax-classification categories.  Remember, only $270 million of that was spent by tourists.  If the 1:40 ratio of advertising to tourist spending were actually true, it would mean that other advertisers would have to be spending over $5.5 million in selling Sedona, in addition to the city.  At a 1:40 ratio, Sedona’s tourism industry would be falling all over itself to put every possible dollar into advertising, which, of course, they are not.  Why?  Because they also know those numbers are highly inflated and they, like the city, will never get their money back.  It’s no surprise the aggressive support of city-funded tourism promotion by the tourist industry continues.

    There is no doubt Sedona’s tourism industry does gain something from the city-paid advertising.  How could it not?  It’s no cost to them.  It’s free and pure profit for them at any level of return.  Sedona residents are the ones that come up short.  Residents give up city services and programs to increase profits for a small percentage of local businesses.  Chamber CEO Jennifer Wesselhoff was recently overheard at an event defending criticism of the Chamber for creating the traffic mess with the comment that there would be the same amount of traffic whether the Chamber advertised or not!  How interesting – and revealing!

    Ultimately it is a clash of values between those who see Sedona primarily as a place to exploit for personal gain and those who cherish it for its special qualities.  The Chamber has lost touch with the value system of most residents when it comes to what matters in Sedona.  Their push for more and more tourists and the trumpeting of larger and larger numbers as their yardstick of success clearly reveals that disconnect.   A rising tourism count may once have been a celebrated number.  That’s no longer the case.

    In a letter to the editor of the Red Rock News last fall, local resident Rune Carlson noted that for those who see tourists as dollar signs, there will never be enough.  Carlson observed that if the Chamber could double the current number of tourists, it would still not be enough.  They would be seeking ways to double that again and then again.   In the words of famous naturalist John Muir, speaking about the commercialization of national parks, “Nothing dollarable is safe.” 

    And so to the questions:  “Is Sedona’s tourism a bubble economy?

    First, what constitutes a bubble and how do we know when we’re seeing one?  The single best descriptive word is “unsustainable.”   Most everyone seems to accept that the housing market of early 2008 was a bubble that burst later that year.  Many did not see it coming until it was too late, despite sophisticated analytical technology.   So what are the signs that Sedona tourism is a bubble?   Who will recognize it and who will deny it before the tourism rocket begins to free fall?

    Sedona Gift Shop

    First, who believes that the current level of tourist traffic and traffic-generated problems in Sedona are sustainable and acceptable?  Stories continue to grow of tourists who purchase a Red Rock Pass, only to return a few hours later wanting their money back because they could not find a place to park at any of the trailheads they visited.  These people won’t come back.  Long waits in stalled traffic just to get into town have become commonplace.  Solutions escape us and have for a decade.   Those who sit and wait have limited patience and abundant options for future destinations.

    If real solutions to handling more and more traffic existed, they would have been applied long ago.  Will people continue to come to Sedona or return under these conditions?  This is really a tourist problem, not a traffic problem.  Tourists shy away from problem areas.  There are plenty of other places to go.  Expecting people to put up with the whole tourist/traffic situation in Sedona is not a sustainable approach. 

    As detailed in Part 1 of this series, tourism revenue actually fell last year despite a big push in tourism marketing.  Masked by temporary outside influences, the base of tourist tax dollars (those who come to stay a few days) is already appears to have reached the peak and the bottom beginning to drop out of that formerly sustaining base.  Only the masses of day-trippers continue to bolster tax totals.  This drive-by economy is also unsustainable.  It too will succumb as the difficulties of just driving through to see the red rocks will become just too much aggravation.

    Bubbles always collapse.  Sometimes they burst suddenly.  Sometimes they deflate slowly over time.  But they always collapse.  That’s the critical message. 

    So how does the Sedona bubble end?  It’s essential to understand it will ultimately collapse back to some lower sustainable level.  Our bubble does not end because we somehow made the current high level of tourist use sustainable.  The problems we face cannot be “solved” at the current tourist use levels. 

    There will be no giant parking lots at each end of town with flocks of shuttle busses hauling tourists around.  There will be no forcing of highways through neighborhoods as the Red Rock News proposes.  There will be no paving of Schnebly Hill Road as some have proposed without understanding the legal, financial and practical infeasibility of such.  There will not be giant over/under passes in uptown, no an “alternate” route for locals only or major enlargement of parking spaces at major trailheads.  All the “whys” these naively-proposed solutions cannot and will not happen are subjects for future articles.  For now, we must understand they will not happen.

    We must finally grasp the reality that solutions to Sedona’s tourist problems lie in first facing the fact that Sedona’s infrastructure and environment simply cannot sustain the current level, let alone higher ones.  It’s like an addict finally acknowledging that they are addicted.  Sedona needs it’s own 12 step program for tourism addiction.  Until we do this, nothing will change.  We must stop spending a million dollars of tax money annually to advertise for people to come here and destroy much of what brought them, and many of us, here to begin with.  More parking areas and more roads and more busses and wider trails will not happen nor would they solve the problems if they did.  They would only lead to more damage and destruction and further lower the level at which tourism can be sustained.  

    We must turn that annual million dollars of advertising into a million dollars of annual repair of trails and trailheads and existing roads and management of tourism at a sustainable level, not into attracting more.  Sedona has been discovered and tourists will come, as Chamber CEO Wesselhoff said, …”whether we advertise or not.” 

    Yes, Sedona is a tourist town but it is becoming less so in terms of our reliance on them to finance the city.  It is also becoming less so in terms of it’s attractiveness to visitors.  Sedona’s tourism bubble is showing signs of deflating.  It’s time to focus on how to achieve a soft landing at a sustainable level, rather than a crash. 

    (Over) Selling Sedona: Decision Points
    How Do They Measure Up? Part 1 • Part 2
    The Fallacy of Transit
    Simple Solutions

    Selling Sedona – One Year Later: Part 1 • Part 2 • Part 3

    Selling Sedona, 2015: Part 1 • Part 2 • Part 3 • Part 4 • Part 5 • Epilogue

    13 Comments

    1. Alarmed on April 25, 2016 10:03 am

      Here’s a doozy from Steve Segner on a competitor’s website (April 24, 2016):

      “Remember all the cost of the marketing comes from the bed tax, before the bed tax the city did pay out of general funds, now the city is saving thousands. Hope this helps.”

      WTF? As before, bed taxes go into the City’s general fund and get paid out of the City’s general fund. So much for Steve “trust me, trust us” Segner and his “saving thousands” ridiculous propaganda.

      • steve segner on April 25, 2016 3:29 pm

        Yes, the City is now saving money. Before the .05% bed tax increase the City of Sedona helped pay for the operation of the Uptown Visitor Center. That money came from the general fund and had to be found in the budget every year. Now the bed tax amount from visitors is collected and dispersed in full by the City specifically for the Uptown Visitor Center, and to fund marketing programs. This new tax is on VISITORS, NOT residents.

        John Martinez and I came up with a plan to raise the bed tax. We both want it to go up 1% but the City Council settled on the current .05% increase. The tax made it possible to help fund the Uptown Visitor Center, and to fund a marketing program for the slower months, which in turn helps support business in Sedona and the 8,000 employees in tourism. Sedona’s visitor growth is higher than another city in the state and most of the US.

        I know there are those of you that just do not want any visitors and no visitor marketing, It is easy to say just stop the day-trippers, well how do you do that when Sedona sits astride two state highways that lead to the Grand Canyon and converge into one lane at the Y. It is wasted time and energy to talk about the past. Two hundred thousand people move to Arizona every year, and that alone will drive day-trippers to Sedona. We need to stop complaining and start planning! We need a visitor and parking plan. We need to look at encouraging walking. We need to think about a shuttle service around town, to the trail heads, and up Oak Creek.

        Sedona is a tourists town and always will be. Sedona will continue to grow. Now we need to work on building an infrastructure that allows for tourism, traffic, and satisfies residents. Let’s plan for the future.

    2. Paul Boyce, Ph.D. on April 25, 2016 10:59 am

      Great analysis, thanks.

    3. Tyler Barrett on April 25, 2016 12:24 pm

      It’s the helicopters that are killing Sedona for me. The time-share funded “free rides” are buzzing my home every 15 minutes on weekends. I moved here for the peace and quiet of the high desert. I am ending up with Viet Nam war noises.

      Stop the helicopters!!

    4. Mike Schroeder on April 25, 2016 12:52 pm

      Chamber CEO Jennifer Wesselhoff was recently overheard at an event defending criticism of the Chamber for creating the traffic mess with the comment that there would be the same amount of traffic whether the Chamber advertised or not! How interesting – and revealing!

      Quote from above – Let’s stop giving the Chamber $1.3 million since Ms. Wesselhoff said it does not matter… kill the majority of the bed tax and let the local hotel association do their own collective marketing. Maybe they should put it out for bid? Maybe they just market to their existing databases? Maybe spending $250,000 for a traffic “study” by the city council for a town that has only TWO ROADS would not be needed.

    5. steve segner on April 25, 2016 3:35 pm

      Yes, the City is now saving money. Before the .05% bed tax increase the City of Sedona helped pay for the operation of the Uptown Visitor Center. That money came from the general fund and had to be found in the budget every year. Now the bed tax amount from visitors is collected and dispersed by the City specifically for the Uptown Visitor Center, and to fund marketing programs. This new tax is on VISITORS, NOT residents.

      John Martinez and I came up with a plan to raise the bed tax. We both want it to go up 1% but the City Council settled on the current .05% increase. The tax made it possible to help fund the Uptown Visitor Center, and to fund a marketing program for the slower months, which in turn helps support business in Sedona and the 8,000 employees in tourism. Sedona’s visitor growth is higher than another city in the state and most of the US.

      I know there are those of you that just do not want any visitors and no visitor marketing, It is easy to say just stop the day-trippers, well how do you do that when Sedona sits astride two state highways that lead to the Grand Canyon and converge into one lane at the Y. It is wasted time and energy to talk about the past. Two hundred thousand people move to Arizona every year, and that alone will drive day-trippers to Sedona. We need to stop complaining and start planning! We need a visitor and parking plan. We need to look at encouraging walking. We need to think about a shuttle service around town, to the trail heads, and up Oak Creek.

      Sedona is a tourists town and always will be. Sedona will continue to grow. Now we need to work on building an infrastructure that allows for tourism, traffic, and satisfies residents. Let’s plan for the future.

    6. Paul Boyce, Ph.D. on April 25, 2016 4:20 pm

      There are 2 types of people in Sedona: those who want to live here in the beauty and who do not appreciate the huge increase in traffic. Then there are people like Steve Segner, who for him, there is no limit to the number of tourist he prefers! Let’s bring them on, millions of them. Obviously, he makes a lot of money off tourists…follow the money.

    7. Concerned Sedona Resident on April 25, 2016 6:20 pm

      Mr. Segner, for lack of knowledge or intentionally, still doesn’t get it.

      The City of Sedona’s General Fund is the source of ALL the money handed over to the Chamber of Commerce. In 2014, the bed tax was raised by half of one percent. (That’s .5%, not the 0.5% Mr. Segner shows in his comment.) That new .5% bed tax portion MUST be spent on tourism promotion. That is ALL the City is obligated to spend on tourism promotion, however.

      Before this bed tax increase, the City took about $300,000 from it’s general fund to support the Chamber’s Uptown Visitor’ Center and gave another $300,000 to the Chamber for “destination marketing.” This year, the City is handing over almost $1.5 million to the Chamber. Only $379,000 of that comes from the bed tax increase that must be spent on “tourism promotion.” The other $1.1 million comes from the City General Fund. The city is now giving about $.5 million MORE to the Chamber, even deducting the bed tax increase, than it ever did before. That’s NOT a savings in anyone’s book except, apparently, Mr. Segner’s.

      The City has paid the major support for the Chamber’s Uptown Visitor Center since this all began about 1996. The money ALWAYS came from the City’s General Fund and it still does. The marketing program Mr. Segner references runs all year around, not just the “slower months.” It is “needed” in the slower months only to maintain Mr. Segner’s and a few other’s profit margins, not by the City or it’s residents.

      The “8,000 employees in tourism” Mr. Segner has mentioned twice in this series is actually closer to 4,000 in Sedona (More Chamber exaggeration.) and most of them come from Cottonwood and other points outside Sedona. We are putting up with the tourist overrun mostly for people outside the City, not for our own residents!

      According to Mr. Segner, “Two hundred thousand people move to Arizona every year, and that alone will drive day-trippers to Sedona,” which reinforces the comment by Chamber CEO Wesselhoff that Sedona doesn’t need to advertise! So why do these two Chamber leaders continue to say it’s not needed in one breath and insist it must with the next? Mr. Segner was the principal Chamber spokesperson pushing for the bed tax increase and more city spending for tourist advertising. Remember, he runs a hotel!

      Yes, Mr. Segner, “Sedona will continue to grow,” but at a slow rate toward a build-out situation. It does not need to grow more tourists, however. We cannot sustain what we have, regardless of how much planning you do!

    8. Paul Boyce on April 26, 2016 7:14 am

      It is pretty obvious that the pro-tourism pro-traffic people are willing to say and write anything that advances their financial interests. Regardless of what the facts are, they will defend the chamber of commerce tooth and nail. I don’t quite understand why the city council continues to accept these unsubstantiated claims masquerading as facts. There must be a backstory to this farce…

    9. Jean on April 28, 2016 12:12 pm

      Do tell. The City’s Manager’s Proposed Budget for next fiscal year has been on the City Council Agenda these last two days. Page 183 lists the unseemly amount under consideration for the Chamber of Commerce.

      Visitor Center – $320,000
      Destination Marketing – $1,364,919
      Product Development – $50,000

      TOTAL – $1,734,919

      During last Tuesday’s Regular City Council Meeting, Council member Jon Thompson mentioned that in about three years the City will need new sources of money. Surprise, surprise.

    10. Ron Maassen on April 28, 2016 4:16 pm

      I could not agree more with the observations of CSR. I have been out of town for a few weeks and missed multiple opportunities to comment on these issues. A couple of points that have not been discussed in any depth.

      1. The photo of Dry Creek Road with the failed pavement edge is due to lack of a preventive maintenance program for our City streets. Similar conditions can be found through out the City. Classic examples exist on Rodeo and I’m sure in your neighborhood. Edge raveling and subsequent failure is easily prevented with a routine shoulder maintenance program. Money here is an investment versus destination marketing reducing the marketing budgets for our tourist businesses. If destination marketing is such a good deal the business community should self fund the effort.

      2. I remember well when the Chamber plea for more destination marketing money was made to Council. When queried by John Martinez, I believe, regarding how the Chamber would know the program was effective. Jennifer said as best I recall—that success would be demonstrated when you could not get into your favorite restaurant and the trail heads would be full.

      3. Has anyone compared chamber staffing now to that existing previous to destination marketing? I see CoC is advertising for another position in the RRN. Is this new or replacement?

      4. How many and which chamber employees were on the China trip? Did they pay their own freight or was it funded via the chamber fundraiser? If a fund raiser, what were the net proceeds or is this perhaps a perq of chamber employment?

      CSR–keep up the good work.

      Ron

    11. Fred Abinet on April 29, 2016 8:46 pm

      back you up 100 % Sedona 30 orders city board to jump, city says how high !!!!!!!!!! Paving material is junk and and recycled junk ! Needs replacing in less than 2 yrs. We need a meeting !!!!!!!!!!!!!!!!!!!! Fred

    12. steve Segner on May 2, 2016 1:07 pm

      Ron Maassen says:
      1.How many and which chamber employees were on the China trip? Did they pay their own freight or was it funded via the chamber fund raiser? If a fund raiser, what were the net proceeds or is this perhaps a perq of chamber employment?
      Answer

      I don’t understand the reason for your asking? Ron,are you a chamber member?
      Yes ,the chamber made money putting this trip together for it’s members and friends that is what chambers do.
      Ron, remember the chamber is owned by it’s members and has it’s own board.

      Ron Maassen says:
      Jennifer said as best I recall—that success would be demonstrated when you could not get into your favorite restaurant and the trail heads would be full.

      Ron, the chamber only advertises in the slow off season months, June July and August. and January.
      and yes and when
      “you cannot get into your favorite restaurant and the trail heads this full,(Summer)
      we will look at changing the program.

      As you know many people leave Sedona in the summer and it make it hard for shops and restaurants to keep good people on staff, the chambers marketing is to help local merchants and hotels get through the summer.
      Sedona is probably the only chamber in America that does not market for holidays and spring break.

      steve segner


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