By John David Balla
(July 19, 2013)
Like so many, I find myself as a reluctant political activist whose eyes have been opened from the shenanigans that the City is playing with our lives and livelihood. The pivotal point for me was a business opportunity with the Chamber of Commerce, an opportunity to give back to my community and make a decent income doing so. But what started out being a typical bidding process ballooned into political maelstrom of subterfuge and deceit which ultimately finds me writing this OpEd.
My dilemma is that I would love to apply my 20+ years of IT, business consulting, and online marketing experience to help out the Chamber. But here’s the kicker… if I did, due to current budgetary constraints, it would leave me bankrupt.
Rather than throwing in the towel, I decided that with so many years invested in this city, it was time to become a good citizen and share my thoughts, concerns, and potential remedies to a City that is currently on a self-destructive path.
I’ll start with some basic economic principles and expand from there, for there is a lot to disentangle, and many dots to connect.
Whether you’re a business, government official, homeowner, artist, or simply a resident of Sedona, the impact of City government, it’s values, priorities, and effectiveness comes down to a fundamental socio-economic temperament.
That is…
Wealth Creation versus Wealth Extraction
In other words, do the actions of the City provide greater opportunity for success or less? I’m purposely refraining from political or economic ideology here for one simple reason. Ideology rarely, if ever, solves problems. In fact, it tends to make things worse. Philosophy, on the other hand, strives to uncover the truth, and that’s what I’m attempting to do here; figure out what’s really going on with the Sedona economy and why it’s happening.
That’s why I feel it of paramount importance to look at behavior, attitudes, actions and results, irrespective of any particular political view. After all, it’s not what we say, but what we do that reveals the truth of such matters.
So let me start with the Chamber, the hub of Sedona’s marketing, advertising, and promotional engine.
Chamber of Commerce seen as an Expense rather than an Investment…
The Chamber has great ambitions to get its entire web presence up to today’s standards. Traffic is down considerably and commensurate with Sedona revenues. I’ve heard or read that currently we’re a whopping 25 percent below revenues from last year (YTD), which itself is odd because the economy is improving, albeit slowly. So this major drop is alarming, and Chamber members, the Chamber itself, and the City collectively should realize that something — probably many policy decisions — are the direct cause of this.
Okay. So I get this RFP from Chamber, read through it, and aside from lacking certain details and best practices (which could be remedied via a couple of meetings), the aspirations are not only “spot on” but also, if they were to be implemented quickly and effectively, would definitely increase visitors/tourists by significant numbers. Translation: More revenues without needing to raise taxes. (Now, we know that this is just part of the problem but let me articulate why this is important and how it plays — on several levels — to the tax revolt issue.
Chamber Budget Slashed by 50 Percent
The budget the Chamber received from the City is woefully inadequate to bolster visitors vis-a-vis revenues for all parties concerned, which is pretty much everyone who lives in Sedona, either directly or indirectly. Note that the Chamber got about $500K in 2011 from the City. But for this coming fiscal year, it’s projected to be about half that. One can only guess what the rationale is here, but who in their right mind would want to jump on a commercial engine that is guaranteed to sputter down the Internet highway while they watch luxury buses from Utah, San Diego, and Tucson zoom by them, full of people having a good time? Such is the case when “half measures” lamely seek to compete for the coveted tourist dollar.
The remedy: Get serious or just don’t bother. Or as a popular 12-step motto proclaims, “Half measures avail as nothing.”
Jennifer Wesselhoff, the Chamber President and CEO, is keenly aware of this, and in no small way is lobbying the City to give the Chamber the funds it needs to have a fighting chance to win over tourists from other markets. At first blush, one would think that this means raising sales taxes or some other hidden tax to find the money. But the fact is…
The money is already there!
Yep. The City budget contains a $300K Contingency Fund, and, “It is important to point out that the Operating Contingency is not being funded with cash reserves…” (Verbatim quote directly from the budget itself). What this means is that there is more than enough money set aside to fund the Chamber appropriately without needing to raise any kind of taxes. In fact, the Chamber exists to generate revenues for Sedona. With a healthy budgetary diet, it will do just that. But right now, it’s on a food stamp diet, making it look bloated while in actuality it’s starving.
After talking to a few irate merchants in town over the past few days, I had a simple question: “Where is all the money going?” I mean I can see the shiny fire engines and brand new police cars, but come on, the money’s gotta be going elsewhere and in a very big way. So I decided to peruse the last few budgets, and man was it an enlightening exercise.
Here are some of the more noteworthy points:
- Not raising taxes by “raising taxes.” The proposed budget for FY 13/14 make no claim of raising sales taxes, but it does raise taxes. Here’s the verbatim quote: “The Recommended Budget does not include any new tax or fee increases other than implementation of the fourth year of the Five-Year Wastewater Plan, approved by City Council in April 2010. A ten percent increase in monthly wastewater fees will go into effect July 1, 2013.”
- The tax collector cometh, armed with new “licenses” (code for new taxes).The City intends to increase revenues by … “A new business license/revenue collection position is recommended at a cost of $50,594 to more efficiently administer the business license program and to assist in delinquent account collections. Off-setting revenue resulting from increased business license revenue and delinquent collections should pay for the cost of this position.” Many merchants are already referring to this as Gestapo tactics, but I won’t. I prefer “shakedown.”
- The money is literally going down the drain. What’s clobbering the Sedona economy is its vast wastewater and sewerage initiatives, which is gobbling up 79 percent of all its expenditures/debt, not to mention the budget in general. Check out this graph which comes directly from the budget…
Follow the money…
Believe me. I know that we have a serious issue with drainage, sewerage, floods, monsoons, and such, but we just don’t have the money to implement it so quickly without having detrimental consequences on the entire Sedona economy, not to mention that significant portions of these initiatives are being used for non-essential pet projects. You’ll have to read over the budgets to see all the marginal stuff that’s being folded into these budgets and some of the accounting “shell games” used to hide them. I encourage everyone to read these lengthy documents because it shows where the money is really going.
Putting it into perspective…
But consider this. The United States spends about 20 percent of its federal budget on the Department of Defense. Now imagine if we applied that to the Sedona budget, but instead of 20 percent it was 79 percent. We wouldn’t even be able to get out of our homes because M1 tanks would be piled up beyond tree level leaving not a blade of grass or red dirt to place a foot on.
Reality Check: There’s always two ways to find money:
- Increase revenues, or
- Reduce expenses.
The knee-jerk City reaction seems to cry “poor” and say the only way we can do this or that is to raise taxes. As Sister Simone Campbell of “Nuns on the Buss” fame aptly put it, “Budgets are moral documents.” They represent our values and priorities. Having perused the budgets for the past two years fairly carefully, I think you may find — if you read between the lines and digest them in their totality — that the wastewater initiative, as it is being implemented, is a strategic maneuver to drive away both businesses and residences to effectuate another “real estate collapse.” But why? That seems crazy, doesn’t it?
Enter the Vampire Capitalists…
Once done, Vampire Capitalists will buy up all the cheap property and make a killing. Welcome to 21st century capitalism, where you can make a bundle by intentionally destroying communities, wages, and the American Dream. In other words, Sedona’s budgetary policy is clearly designed to extract wealth, not create it. This is great news for the Vampires, but for the rest of us, our lifeblood is being sucked out of us, our aspirations, our dignity, and our pursuit of happiness. After all, that’s what vampires do. And again, I could care less what the politics are, or what they say. Actions indeed speak louder than words.
Need Proof of businesses that were forced to close their doors because of new City taxes and other anti-business tactics, just over the past few months?
Bodacious Burger… Gone
Studio Live on Coffee Pot… Gone
Taco Bell/KFC… Gone
…and I’m sure there are many others that you are aware of.
I thought living in Sedona made me rather immune from all of this. Man was I wrong.
The “I/self interest as a virtue” ideology of Ayn Rand, and the “We/Communist Utopia” of Marx have never worked in practice. So can we agree on just one fundamental truth? That ME and WE “must” get along, maybe even dance? Who knows? Maybe even get married some day. Can we all agree that the closer the bond between self interest and public interest, the better off everyone is? Surely there is a time to compete, and a time to cooperate.
Ultimately, the fallout of all of this turmoil and anger will be determined by our collective ability to listen, to be honest, and possess the courage to admit it when are wrong. If we can do that, Sedona will thrive once again. If not, we’ll become another Detroit.
About the author
John David Balla is a business consultant, Internet marketer, author, songwriter, music producer, eBook analyst and designer, and entrepreneur. Prior to moving to Sedona in 2003, John consulted some of the world’s largest corporations and government entities, including Microsoft, IBM, XEROX PARC, John Hancock, Chase, the United States Postal Office, the Georgia State Assembly, and several local county governments in northern Illinois. He has a BA in Psychology and Sociology with a minor in Economics. He can be reached by emailing him at jballa@msn.com.
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31 Comments
Couple of quick thoughts on this…shiny fire engines have nothing to do with the City of Sedona budget. They are provided by the Sedona Fire District. The businesses you referenced that closed up have little to do with the factors you mentioned. Studio Live was a gallant attempt at an entertainment venue, but it was underfunded and unable to meet its obligations. Should the City have dropped its requirements because the owner wasn’t able to afford to meet them?
All of the KFC/Taco Bells in the area closed at the decision of the franchisee. Perhaps the poor location with difficult access/egress may have been a factor.
I never ate at the burger place, but know many who did and who said that it was okay, but nothing special. Was that the fault of the City?
You may have some valid points to make, but since I found these to be without merit, I have some doubts about the rest.
Alarmed:
You need to do your homework better before posting uninformed comments. There have been numerous published articles and interviews of the business owners mentioned and it was City tax policies that caused all of them to close up shop except the KFC/Taco Bell. BTW, why don’t you identify yourself?
Rick,
First of all, I do Identify myself. Perhaps you were simply scanning this document quickly and didn’t notice that there’s an author byline and an “about the author” conclusion at the end of my piece.
Furthermore, you clearly didn’t read the article in its entirety. That you agree with me but somehow are angry at me is peculiar.
At the risk of sounding pedantic, my reference to “shiny fire engines” was part of a discussion I had with a disgruntled business owner. It was said in the context of informing the reader what lead me to write this OpEd. I wanted to give a bit of background, but made no claim that the Fire District is part of the city budget. It was merely the beginning of my question: “Where is all the money going?” which took me down the path of actually reading and analyzing the city’s last two budgets.
As for the Studio Live saga, it is so protracted that an entire book could be written on it. But to say that it closed because it couldn’t meet its obligations is at best, misleading and biased, and at worst, absolutely untrue.
KFC/TACO BELL.
You are correct that it “closed at the decision of the franchisee” in as much as filing for BANKRUPTCY is a decision.
BODACIOUS BURGER and all the rest that have closed or on the verge of closing…
This is to be expected, and yes, on a macroeconomic level, the city is totally culpable. Why? Pretty simple. Tourism is down while fees/taxes are up. This double squeeze is the result of budgetary policy, namely to cut WEALTH CREATION, i.e., reduce advertising, marketing, and promotional investments that get people to visit Sedona and spend their money, while at the same time, increase WEALTH EXTRACTION through fees, fees, and more fees. In other words, less customers coupled with higher expenses is the proverbial “perfect storm” for disaster.
Now of course, the city bears no blame for any particular business in terms of their quality of product or service. That’s not the job of government. And anyone in their right mind knows and understands that.
The merchants of Sedona just want a fighting chance. They’re merely asking the City to stop putting them behind the eight ball.
response to Alarmed
The following information is offered for clarification:
C3 property has all the combined usage rights of C1 and C2 properties, as well as a host of other additional usage rights.
It’s my understanding that there are C2 properties in Sedona operating Outdoor Performance stages, which were not required by the City to submit to any Conditional Use Permit Process. This means the City of Sedona recognizes and affirms the C2 property right of usage to operate an Outdoor Performance Stage, and under Equal Protection under the Law, must also recognize this legal right of usage for all C2 property, and certainly without question all C3 property.
It’s my opinion that Sedona Studio Live was deprived of fair and legal use to operate it’s Outdoor Stage under that property’s legal C3 usage rights by the City of Sedona. The City of Sedona blocked Studio Live’s usage of it’s Outdoor Performance Stage, and instead required that organization to apply for a Conditional Use Permit. As stated prior, C3 property contains all usage rights of C1 and C2 usage, plus additional usage rights.
About Studio Live’s Conditional Use Permit:
To my eye, the conditions and requirements demanded by the City in order to grant Studio Live a Conditional Use Permit to use their outdoor stage were unreasonable, burdensome and would be fiscally untenable to most any business wishing to remain solvent. I truly believe if those requirements were published here in their entirety, the public would likely view them as outrageous, malicious, and ridiculous, and it would be akin to pouring gas on the already raging and growing fire of negative public opinion regarding City Hall’s war against the Arts, especially the Performing Arts.
Sewer Capacity Fees:
It is my understanding that Studio Live paid Sewer Capacity Fees for 100 person capacity in 2009. The City now claims Studio Live only has sewer capacity for 70. Where did one third of their Sewer Capacity go?
Even though Studio Live had paid for 100 person Sewer Capacity, and there would never be a performance the same day on the outdoor stage as on the indoor stage, the City demanded that Studio live must pay additional Sewer Capacity Fees to use their outdoor stage.
Deprived of their Right of Economic Liberty:
I believe the facts clearly indicate that City Hall deprived Sedona Studio Live of their Rights of Economic Liberty by blocking their rightful usage of the C3 property, and in that process, destroyed Sedona’s only PRIVATELY FUNDED non-profit Performing Arts Venue and Learning Centers
FYI: Studio Live had already addressed Neighbor Concerns regarding Sound and would have been a great neighbor and a huge Benefit to the Citizens of Sedona and the City.
Regarding Bodacious Burger:
My understanding is that this business was closed after City Sewer Fee Officials went in and expected the Proprietor to cough up ADDITIONAL Sewer Capacity Fees based upon the Proprietors empty tables. This location was formerly a Denny’s… a National Chain Restaurant. Denny’s clearly did more business than this relatively unknown Bodacious Burger did. Heck… people often stop in Denny’s to use the bathrooms even if they are not staying to eat. Does City Hall expect anyone to believe that Bodacious Burger owed greater additional Sewer Capacity Fees than were already paid for by a Major National Chain like the former Denny’s?
I think John Balla has it right and that City sponsored wealth extraction is definitely alive and policy in Sedona.
Jim DeGeorge
John,
This is a great piece that you’ve authored here and I am sure there are many Sedonans who will recognize the wisdom in your words. If I may, I would like to add these comments to be read in light of your forewarning:
The U.S., Arizona and Chinese economies are already evidencing every sign of slowing down. Worse yet, the bond market has already begun to implode. Mortgage rates are beginning to push up at an accelerating rate which is devastating to the overall real estate market but won’t show any effects until next spring, or so. Rising sales tax rates will also put extreme restraints on the second home sector of the real estate market here. And, rising city tax rates and fee structures will have the unintended consequence of driving away retail buyers of our small non-tourist businesses so that those projected revenues forecasted by Staff will not materialize to any significant extent. Finally, contrary to what the Council majority believes, there really are people in town who understand the dynamics of destination traveler marketing as well as or better than Jennifer Wesselhoff. Unless she knows someway to market around 1] rising gasoline prices, 2] rapidly declining real wages and associated purchasing power, 3] declining consumer non-collateralized credit availability, 4] declining home equity credit access, 5] declining consumer sentiment, and 6] rising credit card interest rates, as well as 7] Sedona’s complete lack of night life for destination travelers, 8] her own complete oversight and misunderstanding of the superior attributes of YouTube marketing over-and-above Facebook marketing, 9] a looming banking system partial failure, and 10] a general disgust of foreigners with the U.S., I don’t see any way in hell that destination traveler tourism (as opposed to our current day-tripper bias) is going to improve any time in the near future. All-in-all, if Sedona doesn’t find some non-tax revenue channels very quickly, I honestly believe we are headed towards becoming a ghost town. Little old Jerome, Flagstaff and Cottonwood, for God’s sake, are kicking our municipal rear in the competitive tourism market.
The only other option that can predate City insolvency is NON-TAX REVENUE generation! So, I hope the Mayor or Vice Mayor will consider agendizing and ultimately making a motion and calling for a vote as follows; To form a “single purpose one-time Blue Ribbon Task Force to Investigate, Analyze and Recommend Non-Tax Revenue Concepts and Sources Available to the City of Sedona”? This Task Force must include outsiders, such as you John, with experience in these concepts, as well as successful local business people who have NOT been involved in promoting tax increases and Chamber funding mechanisms.
If no one on Council will propose and get support for an all out effort to find new revenue sources at the June 30 & 31 meetings, I think Council is going to be confronted with a very large and furious blowback. Whoever on Council (agendizing this concept, making the motion and asking for an affirmative vote) will appear a forward thinking visionary while making those who vote for added taxes appear to have betrayed all those who voted for them in the first place.
Like I said in my initial OpEd, budgets are moral documents. Jennifer and the Chamber of Commerce, if budgeted appropriately, can implement such funds effectively. Of course, money alone doesn’t solve the problem. It requires wisdom and fortitude, conviction and ability.
I remain steadfast that the Sedona economy can grow without new taxes. The devil is in the details which I believe you are insinuating.
Wealth extraction versus Wealth creation. I”m sticking to it.
As for your 10 points, Rick, spot on for sure, but it’s important to keep in mind that Sedona targets households with incomes of 100K and above, and that demographic is doing just fine.
Mr Normand,
Your comments are well stated and in my opinion ‘spot on’! Your list correctly details the reasons why tourism is down.
The chamber is supported by businesses that pay to be a part of an organization that is supposed to help them grow their business. The Travel and Tourism Bureau is a separate entity that is also supported by local “travel” related businesses. In an effort to get people on board with their tax increase they say Sedona is competing with cities that are 5 times larger. The chamber continues to use outdated marketing and advertising methods and claim they need more money. Unfortunately the chamber is mismanaged by someone without the proper resume to do the best job for this city and it’s time that the good people in this city realize that.
response to Alarmed
The following facts are offered for clarification.
Concerning Studio Live:
Fact:
C3 property has all the combined usage rights of C1 and C2 properties, as well as a host of other additional usage rights.
Fact:
I understand that there are C2 properties in Sedona operating Outdoor Stages within their zoning rights, with NO Conditional Use Permits required. This means the City of Sedona in allowing this usage under C2 zoning rights affirms that this usage is correct under C2 property rights. Under equal protection under the law, this precedent must also be legally true for all C2 property, and not even a question under C3 Property rights.
Fact:
I believe Studio Live was deprived fair and legal use under that property’s rightful C3 usage rights by the City of Sedona. The City of Sedona would not permit Studio live to use their Outdoor Stage, and instead required that organization to submit to a Conditional Use Permit process. As stated above, C3 property has all the property rights usage contained in both C1 and C2 plus additional usage rights.
Fact:
To my eye, Studio Live’s Conditional Use Permit Conditions contained requirements that were unreasonable, burdensome, fiscally untenable, and if published here in their entirety would likely be publicly viewed as so outrageous, malicious and ridiculous, it would be like pouring gas on the already raging fire of highly negative public opinion regarding City Hall’s War against the Arts, especially the Performing Arts.
Fact:
My understanding is that Studio Live paid Sewer Capacity Fees for 100 people in 2009. City now claims they only have capacity for 70. Where did one third of their capacity go?
Even though Studio Live had paid for 100 person capacity, and there would never be a performance inside on the same day as a performance outside, and the bathroom was exactly the same, the City demanded that they pay additional Sewer Capacity Fees to use the Back Yard.
Conclusion:
I believe the facts clearly indicate that City Hall deprived Sedona Studio Live of it’s Economic Liberty to be fiscally viable, and in that process, destroyed Sedona’s only PRIVATELY FUNDED non-profit Performing Arts Venue and Learning Centers.
FYI: Studio Live had already addressed neighbors concerns regarding sound and would have been a Great Neighbor and a Huge Benefit to the Citizens of our City.
Bodacious Burger:
My understanding is that this business was closed after City officials went in and expected the owners to cough up ADDITIONAL Sewer Capacity Fees based upon the Owners EMPTY TABLES. This location was formerly a DENNY’s… a National Chain. Denny’s clearly did more business than this relatively unknown Bodacious Burger did. Does City Hall actually expect “anyone” to believe that Bodacious Burger owed greater additional Sewer Capacity Fees than were paid for by a major National Chain like the former Denny’s?
I think that John Balla has it right and that City Sponsored Wealth extraction is definitely in play in Sedona in a major way.
My humble suggestion to the Editor of this publication is to not allow anonymous commentary such as “Alarmed.” Anonymous commentary is too often prone to fabrication.
Jim DeGeorge
US Military Budget You Mentioned Is Out Of Discretionary Budget. It Is Not 20% Of National Budget.
I Don’t Get Your Chamber Numbers. $500K IS For Salaries Alone. Maybe If The Chamber Actually Shows The Results Of Their Activity, Like A Standard Cost Benefit Analysis, Like Every Other Business We Would Be A Little More Sympathetic.
Mike,
See Federal Budget Breakdown PIECHART at http://www.google.com/imgres?imgurl=http://cnnyourmoney.files.wordpress.com/2012/04/ybl_federal_budget_breakdown.png&imgrefurl=http://yourmoney.blogs.cnn.com/2012/04/20/&h=1080&w=1920&sz=634&tbnid=bLklCkOQoAWrJM:&tbnh=64&tbnw=114&zoom=1&usg=__mckVPdc-is79-vVcTeUGwjFk0e4=&docid=OQB4vmOIn8u8_M&sa=X&ei=zWrpUYNQhfqLAtP0gbAE&ved=0CFMQ9QEwAQ&dur=4
I’d insert the piechart here except that this discussion thread does not have the capability to insert pictures. Anyway, it’s 20 percent. Even if were some other percentage, I just don’t understand your point.
As for the Chamber, the numbers I referred to are coming from the City budgets published on the city’s website. They are line items in the City budget. I could find no line item that says “Chamber of Commerce Salaries,” only “Sedona Chamber of Commerce” so I have no idea how you can infer the money is for salaries. All I’m pointing out is that the City has cut the Chamber’s budget in half over the past few years. It’s just a fact and a significant one.
BTW. The Chamber does indeed publish an Annual Report that provides a great deal of matrices to assess it’s effectiveness and much more. Here’s the link for that… http://visitsedona.com/
I think what you are trying to argue is that the Chamber just isn’t effective. Okay. That’s a debate worth having. I really don’t know one way or another but I know there’s a lot of “perception” out there, like your commentary, that is based on hearsay and misinformation. But I’m glad you responded because now you can look at the Chamber’s annual report, critique it and hopefully report back so that others can weigh in.
What I do know is this…
The Chamber has the infrastructure to do what it is designed to do. As concerned citizens we should scrutinize their activities and the effectiveness of their activities, and yes — again — they do provide data to this end, so it’s fair to say that they are more transparent than they are being given credit for.
And let’s not just single out the Chamber. ALL organizations that receive money from the CITY deserve equal scrutiny. But first, we must first understand where the money is going, which was the entire point of my OpEd.
Now that we know the facts are out there, I hope all concerned citizens can find the emotional courage to abandon or at least suspend rhetorical declarations with data and analysis, for if we don’t, we literally don’t know what we are talking about.
One final request…
Could you please give this discussion thread your full name? That goes for everyone. I feel it is a most reasonable request.
Thanks again for responding. This has been, in large part, a productive and informative dialogue.
I guess what was the point that it was in your article in the first place. You are correct, to a degree on the military budget, is actually about 17%.
Regarding the Chamber – Chambers are important. But if you are not provided a matrix that shows ROI then you have no way of getting your money’s worth, or in the case the taxpayer’s money worth.
7 or 8 years ago when we were dealing with the SR179 road issue, the chamber was touting 4 million tourists a year. Completely bogus. After excruciating investigation, totally unsubstantiated, but ADOT had bought into it. Where are the results of their “destination” marketing? There are many ways that you can advertise and promote and find out why people are doing what. That’s pretty much marketing and advertising response 101.
I think it would behoove them to actually come up with some real numbers instead of avoiding the question every time they are asked. I think there are a lot of folks out there that are tired of them asking for more money that the city does not have.
The city had the opportunity to create a magical main street. Almost had it done. And the people were duped into turning down the opportunity. You can’t make that up by throwing money at the chamber unless they start to show what the direct results are from their efforts.
Nothing wrong with the Chamber – it needs to justify its actions when it uses public money.
During the SR89A debate I found it very interesting that there are a lot of Sedona’s citizens who do not want or like the tourists as they want their town as it was in the past. Expect a lot of resistance there especially if the city is lacking in basic services in any local neighborhoods.
Hi Mike,
Thanks for your reply. Unfortunately, there is little I can say to the points you raise because I was not privy to most of it. So I encourage those who are in a better position to respond to do so.
As for Sedona citizens not liking tourists, yeah, I’ve observed a lot of that, and on certain days, I am definitely one of them. LOL! I have also experienced what I call being “profiled as a local” at a couple or restaurants whereby my group was treated rudely — very rudely — because the manager/owner assumed we were deadbeat locals who had no money and just wanted to loiter and drink water even though our pockets were loaded with cash and 3 of the 5 in my group were visiting from the East Coast. One situation was so egregious that I told the owner I would never return and have made good on that promise.
As for ROI, it’s relatively easy to do for online initiatives but much harder to measure when using other offline media. Just the nature of the beast.
Despite common misconceptions, a Chamber of Commerce is more akin to a fraternal organization; in most cases, a Chamber of Commerce does not receive public or governmental funding – a large majority of Chambers of Commerce is existing today survive as a result of donations and membership dues. – See more at: https://commercial.laws.com/chamber-of-commerce#sthash.wGUBhW8g.dpuf
I can’t understand why the City feels that they need to fund the Chamber. Why should Sedona’s Chamber be treated differently than most others in this country?
Their idea of “Destination Marketing” is only supported by those who make money advising chambers on destination marketing. Paper is dead…get it all on the web, that’s where vacationers are looking these days.
Tyler,
Thanks for contributing the link above. I read through it and found it interesting and definitely informative. Also note that it — the article you reference — states: “Although there exists no uniform standard for a procedure with regard to the funding of a Chamber of Commerce, a bulk of Chambers of Commerce in existence maintain their respective operations as a result of private donations, membership dues, and fundraising…” I mention this because the Sedona Chamber of Commerce is unremarkable in this regard, although it does receive money from the City as well.
There seems a misperception that the Chamber is getting all of its money from the City, and it clearly is not.
As to your second point, that’s a valid question, and I believe others, i.e., the City and Chamber itself, are in a better position to address it than myself. If I was forced to speculate, it would stand to reason that since Sedona relies so heavily on tourism, that fact alone makes it a rather atypical economy that warrants atypical sources of revenue generation while retaining the other sources of income from more typical economies.
The only analogy I can draw from experience is when I met with the Vice Minister of Tourism of Peru a few year’s back. His Department had a huge budget for making private investments to bolster tourism since tourism is the country’s 2nd largest source of revenue. It made sense to me and still does. INVEST in the golden goose.
As for Destination Marketing, refer to the preceding paragraph just penned. It does have its place but I agree, it has become a “buzz word” that has been hyped up to “hysterical” proportions, much like social media has. How many businesses do you know that feel they just have to be on Facebook and Twitter, but when pressed don’t really know why other than the fact that “everybody else is doing it” which is a rather dumb reason to enter new marketing channels. But as an Internet Marketer, Destination Marketing makes sense for a town like Sedona, as it does for a country like Peru.
Finally, as for your remark about “Paper is dead. Get on the Web,” I find it hard to take issue with you on that one. Note that Online Marketing is a top priority for the Chamber, as it should be.
Thanks for sharing
Whoa, what’s with the “Chamber Budget Slashed by 50 Percent” statement?
The City has not cut the Chambers budget in half. In fact, the City Council is acting on service contracts at its Council meeting tonight. Proposed for the Chamber: $250K for Destination Marketing, $275K for the Visitors Center, and $14K for the Marathon. I.e., $539K, an increase from last year.
Most small towns the size of Sedona do not fund their Chambers, and most local businesses are not members of the Sedona Chamber of Commerce.
Of note: According to the St. Louis Fed’s 2012 Annual Report, except for the wealthy, Americans have recovered only 45% of what they lost during the Great Recession. Obviously, sales and bed tax receipts have been impacted. The State’s TEMPORARY 1% sales tax increase (now expired) impeded Sedona’s road to recovery, as will a .5% City sales tax increase.
BTW, the Chamber will be holding their Monthly Networking Mixer on July 25th and traveling to Ireland on October 27th. Last year they went to China. Funding from the City allows it to waste time and $$$ on frivolities.
Hi Jean,
I’m referring to page 55 of the City’s Budget, comparing years 09/10 with 12/13.
Ahem!
There are a few factors here no one is addressing.
First, Sedona is boring — no real night life; no solid people-drawing events; conflicting happenings between West Sedona and Uptown; and a city council/staff impervious to the needs of the arts community and hostile to musicians.
Let us not forget the terrible reputation Sedona has earned as being a police state where our dedicated officers make harassing tourists a sport they gleefully enjoy.
Tourists and locals alike are well aware of the dangers of going out at night to enjoy good music and a few drinks and fear having to “run the gauntlet’ on their way back home or to their hotel.
Sedona’s luster is gone. Its mystique tarnished. With Cottonwood raising its head from the muck and actively working together, businesses and government, to make it a new and exciting destination point, Sedona is on the ropes, saddled by lack of vision, lack of imagination and stagnancy.
Studio Live? That fiasco was all about city staff trying to make a few extra bucks on the backs of its musicians. I think the word ‘extortion” fits well here.
Even the changing of the guard when the “old” city council was ousted by the “new” city council in an election sweep over the lights-on-89A battle two elections ago, failed to make a difference.
Solution? Elect Rick Normand, Mike Schroeder, John Balla and Jim DeGeorge to the council and let them go to work rescuing this wounded elephant from the tar pit.
Jean,
Thanks for sharing your perspectives. Your characterization of Sedona as “boring” really got me thinking. I would tend to agree with you but I feel there is a deeper and more profound concern that prompted an epiphany for which I thank you. And that is…
Sedona is suffering from an IDENTITY CRISIS.
It doesn’t know what it is, what it wants to be, could be, or even should be. The business consultant side of me says a MISSION STATEMENT followed by a true and viable STRATEGY for meeting these objectives is the logical place to start. Budget building comes from there and every line item is scrutinized by asking and answering… “Does X or Y line item feed our stated objectives or not, and to what degree, along with realistic ROI?”
But from what I can glean, this isn’t happening. Consequently people become alienated which manifests psychologically as “boredom” or even depression. So yes, the city’s lack of identity necessarily undermines the very notion of “community.”
Then why am I here?
Answer: I really don’t know (for the reasons just stated). I don’t hate it because my expectations are quite low. But that’s all starting to change thanks in part to people like you. We are social animals. Healthy communities are synergistic and empathetic, not hopelessly fragmented to a point of incoherence.
If we can’t relate to our environment — or conversely, our environment can’t relate to or appreciate us — it becomes very difficult to find meaning and purpose in life.
Perhaps this is the common thread that is tying all the grievances being voiced together.
Forming a true community in a place like Sedona is difficult stuff. Pretty much everyone is from somewhere else, many of whom are looking to start a new life, and see the Sedona “mystique” as a great canvas to begin anew. That’s a pretty lofty expectation, especially after economic realities set in.
The irony is that these grievances and revolts are providing the foundation for cohesion, and community, and may very well prove to be the essential underpinnings to solving Sedona’s identity crisis.
So keep on keepin’ on, people!
Correction to the above thread. I am addressing Everygreen Wildwood, not Jean. My apologies if I caused any confusion.
No sweat John. It’s an honor to be confused with Jean. Make it up to me by running for mayor.
To John,
Looking at page 55 of the City’s Budget [for last year] and comparing years 09/10 with 12/13 one can see the Chamber budget WAS NOT slashed by 50%. In fact, there was an INCREASE of $66,887 in 12/13.
With regard to 09/10, there is but one line item. In 12/13 there are two. New is Destination Marketing.
09/10 Chamber of Commerce, $513,113
12/13 Chamber of Commerce, $274,500
Destination Marketing, $325,500 ($225,500 for the Chamber)
In May of last fiscal year (12/13), the Chamber came back before the City Council and requested $80,000 additional in Destination Marketing funding, which the Council rubber-stamped.
To conclude, your allegation of a “Vampire Budget” doesn’t hold water. In 09/10 the Chamber received $513,113 from City taxpayers. And in 12/13 it received $580,000 ($274,500 + $225,500 + $80,000) from City taxpayers.
Jean,
Sounds like you have some inside information. Now that we are quite literally on the same page, perhaps you can enlighten me on how you know the line item DESTINATION MARKETING went to the Chamber, and the amount of that line item that went to the Chamber. You seem to know what you are talking about.
By creating a new line item and not labeling it in a way that makes it clear where the money is going, is confusing and prone to analytical errors.
My OpEd attempts to make many points, and the main one is that there’s a lot more WEALTH EXTRACTION going on (through taxation and fees) than WEALTH CREATION (through investments that bring ROI). I’m speaking of the budget in its totality here.
I’ve also learned from this discussion thread that there exists many interesting polemics, for which the Chamber is but one. Some see City allocations to the Chamber as a waste of money, an expense, i.e., WEALTH EXTRACTION, while others see it as a worthy investment that stimulates the Sedona economy, i.e., WEALTH CREATION. These perceptions matter and hopefully a consensus can be reached so that future budgets can be adjusted in kind.
Those closest to the situation should make their case, and they know who they are.
But for right now, there’s an awful lot of irate merchants out there that are feeling the effects of WEALTH EXTRACTION as the result of the City’s budget for which the wastewater expenditure and the fees associated with it is having negative consequences.
We know this is further complicated by business in general being down at a time when the national and state economies are growing, albeit slowly. This double-squeeze of having less customers and more expenditures gives credence to a Vampire Budget. I intentionally used this hyperbole to sound the alarm. Budgetary policy is not working. Sedona’s economy is getting worse when it should be getting better.
I would further contend that the budget is merely a reflection of a larger problem. That Sedona has a rather profound identity crisis. As stated elsewhere in this discussion thread, the business consultant side of me says a MISSION STATEMENT followed by a true and viable STRATEGY for meeting these objectives is the logical place to start. Budget building comes from there and every line item is scrutinized by asking and answering… “Does X or Y line item feed our stated objectives or not, and to what degree, along with realistic ROI?”
At any rate, thank for sharing, and I look forward to your response.
Evergreen Wildwood forgot to mention the yellow-jacketed junior wanna -be “Zimmermans” prowling Uptown Sedona in groups of two or three intimidating shoppers and diners alike and giving visitors citations for parking too long while they are out spending money in our town. Imagine how a visitor must feel coming back to their car after blowing a wad of cash in Uptown Sedona and finding a ticket on their windshield. Do you think they will ever come back to Sedona again? They will warn their friends and their friends will warn others and the fear of coming here will grow exponentially. Who in creation came up with this ridiculous idea?
I heard some consultant was hired to do a “study” on the Uptown parking situation. All of what you mentioned was his recommendation which was obviously adopted and implemented.
You are so right, Mortimer. People talk. Parking limits and tickets are a violation of Sales/Marketing 101: reduce friction between the buyer and seller wherever possible. This policy only adds friction. Visitors spend less because “buying time constraints” have been imposed. We should be making it as easy as possible for visitors to enjoy Sedona, on their terms, not ours. A perfect example of “penny wise, pound foolish.”
John,
I couldn’t agree with you more about the WEALTH EXTRACTION problem. In my opinion, socializing costs and privatizing profits via increasing fees and/or taxes has become exceedingly popular with City Hall during the last few years or so. I am prone to believe most of the funding given the Chamber of Commerce falls under the category of wealth extraction.
But for a few exceptions, I certainly agree with your Op Ed article en toto. One example you’ve nailed superbly: The Wastewater Treatment Plant ‘experiment’ is gobbling up far too many millions and is extremely financially risky. The City Engineer stated he does not know if injection will work and how much water the plant can take (April 26, 2013 Budget Workshop). We are now at 1.1M or 1.2M gals/day capacity. The City Engineer indicates wetlands capacity enhancements are needed for 2M gals/day. In addition, that a future effluent management optimization study will look at everything (wetlands, injection, spray irrigation) and come up with a plan. A little over 60% of Sedonans are on the sewer. Please tell me sewer ratepayers are not guinea pigs and our wallets are not being raided.
The last two City Budgets really don’t tell what’s what with regard to the new Destination Marketing line-item. The way the City Council has handled it thus far is to set the Destination Marketing total funding when the budget is formally adopted in June. Then afterwards–at a July Council meeting–the decision is made on how much the Chamber will receive. I usually try to watch Cable Chanel 4 that broadcasts Council meetings, especially if something ‘interesting’ is on the agenda regarding financial matters.
Thank you very much for sounding the alarm! Sedona City Hall is a piece of work–various cans of worms and all.
P.S. to John
Reviewed my notes and came up with the Destination Marketing data you requested.
To the Sedona Chamber of Commerce
13/14 DM budgeted = $350,000. $250,000 goes to Chamber.
budgeted, with an additional $100,000 up for grabs.
Perhaps the $14,000 for the Marathon is also for DM???
12/13 $225,500 (DM budgeted = $325,500).
An extra $80,000 for the Chamber was approved in May.
Thanks for the additional data, Jean! I wish I could shed some light on it but I am not in a position to do so, i.e., I’m entirely ignorant about the who, what, where, why, and how’s. Yet I say so without prejudice.
THE COUNCIL AGENDA FOR NEXT WEEK has been posted on the City’s website.
(1) *JULY 30th, 3:00 p.m.: Presentation/discussion/possible direction re:
(a) establishing a secondary property tax to fund drainage improvements (this must go before the electorate)
(b) formation of special improvement districts to fund critical drainage projects in specific areas
(2) JULY 31st, 3:00 p.m.: Possible action on the Chamber of Commerce and Lodging Council request for a bed tax increase from 3% to 3.5%.
The special interest Lodging Council has not been legally registered with the State of Arizona since 4/12/2011. And the special interest Chamber of Commerce serves members both in and outside Sedona city limits. Only 27% of Chamber members are licensed city businesses. According to the Chamber, Sedona has been able to buck the trend of losing tourism market share, but is at risk. With supply being inelastic, several million dollars can be spent on tourism with little to show. The Lodging Council states “50% of Total Tax Generation Comes from Visitors.” Whether you agree with this percentage or not, nothing is mentioned about the costs of tourism to the City of Sedona (i.e., additional police, increased highway maintenance, a bloated city staff, tourism’s real share of debt service payments–around $6 million/yr., etc.)
THE FIRE DISTRICT indicates the mil rate on our next property tax bills will see an increase.
THE SCHOOL DISTRICT indicates a bond issue will be on the November ballot.
SEDONA’S POPULATION was only 10,031 per the 2010 U.S. Census. In that it is a retirement community, the vast majority are living on fixed incomes, with very many on food stamps. When middle class families have less to spend, businesses have fewer customers, homes go up for sale, commercial and residential vacancies increase. The Sedona economy is at extreme risk. More taxes are regressive and will lead to more problems than they solve.
*THE MAYOR AND CITY COUNCIL have been spending money on all kinds of things that do not fit many of Sedona’s needs. Serious drainage problems for which they claim a shortage of funds–over $30 million per Councilors Ward and Martinez–have been let go. Some drainage problems are due to faulty engineering design approved by City Hall over the years. The City of Sedona has approved dozens of non-drainage capital projects far too lengthy to list here via its current fiscal year budget (adopted in June, effective July 1st). The City’s wish list of Capital Improvement Program projects must be cut back very substantially (currently four pages long). Other than drainage projects and critical wastewater projects (several aren’t), the rest need to be put on hold. Drainage problems must be corrected without new taxes on any level.
At an attempt to add a bit of humor to this, it seems that the vampires are more akin to sewer rats.
At any rate, EVERYTHING on the agenda is calling for additional taxes and fees? Everything? No discussion about finding ways to cut non-essential expenditures? Am I missing something?
Thank you, by the way, for posting the agenda above.
What it’s telling me is that a determination has been made that EVERYTHING in the current budget is absolutely essential, and therefore, there is no choice but to raise taxes. I find that to be, quite literally, incredible. No austerity measures are even on the table? None?
I’ve seen good budgets and bad ones. But never have I seen one — even a really good one — that had non-essentials in them. Taxation should almost always be a last resort, not an impulsive, knee-jerk response to any budget crisis. There’s other, less painful ways to find money, and that begins with cutting non-essentials.
Pretty simple stuff.
Give me a day and I’ll bet you I could find a million bucks of non-essential line items that 80 percent of the Sedona citizenry would agree upon. It probably wouldn’t even take that long.
I’m really starting to wonder whether a single member of the City Council has taken even one class in economics. If they have, it certainly is not showing for the reasons you articulated.