Tourism holds strong in SLO County

The 2011 summer season proves a healthy one as cities across SLO County report increases in visitor-related revenue, helping the economy rebound

jlynem@thetribunenews.comOctober 22, 2011 

NICK LUCERO — nlucero@thetribunenews.com Buy Photo

Tourism, one of the county’s top economic drivers, fared well this past summer — a sign that it’s helping to lead the local economic recovery, experts said.

Several cities — including San Luis Obispo, Pismo Beach, Paso Robles, Arroyo Grande and Morro Bay — reported year-over-year increases in transient occupancy tax revenues (bed taxes), which were welcome news to hoteliers.

“Tourism is doing well and consumer spending overall has been coming back, and I don’t think San Luis Obispo County has been any exception,” said Jordan G. Levine, an economist and director of economic research for Beacon Economics, a Southern California-based forecasting firm that presents the county’s annual economic forecast.

“There was healthy growth in the second quarter in terms of consumer spending, and local restaurants and hotels were definitely a big part of that,” he said.

The weak dollar has helped.

“California is attractive to overseas visitors and with domestic travelers, who instead of going to Europe would rather have a nice beach vacation in San Luis Obispo County,” Levine said.

The county’s economy depends greatly on the ability of various communities to attract visitors to beaches, quaint downtowns, world-class wineries and recreational opportunities, attributes that make the Central Coast a popular destination.

Tourism business generates more than $1 billion annually in travel spending in the county, resulting in nearly $70 million in state and local tax revenues, according to a 2009 analysis by Dean Runyan Associates, which does market research and economic analysis on tourism and travel.

Tourism also generates jobs, officials say.

September data from the state’s Employment Development Department showed 500 jobs added in the leisure and hospitality sector compared to the same month a year ago.

At hotel properties countywide, occupancy, average daily room rate and revenue per available room have increased year-to-date through September, compared to last year, according to the most recent data from Smith Travel Research.

“The numbers are pretty incredible when you look at how tourism impacts our county,” said Stacie Jacob, executive director of the county’s Visitors & Conference Bureau.

“Tourism is the largest industry next to agriculture, and the two intersect quite often, particularly when you talk about wine tourism,’’ she added. “A lot of people are investing in these industries, and that’s bringing economic stability to our region.”

While it’s difficult to identify a single reason for the success of the recent summer season, Jacob said that collaborative efforts to market the county have played an important role.

A variety of communities and organizations are leveraging their resources to spread the word that the county is a place worth visiting time and again.

The unincorporated jurisdictions in the county, as well as the cities of Morro Bay, Paso Robles, Pismo Beach and San Luis Obispo, have business improvement districts, where a monthly assessment ranging from 1 percent to 3 percent collected from hotel room receipts goes into a fund used solely for marketing purposes. That’s on top of the transient occupancy tax (TOT) levied on rates at hotels, motels and other lodgings.

Jacob also credits the county’s location halfway between Los Angeles and San Francisco, and the diversity of the region — ranging from beach towns to wine country to downtown San Luis Obispo.

It provides options for people, she said, and gives them another reason to prolong their stay, and tell their friends to visit.

“We’re hoping they’ll stay not just one night but two or three nights in the area,” she said.

Jacob said it’s also important for groups to see the county as the place to host their events.

Jim Throop, director of administrative services for the city of Paso Robles, said tourism has been the “engine driving the economy for some time now.”

“That 8 percent is a very good thing to see in a still-stagnant economy,” said Throop, referring to his city’s 8 percent increase in TOT for July and August.

The city reported an 11 percent increase for the 2011 fiscal year that ended June 30.

The results of the city working with other groups to promote the area are paying off, Throop said, noting that the city was recently featured in an article in USA Today.

“You get a lot of people down south (Southern California) who haven’t been here before, and they’re starting to come up here and say, ‘Wow, it’s gorgeous,’ ” Throop said. “It’s really starting to get that word out.”

Lindsey Miller, director of marketing for the San Luis Obispo Chamber of Commerce, said travel experts anticipated an increase in visitors heading into summer. The expectation was that more people would be making driving trips within the state, she said.

“We could definitely feel an increase here in San Luis Obispo, not only from other Californians traveling here, but a lot of Europeans,” she said. “Our visitor center was busy all summer long.”

Tourism experts say events like the Amgen Tour of California bike race and Sunset Savor the Central Coast — a food and wine event — are critical to attracting visitors. The Sunset Savor event generated $1.7 million in tourist spending last year. The bureau has not yet released data on this year’s four-day event, which wrapped up earlier this month.

In particular, events like Savor help travelers to connect with the county’s brand, one that invites visitors to become more intimate with the people and places that make the county stand alone.

“When you go into a tasting room, it might be the winemaker or owner talking to you,” she said. “If you go to the Brown Butter Cookie Company in Cayucos, you might meet the sisters.”

Jacob added: “We’re in such a great position now. We are what so many people remember rural California to be like, and we are able to protect that in our county.”

SLO County's tourism numbers improving

The hotel industry in SLO County posted gains across all three major methods of measure in the summer of 2011. Here’s a look at how July and August of this year improved over last:

Jul 2010Jul 2011Aug 2010 Aug 2011
Occupancy rate78.0%80.1%75.9%77.7%
Average daily rate$130.62$136.53$126.01$129.61
Revenue per available room$101.94$109.41$95.62$100.66

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