Strong tourist season likely
The first wave appeared over the weekend in western Nevada County, toting cameras, consulting maps, and – locals hope – carrying pockets full of money to spend at restaurants, retailers, hotels, inns and other establishments in the area.
It’s the start of the annual migration of tourists, and how many of them visit the area between now and Labor Day will impact the income of service workers, the viability of businesses, and the tax revenue of Grass Valley and Nevada City.
Both cities have gone to great lengths to capture their share of California’s fourth largest industry, the first or second largest economic generator in every rural county in the state. Right now, the prospects for a strong season are good.
Leisure travel in California is expected to increase 3.1 percent this summer and 5.2 percent in the fall despite concerns over rising fuel costs and terrorism, according to research done for the Travel Industry Association of America.
The California Travel and Tourism Commission expects domestic travel to the Golden State to increase 6.3 percent this summer and another 8.5 percent this fall, compared to levels of a year earlier.
“We expect that the increased preferences for domestic travel, close-to-home destinations and highway travel will continue,” said Dr. Suzanne Cook, TIA’s senior vice president for research.
To get the season off to a running start, 31 million motorists are expected to hit the roads this holiday weekend, according to a AAA survey.
All of this bodes well for western Nevada County, which depends on motorists making short visits for the bulk of its tourist business.
Starting with the Sierra Festival for the Arts that ends today in Grass Valley, more than 40 special events will be held in the area through Labor Day to lure visitors to Grass Valley and Nevada City. That’s in addition to such hearty perennials as the Empire Mine State Historical Park and the Nevada County Fair.
The Joint Chambers of Commerce for Nevada County have spent almost $20,000 to print and distribute 195,000 four-color rack cards promoting local attractions throughout the Bay Area, Sacramento, Lake Tahoe and Reno.
City Manager Mark Miller uses a broader definition when discussing the impact visitors have on Nevada City.
“It’s not just tourism, but the cultural and recreational opportunities we have around here,” Miller said last week. “The arts organizations in Nevada City alone have combined budgets of more than a million dollars, and that money gets spent locally (with people) who in turn spend other money in town.”
Several economic studies have concluded that every dollar spent by a visitor generates seven dollars in additional spending and tax revenue. Or as Miller likes to put it:
“Tourism-generated money is not spent on raw materials from Japan, it’s spent directly in the community. Tourism is a real economic engine.”
Miller estimates that about half of the city’s annual sales tax revenue of about $1 million is related to tourism, culture and recreation. Then there’s the transient occupancy tax, which generates over $300,000 a year to the city.
“We’re a service economy here, for the most part,” he said.
Grass Valley is the region’s economic engine, and one statistic from a 2003 economic analysis drives home the point: Per capita retail sales in the city top $23,000, more than twice the statewide average of $9,500.
Much of the money that comes from outside the county is spent in the 13 blocks that make up historic downtown Grass Valley, the city’s main tourist magnet.
City officials estimate that the downtown area generated slightly over 12 percent of the $3.8 million Grass Valley collected in general sales taxes in the 2002-03 fiscal year, and almost 58 percent of $196,450 in transient occupancy taxes collected during the same period.
Howard Levine, executive director of the downtown association, said last week he expects a strong tourist season based on the early indicators. Reservations at the city’s bed and breakfast inns are strong for June and look good for July, he said.
“This is a big change from last quarter, when it was as slow as we’ve ever seen it,” Levine said. “Business is starting to rebound.”
“The travel people say business will pick up substantially this summer, and we’ll get our share of it.”
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