2017-10-26 / Front Page

Supervisors spat over formula for funding given to tourism bureau


The chairman of the Mariposa County Board of Supervisors chastised the Yosemite-Mariposa Tourism Bureau last week, even calling into question the integrity of the administration.

Supervisor Marshall Long brought up the issue of the tourism bureau during a budget discussion at the board meeting on Oct. 17.

But some of the other supervisors called Long’s accusations into question and officials from the tourism bureau say they have worked hard to cooperate with the County on all issues.

Long even went so far as to say the tourism bureau had “millions” of dollars in reserve funding.

Asked by Supervisor Kevin Cann why he thought the bureau had millions of dollars in reserves, Long said he “saw the financials.”

That was said after Long repeatedly claimed the tourism bureau refused to show him their financials after years of requests.

Banking statements from the tourism bureau show there are not millions in their accounts. The fund balances differ from month to month, depending on funding sources and expenses.

But for example, in August 2017, the balance for all accounts was just over $525,000. For their website, yosemite.com, the balance in that same month was just over $44,000.

Yosemite-Mariposa Tourism Bureau Executive Director Terry Selk said that in talking with officials from tourism bureaus across the West, some do have millions in reserve accounts in case there is a catastrophe. Selk said the local bureau probably should have a larger reserve because the area is subject to catastrophes, but that isn’t the case at this time.

During the budget discussion by the supervisors, which was focused around “white board” items, Long brought up the tourism bureau. The white board items are those projects and programs the County may fund once the balancing adjustments are made following budget approval. The tourism bureau was not on the white board prior to the discussion.

Long told the board members he wanted to see $17,000 cut from the tourism bureau budget. That was in spite of the fact the board and tourism bureau made an agreement to change the funding formula.

That agreement bases the tourism bureau’s funding on a percent of the transient occupancy taxes (TOT) collected from lodging business in the County.

Long’s justification was he wanted to see a 2 percent decrease in the budget because that’s what County departments were asked to cut this year. The County faces mounting public employee retirement costs in the coming years.

It was also noted the tourism bureau is not a department of the County government, rather they operate with a yearly contract.

TOT on the rise

Selk, who was not at the board meeting and was unaware the issue was going to be discussed, said the tourism bureau negotiated the agreement in good faith and it was approved by the supervisors.

When the County formulated the budget, it based the numbers on anticipated TOT revenue. That estimate was the tourism bureau would receive $559,999 this year. That is based on 4 percent of the TOT collections averaged over a three-year period.

As Mariposa County Chief Administrative Officer Dallin Kimble said, the TOT collections “continue to surprise us.”

This year, in spite of the Detwiler Fire, multiple Park fires as well as rockslides, TOT collections once again surpassed projections. Collections were just over $15 million for the last fiscal year.

What that means is under the agreed upon formula, the tourism bureau will receive $571,000.

But, as Cann pointed out, the extra $12,000 that goes to the tourism bureau means the County receives an extra $300,000. The County keeps 96 percent of the TOT funding and that is what funds a huge chunk of the budget.

Those funds are used for everything from the sheriff’s office to the library.

Investment opportunities

Another issue that arose was a “return on investment” (ROI) study that Long insisted upon before agreeing to fund the tourism bureau with the new formula. Long said he wanted professionals to determine if the County was getting its money’s worth by providing funds to the tourism bureau.

As Supervisor Merlin Jones pointed out, the original agreement was the County would fund that study.

Cann reminded Long he was the one who insisted on the study.

“They should have been doing this on their own without my prodding,” said Long.

But Selk said the supervisors agreed to fund the study. Then, he said, the issue was taken to the tourism board of directors.

That board, he said, agreed to do the ROI study from the tourism budget.

Since that time, Selk said they have solicited proposals for the study.

“We have found a company that is highly respected,” said Selk.

He also said the bureau is now in the process of “preparing a proposal” which they plan to submit to the board of supervisors.

“We are making every effort to apply and accommodate,” said Selk.

He said that includes complying with a request made by the Mariposa County Grand Jury this year which questioned how the bureau does its financial reporting to the board of supervisors.

Selk said five years of financial statements were reviewed by the Merced accounting firm of Spinardi & Jones.

Though it is not a full audit, the firm did do a review of the financial statements, something the bureau asked to be done.

“Based on our reviews, we are not aware of any material modifications that should be made to the accompanying financial statements in order for them to be in accordance with the cash basis of accounting,” the firm wrote a cover letter with the review.

Jones said the grand jury report indicated both the County and the tourism bureau were “equally at fault” and that the corrections have been made. Selk said he has worked closely with Kimble in order to fully comply with the requests and feels that has taken place.

Questioning integrity

At one point during the meeting, Long called into question the management of the tourism bureau.

“I want them to show some integrity for a change,” said Long, who added he is “not comfortable” with the tourism administration.

But Jones said he attends the tourism board meetings and said “they are so transparent” with their budgeting process. Jones said he has only missed one tourism board meeting in the past two years.

Selk pointed out the tourism board has a treasurer who meets with him and other tourism officials regularly to go over the budget. In addition, two supervisors regularly attend the tourism bureau board meetings. Those are Jones and Cann, who act as liaisons to the board.

“We have a process and it has checks and balances,” said Selk.

“At some point, we have to figure out what we are saying,” said Cann. “They are the one thing that is making money here. Dealing with the golden goose is a little dangerous.”

Supervisor Rosemarie Smallcombe agreed.

“We’ve made a commitment and I think we need to honor that commitment,” said Smallcombe of the promised funding for the tourism bureau.

She added she was “uncomfortable” if the board decided not to honor the agreement.

Jones, too, agreed, questioning any justification for reducing the budget.

“Is that the right thing to do or does the board risk its reputation?” said Jones.

Supervisor Miles Menetrey questioned the terms of the agreement, saying he still wasn’t sure it was locked in by the board.

It was clarified by Smallcombe and Kimble the agreement was for one year. Smallcombe said she thinks the board of supervisors need to have a meeting with tourism officials because there are so many “moving parts” involved.

Moving parts

One of those moving parts is the TOT itself.

That tax, which currently stands at 10 percent, should be raised, said several of the supervisors.

“We are committed to bringing a TOT raise to this board,” said Cann.

He said with the current formula, “we are throwing away $2 million to $3 million a year.”

“Everybody get ready for it,” said Jones. “It is going to need to go up.”

To do that, supervisors must place it on the ballot during an election and it must be approved by voters.

That discussion by the supervisors is likely to happen soon.

Also at issue is the TBID tax, or Tourism Business Improvement Tax, which is now 1 percent. That money, which was about $1.2 million, goes to the tourism bureau. That money funds various components of the tourism office. The County’s contributions strictly funds marketing, said Selk.

In both instances, Selk said the tourism board of directors is opposed to raising the fees. The TBID tax can only be changed by the lodging owners in the district. Selk said the board has gone on record opposing any raise in the TBID.

A new TBID agreement is presently in the works, said Selk. The proposal will be given to the board of supervisors before it is voted upon by the lodging owners.

Another issue that surfaced during the board of supervisors meeting was the visitor experience.

The vast majority of tourists come to Mariposa County to experience Yosemite National Park. With increased attendance at the Park, there have been various issues hampering the visitor experience, including overcrowding and parking woes.

Long said tourists are coming to the Park and “just leaving” because of the bad experience.

Selk acknowledged there are issues during the peak season and emphasized that is why the tourism bureau focuses almost all of its efforts on the off season.

He did say the bureau “plays a role” during the peak season, including helping get the word out when issues like fires and rockfalls arise.

The off season

But most of their efforts focus on luring visitors when the Park is not nearly as busy. Selk also said it is “not a given” that Yosemite will be on the agenda of all California tourists.

“We’re all fighting for the same market share,” said Selk, pointing to areas like Lake Tahoe, Madera County and others.

That, he said, is why when they do marketing efforts, they focus on the off season.

Some of those results are visible in Mariposa. The tour operator “Top Deck” regularly brings tourists to Mariposa, many times staying overnight in a local hotel. That was a direct result of continued contact between the tourism bureau and Top Deck officials.

Selk said they have also targeted many other markets during interactions with officials overseas who arrange tours.

All of the time, he said, they focus on having visitors stay in Mariposa.

“We invest in partnerships who are willing to sell for the off-season,” said Selk.

He said Mariposa is a focus in “every single presentation” and that they “try to do the same with Coulterville.”

Selk also has numbers to back up what he believes is a successful program.

For example, in fiscal year 2014-15, overall TOT growth in the County was 16.7 percent. In the off season, which is October through April, the TOT grew 33 percent.

Overall since 2012-13, overall TOT growth was 30.5 percent while the off season growth was 42 percent.

“I’m not saying we are responsible for all of that,” said Selk.

But, he does believe the tourism bureau is “influencing it somewhat.”

Overall tourism in America has grown steadily over the past several years, said Selk, and the overriding question is: “Who’s coming and how are they getting here?”

Selk believes their efforts are working, including the fact they made a big investment of around $75,000 to obtain the yosemite.com website and completely revamp the site.

Since that happened, in July 2016, the site visits have jumped dramatically.

Between July 2016 and June 2017, that site had 4 million page views, up 236 percent from the previous year. In just six months of that period, there were 110,000 referrals to lodging facilities in Mariposa County, another major increase.

They also have other businesses on the site, including restaurants and attractions. Those, too, have shown major increases in traffic. For those businesses, the service is free.

Greg Little is Editor of the Mariposa Gazette and can be reached at greg@mariposagazette.com.

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