The Grand Jury issued a report noting that the Tourism Marketing District (“TMD”) mishandled the funds that were supposed to help generate more business for local hotels and motels. The TMD has already changed its governing structure (and most likely will vote itself out of existence) so while the Grand Jury findings may now be a moot point, the worst part is that it was a tremendous missed marketing opportunity.
The City and the Chamber of Commerce created the TMD whose sole purpose was to help the city’s hotels and motels by adding a tax on the rooms and using that money for marketing purposes. As the Chamber of Commerce put it simply: to put “more heads on beds.” Great (borrowed) slogan, unfortunately, as the Grand Jury reported, the money was mostly used to supplement salaries at the Chamber of Commerce and to maintain the Visitor Center.
Almost half a million dollars (72% of the money collected) was spent on salaries. About $200K was spent to maintain the Visitor Center (which included $15,000 for a car and telephone allowance). Another 15% went to legal fees which left only 10% of the budget to go to marketing “hard” costs. The Chamber did note that staff time should count toward marketing. [Chamber Response]
In case you are not familiar with the Visitor Center, it is a building located at the E Street trolley station. Many people question whether the cost of maintaining a brick and mortar Visitor Center is relevant in the age of the Internet. That can be debated but no one can argue that many people today search for a hotel room using search engines like hotel.com or Travelocity.
Instead of spending the money on salaries, legal fees, or a remodel, the TMD should have tried to figure out creative ways to market to tourists especially when there are sold-out conventions in San Diego (Heard of a little convention called Comic Con?). After all, Chula Vista is a 25-minute trolley ride from the Convention Center and there are seven motels walking distance from a trolley station. Another target audience would also be the residents of Arizona. The San Diego region gets about two million visitors from Arizona each year. While it’s obvious that this type of marketing should have happened outside of Chula Vista, most of the marketing done by the TMD was done within the City.
It’s unfortunate that the funds were not used properly. Of all times, now is when Chula Vista needs additional revenues. In July, the hotel and motel owners will review and consider whether to keep the TMD. Given the track record, it is doubtful they will continue taxing their customers. That is too bad because a little money, properly managed, in a creative way could have gone a long way to help the City.
Grand Jury Report (via the UT San Diego)
Chula Vista Chamber Response to Report (via the UT San Diego)
Star News Article: TMD Spending Questioned
Star News Op-Ed: Getting Their Act Together
UT San Diego Article: Report Chula Vista Tourism Dollars Blurred
TMD Budget (via the UT San Diego)