Minutes Of the NC Travel and Tourism Board Meeting February 10, 2004 Board Members Present – Lynn Minges, Secretary Jim Fain, Carol Lohr, Doug Brindley, John Burton, Chris Cavanaugh, Haddon Clark, Jim Godfrey, Craig Madison, Mary Martin, Kelly May, John McLellan, Kelly Miller, Tom Ruff, and Cathy Wallace. Board Members Absent - Joyce Dugan, Senator A.B. Swindell, Senator Scott Thomas, Representative Thomas Wright, Representative Wilma Sherrill, Mohammed Jenatian, Susan Spangler, David Bundy, Hank Kahn, Phil Kirk, Doug Stafford and Anne Sternal. Liaisons, Guests and Staff Present – Gerry Hancock, Carole Lawler, Jim and Amy Hobbs, Scott Gilmore, Stephanie McGarrah, Teresa Watts, Donna Daughtry, Chris Mackey, and Betty Blades. Chair, Carol Lohr, called the meeting to order in the 4th floor boardroom of the Department of Commerce, Education Building, Raleigh, NC. Motion was made and seconded to approve the November 18, 2003 minutes as written. School Start Date ♦ Jim Hobbs of the NC Hotel and Lodging Association gave an update on the early start date issue. Members present received a handout from SOS-NC (Save Our Summers-North Carolina), a volunteer coalition of parents, grandparents, education professionals, and others seeking to restore a more traditional school calendar for elementary and second schools throughout the state. This handout gives an overview of their objectives and their petition to the General Assembly. Following much discussion, the board heard from Lynn Minges regarding her visit with Howard Lee, Superintendent of the NC State Board of Education and relayed their conversation. Howard Lee feels, as does the NC Travel and Tourism Coalition, that an informal study should take place on this issue exploring both sides of the issue. Mr. Lee has agreed to meet with representatives from the tourism industry, set up working committees with legislators, Travel & Tourism Board members, as well as Board of Education members. Discussion by the T&T Board Members brought forward the following points: to form an Ad Hoc Committee to study discrepancies in the opening school dates ranging from August 3 to August 25; membership on this proposed committee would be made up of key people from several boards, as well as members of the medical community on this board and small business owners, etc. Gerry Hancock suggested inviting Superintendent Mike Ward or Lee Ann Winters from Public Instruction speak to the T&T Board. Carol Lohr recommended they speak to prepared questions. This issue will probably carry into 2005 as the short session of the 2003-2004 General Assembly begins May 10, 2004. This discussion ended with no final conclusions nor was a committee set up. (handout provided to board members) Committee Reports ♦ Nominating Committee – On behalf of members Kelly May and John Burton, Chair, Jim Godfrey made a motion that Carol Lohr continue in her position as Chairperson. The motion was seconded and passed unanimously. 1
T&T Board Meeting Feb. 10, 2004 – Minutes ♦ Incentives Committee – Chair, Craig Madison gave an overview of the incentives committee two day retreat with Mitch Nichols and presented a draft of a suggested tourism incentive program. This committee, was a consortium of NC lodging, hospitality and members of this board. The committee identified the NC tourism industry as an “economic developer and engine” which did not qualify for any of the current incentives programs administered by the DOC to encourage the tourism industry base. Key points of the program as proposed in the draft include: $10 million dollar minimum project cost; program would NOT be open to municipal, county, state or federal entities but would be open to for-profit and non-profit entities; attract at least 25% of its visitors from out of state; project would not be feasible “but for” the incentive; provide tax recapture over 10 year period and allocate 10% of the tax recapture to start a separate tourism development grant fund. (Refer to handout provided to board members for specific points and complete scope of program.) Carol Lohr called for discussion. Lynn Minges extended a request from the Economic Board for recommendations to be heard at their February 22 meeting. Stephanie McGarrah, Policy Analyst/EDB Liaison with the NC Dept. of Commerce, shared comments and feedback from the Economic Development Board. After hearing these comments and discussion among the board, the board identified four items for modification before it is presented at the February meeting of the Economic Development Board. The modifications are: under Incentive Structure, the word “gift” should be changed to “retail sales”; require an application fee from the developer to cover the cost of the study; modify cost recapture, and ask for a $3 million seed fund to begin the program. Craig Madison motioned that the draft be accepted with those changes. Motion was seconded by Jim Godfrey and passed unanimously. Stephanie McGarrah and her staff were to make these modifications and present to the Economic Development Board. ♦ Grants Committee – In the absence of the grants committee chairperson Susan Spangler, Teresa Watts spoke to the board regarding issues surrounding the current Tourism Development Fund and Tourism Promotion Fund programs. Limited discussion followed the presentation including suggested revisions to the matching formulae for the Tourism Promotion Funds grants and increased and recurring funds for both programs. Carol Lohr motioned that the Division draft a letter of support from the board to Secretary Fain in support of both programs. Secretary Fain could present same to the Governor to make sure it is included in the DOC budget to be presented to the legislature. Jim Godfrey seconded and the motion passed unanimously. (handout provided to board members) Division Update Lynn Minges gave the division update. Upcoming industry events are: ♦ Governor’s Conference on Tourism, April 5-7, 2004 at the Westin Hotel in Charlotte. All board members may register for $200. Some of the topics covered at the conference will be “Business As Usual in Times That Aren’t” – Delos Smith, “Creating a Competitive Economic Advantage Through 2
T&T Board Meeting Feb. 10, 2004 – Minutes ♦ Tourism” - Ed Barlow, CEO, Creating the Future, Inc. and Tourism Policy Issues presented in talk show format during the final luncheon. ♦ Tourism Day – May 11 on the Halifax Mall. The board will meet earlier on that date and then adjourn at Noon to join Tourism Day festivities. ♦ Mid Year Marketing Update – September 14 at a location to be decided. The board will also meet that morning prior to the Mid Year Marketing Update, which will begin at 1 p.m. Lynn shared a suggestion from board member, Representative Thomas Wright, to improve visibility among the General Assembly members. The example Representative Wright gave was an approach used by AgriBusiness. Each week the general assembly is in session, AgriBusiness representatives leave something on each legislator’s desk along with a note that always states how much AgriBusiness contributes to the state’s economy. Lynn reported on the following critical issues: ♦ Operating funds for I-26 Welcome Center in Madison County. The current funding an Appalachian Regional Commission grant will expire on June 30th and will not be re-funded. The center needs $200,000 for operating expenses per year. Kelly May presented a Resolution for I-26 funding and moved it be passed. Jim Godfrey seconded her motion; there was no discussion and the motion passed unanimously. Mary Martin asked that the board send a letter of appreciation to the Appalachian Cultural Grant Committee thanking them for their funding. Gerry Hancock asked if the amount of $200,000 should be included in the Resolution, but Lynn Minges said it would be set out in the accompanying cover letter to each member of the General Assembly. (handout provided to board members) ♦ DOT State Highway Maps- Although the Division of Tourism is the largest distributor of these maps at 1.2 million/year DOT charges $200,000 a year to purchase maps. The matter was opened for discussion and the board members gave the following options (1) ask for the $200,000 to be put back in the budget; (2) ask DOT to pay for the maps and (3) produce our own ad-supported map. The DOT maps are printed by contract with an outside vendor. Lynn intends to meet again with DOT officials to discuss the issue. Jim Godfrey questioned why DOT prints the maps each year rather than every other year. (handout provided to board members) ♦ Budget Overview report and replacement of funds cut or reverted: $200,000 to support operation of I-26 Madison County Welcome Center Need to get $100,000 back in the Welcome Centers operating budget $1 million into Advertising line item to resolve previous budget cuts $ 500,000 for Matching Funds grant program $500,000 for Rural Tourism Development grants $ 28,000 Printing funds for maps $55,000 for Sponsorship at US Open in 2005 $100,000 for updates at Inquiry/Call Center (handout provided to board members) Gerry Hancock suggested that we use “real numbers” rather than “round numbers”. In reviewing the printed handout for budget considerations, Secretary Fain asked that 3
T&T Board Meeting Feb. 10, 2004 – Minutes each board member rank the budget considerations and advise Lynn if they had strong feelings about any particular issue. The board felt the top priorities were: Welcome Centers, Inquiry/Call Center and continued funding for I-26 Welcome Center in Madison County. A memo will be prepared and delivered to Secretary Fain. The board members supported the 2005 US Open as a sound investment. Secretary Fain reported that he is hopeful that the General Assembly may appropriate more money for this event. Board members praised the networking opportunities provided them at the 1999 US Open as the “greatest collection of CEOs ever to assemble in NC”. Gerry Hancock suggested funding items 4 & 5, which would help, 3 (advertising) and inquired as to how much marketing money was taken? Lynn reported that the 2004 matching funds grants of $127,000 were awarded by taking the money from the advertising budget. Haddon Clark asked how much of an increase to the budget and Lynn answered about 25% and advised there is some flexibility in the budget. Discussion continued on funding for the welcome centers. Lynn reported that all upkeep on these centers comes from the Division budget. The board felt welcome centers served as the “front door” to NC and the appearance of our “front door” typically made folks stay longer in NC. Chris Cavanaugh asked if funds could be garnered by participating in a program based on paid brochure distribution (Virginia operates a program like this, however, federal law would prohibit NC from this type of operation). Spring Advertising Overview Scott Gilmore gave the board an overview of the Spring/Summer TV advertising. The three ads, Volume, Canoe and Hiker will begin appearing in March in thirty second and fifteen second spots to targeted audiences on specific cable channels. Legislative Issues Update Gerry Hancock reported that for the upcoming legislative sessions Tourism Incentives would be a major focus for the Coalition’s efforts. In the last session Tourism sustained less cuts than other agencies, however another focus for the Coalition will be to increase dollars for the Division’s budget. The General Assembly cannot take up controversial local bills in a short session, the school start issue will most likely be continued to the 2005 session. Jim Hobbs reported that another major issue in the upcoming session would be to keep local government out of the lodging industry regarding public ownership of hotels. Chris Mackey announced the American Heritage Insert featuring NC would appear in March issue of American Heritage magazine. 50,000 inserts will be printed, shrinkwrapped with the March issue and sent to targeted subscribers on the East Coast and 50,000 will be printed for the Division’s use There was no additional business and the meeting was adjourned at 2:05 p.m.
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