Las Vegas Sun

October 24, 2014

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Tourism column:

Down economy means tourism suffering statewide

Everybody knows that visitation numbers are down for Southern Nevada.

When the economy tanked, people took a conservative approach, removed their traveling shoes and took “staycations.”

Through May, 2009 visitor volume in Southern Nevada was down 6.9 percent to 15.2 million people with convention attendance off 28.6 percent to 2.3 million.

As a result, resorts were forced to become more aggressive in attracting customers, and they slashed room rates. Although the decline in average daily room rates has spurred traffic, revenue has fallen dramatically.

Average daily room rates are down 27 percent from 2008 levels to $97.23. That means room tax receipts are off.

On top of that, gaming tax revenue is down as travelers who gamble have been more reluctant to spend on entertainment. As of May gaming revenue in Clark County is down 13.2 percent for the year to $3.8 billion.

That’s the story for Las Vegas, one of the world’s top resort destinations. But how are things going for the rest of the state, where the tourism industry is a matter of survival?

In general, the news is bad. But there were a few surprises offered by a quarterly tourism report compiled recently by the Nevada Tourism Commission.

Visitor volume and convention traffic are as bad, if not worse, in other parts of the state.

For the first quarter, visitor volume statewide was off 11.7 percent to 11.4 million. Of that, 8.8 million were visitors to Las Vegas. In Washoe County, visitation was off 12.7 percent to 957,638 and in all other counties statewide, visitation was down an astonishing 30.5 percent to 663,000.

Although convention attendance is bad in Las Vegas — for the quarter, it was off 29 percent — it was surprisingly vibrant in Washoe County and the rural counties. Washoe County’s convention traffic was up 66.5 percent to 91,712 people, and in all other counties, it was up 37.7 percent to 72,492.

A good chunk of Washoe County’s success was UNR hosting the Western Athletic Conference basketball tournament in March.

Occupancy rates, normally in the high 80s or low 90s by percentage in Clark County, had a fairly steep downturn in 2009’s first quarter. Las Vegas was at 80.5 percent, 7.9 percentage points off the 2008 level.

Lake Tahoe, which enjoyed a fairly good ski season, had occupancy rates of 74.4 percent, off 8.4 percentage points from the first quarter of 2008.

Washoe County, which includes some of the North Shore resorts of Lake Tahoe, had 54.2 percent occupancy, down 7.9 percentage points for the quarter. The rest of the state had 42.6 percent occupancy, down 10.7 percentage points.

Those declining occupancy rates were occurring as room inventory was going up statewide.

In Las Vegas, we had 3.4 percent more rooms to 141,119 for the quarter compared with last year. Mesquite, which saw the closure of the Oasis during the quarter, had 27.4 percent fewer rooms to 1,981. Lake Tahoe lost 9.3 percent of its capacity to 2,132 rooms. Washoe County inventory fell 0.5 percent to 17,708, but the rural counties had a 0.4 percent increase to 12,299 rooms.

That resulted in a statewide increase of 2 percent inventory, to 185,894 rooms.

But the combination of lower traffic and lower room rates resulted in lower room tax collections as well as lower gross gaming revenue.

Three-eighths of 1 percent of the room tax goes to the Tourism Commission to promote the state. Room tax revenue was down across the board with double-digit percentage declines in Clark, Washoe and Elko counties and Carson City. Worst hit was Washoe County, where room tax collections are off 21.6 percent. Clark County was off 17.6 percent, Elko 12.1 percent, and Carson City, 10.3 percent, while Douglas County (the South Shore resorts of Lake Tahoe) was down 6.7 percent and the rural counties, down only 4 percent.

Statewide, gross gaming revenue was down 14.8 percent for the quarter — about the same level as it was in Clark County (14.7 percent). The biggest losers were South Shore Lake Tahoe (down 28.5 percent) and the Strip (down 16.9 percent) with the least damage occurring in Elko County, off 4.2 percent.

McCarran International Airport isn’t the only airport in the state suffering from a decline in passenger traffic.

For the quarter, McCarran traffic was off 14.1 percent to 9.7 million passengers, the biggest contributor to the state’s 15.1 percent decline to 10.7 million passengers.

Big declines were recorded by Henderson Executive Airport (off 59.9 percent to 3,946 passengers), North Las Vegas Airport (down 36.1 percent to 17,048 passengers) and Elko Airport (down 26.8 percent to 9,302 passengers).

Reno-Tahoe International Airport had a quarterly decline of 23.9 percent to 932,507 passengers and Laughlin-Bullhead International Airport had the shallowest decline at 6.9 percent to 75,999 passengers.

The quarterly visitation statistics at state parks and nearby park attractions just outside the state had the biggest swings in usage.

Overall for the quarter, park visitation was down 5.1 percent to 3.8 million people. But some parks had double-digit percentage increases while others had double-digit percentage declines.

State parks showed a 12 percent increase in visitation to 497,340 people — an indication that some Nevada staycationers are checking out our outdoor attractions.

Death Valley National Park, a couple hours northwest of Las Vegas, showed a 12.7 percent increase in visitors to 190,783. Likewise Red Rock Canyon, just west of town, had an 8.5 percent increase in visits to 270,711.

The Hoover Dam Visitor Center, meanwhile, had a 16.2 percent decline in visitation to 166,847, and California’s Yosemite National Park was off 12.1 percent to 326,562, probably as a result of snowfall.

Other park numbers: Lake Mead National Recreation Area, down 9.8 percent to 1.3 million; Utah’s Bryce Canyon National Park, down 9.7 percent to 190,783; Arizona’s Grand Canyon National Park, down 7.8 percent to 590,824; Utah’s Zion National Park, down 5 percent to 295,814; and eastern Nevada’s Great Basin National Park, down 0.4 percent to 4,688 visitors.

Loving the Mob

I recently visited the Newseum, the new museum dedicated to journalism in Washington.

At the time of my visit, there was a special exhibition about the coverage of crime with displays on the exploits of the Unabomber (there was a replica of his Montana cabin), the kidnapping and murder of the Lindbergh baby, the exploits of Patricia Hearst and other high-profile cases.

And the visitors were fascinated.

That is one reason why I think the much-maligned Las Vegas Museum of Organized Crime and Law Enforcement — commonly called the mob museum — has a good chance of success when the doors open in downtown Las Vegas in early 2011.

Las Vegas Mayor Oscar Goodman and former Nevada Gov. and Sen. Richard Bryan were on hand last week for a ceremony kicking off the renovation of the historic federal courthouse. Once the building is refurbished, artifacts and memorabilia will be gathered for display. Goodman has promised that visitors will be booked and fingerprinted when they arrive at the museum as part of the experience.

The rise and fall of the mob was a part of the Las Vegas story and to ignore that would be a denial of our history. Although many people lament the rooting out of the mob and subsequent arrival of corporations to run casinos, the end result is a bigger — and safer — Las Vegas.

Goodman said the goal of the museum is not to glorify the influence of organized crime but to tell the story of its role in the development of our city.

And that will be fascinating to thousands of visitors.

Richard N. Velotta covers tourism, technology and small business for In Business Las Vegas and its sister publication, the Las Vegas Sun. He can be reached at 259-4061 or at [email protected]

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