California has cut its $7 million in state funding for marketing
tourism under a budget plan approved by lawmakers after a six-week
deadlock over how to lessen the state’s $38.2 billion deficit.
Under the $100 billion plan, which relies on heavy borrowing,
program cuts and fee increases, the state-funded arm of the
industry’s promotional organization, California Travel, will lose
its $7 million marketing budget.
Gov. Gray Davis was expected to approve the plan late last
week.
The cuts will slash marketing funds in half for promoting the
state’s $75 billion travel industry, the fifth largest contributor
to the California economy.
Even though promotional funds for the California Division of
Tourism will be slashed, California Travel will continue operating
its core programs from the $7 million it receives in private
funding from an industry-approved assessment.
“Tourism will take a big hit in advertising,” said Jennifer
Jasper, the deputy director of the California Travel and Tourism
Comm- ission, the privately funded arm of California Travel. “We’re
hoping that tourism will remain flat and stable, but we know that
advertising brings people to the state and maintains market
share.”
California Travel has been preparing for a worst-case scenario
since total elimination of the state-funded marketing budget was
first proposed by Davis in January, but has been working on three
budgets based on funding scenarios.
“An assembly committee agreed to put in $5 million last month.
That’s where we stood a month ago,” said Terry Taylor Solorio,
president of the California Travel Industry Association.
About seven jobs were eliminated in June in the division of
tourism as a result of the state’s financial crisis.
California Travel will maintain its co-op and communication
programs, travel trade shows, and publications with assessment
money. It will also keep its trade offices and trade partners in
key overseas markets such as the United Kingdom, Germany and
Japan.
Jasper said the commission will try to offset the advertising
loss by being more aggressive with media.
“We understand that this is a desperate time for the
legislature,” she said. “Obviously we would have welcomed the
funding but realize that it was a tough year in California. We
realize that we are not alone and hope that it is a temporary road
block.”
The total budget for the California Division of Tourism had been
funded through the state’s economic development office, which was
completely eliminated by legislators.
Some funding was spared to maintain administrative positions in
the Division of Tourism, which will be shifted to the authority of
the Business, Transportation and Housing Agency.
