EDITOR’S NOTE: The following is penned as commentary and is listed in our EDITORIAL section.
By Randy Arrington, publisher
LURAY, July 21 — Usually people complain about the speed of government, often describing it as a slow grind that seldom seems to get anything done. Well that’s not the case for the tourism industry in Page County. In one single vote cast one month after the formation of a new tourism council, all tourism marketing efforts for the county as a whole (including the three towns) has been shifted from the Luray-Page County Chamber of Commerce to Page County’s office of Economic Development and Tourism lead by Director Nina Long Fox.
“You could not have a better person in that role,” J.D. Cave, chairman of the new tourism council told the Page County Board of Supervisors during their meeting Tuesday night.
Fox was hired by the county on March 8, originally as Business Retention and Development Director, before officially becoming the Director of Economic Development and Tourism effective April 5, according to a previous interview with County Administrator Amity Moler. Fox was promoted after the late March resignation of the former coordinator of the department, Liz Lewis.
Fox has hit the ground running and has garnered an abundance of extremely high praise from those who surround her. Now, the ambitious director, who recently entered the public sector, wants to guide all marketing for tourism countywide through her office, while also focusing on economic development.
Just prior to Cave’s comments Tuesday night, the supervisors approved Transient Occupancy Tax (TOT) funding recommendations from the new tourism council that allocated only $100,000 to the Chamber. The organization had requested $325,000 after receiving $275,000 in TOT funds last year during the COVID-19 pandemic. The $175,000 reduction (or $225,000 reduction from the request) will affectively shut down all tourism promotion currently being done by the Chamber and limit its tourism functions to simply operating the Visitors Center.
“I think it was surprising the board decided to defund the Chamber’s Tourism Council and Marketing Committee with the award of barely enough funds to continue operating the state-sanctioned Visitors Center seven days a week throughout the year,” John Shaffer, chairman of the Chamber’s Tourism Council and Director of Marketing and Public Relations for Luray Caverns, stated on Wednesday.
“This 25-year-old Chamber tourism organization will virtually cease operations immediately following no communication from the [Economic Development and Tourism office],” Shaffer continued. “It is this organization that over many years has been responsible for establishing Page County with the recognizable designation as the ‘Cabin Capital of Virginia’ allowing it to achieve the success that this lodging segment enjoys today.”
“It will surely be hard to duplicate the talent along with drawing down additional TOT moneys for staff, to continue the success of the Tourism Council and Marketing Committee composed of marketers from some of state’s largest businesses in each segment of the industry who volunteer their time for Page County,” Shaffer added.
One of two driving forces that lead to the creation of the “new” tourism council was a “change” to existing state law that granted taxing authority to all counties across Virginia to levy a transient occupancy tax. Requirements within that law call for a committee dedicated to tourism to decide how the funds will be distributed. Page County has benefitted from a 5-percent TOT levy for more than a decade, with distribution being decided by the supervisors. The change to the law simply opened up the taxing opportunity to more localities, while the regulations were already in place. The formation of the new council was aimed at an attempt to better adhere to the existing state regulations.
However, rather than hand over TOT fund dispersement to the Chamber’s tourism council — recognized by the state as Page County’s Destination Marketing Organization (DMO) — the board of supervisors appointed six cabin owners to a new tourism council on June 15 and tasked them with deciding the fate of $1.1 million in TOT revenue collected in the last 12 months.
While the Chamber received $100,000 of those TOT funds, the Economic Development and Tourism office received $191,000. Of that, about $60,000 is earmarked for a new tourism coordinator in Fox’s department (up to $91,000 including coverage of benefits and related payroll taxes), so that Fox can focus on economic development as she was originally hired to do. A total of $100,000 is specifically earmarked for tourism marketing, according to Fox’s presentation Tuesday night.
“Housing tourism initiatives within the Economic Development and Tourism department at the county ensures that you have a group that has a pulse on more things happening in the community than any other institution is capable of doing,” Fox told supervisors on Tuesday. “So, we are more available to law enforcement, education, civic groups, etc., and it makes us able to be able to make better decisions for our community as a whole.”
District 2 supervisor Allen Louderback stated during the meeting that other localities have benefited from a consolidated approach to tourism marketing.
“Part of our idea is to create an integrated marketing solution for our community and not have it be as segmented as it historically has been,” Fox said. “We have more buying power by consolidating these funds and working together. We want to take back in-house the marketing piece as a county, so that we can better leverage our county as a whole and not just based on Chamber members.”
The second driving force behind the creation of the new tourism council by the county began more than a decade ago as a wedge started to grow between retail merchants served by the Chamber and cabin owners who felt underserved by the Chamber. Discussions a few years ago among cabin owners kicked around the idea of forming their own cabin association because they felt the Chamber was not meeting their needs even though they made up a significant portion of the membership. Several disgruntled cabin owners who held this position about the chamber and voiced it to others were appointed to the committee.
“It’s really important that the tourism council is respected for its position because of the types of business they represent, which is lodging,” Fox told supervisors. The logic behind the focus on cabin owners is that they provide a vast majority of TOT revenue, and therefore should have a direct voice in how that money is spent.
The members of the new tourism council appointed by the board of supervisors on June 15 include:
J.D. Cave — At-Large, chairman
Seretha Judy — District 1
Karen Riddle — District 2
Randy Howan — District 3
Bart Price — District 4
Charlie Jenkins — District 5
“We don’t take our responsibility lightly,” Cave told supervisors on Tuesday. “The folks that you have appointed are professionals in the industry. We have a stake in what’s going on.”
Cave, whose family owns Shenandoah Woods near Stanley, noted that the new tourism council’s recommendations were unanimous, noting “I think that means something.”
The only other recommendation the council made was to allocate $25,000 for each of the three towns. However, the TOT funds will come with stipulations, including reporting back to the council to ensure that the funds are being spent correctly.
“We will be earmarking that money for the towns…I say earmarking so that we can collaborate with each of the towns on tourism initiatives and marketing the town,” Fox said. “This way we ensure that the money being spent is actually for the purpose of these funds, and not just because it’s an organization that we care about.”
The added oversight that the new council promises does address the issue of making sure TOT funds go toward promoting tourism and “putting more heads in beds.” This was not the case several years ago when District 3 supervisor Mark Stroupe proposed giving the Stanley sandlot baseball players $5,000 in TOT funds to help support a trip with family and friends to Cooperstown, N.Y. to donate an old scorebook to the Baseball Hall of Fame. New York got some of those TOT dollars. Yet, Stroupe labeled the moment as the “biggest thing to happen in Page County since [Luray] Caverns was discovered.” That same year, a major cycling event that brought hundreds of visitors to Page County for the weekend received $0 in TOT support. The same event had received $5,000 the previous year.
In fact, the council may be a lot more selective in which events receive TOT funds from this point forward. Quarterly meetings will be held to review applications for funds from various organizations and a set of criteria is being established by the new council.
The council also changed the process of distributing funds by basing their allocations on “money in hand” rather than projected revenues. With that in mind, the council still has nearly $200,000 on hand for future allocations in the current fiscal year. By law, 2 percent of the 5-percent levy must be returned to the locality’s general fund, which totaled more than $500,000 in the current allocations.
While the formation of the new tourism council and tighter oversight on the use of funds will better meet the requirements of state law, a large portion of the Economic Development and Tourism department’s staff and functions will be paid for with TOT funds — and the board of supervisors has clearly stated that they want the focus of that office to be economic development, not tourism.
“We don’t want to lose focus on economic development,” District 1 supervisor Keith Guzy said on Tuesday. “We don’t need a $60,000 full-time position and the entire department and your time going to tourism, and we’re losing the focus of what we hired you for…is to do economic development…which is butts in seats, jobs and people that have work around here…I think that’s gotta be the focus.”
Fox quickly tried to remind Guzy that “90 percent” of her funding was through TOT and that it would be “unfair and negligent” to not also have a tourism focus in her office.
“We all made the decision to move away from [tourism] a year ago when we changed that position,” Guzy said. “We all agreed that economic development has to be first.”
The Luray-Page County Chamber of Commerce’s Board of Directors will be meeting Thursday morning to discuss the funding blow they received on Tuesday night. Chamber president Gina Hilliard assures Chamber members that this “will not affect anything we do on the Chamber side,” adding that the cuts basically shut down the organization’s tourism council and marketing. The funding changes affect the Chamber’s current budget, which began July 1.
“While we’re disappointed to hear of the board of supervisors decision to defund our only local tourism and marketing organization, we’d like to ensure our members and community that the work and mission of the Chamber remains focused and committed to promoting and supporting local businesses,” stated Christopher Jenkins, chairman of the Chamber’s Board of Directors.
While Chamber directors say they are “shocked,” the most alarming aspect was the lack of communication with the Chamber. The organization’s president said she found out about the possible funding cut after an anonymous tip via phone less than two hours before the supervisors’ meeting.
“My only hesitation…if the Chamber and the Chamber board aren’t aware of the massive cut, then that’s gonna be…,” Guzy stated before the vote. He questioned Fox no less than three times about her communication with the Chamber.
“I have communicated with Gina what my proposal…professional opinion was about what should happen,” Fox told Guzy. “Their board has received any public information that is available. They are aware, as far as I understand, because of letters that they have submitted as well as conversations they have had with my council.”
Chamber representatives sent an email to every member of the board of supervisors and the county administrator on June 29 noting support for the newly appointed council and requesting an opportunity to answer any questions or make a presentation about the services they provide. A second email was sent to Cave, the chairman of the council, on July 8 stating the same basic message.
Cave closed his email response on July 9 by stating, “We look forward to continuing good relations with the Chamber.” How ironic that a little over a month earlier, the Chamber had held its 95th annual banquet at Shenandoah Woods.
Guzy continued to push during the meeting to clarify what communication had taken place with the Chamber.
“We can’t just say…we’ve just gutted the Chamber $175,000 of its operating budget…that a little hard to take. There needs to be a little more coordination. They need to be prepared for that,” Guzy said during the meeting. “I hope that she has, and you have, and both of you have discussed it because $175,000 tomorrow morning…that’s gonna change the way they do business. They have contracts and everything else…they will have to change that tomorrow to be able to fund themselves the rest of the year.”
“I have not publicly discussed it with their council. I’ve had the conversation with Gina,” Fox replied.
When asked directly at the meeting on Tuesday by Guzy, the Chamber president said, “I have to disagree…there was no discussion of a figure.”
During an interview the following day with PVN, Fox stated that she didn’t have time to notify the Chamber, as the new tourism council held its last meeting from 3 to 5 p.m. on Tuesday to finalize its recommendations. So, the final recommendation was not final until two hours before the supervisors’ meeting.
“This is just an advisory council, so I could not speak to what had not been voted on,” Fox said of notifying the Chamber.
The new tourism director was highly critical of the Chamber’s past marketing efforts and echoed some of the complaints aired by cabin owners — a business that her family has invested in. Fox noted that the Chamber annually spent more than $160,000 on marketing efforts, and that her office was able to secure a $30,000 contract with a third party that is providing a better service.
“You have basically subcontracted out the marketing initiative to the Chamber, and we’re not yielding a result that should be yielded,” Fox told the board of supervisors. “Would you continue to work with a subcontractor that’s not providing you the results you need?”
After praising the Chamber staff and noting that she didn’t want anyone to lose their job, Fox stated, “But I do question the Chamber’s ability to fairly market all of Page County’s lodging business as a whole, they have not done it historically.”
When challenged about notifying the Chamber and making sure they knew of the potential impending cuts, Fox stated: “They’ve had an opportunity here this evening. They knew this was being presented…there is no question as to that. I know several of our [council] members have received phone calls, so they were very aware of it. They chose not to be here. They had open comment. My question would be, where are they?”
Despite the she-said / she-said aspect to who knew what when, the situation could have been handled better. Guzy was the only dissenting vote on the funding recommendations because he recognized — and called out — the problems with the process. It seemed apparent that the new tourism council wasn’t too concerned with the Chamber’s input or whether or not they were notified about what they wanted to do. As far as several of the council members were concerned, the Chamber had its chance to show what they could do for cabin owners the last 25 years, and they had failed to do so.
Whether one approves or disapproves of the Chamber’s output and performance with regard to tourism marketing, trying to ram through major initiatives of this nature in just over 30 days with no warning is not a good way to do business in a small community — particularly with a group that you plan to try to work with in the future.
“There is still money that is not allocated, so there is still substantial room for discussion…for fairness, or whatever word you would attach to that,” said Dr. Morgan Phenix, chairman of the board of supervisors. “There’s plenty of room to work this out, because it is a change…and there’s varying degrees of who said what when.”
Next year’s projected TOT revenues are $1.5 million — the most ever in Page County. Those tax revenues represent an estimated $30 million being spent on short-term rentals in the county over the next year, mostly in cabins. That’s a lot of money, and the pool is expected to keep growing.
One of the stipulations that the new tourism council will evoke on the Chamber in exchange for TOT funds to operate the Visitor’s Center is to require them to allow any business that contributes to TOT to advertise on their digital websites and place a rack card in the Visitors Center.
It seems like the cabin owners have finally gotten what they have wanted for many years — and in record time. Government can work fast when you pull the right strings. And with nearly 400 rental cabins in Virginia’s “Cabin Capital” maybe they’ll finally get the individualized attention they’ve been craving.
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