Local tourist industries hope to weather the storm

JACKSONVILLE — A booming economy and forward thinking helped Oregon tourism grow into an $8.3 billion industry — before the subprime lending collapse sparked an economic meltdown.

With vacations becoming a luxury for many families, tourism officials and representatives of the hospitality industry gathered Thursday in historic Redman's Hall to ponder how to steer one of the state's primary employment sectors through an uncertain future.

The looming minimum-wage increase to $8.40 next January has hospitality-industry operators crunching numbers in multiple ways searching for ways to save jobs and companies.

"I think the important thing to remember is that everybody here today is feeling the same pain," said Rogue Regency Inn & Suites General Manager Bruce Hoevet after the session. "We're trying to figure this out when we're back sitting in the office. We got a chance to see that we're not the lone person dealing with it."

Oregon tourism has benefitted from a 1 percent tax tacked on to lodging bills for the past five years. That money has gone to promote the state near and far.

Now there is a new round of challenges.

Hospitality industry wages produce a larger share of earnings in rural counties than urban counties, said Jeff Hampton, executive director of the Oregon Lodging Association. "The direct effect of visitors spending on these jobs is more important than ever. The money circulates back around, so it's critical to protect those jobs."

He said Oregon is one of seven states that don't have tip credits when it comes to minimum wages.

Hoevet said lodging companies walk a tightrope between overstaffing and providing a quality experience for a fair price.

"I guess that's why McDonald's stock is doing so well right now," he said.

At the same time, motels and hotels need to be flexible when it comes to room rates.

"You can't sell a room the next night," Hoevet said. "You can't let (a traveler) walk out the door, you've got to find an agreeable price for both parties."

Charles Willis, general manager for Crater Lake Lodge operator Xanterra Parks & Resorts, said his company manages the national park's recycling effort at Crater Lake, and sustainability has become a growing issue for many hospitality operators as well.

"Xanterra has a full-time environmental director and 20 percent of the capital budget goes to chasing environmental issues," Willis said.

While emphasis often is placed on particular attractions, Bob Hackett, Oregon Shakespeare Festival's marketing manager, pointed out that visitors naturally gravitate to the Southern Oregon region.

Attractions such as Ashland Springs Hotel, Lithia Park and the school now known as Southern Oregon University were on the scene before the formation of Oregon Shakespeare Festival.

"Our $25 million budget ripples out to $150 million," Hackett said, noting $15 million of that came through ticket sales, but another $135 million was spent on lodging, restaurants and other entry points.

He said tourism doesn't conflict with the region's natural beauty, agriculture or other pre-exisiting values.

Hackett said hard economic times require tourist-dependent businesses to be more flexible than in the past.

"We may have to restructure the way we do business with a new group of people and make sure our business practices are more flexible than before if we want to attract new people," he said. "We need to evaluate programs and the way we're reaching people."

Anne Jenkins, senior vice president of the Southern Oregon Visitors Association, said the industry needs to bridge the gap so future generations will get involved in making their communities special places that attract visitors. Smaller communities don't always have the numbers to carry on volunteer events year after year.

"Things will continue to die," she said, "unless we get kids involved."

Reach reporter Greg Stiles at 776-4463 or e-mail business@mailtribune.com.

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