Door County Tourism Zone Commission : Meeting Minutes

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May 26, 2009 2009 ANNUAL MEETING

2009 ANNUAL MEETING
Crossroads at Big Creek
Sturgeon Bay

May 26, 2009

Commissioners Present: Kufrin, Boston, Coulson, Cyrus, D�Amico, Holtz, Jacobson, Jeanquart, Larson, LeClair, Nelson, Tice, Weddig

Audience: Dianne Lensert/Kerber Rose; Kathy Kirkland/TZC Administrative Assistant; Jack Moneypenny, Jon Jarosh, Mary Denis, Bruce Hill/Door County Visitor Bureau; Dina Boettcher, Boettcher Communications/Sturgeon Bay; Nancy Fisher, Village of Egg Harbor, President; Mike Gilson, Gilson Guest House/Fish Creek; Tom Girman, Supervisor/Sevastopol; Pat Healy, Healy�s Open Door Guesthouse/Town of Egg Harbor; Kristen Kubisiak, Door County Advocate; Mrs. Kufrin; Gregg Stillman, Foremost Management Services/Fish Creek; Tom Voegele, Bay Pharmacy/Mayor, City of Sturgeon Bay; Cindy Weber, YMCA/Sturgeon Bay; Jerry Zaug, Country House/Sister Bay

Agenda
5 p.m. � Refreshments
6 p.m. � Presentation of 2008 Annual Report

Presentation
Kufrin began the Annual Meeting at 6:10 p.m. and introduced the Commissioners present. The Tourism Zone Commission (TZC) Annual Report is made part of these minutes, which also includes the Door County Visitor Bureau (DCVB) presentation. Kufrin stated that this is the second full year into the Tourism Zone operations, started in May 2007, with many people active in making it happen. The Zone started with nine communities, and the biggest accomplishment in 2008 was the balance of the county coming onboard. There are now 26 Commissioners, and the goal is to grow to 30 or more.

It�s a misconception that the Door County Tourism Zone is part of Door County government; we�re not connected to the county but rather an independent government entity created by the member municipalities by an Intergovernmental Agreement, first formulated by Chuck Tice, along with our Bylaws, and updated in May 2008 to conform more to the practical operation of the TZC. Room Tax is a specific set of State statutes for collecting 5.5% tax on transient rentals, and the dollars collected have to be spent on marketing that generates paid overnight stays. There�s a 70/30 split mandated by the state, and the TZC had to contract with a marketing entity in the Zone. It was out of the ordinary that the DCVB was located in the City of Sturgeon Bay, but we always intended for the City to become a member.

The TZC is the tax collector, through Kerber Rose and our administrative assistant, who manage the tax and permitting. It�s our obligation to collect all the payments and make sure the information collected can be effective in marketing. Kufrin reiterated the Mission Statement in the Annual Report. He stated that people feel we do a good job and there aren�t a lot of issues with how we�re undertaking our business.

In 2008, the DCVB tax money was switched from �reimbursement� (2007) to �disbursement,� which is evidenced by the Audit statement. We also review the performance and marketing efforts of the DCVB; we�ll be doing that again in June and July, evaluating how well it�s doing in terms of commitments made, objectives, and expectations agreed upon.

There�s a table in the report that demonstrates from whom we�re collecting the room tax. There are 179 primarily commercial permit holders, about 20/80 with those who are non-commercial/owner units. In the type of units, almost 3,800 units are commercial operators, and 830 are the ones and twos that flew under the radar in the past and were not paying room tax or sales tax, did not have permits from state.

Kufrin said that in 2008, the TZC faced a challenge of starting with a partial year in 2007, so we had to measure that against 2008 plus adding new members, so every time we try to compare month-to-month, we weren�t getting 100% comparisons. High payments to DCVB in 2008 were due to about $900,000 of 2007 tax held over and paid over the first five months of 2008. The municipalities can do what they want with their 30% (including their local business bureaus), and the municipalities have been pleased with the monthly money. The TZC ended the year with $26,000. There�s also a chart in the Annual Report showing how much was collected by each community.

In 2008, the Commission established its own website and contracted with a company to generate a web-based payment program to allow permit holders pay online as the state does. Kirkland came on as administrative assistant in May of last year just before the Annual Meeting. The 2008 Audit is also in the packet.

The TZC has several committees, including the new Compliance Committee, chaired by Tice, which will come up with common rules and practices on how we deal with delinquent/non-compliant properties. Two such properties are in Circuit Court right now, and two others decided to make their payments. Compliance is important so the tax is a level playing field for everyone. We�ll be getting a State Department of Health list of all its permit holders, and we can compare how many match with our own list.

Kufrin thanked all the Commissioners for helping out in 2008. The TZC meets on the third Thursday of each month, rotating around the county. We do feel we�re serving an important purpose and enabling Door County to compete on a statewide and national basis for tourism to sustain a tremendous number of jobs. Locally, without the room tax flowing into the communities, they wouldn�t be able to accomplish the projects that they are.

Kufrin introduced Jack Moneypenny to speak to the report�s Door County Visitor Bureau section.

Moneypenny said for the first six to 10 months, he went to the TZC meetings, and the Commission told him to start marketing but without knowing how much money would be available. The first real budget was approved in December 2007 to go through July 2008. The first year�s money went to eBrains, Geiger & Associates, and a Midwest Living insert for about $910,000 total. Were those expenditures worth it? He felt they were. When first joining the DCVB, the county had only $220,000 a year to spend; we had to rebuild our market share and branding. Everyone in the Midwest was aware of us but they had lost touch. Moneypenny said the DCVB�s job is to reestablish the connection in the greater Midwest area. If we didn�t have the room tax money coming in now, with the economic downturn, we would have lost business.

Moneypenny went through the Primary Results numbers. Traveler expenditures went up, and the Door County traveler expenditures went up $80 million. Davis & Peterson has been doing this for years with the same methodology; if an entity doesn�t pay for a specific study, it gets an abbreviated in-state study. They call maybe 30 innkeepers and extrapolate. The DCVB did that through 2007. Wanting more accuracy�not science perfect but it�s the state methodology� the DCVB spent $6,000+ for a specific Door County study. They called everyone on the Health Department list and asked the questions about occupancy, etc., took those numbers, hade an economist look at the area and determine how many jobs are affected in our area based on those numbers. The third step is face-to-face interviews, about 4,000 around Wisconsin to get a general sense of how people spent their money on vacations. The third level of study costs $125,000, where they come in your area and tear it apart, interview everyone (restaurants, etc.). The DCVB can�t justify spending that much on a survey. The county�s market share is 3.69% compared to 3.16% market share last year, and Door County is up to 6th place from 7th.

Moneypenny has said the numbers are flawed, but this is a new methodology for us, this is our benchmark. Does he believe spending increased 18%? Probably not, but reporting increased along with its accuracy. But we did increase last year, although probably not $80 million. Reports used to say there were 13,200 jobs in tourism, but the economist looked at intercommerce in the county. So many goods and products are purchased outside of Door County as well as retail products; that�s the discrepancy. Once the economist redid it, he said the number is 8,471 full-time equivalent jobs.

Moneypenny addressed Marketing and Sales as shown on his report. E-mails are organic users who want more about Door County, tying into PI leads. A qualified person gets e-mail; and the open rates and pass-along rates are great. The DCVB hits qualified leads with e-mail only once a month to be respectful of the recipients� time. �Explore the Door� podcasts are now available on iTunes and YouTube, and people are downloading the podcasts.

Moneypenny showed a graph of website visits one year over the next; site visits are up. September and October start to wane year-over-year. It levels off, but those two months was when the economy started to drop.

In regard to Group Sales, this has been a goal only for the past year. The DCVB staff has been attending shows and has joined some group organizations, written articles, etc.

Moneypenny detailed the Ad Highlights for 2008. Among others, a newspaper insert in the Chicago Tribune cost 3 cents apiece (including insertion), and the DCVB has the ability to target recipients on different subjects (cuisine, etc.) There were 147 commercials on Fox 11 running every day between 5 a.m. and 8 a.m. In addition, 50 radio stations in the Badger loop ran four 30-second commercials during broadcast of the games every week from September through November.

Communications/Public Relations was handled by Geiger. Moneypenny stated that the ad equivalency rate jumped from $149,272 in 2007 to $904,599 in 2008. There were seasonal press trips orchestrated by Geiger that resulted in 544 articles written about Door County, generating 72,588,585 impressions and an ad equivalency rate of $4,744,650. The practice of hosting journalists will continue.

Welcome Center traffic peaks in the summer, as shown in the presentation. There has been a controversy about welcome centers around the state being closed due to budget cuts, and Moneypenny will fight to keep them open. He sees the people in the local center, and the visitors like the interaction and help.

Looking ahead, Yesawich, Pepperdine & Brown put out a 2009 National Travel Monitor, surveying travelers around the country. The report said that looking ahead in 2009, 25% of the people surveyed said they�re taking more trips this year than last; 55% said the same number of trips, and only 18% said fewer trips this year. So, 80% of the people surveyed said they would be taking the same number or more trips in 2009.

On May 2, the Chicago Tribune and Pittsburgh Post Gazette ran an article about travel in 2009; one segment that will not stop traveling is the gay and lesbian population, which prides itself on double income and traveling. The DCVB has already put a toe in that market in Chicago and will try to go after that target. As of today, requests for the Visitors Guide are up about 35% from last year.

Moneypenny said he appreciates all the TZC, Kufrin, and the Commissioners do. All are hoping for gradual growth.

Kufrin asked for questions from the audience. Nelson asked Moneypenny about if we foresee growth in market share this year. The rest of the state is flat and we�re on an upward swing. Moneypenny said everyone calls us �moneybags,� and other counties are flailing. Milwaukee closed its call center and visitor center. He�s hopeful if we stay with the program and put the message out there, we can capitalize on those taking trips. Our market is still the Midwest, with Iowa being a fairly new market. This is our year to keep growing market share.

Hill asked about the county being sixth instead of seventh. What was the fifth destination? Moneypenny stated it was the Milwaukee area. All the destinations above us are near major metropolitan areas. There were no other questions.

Adjournment
Kufrin thanked everyone for coming and adjourned the meeting at 7:30 p.m.

Respectfully submitted,

Kathy Kirkland
Administrative Assistant

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