12:10 pm | Study: S.C. tourism boom from more marketing

C. GRANT JACKSON

The (Columbia) State

South Carolina can substantially grow its tourism industry -- tripling or even quadrupling the revenue it contributes to the state's economy -- according to a plan laid out by consultants.

The South Carolina Tourism Action Plan 2006 calls for substantially increasing funds for marketing and for reorganizing the state's tourism administration.

Consulting firm Tourism Development International Ltd., who completed an industry study earlier this year, found that "South Carolina is underperforming its potential -- it is doing well but could do much, much better."

With the right steps, South Carolina could become "one of the country's leading tourism states in less than two decades," the consultants said.

State government leaders are receptive to increasing the marketing money, said Chad Prosser, director of the S.C. Department of Parks, Recreation and Tourism.

"There is a package that we can come out of this (legislative) session with that everyone can agree on -- the industry, the governor and the General Assembly," said Prosser, who unveiled the study last week at a meeting of New Carolina-S.C.'s Council on Competitiveness. Prosser chairs the New Carolina Tourism Cluster Committee.

Gov. Mark Sanford will take the study under consideration as he develops the 2007-08 state budget he will propose to lawmakers early next year, spokesman Joel Sawyer said.

The $400,000 study was paid for by a partnership of public and private organizations, including many small tourism businesses.

The study's authors, based in Ireland, had harsh words for state government's lack of recognition of tourism's role in the economy.

"This appears to be the main reason why the Legislature does not provide the state tourism organization with the resources required to lead and facilitate the expansion of the sector," the study said.

"Put simply, the current organization of tourism, the lack of planning and asset preservation, and adequate investment -- in particular in marketing -- pose the most significant threats to the future of tourism to and within the state."

Among other things, the study calls for removing tourism from the Department of Parks, Recreation and Tourism and creating a separate state tourism organization, a public/private partnership that would be removed one level from government.

While the tourism cluster committee adopted most of the committee's recommendations, it rejected that one, Prosser said.

Most of the committee members felt that the Irish consultants did not fully understand the cabinet form of government and the value of the department having a seat at the table, he said.

The committee did agree with the consultants that tourism leaders need to form a privately led umbrella organization to bring together the industry's diverse elements and it prioritized which to pursue.

The key finding of the study is that tourism is a very strong industry in South Carolina, Prosser said, but the state has only scratched the surface of its potential.

Tourism contributes $10.9 billion annually to the state's gross product and employs more than 200,000 people.

Tourism, considered the state's No. 1 industry, surpassed textiles about four years ago as the state's largest export, Prosser said.

But South Carolina spends a comparatively small amount of money to market tourism, the study found.

Parks, Recreation and Tourism's marketing budget for the last fiscal year was $14.6 million, with about $10 million from state appropriations.

That means the state reinvested less than one-fifth of one percent of the $9 billion in direct tourist spending in the state in marketing and advertising to attract new visitors, the consultants said.

More successful areas spend 1-11/2 percent, Prosser said.

"About half a percent is the price of entry to be in the game," he said. "More destinations are promoting themselves, whether it is Ireland or Australia or Virginia Beach."

If budgets are doubled, the consultants said, earnings from tourism can double in five years and double again by 2020.

"Tourism can grow to contribute more than $40 billion a year to the gross state product -- with a commensurate growth in jobs," the study says.

That figure likely would be closer to $30 billion, Prosser said, "but it is doable, and it can have an impact if we do this strategically and comprehensively."

New Carolina has hired former state Revenue Department director Burnie Maybank to evaluate the sources of state revenue for tourism.

Tourists pay sales, admissions and accommodations taxes, among others.

"We need to look at finding a recurring source of revenue that will grow with the growth of the industry, so that we basically have that core fuel in the budget every year," Prosser said.

One plan under consideration is `'10-10-10" -- $10 million more for state branding efforts, $10 million more for destination-specific branding and $10 million for developing new tourist venues -- especially away from the coast.

A $5 million destination-specific pilot program worked well this year, Prosser said, because the program required a $2 private sector match for every dollar of state money. That created $15 million in new money to promote key destinations.

"We've got inland rural areas where we have great potential," Prosser said.

Developing inland destinations also makes sense from a job creation standpoint.

"The threshold for creating tourism jobs tends to be a bit lower than it is in the manufacturing sector," Prosser said. "So it allows us to go in in some cases on a smaller scale and have a quicker impact on those areas."

NEW CAROLINA TOURISM ACTION PLAN

Key issues adopted by tourism cluster subcommittee

Money: Provide a dedicated, recurring source of revenue to support tourism

Product development: Create a state product development plan with emphasis on inland areas

Industry alliance: Form a private sector umbrella organization to unify the state's diverse tourism industry

Access: Improve highway and direct air access to key tourism areas, such as Myrtle Beach

Natural resources: Develop a plan to protect natural resources that attract new and repeat visitors

Job training: Improve job training for tourism workers