ANCHORAGE -- New Millennium Plan.
These three words represent the most vital task facing Alaska
tourism interests in the years ahead. The plan is an effort to
streamline the state's promotional effort and provide a framework
for stable funding.
In essence, it would bring under one nonprofit umbrella the
activities of the publicly funded Division of Tourism (DOT), the
trade association known as the Alaska Visitors Association (AVA)
and the Alaska Tourism Marketing Council (ATMC), which oversees the
domestic promotional programs jointly agreed to by the other two,
while the DOT retains control of international marketing.
The challenge now facing the industry is to persuade the
Republican-majority Legislature and the administration of Gov. Tony
Knowles, a Democrat, to approve the plan.
An attempt this year failed; a bill to implement it never got
out of the Legislature. The opposition is rooted in the issue of
who should have the right to make marketing decisions.
Specifically, the Knowles administration wants to retain many of
the state's marketing (and, therefore, spending) functions within
the DOT; the private sector, while still expecting some state
funding for at least the first five years of the program, wants the
DOT to become a planning, development, liaison and advocacy agency,
with no marketing responsibilities.
That sticking point was a major reason that the plan did not get
the legislative green light in 1998; some now wonder if a
compromise can be reached in time for a revised version of it to be
approved in the 1999 session.
One past AVA president, speaking on condition that he not be
identified said, "There's no great sentiment in the private sector
for us to pay more money if we have no control over how it's to be
Some history of the marketing effort in Alaska might help
explain how tourism arrived at its current impasse. Cooperative
marketing really began in Alaska in 1950, when the private sector,
through what was then known as the Alaska Travel Promotion
Association (it became the AVA in 1970) began to turn the
contributions of its members not simply to running the trade
organization but also to implementing a relatively low-cost,
generic advertising and promotional program.
In the 1960s, this was enlarged upon informally when the
association -- still using only its members' money -- began to
coordinate its marketing programs with those of the newly formed
DOT. And in 1976, the AVA went one step further, proposing a bill,
which the Legislature approved, to comingle the funds of the
state's official tourism agency with the talent and financial
contributions of private business, the AVA to supply the ideas and
the DOT to implement them.
A dozen years later, the public and private sectors were more
tightly bound together when the Legislature approved the formation
of the ATMC to implement the domestic programs of the AVA/DOT. The
ATMC produces the state's official Annual Vacation Planner, sales
literature and other marketing materials.
The cooperative effort, although openly envied by many other
states through the years, led to duplication of efforts -- and some
personality clashes -- among the three entities involved. Over the
years, the private sector's share of the total budget was
considerably lower than the state's.
And, with the state's contribution dropping sharply in recent
years -- from $10 million in 1991 to around $4 million in 1998 --
the private sector has been asked to pick up an increased portion
of the tab. It is paying more now than it ever did, but it has been
unable to come anywhere near replacing the lost state revenues, and
Alaska has continued to lose ground to other tourism
In 1991, for instance, the combined DOT-ATMC budget was in
excess of $12 million; in 1998 it was half of that. Decreasing oil
revenues that caused a budget deficit forced the Legislature to
make spending cuts across the board -- in education, in welfare
programs and, of course, in tourism.
Generic Alaska tourism promotion, some in the House and Senate
felt, was a private sector matter and ought not to use up vital
public funds. If the private sector would not finance it, they
figured, new taxes would.
In an effort to develop a mechanism to produce a reliable and
constant source of funding and to head off additional tourism
taxes, the AVA devised the New Millennium Plan. It would create the
Alaska Travel Industry Association (ATIA) to which visitor-related
companies would contribute on a sliding scale, depending on number
of employees and, in the case of the cruise lines, an additional
voluntary levy, based on the number of passenger berths each
The cruise assessment alone, the planners say, would raise $2
million a year within three years of implementation. Destination
marketing organizations and local communities would also be asked
to contribute on the basis of visitor spending -- a quarter of 1%
taken in is the amount mentioned in the plan.
"Pay to play" programs such as buying ads in the Vacation
Planner; buying mailing lists and promotional film footage; having
the new organization distribute brochures; buying research, etc.,
are also seen as ways to generate revenue for ATIA.
The New Millennium Plan also would attempt to raise more money
by offering "affiliate" memberships to such entities as insurance
companies, printers, advertising and public relations firms and
others that might derive less than 10% of their income from
tourism. Their participation would be in four support levels --
those at bronze level would pay $500; silver, $1,000; gold, $5,000,
and patrons, $10,000.
Through the methods mentioned, ATIA's sponsors expect to raise
at least $6 million a year within three years, which, combined with
an anticipated infusion of $4 million from the state, would give
the tourism effort a $10 million budget.
Even at that, Alaska would rank no better than 18th among states
in tourism spending; it currently is in 27th place.