California tourism spending tops $140B in 2018, as Wine Country revenue rises, report says

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California’s tourism industry is healthy, according to a new economic impact report that concentrated on three segments: travel-related spending, employment, and state and local tax revenues.

Visit California, which on May 6 released its 2018 Economic Impact Report, found that travel spending across the state reached more than $140.6 billion; 1.2 million jobs were created; and $11.8 billion was collected in state and local tax revenue.

“To put that in perspective, revenue from the tourism industry is enough to resurface 17,000 miles of freeway roads … hire 149,000 new teachers and employ 107,000 police officers,” said Caroline Beteta, CEO, Visit California, a nonprofit organization tasked with driving domestic and international visitation to the state. “Without the tax revenues generated by travel spending, each California household would have to pay an additional $890 in taxes to maintain state and local services.”

The report kicked off California Travel and Tourism Month, which highlights the hospitality industry as an important economic driver for the state and local communities. Visit California commissioned the report from research firm Dean Runyan and Associates for the 20th year.

Drilling down on a local level, both Sonoma County Tourism and Visit Napa Valley also released their respective region’s economic impact report for 2018. A representative from the Marin Convention and Visitors Bureau, the county’s tourism agency, is awaiting its 2018 numbers from Visit California. The agency doesn’t generate its own report.

Sonoma County

Sonoma County’s 2018 economic impact report, while overall positive, doesn’t tell the full story for the region that remains in recovery mode from the October 2017 firestorm, said Claudia Vecchio, president and CEO of Sonoma County Tourism.

“In the 18 months following the 2017 wildfires, tourism in Sonoma County experienced a time unlike any in our history,” Vecchio said. “Traditional performance metrics, such as the STR report of lodging rates and occupancy, were monitored but did not convey the full picture of the challenges faced by the tourism industry during this rebuilding time period.”

In addition, even though area lodging properties were full, many of the occupants were people displaced from having lost their homes in the fires, or workers employed by construction and rebuilding companies, she said.

Still, the findings — also commissioned through Visit California’s partnership with Dean Runyan and Associates — are “Sonoma Strong.”

According to the findings, visitor spending in the county rose 4.4% to nearly $2.2 billion from 2017 to 2018. It also showed a 6.7% increase, or $194.8 million, in travel-generated state and local tax revenues. Of that, visitors generated $102.1 million for Sonoma County to fund local services.

Sonoma County’s hospitality industry, which employs more than 22,000 people, did show a drop of less than 1% in hospitality employment, according to the report.

“While we are pleased that tourism continues to drive strong economic activity, we know the industry has worked harder during the past 18 months than ever before,” said Joe Bartolomei, chairman of Sonoma County Tourism’s board of directors and co-owner of Farmhouse Inn, a luxury hotel in Forestville. “Tourism is an integral part of all our communities and we’re working to ensure our businesses and employees have the support needed to succeed.”

Napa Valley

Anchored by its flowing wine industry, Napa Valley’s tourism growth is on an upward trend, with 3.85 million visitors last year, according to Visit Napa Valley’s 2018 economic impact report from Destination Analysts, released May 3.

The nearly 4 million visitors reflects a 4.4% increase each year since 2016, the last time Visit Napa Valley reported statistics. The spike also carried over to longer stays.

“Compared to the 2016 study, overnight visitation in Napa Valley grew 13.7% in 2018 (1.2 million), with day-trip visitation growing 5.3 % (2.4 million), supporting Visit Napa Valley’s mission to inspire visitors to extend their stay by experiencing the valley’s more than 125 hotels, motels, and inns,” said Linsey Gallagher, president and CEO for Visit Napa Valley.

Pre-trip websites were the primary source of planning by visitors. As for what influenced them to make the trip, “opinions of friends/relatives directly or through social media” were primary, according to the report.

Spending by tourists reached $2.23 billion, a 15.9% increase over 2016, the report concluded. Visitors spent just under two days per visit on average, dropping about $247 day, or $405 per person per day, for lodging guests.

Behind wine, tourism is the second-largest employer in Napa County. The report states the industry delivers paychecks to 15,872 people, with a combined payroll of $492 million. That’s an employment increase of 18.1% from 13,437 jobs in 2016 and a payroll jump of 27.2% from $387 million.

Aside from the jobs, the report highlighted the amount of tax revenues received by the valley’s locales, including through levies placed on visitors’ hotel bills. About a third of the visitors who come to the Napa area stay the night, and the city of Napa receives the largest share of those hotel guests.

That translated to $21.6 million in hotel tax revenues for Napa in 2018, far outstripping its nearest rival, Yountville at $6.9 million, the figures show.

Above all, wine was the main attraction for those who visited. The report stated about 97% of visitors stopped by a winery on their trip, and 73% visited at least one tasting room.

Dining, winery tours, shopping and getting on board the Napa Valley Wine Train were the other top ranked activities.

“Our goal is to maintain and increase travel and spending in the Napa Valley during non-peak time periods, including November through April (Cabernet Season) and midweek, Sunday through Thursday nights,” Gallagher said.

Staff Writer Cheryl Sarfaty covers tourism, hospitality, health care and education. Reach her at cheryl.sarfaty@ busjrnl.com or 707-521-4259. Editor Anthony Borders contributed to this report.

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