In fiercely local Olympia, tourists are economic gold

When fans of musician Jimmy Buffett desperately needed a new place to hold a party, an Olympia man knew where to look.

Rob Hill suggested that his fellow Buffett fans — known as Parrot Heads of Puget Sound — book their annual shindig at the Red Lion Hotel in Olympia.

In July, about 300 Parrot Heads gathered at the hotel on Olympia’s west side for their weekend-long Laid Back Attack XIII, a tribute to live music and the life that Buffett embraces in beach bum songs such as “Margaritaville” and “Cheeseburger in Paradise.”

The Parrot Heads also raised nearly $30,000 that weekend for United Service Organizations, a charity that supports U.S. troops and their families.

Apparently, the Olympia hotel and the Parrot Heads found their lost shaker of salt. The event had long been held near Sea-Tac Airport to accommodate travelers and the club’s Seattle-heavy membership. But a last-minute crisis left last summer’s event without a venue. Organizers feared Parrot Heads would be reluctant to drive to Olympia, but they didn’t want to cancel.

“As it turned out, it was our best attended ever,” said Hill, the club’s co-chairman.

The Laid Back Attack will return to the Red Lion Hotel in 2016. To help with the cost, the club has applied for $5,000 in lodging tax money, money the city of Olympia doles out every year for groups that attract visitors and fill up hotel rooms. Next summer’s event is expected to generate 415 hotel room nights.

“We’re bringing in people from, in some cases, outside the country, but certainly other parts of the country who otherwise would have no incentive to come to Olympia,” Hill said. “A lot of people are discovering the area for the first time, including some from Seattle who had never stopped in Olympia.”

Groups such as the Parrot Heads are economic gold for Olympia, said Jeff Bowe, director of sales at the Red Lion Hotel.

These multiday events draw people from outside Thurston County, and their economic effect is easy to quantify, he said. For example, the hotel can track the number of rooms booked by Parrot Heads and the amount of food and beverages consumed at the hotel.

“That’s not counting the bar hops, pub crawls and people gassing up their cars,” said Bowe, who has 20 years of experience in the hospitality industry. “We need to make sure we give out those lodging tax funds to organizations that come for multiple nights and focus on cool or unique stuff.”

HOTELS AND ACTIVITIES

Hotel rooms are a key tool for gauging economic activity from out-of-towners.

Each overnight hotel visitor in Thurston County spends an average of $159 a day and stays two nights, according to a report by Dean Runyan Associates, which tracks the local travel industry.

In 2014, visitors spent a total of $265 million in Thurston County. This number includes accommodations, food service, fuel, transportation, retail sales and arts and entertainment. The report estimates that Thurston County had about 164,000 total paid hotel room nights.

The government gets a cut of the hotel proceeds and uses it to support more tourism activity. Thurston County’s Tourism Promotion Area charges $2 per hotel room per night, while the county’s three biggest cities each charge a 4 percent occupancy tax per room per night.

A crucial behind-the scenes player in South Sound tourism is the Olympia-Lacey-Tumwater Visitor & Convention Bureau, which expects to generate 9,000 hotel visits in 2016, according to its lodging tax application.

The bureau’s focus goes beyond hotels to promote the region as a whole while luring visitors to spend time at local destinations such as the Capitol, the waterfront, downtown Olympia and even parks.

Shauna Stewart, executive director of the bureau, said she believes that a great place to visit can make for a great place to live. Tourism has a positive effect on the local sales tax base and the quality of restaurants and businesses, she said.

“People don’t come to stay in hotels,” she said. “They come to do activities.”

The Hands On Children’s Museum is a top destination in Thurston County, but the museum’s current, larger location has taken that status to the next level.

Since November 2012, the nationally recognized museum has averaged more than 300,000 visitors a year — almost double the visitors at its former facility near the Capitol Campus.

The new building on Jefferson Street is constantly booked on weekends as a venue for weddings, company meetings and other after-hour events. In total, the museum hosts about 55 private events a year, executive director Patty Belmonte said.

About 119,229 museum visitors came from outside Thurston County the first year at its current home, with about 32,977 visitors coming from 50 miles or more away from Olympia.

“Each year, it’s been greater than expected,” said Belmonte, who joined the staff 20 years ago when the original museum was threatened with closing.

EFFECT OF LODGING TAX MONEY

For the 2016 budget, Olympia’s Lodging Tax Advisory Committee will recommend $250,035 worth of grants parceled out to 15 applicants. That same amount, which equates to half of the city’s lodging tax revenue, will go to The Washington Center for the Performing Arts.

The second-largest recipient is the Visitor & Convention Bureau, which is seeking $100,000.

Most allocations are less than $10,000. Priority goes to applicants with a tourism marketing plan and documented activities that lead to hotel visits. The committee also is pushing for recipients to produce more accurate data to measure the return on investment.

The children’s museum uses an array of reports and visitor feedback to track its economic effects. As 2015 comes to a close, the museum estimates an $8 million effect on the economy and 4,665 paid hotel room nights from its visitors for the year.

Because of its nonprofit status, the museum can use lodging tax money to double the value of advertising efforts in the Pacific Northwest, which generates the majority of out-of-town patrons, Belmonte said.

However, less lodging tax money means less potential to attract visitors. This year, the children’s museum has asked for $62,605 in lodging tax money, but the committee has recommended $45,000. Belmonte has served on past Lodging Tax Committees and understands that some years are more generous than others.

“Fewer (lodging tax) funds mean that we will be able to do less experimentation and stick with only what we know has worked in the past,” she said.

That experimentation has included redesigning of its website and targeting specific demographics through Pandora, an online music service. In 2014, the latter was used to promote a winter break visit to Olympia. According to the museum, the results led to a 50 percent increase in visitors from outside Thurston County, with 5,612 visitors compared with 2,852 in the same three-week period in 2013.

Other lodging tax applicants include the Washington State Senior Games, which is set to receive $20,000 based on a projection of 810 paid hotel rooms this summer. The event attracts 2,000 competitors every year, with about 75 percent of athletes coming from outside Thurston County.

The Greater Olympia Dixieland Jazz Festival will receive $21,000 for its annual event, which is in Lacey but is expected to generate 2,200 hotel room nights.

This story was originally published November 13, 2015 at 4:45 AM with the headline "In fiercely local Olympia, tourists are economic gold."