Legislature(1995 - 1996)

10/06/1995 01:10 PM House ITT

Audio Topic
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
txt
                   HOUSE SPECIAL COMMITTEE ON                                  
                INTERNATIONAL TRADE AND TOURISM                                
                        October 6, 1995                                        
                           1:10 p.m.                                           
            Fairbanks Legislative Information Office                           
                                                                               
                                                                               
 MEMBERS PRESENT                                                               
                                                                               
 Representative Beverly Masek, Chairman                                        
 Representative Jeannette James                                                
 Representative Pete Kott                                                      
 Representative Caren Robinson                                                 
                                                                               
 MEMBERS ABSENT                                                                
                                                                               
 Representative Alan Austerman, Vice Chairman                                  
 Representative Brian Porter                                                   
 Representative Irene Nicholia                                                 
                                                                               
 COMMITTEE CALENDAR                                                            
                                                                               
 Regional report from local tourism                                            
                                                                               
 International report from Representative James                                
                                                                               
 Report from Hank Phillips, President, National Tour Association               
                                                                               
 Discussion:  Promoting Cottage Industries in Alaska                           
                                                                               
                                                                               
 WITNESS REGISTER                                                              
                                                                               
 AMY REED GEIGER, Manager                                                      
 Visitor Services - Museum                                                     
 University of Alaska                                                          
 P.O. Box                                                                      
 Fairbanks, Alaska 99775                                                       
 Telephone:  (907) 474-7505                                                    
 POSITION STATEMENT:  Discussed tourism issues                                 
                                                                               
 PAUL WELTON                                                                   
 Arctic Seven Tours                                                            
 P.O. Box 80488                                                                
 Fairbanks, Alaska 99708                                                       
 Telephone:  (907) 479-0751                                                    
 POSITION STATEMENT:  Discussed tourism issues                                 
                                                                               
 DEBBIE EBERHARDT, Owner/Operator                                              
 A Taste of Alaska Lodge                                                       
 551 Eberhardt Road                                                            
 Fairbanks, Alaska 99712                                                       
 Telephone:  (907) 488-7855                                                    
 POSITION STATEMENT:  Discussed tourism issues                                 
                                                                               
 HANK PHILLIPS, Senior Vice President                                          
 National Tour Association                                                     
 546 East Main Street                                                          
 P.O. Box 3071                                                                 
 Lexington, Kentucky 40597-3071                                                
 Telephone:  (606) 226-4255                                                    
 POSITION STATEMENT:  Discussed tourism issues                                 
                                                                               
 WENDY WOLF, Programs Manager                                                  
 Division of Tourism                                                           
 Department of Commerce and                                                    
   Economic Development                                                        
 P.O. Box 110801                                                               
 Juneau, Alaska 99811-0801                                                     
 Telephone:  (907) 465-5471                                                    
 POSITION STATEMENT:  Discussed tourism issues                                 
                                                                               
 SHARON GAIPTMAN, Development Specialist                                       
 Division of Tourism                                                           
 Department of Commerce and                                                    
   Economic Development                                                        
 P.O. Box 110801                                                               
 Juneau, Alaska 99811-0801                                                     
 Telephone:  (907) 465-5478                                                    
 POSITION STATEMENT:  Discussed tourism issues                                 
                                                                               
 DAVE CARP, Executive Director                                                 
 Alaska Tourism Marketing Council                                              
 3601 C Street, Suite 700                                                      
 Anchorage, Alaska 99503-5935                                                  
 Telephone:  (907) 563-2289                                                    
 POSITION STATEMENT:  Discussed tourism issues                                 
                                                                               
 ACTION NARRATIVE                                                              
                                                                               
 TAPE 95-8, SIDE A                                                             
 Number 004                                                                    
                                                                               
 The House Special Committee on International Trade and Tourism                
 was called to order by Chairman Masek at 1:10 p.m.                            
                                                                               
 CHAIRMAN BEVERLY MASEK announced the meeting would be                         
 teleconferenced.  Members present at the call to order were                   
 Representatives Masek, Kott and James.  Staff for Representatives             
 Austerman and Porter were in attendance via teleconference.                   
 Representative Robinson was in attendance via teleconference from             
 Juneau.                                                                       
                                                                               
 Number 116                                                                    
 CHAIRMAN MASEK informed the committee the Alaska Visitor's                    
 Association (AVA) is currently having a international trade and               
 tourism meeting in Fairbanks and she thought it would be an                   
 excellent time to hear from some of the small businesses                      
 throughout the state.                                                         
                                                                               
 CHAIRMAN MASEK said the meeting is one of a series of meetings                
 she is planning on holding until January.  She encouraged anyone              
 who is related to the tourism industry to submit information as               
 she is planning to write a report regarding tourism for the                   
 House, Senate and the Governor's Office.                                      
                                                                               
 Number 332                                                                    
                                                                               
 CHAIRMAN MASEK said the first item on the agenda includes                     
 addressing regional reports from local tourism businesses on what             
 are:  A. The existing opportunities for locally controlled                    
 tourism in Fairbanks; B. What is the potential; and C. How to                 
 achieve the potential.  She said the committee would have a                   
 discussion with people who will share ideas with the committee.               
                                                                               
 CHAIRMAN MASEK explained the second item on the agenda is                     
 international reports.  Chairman Masek noted there would be a                 
 report from Representative James on her recent trade delegation               
 trip to China.  She also noted there would be a report from Hank              
 Phillips, Senior Vice President, National Tours Association, on               
 the importance of the international market.  The committee would              
 then take public testimony.                                                   
                                                                               
 Number 624                                                                    
                                                                               
 CHAIRMAN MASEK invited Mr. Geiger to come before the committee.               
                                                                               
 AMY REED GEIGER, Manager, Visitor Services - Museum                           
 University of Alaska, stated he deals with admissions, visitation             
 and daily operations at the museum.  He said they are advocates               
 for all of the interior attractions and small business.  They                 
 encourage small tour groups and local residents to take advantage             
 of the gallery and the special exhibits.  Mr. Geiger noted during             
 the summer months, they focus on very pertinent Alaskan topics                
 that would be attractive to the tourist industry.  He explained               
 another interest is the museum store which does promote and                   
 showcase many local artists and small business.  They solicit                 
 products from all over the state and a majority of the products               
 in the store are Alaskan products.                                            
                                                                               
 MR. GEIGER said the museum is in their third year of a                        
 collaborative effort with the World Eskimo and Indian Olympics.               
 He noted this is a spectacular show which deals with endogenous               
 Alaskan Native games.  It is a good opportunity for endogenous                
 Alaskan Natives to reveal their heritage.                                     
                                                                               
 Number 908                                                                    
                                                                               
 MR. GEIGER said the museum currently has a annual arts and crafts             
 fair entitled "Treat Yourself to a Toy," which is held in                     
 December.  They invite a variety of local artists to participate.             
                                                                               
 MR. GEIGER explained they are attempting to build on to the                   
 museum in order to create an art gallery and potentially a                    
 planetarium.  He noted they don't look at this as competition                 
 with other attractions.  The more attractions that there are in               
 the area means there will be more reasons for visitors to come to             
 the Fairbanks area.  Mr. Geiger said they hope to create this                 
 phase two over the next seven or eight years in order to show                 
 more art.                                                                     
                                                                               
 MR. GEIGER said they have realized during the months of May and               
 September there has been a 5 percent increase in visitation.  He              
 said the museum is able to take advantage of the 5 percent                    
 increase because they are still open whereas there are a lot of               
 local attractions that are only open in June, July and August.                
 Mr. Geiger said he feels that there are some small businesses and             
 locals that could be taking advantage of that shoulder season and             
 it might to something to look into.  He noted they are                        
 considering changing their summer hours to be from May 15 through             
 September 15.                                                                 
                                                                               
 Number 1158                                                                   
                                                                               
 REPRESENTATIVE JEANETTE JAMES indicated she is very interested in             
 the planetarium and asked if it is going to be a display.                     
                                                                               
 MR. GEIGER explained the planetarium will be in collaboration                 
 with the Geophysical Institute to some extent.  He noted there                
 are a lot of Japanese tours in the winter months because of the               
 northern lights.                                                              
                                                                               
 REPRESENTATIVE JAMES inquired as to what the winter hours are at              
 the museum.  MR. GEIGER stated they are open year round.  He said             
 if you come in June, July or August, there is almost total light              
 all night so there isn't an opportunity for someone from the                  
 Lower 48 to view the lights.  If they had a planetarium, it would             
 serve a function to be able to view the lights and consolations.              
                                                                               
 MR. GEIGER said he has learned from the meetings held by the                  
 Alaska Visitor's Association (AVA) that visitors really like                  
 educational programs.  He said we might want to encourage other               
 small businesses, local attractions and entities to have                      
 informational sources within their attractions of their small                 
 business.                                                                     
                                                                               
 Number 1505                                                                   
                                                                               
 REPRESENTATIVE JAMES asked if there are guided tours through the              
 museum or is it visual and read as you go.  MR. GEIGER indicated              
 currently there aren't guided tours.  They have considered guided             
 tours but there are a couple of problems.  One is that the floor              
 space isn't particularly large.  If they were to provide guided               
 tours, they probably would like to charge a price.  It would be               
 hard to try to filter out people that are just coming to the                  
 gallery and aren't part of the tour.  He noted they provide tours             
 for travel industry people.                                                   
                                                                               
 REPRESENTATIVE JAMES referred to the museum in Juneau and said                
 when she visited, she had met a lady from the library and she                 
 gave a personal tour.  She said it was wonderful.  One thing                  
 about reading everything is it takes so long to get through and               
 you miss a lot of it.                                                         
                                                                               
 MR. GEIGER said he agrees with Representative James.  He noted                
 one thing they have done in order to capture that feeling is they             
 have started to explain their program which has been very                     
 popular.                                                                      
                                                                               
 REPRESENTATIVE JAMES noted she had just returned from a three                 
 week trip to China and she had the privilege of a guided tour                 
 through the Forbidden City.  She said she watched other guided                
 tours going through there.  The one on two experience they had                
 could not be repeated.  Representative James noted she would pay              
 a lot of money for the one on one experience.                                 
                                                                               
 Number 1827                                                                   
                                                                               
 REPRESENTATIVE JAMES referred to when the tour people decided not             
 to go to the university but to go to the El Dorado and asked if               
 that was damaging to the museum.  MR. GEIGER said they are                    
 recovering.  He noted what bothers him about that is when money               
 shrinks, the first thing that it shrinks in is offering public                
 services.  He said the "Explainer Program" that he just                       
 discussed, which was free to anybody that came to the museum, is              
 probably on the cutting block.  The question is, "Can we still                
 afford to provide this service?"  Mr. Geiger said in going over               
 the numbers, they went from 142,000 with Princess to 124,000                  
 without Princess.  They realized about a 2 percent increase if                
 you were to subtract the (indisc.) of Princess.  He said he                   
 wishes there were more options for people on tours.  Sometimes he             
 believes it would be more equitable for everybody in Fairbanks if             
 people had more of an opportunity to pick and choose what                     
 attractions they would partake in.  Mr. Geiger noted they are                 
 fortunate to still get Westours which brings great numbers to the             
 museum.                                                                       
                                                                               
 Number 2110                                                                   
                                                                               
 CHAIRMAN MASEK asked Mr. Geiger what approach the museum takes in             
 marketing to the individual tourist.  She asked how they know the             
 museum exists.  MR. GEIGER said they are fortunate to have a lot              
 of "word of mouth" in Fairbanks.  He said he believes that is                 
 probably the way the museum gets marketed the best.  Mr. Geiger               
 said the museum does reach out to tour groups and other groups                
 via mailings and brochures.  They have not pursued an aggressive              
 marketing.  The public services end of the museum is only one                 
 little part of it.  He said the museum is a complex place and one             
 of the mandates is research.  He noted other things go on there.              
 Mr. Geiger explained over the course of the past decade, the                  
 museum has grown tremendously and the employees that deal with                
 the public sector have stayed the same.  He noted he is the first             
 new employee added to the public sector realm of the museum since             
 its move in 1982.                                                             
                                                                               
 Number 2327                                                                   
                                                                               
 CHAIRMAN MASEK asked how many people work in the museum's gift                
 shop.  MR. GEIGER explained the gift shop is completely run by                
 University of Alaska - Fairbanks students.  They are student jobs             
 and you would have to be a full-time student in order to have the             
 job.  In the summer, they have approximately 15 museum                        
 attendants.  In the winter, the number drops to eight or nine.                
 He noted in the summer the attendants are full-time and the                   
 winter there are less than 20 hours per week.                                 
                                                                               
 CHAIRMAN MASEK inquired if those people are part of the                       
 educational part of the museum.  MR. GEIGER indicated the                     
 Explainer Program is handled by the Public Relations and                      
 Education Department of the museum which is run by Terry Dickie.              
 He handles the docent programs for school kids which teaches more             
 about Alaskan history.  Mr. Dickie also handles the Explainer                 
 Program in which there are usually three explainers during the                
 summer.  It runs from June through August 30.                                 
                                                                               
 CHAIRMAN MASEK referred to the university students and asked if               
 they have a real interest in tours and expanding to the tourist               
 industry.  MR. GEIGER said often they do.  He noted the good                  
 thing about being a museum attendant is you can have a big                    
 variety of interests and aptitudes and also be a wonderful museum             
 attendant.  No only do they work in the store and with tourism,               
 but they also work in the gallery and have to have some knowledge             
 of natural and physical Alaskan history.                                      
                                                                               
 Number 2744                                                                   
                                                                               
 CHAIRMAN MASEK asked Mr. Geiger how he thinks the state can                   
 improve on anything that would impact the museum.  MR. GEIGER                 
 said he thinks they are lucky to enjoy a legislature and governor             
 that promotes tourism.  He explained he is relatively naive of                
 exactly what the legislature and the state does in order to                   
 promote tourism directly.  There definitely is a need for the                 
 state to provide an overview of Alaska.  Mr. Geiger referred to               
 an issue talked about in the AVA meeting earlier in the day which             
 was how roadways and campsites were getting exploited by people               
 throwing trash out, et cetera, and how the people of Alaska find              
 that very offensive.  He said the AVA talked about efforts of how             
 to perhaps get the state to make an organized effort to clean it              
 up.  In addition to that, he believes it would be really good if              
 the state or legislature provided a list of expectations for                  
 tourists and Alaskans using the roadways and facilities                       
 explaining mandates of what they shouldn't do while using the                 
 facilities, et cetera.                                                        
                                                                               
 CHAIRMAN MASEK noted Gail Phillips, Speaker of the House,                     
 appointed her to serve on the Marketing Alaska Group which is                 
 made up of members from the private sector, the House and the                 
 Senate.  She noted the litter problem is being talked about.                  
 Hopefully, there will be something done because it is really a                
 big problem.                                                                  
                                                                               
 Number 3201                                                                   
                                                                               
 The next person to address the committee was Paul Welton                      
                                                                               
 PAUL WELTON, Arctic Seven Tours, informed the committee members               
 he is representing a number of small companies including Alaska's             
 Seven Gables which is one of the larger bed and breakfasts in the             
 state of Alaska.  It is marketed nationally and internationally.              
 Another is Arctic Seven Tours which has boat, bike, snow machine              
 rentals and reservation services.  He said they have a rather                 
 aggressive marketing campaign and one of the reasons is that 50               
 percent of their business comes from overseas.                                
                                                                               
 REPRESENTATIVE MASEK said she would like the committee to hear                
 what the existing opportunities are for locally controlled                    
 tourism in Fairbanks, what the potential is and how to achieve                
 the potential.  She referred to marketing and asked how he feels              
 the state can help smaller businesses.                                        
                                                                               
 MR. WELTON referred to the question of "What are the present                  
 existing opportunities," and said his organization is in its                  
 infancy.  The first part of any tourism is package tours.  A lot              
 of people are afraid to go to places like Russia.  They like to               
 go in with a group as you have protection and security.  Mr.                  
 Welton said after the market continues to mature, then you have               
 the individual travelers making their own reservations.  He noted             
 the large tour companies tend to dominate the market and he is                
 very thankful because they do much of his company's marketing for             
 them.  They are able to bring in people by the thousands with                 
 ship, airplanes, et cetera.  Many times the infrastructure cannot             
 hold the number of people they are bringing in.  Therefore, it                
 spreads out in to the small economy such as the bed and                       
 breakfasts catching the overflow of the larger tour companies.                
 MR. WELTON referred to the question of how to achieve the                     
 potential and said one thing that has been very successful is the             
 Alaska Tourism Marketing Council (ATMC).  He said the smaller                 
 businesses are sorry to hear about the cuts occurring with the                
 ATMC.  That affects the small companies because in the beginning,             
 he thought the advertising was free.  Currently, for a couple of              
 lines of advertising is $500.  He noted he believes the $500 fee              
 is a very good fee when you consider that it is being printed in              
 terms of 700,000 copies which is being distributed throughout the             
 nation and other parts of the world.  For people just beginning,              
 $500 is a major cost.                                                         
                                                                               
 MR. WELTON said another area to enhance achievement would be the              
 product Alaska.  One of the problems in Alaska is the                         
 bottlenecks.  This is a major problem in Fairbanks, particularly              
 with the federal controlled and managed Denali State Park.  Along             
 with that is the word "access."  Access to more of Alaska really              
 needs to be opened up rather than being restricted to predefined              
 areas.                                                                        
                                                                               
 MR. WELTON explained a major problem is an identity crises.  He               
 showed the committee a brochure from Germany which had a map of               
 Alaska and didn't show the city of Fairbanks.                                 
                                                                               
 Number 3949                                                                   
                                                                               
 CHAIRMAN MASEK indicated Fairbanks is Alaska's second largest                 
 city.  She said the state does have an office in Germany and                  
 there is a representative who does represent the state of Alaska              
 on tourism.  She suggested that the committee may find out from               
 the representative why there aren't more details as it is a big               
 concern.                                                                      
                                                                               
 MR. WELTON explained one of the reasons his company had to spend              
 thousands of dollars to go internationally.  The mentor of this               
 was Dale Fox who runs marketing and consulting out of Anchorage               
 for large companies that can afford his fees.  Mr. Welton                     
 explained he had contacted Mr. Fox because he had contacted the               
 Division of Tourism in Juneau numerous times to try and get                   
 information on travel guides in Germany.  He said he didn't want              
 to spend thousands of dollars to go to Germany to get the travel              
 guides.  He said he wasn't getting anywhere with requesting                   
 information on the travel guides.  Mr. Welton explained that what             
 it came down to is Mr. Fox said either we can pay him a couple of             
 thousand dollars to get the information for him or Mr. Welton                 
 could get on a plane and fly to Germany to get their own                      
 information.  Mr. Welton said he and his wife decided to go to                
 Germany.  He showed the committee some clandestine photographs he             
 smuggled out of Germany, which showed the building that the                   
 Division of Tourism occupies.  He informed the committee there                
 are some plaques on the outside of the building in which there                
 are some misspellings.  You'll also notice Alaska isn't the only              
 state being represented but also Miami, Florida.  Nobody seems to             
 be aware of the fact that it is Miami and Alaska.  Mr. Welton                 
 said he was prohibited on more than one occasion by more than one             
 person at the Division of Tourism to take any photographs in                  
 Germany.  He explained he took the photographs to show what he                
 had found.  He was told on two occasions by the Edeltraud Sommer,             
 the director, and the assistant director in Germany, that no                  
 photos would be taken under any circumstances.                                
                                                                               
 CHAIRMAN MASEK asked if Ms. Sommer explained why.  MR. WELTON                 
 informed the committee Ms. Sommer reversed the question by                    
 saying, "Well why would you want to take photographs?"  Mr.                   
 Welton said if it is the state's office and he is paying money as             
 a tourist visiting Germany, why can't he take pictures.                       
                                                                               
 CHAIRMAN MASEK asked if he was allowed to go into the office.                 
 MR. WELTON explained he was allowed to go into the office but                 
 wasn't allowed to take photographs inside the office.                         
                                                                               
 Number 4419                                                                   
                                                                               
 CHAIRMAN MASEK said there were some people who came to her                    
 personally regarding the issue.  She referred to a meeting she                
 held in Juneau who brought those same concerns to her.  Chairman              
 Masek said she understands Mr. Welton's concerns.  They really                
 should be advertising for our state.  She noted she would ask a               
 representative from the Division of Tourism to testify after Mr.              
 Welton.  Chairman Masek asked Mr. Welton when he made the trip to             
 Germany.                                                                      
                                                                               
 MR. WELTON said he couldn't give the exact date but he thought it             
 could be last November.                                                       
                                                                               
 TAPE 95-8, SIDE B                                                             
 Number 110                                                                    
                                                                               
 MR. WELTON showed the committee a book from Great Britain that                
 the travel agencies in Great Britain use to book clients to the               
 United States.  He noted the book costs hundreds of dollars.  He              
 said the book has about 50 pages of advertising on Florida.  Mr.              
 Welton said he looked for Alaska and it wasn't listed.  He noted              
 there were three pages of fine print on Ohio which he didn't                  
 realize was a major tourist destination.  Mr. Welton said how can             
 a travel agent in Great Britain reference Alaska if it isn't in               
 the book.  He noted the book has information provided by the                  
 states and it doesn't cost anything to advertise in the book.                 
                                                                               
 CHAIRMAN MASEK noted the state has other offices besides the ones             
 in Germany and Great Britain.  There is an office in Australia                
 where there are trade specialists who are contracted through the              
 state to do the marketing for Alaska.                                         
                                                                               
 MR. WELTON said he thinks that is the problem.  There aren't                  
 Alaskans representing Alaska.  Imagine if a Japanese corporation              
 came to the United States and didn't have a Japanese                          
 representative.  Mr. Welton said he finds it ironic that the                  
 state can contract with Japan or Germany and never have an                    
 Alaskan represent us.  He believes it should be an Alaskan                    
 representing Alaska rather than other people whose interests are              
 quite divided as they are representing other states.                          
                                                                               
 Number 628                                                                    
                                                                               
 CHAIRMAN MASEK said she has traveled extensively throughout                   
 Europe several times.  She explained she attended a trade show in             
 Italy in 1993.  Alaska had no representation.  She said Florida               
 had good representation.  Chairman Masek said Alaska has to                   
 become more competitive.  We need to see changes.  She referred               
 to budgets being cut and said it has to be done to where there is             
 a positive impact on tourism in our state.  We must do everything             
 we can to improve tourism.  She asked Mr. Welton if he had                    
 additional comments.                                                          
                                                                               
 MR. WELTON referred to the ATMC and said in terms of state money,             
 everyone will agree that the ATMC has done a very good job and                
 has been very effective.  He referred to the Division of Tourism              
 and said he believes their budget is $4 million or $5 million.                
 He believes half of that is going to the contractors.  Mr. Welton             
 said he would like to point out that when you go to an                        
 international contractor's office, they don't give out Alaskan                
 information in terms of tourism.  Instead, they are giving out                
 their own lists.  He showed the committee some information in                 
 which advertised German tour operators but no Alaskan tour                    
 operators.  He said we're taking our Alaskan money, giving it to              
 a non Alaskan who is representing 77 German tour operators.  He               
 indicated this also occurring in Japan.                                       
                                                                               
 MR. WELTON said the Division of Tourism puts out a generic                    
 publication, that is paid for with taxpayers dollars.  He said                
 there are lots of beautiful photos in it but there isn't                      
 advertising from a particular company.  It is very generic.  Mr.              
 Welton noted he would like to see the Alaska Milepost Magazine in             
 the Division of Tourism's office in Germany.  Most Germans that               
 come to Alaska come for 30 days, rent recreational vehicles and               
 travel.  He noted there is also a lot of advertising in the                   
 Milepost.                                                                     
                                                                               
 Number 1357                                                                   
                                                                               
 REPRESENTATIVE JAMES referred to access and said in Anchorage she             
 attended an all day Joint House and Senate State Affairs                      
 Committee meeting regarding RS 2477 trails throughout the state               
 with the interest of being able to provide legal access.  One of              
 the discussions is that because of federal regulations, do we                 
 allow trails as trails for what they're being used as now.                    
 Later, if they are to be used as something else, public input                 
 should be allowed.  Representative James said we are going to                 
 need some help in addressing trails on federal lands.  She said               
 the legislature is very concerned about access in the state.  She             
 asked that if there is any input on that issue, they should be                
 given to the committee.                                                       
                                                                               
 Number 1532                                                                   
                                                                               
 CHAIRMAN MASEK asked if there were questions to be asked via                  
 teleconference.  REPRESENTATIVE KAREN ROBINSON indicated she                  
 didn't have any questions.  CHAIRMAN MASEK asked if                           
 Representative Austerman was available in Kodiak.  A Cliff Stone,             
 staff member to Representative Austerman, indicated the                       
 representative hadn't arrived yet.                                            
                                                                               
 Number 1600                                                                   
                                                                               
 CHAIRMAN MASEK announced the committee would take a five minute               
 break at 2:15 p.m.                                                            
                                                                               
 CHAIRMAN MASEK called the meeting back to order at 2:34 p.m.  She             
 noted Daniella Loper from Representative Porter's office was                  
 connected via teleconference.                                                 
                                                                               
 Number 1710                                                                   
                                                                               
 DEBBIE EBERHARDT, Owner/Operator, A Taste of Alaska Lodge, was                
 next to testify before the committee.  She noted her business is              
 considered a bed and breakfast and is located in Fairbanks.  Ms.              
 Eberhardt said her and Mr. Welton do share a lot of the same                  
 ideas but her comments are kind of opposite of what Mr. Welton                
 has said.  She mentioned she advertises with the Alaska State                 
 Planner and said she bought one of the first display adds that                
 was bought by a bed and breakfast.  Ms. Eberhardt said 99.9                   
 percent of the business that her business generates comes                     
 directly from that advertisement.  She noted she isn't a member               
 of the AVA but hopes to joint in the future.  Currently, she                  
 feels her efforts seem to be directed through her own marketing               
 division and not through an organization.  Ms. Eberhardt referred             
 to the Division of Tourism and said she has attended several                  
 workshops and seminars put on by the division.  She discussed a               
 European travel fair she attended at the Wedgewood Resort the                 
 previous Tuesday.  Ms. Eberhardt said the fair was very well                  
 organized by the division.  She said she can't say that any of                
 the state's opportunities which have directly affected her have               
 been bad.  She said it upsets her that the budgets are being cut.             
 If the ATMC budget is cut, the Vacation Planner is out the                    
 window.  Ms. Eberhardt said she has been in business over the                 
 past four years and has found some things work and some things                
 don't.  She indicated that budget cuts won't hurt the larger                  
 companies but will hurt the small business.                                   
                                                                               
 MS. EBERHARDT said her biggest complaint is that the state of                 
 Alaska is she is in direct competition with them.  Her business               
 is located at 5.3 mile of the Chena Hot Springs Road.  She is 53              
 miles from the Chena Hot Springs Resort which is currently owned              
 by the state of Alaska.  She said the state is controlling her                
 business as they are involved in tourism in the wrong areas.  The             
 railroad is owned by the state of Alaska and the state dictates               
 when the train runs and when it doesn't.                                      
                                                                               
 Number 2305                                                                   
                                                                               
 CHAIRMAN MASEK asked Ms. Eberhardt if she has any thoughts or                 
 ideas as far as the opportunities in Fairbanks for the local                  
 controlled tourism and as far as the state being involved.  MS.               
 EBERHARDT said the state needs to continue funding and assist the             
 small operators.  She indicated there should be more financial                
 support from the state in getting more business going.  She                   
 suggested that when there are state conferences in Fairbanks,                 
 employees should start picking some of the smaller business to                
 use as their overnight lodging and small conferences.                         
                                                                               
 MS. EBERHARDT said she thinks there are enough bed and breakfasts             
 in the Fairbanks area but probably not in the state as a whole.               
 She noted dog mushing is very popular but she isn't sure there                
 are any programs to assist a dog musher in getting a program off              
 the ground.                                                                   
                                                                               
 Number 2638                                                                   
                                                                               
 CHAIRMAN MASEK said the most concern is with budgets and we will              
 continue to see more cuts.  She said that is one of the reasons               
 she is holding hearings and she plans to have several more before             
 session begins.  She would like to hear from the small business               
 people who are struggling.  Chairman Masek said we need to look               
 for positive ways to spend the money as there probably won't be               
 much more funding.                                                            
                                                                               
 MS. EBERHARDT said if the budgets are going to be cut, those cuts             
 need to be redirected.  There is very little money, if any, that              
 is directed towards winter tourism.  Everybody says they have to              
 make their money in four or five months.  On the contrary for                 
 her, she does a lot of tourism in the winter.  She stated she                 
 survives in the winter on the local and tourism markets.  Ms.                 
 Eberhardt urged that marketing include the winter months.  She                
 stated not enough money is being spent on the winter market.                  
                                                                               
 Number 2820                                                                   
                                                                               
 CHAIRMAN MASEK asked if that is individual tours.  MS. EBERHARDT              
 said not enough money is being spent for any type of tours                    
 whether it is individual or larger companies.  She asked why                  
 would anyone come to Alaska if they don't hear anything about                 
 winter markets.  If they just hear about the summer markets,                  
 they're only going to come in the summer.  She said July in                   
 Fairbanks seems to be heavily marketed.  In her opinion, May,                 
 June, August and September are the premium months for the                     
 Fairbanks area.  Chairman Masek thanked Ms. Eberhardt for her                 
 testimony.                                                                    
                                                                               
 Number 3153                                                                   
                                                                               
 CHAIRMAN MASEK noted for the record that Dave Harp, Executive                 
 Director, ATMC, was in attendance.  She also noted there were                 
 several other people present from the Alaska tourism industry and             
 the Governor's office.                                                        
                                                                               
 Number 3234                                                                   
                                                                               
 HANK PHILLIPS, Senior Vice President, National Tour Association               
 (NTA), stated his company is located in Lexington, Kentucky.  Mr.             
 Phillips said in preparing for his trip to Fairbanks, he was                  
 amazed at the reaction of people that he told he was traveling to             
 Alaska.  He said Alaska is blessed as it has a mystic and a                   
 magnificent majesty that is all its own.  He said he has come to              
 love the people of Alaska.  They offer their own special brand of             
 hospitality and have fun and a friendly approach to visitors.                 
                                                                               
 MR. PHILLIPS informed the committee the NTA is the largest North              
 American trade association in the package travel industry.  NTA               
 has 4,000 corporate members.  That membership represents a cross              
 section of the travel industry.  Their membership includes more               
 than 600 tour operators who develop, sell, and operate travel                 
 packages to destinations in the U.S., Canada, Mexico and around               
 the word.  Other categories of membership include 800 destination             
 marketing organizations representing local, regional, state and               
 providential travel promotion offices and more than 2,300                     
 suppliers representing attractions, hotels, restaurants, bus                  
 companies, airlines, receptive operators and many others.  Mr.                
 Phillips informed the committee there are 36 members of NTA who               
 are based in Alaska.  There are a number of others that are very              
 active in the Alaskan industry but aren't necessarily based in                
 the state.  He noted that out of the 600 tour companies that are              
 members of the NTA, 290 have told him that they bring groups,                 
 tours or packages to the state of Alaska.                                     
                                                                               
 MR. PHILLIPS said he would comment on how NTA relates to some of              
 the small companies and suppliers like small hotels or                        
 restaurants.  He said many of those are part of the 2,300                     
 membership.  The NTA often tells people that they may not be for              
 them because of the cost of joining the association and                       
 participating in the activities of the association.  Mr. Phillips             
 said the NTA strongly encourages them to work closely with their              
 local convention and visitor's bureaus (CVB) as there are                     
 approximately 700 that are members of NTA.  He said they also                 
 encourage them work closely with their state tourism offices.  He             
 noted all 50 states and all Canadian provinces are members of                 
 NTA.                                                                          
                                                                               
 MR. PHILLIPS explained NTA has recognized inbound international               
 tourism as an important market segment to the travel industry and             
 NTA's members and is one that will continue to grow as the                    
 world's emerging economies produce more and more travelers.                   
 Recognizing this, in 1987 NTA established an international                    
 committee to develop a comprehensive plan to increase the                     
 capabilities of the NTA membership to access and serve the                    
 inbound international market.  To achieve this, the committee has             
 since focused its work on developing programs in two areas,                   
 education and marketing.  Through this dual programming effort,               
 NTA educates their members about the overseas markets and also                
 promotes members to the international tour and travel producers.              
 Each year, NTA is represented at various international trade                  
 shows to promote the products and services of their members.  He              
 noted that the board of directors has approved participation at               
 seven international shows.  Three of those will be offered to                 
 tour operators to come in and operate under NTA's umbrella.                   
                                                                               
 MR. PHILLIPS said we all know that travel and tourism is good                 
 business in America and is also very good business for America.               
 The travel and tourism industry is the third largest industry in              
 the U.S. and is the second largest employer with a $417 billion               
 annual impact on our nation's economy.  The overseas market                   
 currently generates nearly one-sixth of all tourism dollars or                
 $77.6 billion annually.  The U.S. travelers spend $22 billion                 
 overseas.                                                                     
                                                                               
 MR. PHILLIPS informed the committee members during the last ten               
 years, Alaska has seen a steady increase in its overseas market.              
 According to a 1993 AVA survey conducted by the McDowell Group,               
 the number of international visitors has increased 57 percent and             
 overseas spending in the state has increased more than five fold.             
 Although the overseas market represented just six percent of                  
 Alaska's total visitation in 1993, it produced $55.4 million in               
 tourism spending during the summer tourist season.  The overseas              
 visitor to Alaska spends nearly $1 thousand per day on lodging,               
 transportation, tourism recreation, food and souvenirs.  Mr.                  
 Phillips said those numbers were gathered from research which was             
 supported by state funding.  He noted that same research                      
 represents a project that is envy of several other states.                    
                                                                               
 MR. PHILLIPS said Alaska is a new frontier of foreign travelers.              
 We are seeing a trend in the overseas markets that could put                  
 Alaska high on the list of key destinations.  Mr. Phillips said               
 the traditional big cities and major tourist attractions in the               
 Lower 48 are still going to attract foreign visitors but many of              
 the repeat travelers are now looking for new destinations and                 
 unique travel experiences.  They want to see the wilderness areas             
 and native habitat that is entirely different from their own                  
 countries.  He noted that adventure travel is becoming                        
 increasingly popular.  Mr. Phillips said at the international                 
 travel shows that the NTA attends, buyers frequently ask for more             
 information about Alaska.                                                     
                                                                               
 Number 4234                                                                   
                                                                               
 MR. PHILLIPS explained the international market is an important               
 tourism marketing segment and is rapidly growing.  He referred to             
 Japan and said the forecast indicates substantial growth ahead                
 with over 20 million outbound departures by the year 2000.                    
 Currently, over four million Japanese visit the U.S. each year                
 and this is expected to double by the turn of the century.  Japan             
 represented 11 percent of all of Alaska's inbound tourism in                  
 1993.  Clearly, there is great potential of growth from the                   
 Japanese market and this is only one example of Alaska's bright               
 future.  There is a challenge and that is effective promotion                 
 which is essential for the success of travel and tourism.  If you             
 promote, the tourist will come and they will spend.                           
                                                                               
 MR. PHILLIPS referred to hearing the Governor speak the previous              
 day and said he made reference to Alaska being a land of dreams,              
 but he pointed out that it is not a field of dreams.  Just                    
 because it is here and just because it is as great as it is, that             
 doesn't mean people are going to automatically come to Alaska.                
 It is going to take hard aggressive promotion.  Mr. Phillips                  
 explained the dollars spent on tourism promotion is a good                    
 investment that results in a stronger economy.                                
                                                                               
 MR. PHILLIPS said traditional methods of marketing to the                     
 international market include international trade shows, trade                 
 missions, brochures, advertisements and trade consumer                        
 publications.  Another tried and true marketing method is                     
 familiarization tours.  He said he learned upon his arrival in                
 Alaska that 20 German and United Kingdom travel producers were in             
 Alaska on a familiarization tour.  They saw all the regions of                
 the state and visited Fairbanks where 60 businesses put together              
 a trade show to show their services and products to the travel                
 producers.                                                                    
                                                                               
 Number 4601                                                                   
                                                                               
 MR. PHILLIPS said another point is that there are some emerging               
 methods of marketing.  One important emerging marketing tool is               
 the information super highway.  Automated marketing, just like                
 the other methods of marketing, deserve the committee's awareness             
 and support.  He said NTA is convinced that automation is a                   
 importance and they have invested large sums in developing two                
 networks called NTA On-Line and NTA Tour and Travel Shop to                   
 assist with marketing both domestically and internationally.  He              
 said NTA members, including the Alaska members, are able to go                
 on-line.                                                                      
                                                                               
 TAPE 95-9, SIDE A                                                             
 Number 013                                                                    
                                                                               
 MR. PHILLIPS said another suggestion he would offer as a part of              
 international marketing is to recognize that it is not just a                 
 function of being out there promoting and marketing but that it               
 is critical and essential.  Knowing what to do with the business              
 once it arrives is also critical and involves education.  It                  
 involves educating the travel industry and related businesses so              
 that they understand how to service the international traveler.               
 Once you have the business, you also need to remove barriers.                 
 Those who have traveled abroad know how important your comfort                
 level and piece of mind is to an enjoyable travel experience when             
 you visit a foreign country.  He suggested there be important                 
 international signage.  See how able foreign visitors are to                  
 exchange their currency or to utilize multilingual services or                
 information.                                                                  
                                                                               
 MR. PHILLIPS said another important ingredient is partnerships.               
 The cost of international marketing and the consumer demand are               
 both too high for anyone to try to go at it alone.  Here again,               
 Alaska is a standout.  He said he doesn't know of any other state             
 where the tourism industry is more united than it is in Alaska.               
 He said in other states unity and partnerships are sometimes the              
 exception more than they are the rule.  He commended the                      
 legislature and the Division of Tourism, Department of Commerce               
 and Economic Development, for the support that has been provided              
 to the industry.                                                              
                                                                               
 Number 344                                                                    
                                                                               
 MR. PHILLIPS said if Alaska is truly interested in the                        
 international market, then he would encourage that everything                 
 possible be done to encourage and promote cooperative and                     
 mutually supported relations with the different pipelines to the              
 international visitor.  He referred to pipelines and said what he             
 is talking about are the airlines that serve Alaska, the cruise               
 lines, key gateway cities such as Seattle and Vancouver, also                 
 regions like Vancouver.                                                       
                                                                               
 MR. PHILLIPS noted the Division of Tourism and the entire Alaskan             
 tourism industry has been very helpful to the NTA.  He thanked                
 the committee for listening to him.                                           
                                                                               
 Number 543                                                                    
                                                                               
 CHAIRMAN MASEK thanked Mr. Phillips for his testimony and asked               
 if there were any questions from the committee members.                       
 Number 606                                                                    
                                                                               
 REPRESENTATIVE PETE KOTT said there are some people in the state              
 who would suggest a partnership has developed between the state               
 and the private sector to market Alaska.  There are some people               
 in the state that would suggest that really the state doesn't                 
 benefit directly because we have a very small tax base and there              
 isn't a state income tax or sales tax.  If you look beyond that               
 scope, you'll find there are additional benefits.  Representative             
 Kott said if the state were to pursue an income or sales tax on               
 statewide bases, would that affect our domestic traveler.                     
                                                                               
 MR. PHILLIPS said any increase in traveler's costs will have an               
 impact on the ability of those travelers and those who bring them             
 here.  He said anything like a sales tax that would generate                  
 higher costs for travelers would not be helpful to Alaska's                   
 tourism interests.                                                            
                                                                               
 Number 1002                                                                   
                                                                               
 REPRESENTATIVE JAMES pointed out one issue we have to solve is                
 that tourism cannot pay for the infrastructure that is needed for             
 tourism at this point such as utilities, emergency services, et               
 cetera.  She said we need to figure out how tourism can pay its               
 share of our expense to provide a place for tourism to be.                    
                                                                               
 REPRESENTATIVE JAMES referred to eco-tourism having a real future             
 and said there is a limit as to what traffic it will bear and not             
 lose the eco that came to seed.  She said we're facing lots of                
 dilemmas and we have to plan this or we could have terrible                   
 disasters in the state.                                                       
                                                                               
 Number 1613                                                                   
                                                                               
 CHAIRMAN MASEK said she would like to hear from Representative                
 James regarding her trip to China                                             
                                                                               
 REPRESENTATIVE JAMES told the committee she enjoyed her trip to               
 China and would like to go again but before she does, she would               
 like to learn to speak the Chinese language.  She informed                    
 committee members there were three who went on the trip, herself,             
 Dr. Jennifer McBeth and Dr. Yoal Wang (Sp.?) from the University              
 of Alaska, Division of Agriculture.  She said their main purpose              
 of the trip was to get acquainted with the Chinese and to sell                
 virus reseed potatoes as China is the largest nation of producer              
 potatoes in the world now that the Soviet Union has broken apart.             
 She noted they do use a lot of pesticides and commercial                      
 fertilizers.  They use their land and they use it and use it.                 
 There are a lot of people in China.  Representative James said                
 the trip was prepared by Dr. Wang.  She said he was sent to China             
 to establish the trip and to be sure there was somebody to meet               
 them at the airport, take them to hotels, et cetera.                          
 Representative James said they spent most of their time in                    
 Benshie (Sp.?) County which is the area Dr. Wang is from.  She                
 explained that is where they eventually did get an order of                   
 40,000 pounds virus reseed potatoes to be shipped after the first             
 of the year.  Representative James said they spent most of their              
 time there because before the Chinese are ready to do business                
 with you, they have to know you.  She noted this was her first                
 international trip aside from going to Canada.  The Chinese                   
 really didn't want to business until they had been there about a              
 week.                                                                         
                                                                               
 REPRESENTATIVE JAMES informed the committee that 150 pounds of                
 reseed potatoes had been sent to China which they used for a                  
 test.  The test wasn't very successful but the one thing about                
 the test that convinced them to buy the 40,000 pounds is that our             
 potatoes were disease resistant.  Also, their potatoes are more               
 wet and they aren't available to make chips.  She said what they              
 would really like to do is exchange one of our varieties with a               
 variety that is currently being grown in China.                               
                                                                               
 REPRESENTATIVE JAMES said within three years, they will probably              
 open their port.  Their port is currently closed.  She noted the              
 Netherlands have been trying to get in.  She said China is trying             
 to move into a market economy so they have created little                     
 businesses that operate on their own but are owned by the                     
 government.  An example of this is the Alaska Railroad                        
 Corporation.  Part of the reason for doing that is to get a                   
 market economy going and also to put their people to work.                    
                                                                               
 Number 2236                                                                   
                                                                               
 REPRESENTATIVE JAMES said she has a much better attitude about                
 China since she has been there.  She said she really has sympathy             
 for the position they're in as they are trying to move out of                 
 pure socialism.                                                               
                                                                               
 REPRESENTATIVE JAMES said another goal was to bring back some                 
 Chinese ginseng to see if it would grow in Alaska.  It is a very              
 sensitive plant and takes three to four years for it to be large              
 enough to use for production.  She noted ginseng is a very                    
 expensive product and if we could grow it in Alaska, that would               
 be another industry for Alaska and it could put us on the map.                
                                                                               
 REPRESENTATIVE JAMES said the Chinese are interested in growing               
 the potatoes and are also interested in technology to make chips.             
 She noted they are begging for somebody to bring them technology              
 as they don't have technology.  Representative James said she                 
 went to hot springs at a resort that was built recently.  The                 
 workmanship was very poor but they are doing the best they can.               
                                                                               
 Number 2656                                                                   
                                                                               
 REPRESENTATIVE JAMES said the Chinese are very interested in                  
 sending tourist to Alaska.  There are a lot of Chinese who have               
 money and are interested in getting something started but the                 
 problem is it is very difficult to get a visa to come to the U.S.             
                                                                               
 REPRESENTATIVE JAMES concluded by saying the trip wasn't all work             
 and play, it was very entertaining and good experience.                       
                                                                               
 Number 3110                                                                   
                                                                               
 CHAIRMAN MASEK said the committee would take a break at 3:35 p.m.             
 The meeting was called back to order at 3:50 p.m.  Chairman                   
 Masked asked the next witness to come forward                                 
                                                                               
 Number 3149                                                                   
                                                                               
 WENDY WOLF, Programs Manager, Division of Tourism, Department of              
 Commerce and Economic Development, came before the committee and              
 introduced Sharon Gaiptman, Development Specialist.  She                      
 explained Ms. Gaiptman is charged with reading our international              
 marketing efforts in the United Kingdom and in German speaking                
 Europe.                                                                       
                                                                               
 MS. WOLF said she didn't have any prepared testimony but would                
 like to clarify and react to some things she heard from people                
 testifying earlier in the meeting.                                            
                                                                               
 Number 3224                                                                   
                                                                               
 MS. WOLF explained the purposes of their offices overseas needs               
 to be clarified.  It is the normal in trade of international                  
 trade that you don't actually send your own people to sit in                  
 offices.  She said it is very much like Representative James had              
 said in that people need to know you in order to do business with             
 you.  Ms. Wolf said they hire a person that knows the trade.                  
 There are representatives like this all over the world and they               
 take on several destinations as long as they're not competing                 
 destinations.  Their job is not to be a consumer office.                      
 Consumers do not walk into these offices and they are not present             
 as a place where consumers come and get information.  Their job               
 is to get a foreign entry for us into the trade to find the                   
 people who send people out of Germany on airplanes, tours, et                 
 cetera.  They are really there to link us to the trade.  An                   
 independent traveler will find the Alaska Division of Tourism and             
 get information from them directly.  Ms. Wolf explained they have             
 been very successful and the trade is very comfortable with the               
 operation at Aero Traffic.  That is the purpose they serve there.             
 The representation in the United Kingdom is brand new.  It is                 
 about $25,000.  Jackie Todd is basically volunteering her time to             
 talk about Alaska.  It is not a money maker for her.  She is so               
 fascinated about Alaska that her company is letting her be a                  
 spokesperson for us in making sure there is a source of                       
 information about Alaska.  She said when somebody really wants to             
 travel, they use the same collateral that the Marketing Council               
 does.                                                                         
                                                                               
 Number 3445                                                                   
                                                                               
 REPRESENTATIVE JAMES asked how much money is spent.                           
                                                                               
 SHARON GAIPTMAN, Development Specialist, Division of Tourism,                 
 Department of Commerce and Economic Development, said the amount              
 is $425,000.   REPRESENTATIVE JAMES asked if the amount includes              
 money for space.                                                              
                                                                               
 MS. GAIPTMAN said it provides part of the space and some of the               
 money goes towards the administration of the contract, but the                
 majority of those dollars go towards trade relations, advertising             
 fam support.  She noted they are in the process of securing a                 
 third weekly charter from Frankfurt to Anchorage which will begin             
 next summer.  Ms. Gaiptman noted that takes a lot of money and                
 time in order to support the operator that is going to be                     
 guaranteeing those seats.  Most of the money goes into actual                 
 trade and some consumer relations.                                            
                                                                               
 Number 3543                                                                   
                                                                               
 REPRESENTATIVE JAMES asked what kind of record keeping there is               
 in the success of the operation.  MS. GAIPTMAN explained she has              
 a great deal of record keeping.  She said she would be happy to               
 put together information explaining what they do throughout                   
 Europe.                                                                       
                                                                               
 REPRESENTATIVE JAMES indicated she would rather spend some time               
 talking with Ms. Gaiptman.  MS. GAIPTMAN indicated they would                 
 find some time to talk.                                                       
                                                                               
 Number 3625                                                                   
                                                                               
 MS. WOLF said the decisions they make to go into markets are                  
 based on lots of things.  She indicated in Ms. Gaiptman's moving              
 around through the trade contacts that were made for her in                   
 Europe, it became very apparent that there was an interest in the             
 United Kingdom.  That is why they decided to move a small effort              
 there.  The same happened when they expanded in Japan.  They had              
 a lot going on in Japan, but then Australia started to show an                
 incredible increase.                                                          
                                                                               
 MS. GAIPTMAN referred to the information given by Mr. Welton                  
 which listed the German tour operators and said she was happy he              
 brought that list because that goes out to somebody in Germany                
 who requests information about Alaska.  They get the list of who              
 those tour operators are in German speaking Europe who have                   
 Alaska programs.  The part that is missing on that sheet is those             
 Alaska programs that are made up of Alaska product.  It is only               
 Alaska suppliers with whom those tour operators are working.  It              
 is just not listed as to whom each of those are.  She noted the               
 division has the brochure that can show whose product it being                
 sold where.  Ms. Gaiptman noted there is another brochure they                
 mail out that includes ways that people can get the Milepost.                 
 Ms. Gaiptman explained that because they are a state agency, they             
 don't push one persons business over another.  Their job is to                
 represent the entire industry in the state.                                   
                                                                               
 MS. WOLF noted they also had the state highway map translated                 
 into German.                                                                  
                                                                               
 Number 4002                                                                   
                                                                               
 REPRESENTATIVE JAMES said Alaska couldn't ever compete dollar                 
 wise with Miami.                                                              
                                                                               
 MS. WOLF referred to the German office and said there are several             
 staff people in that office.  There is one staff person that is               
 dedicated to working on nothing but Alaska, she knows the                     
 businesses here, has been to Alaska, met the people here who are              
 the suppliers and worked with the operators.                                  
                                                                               
 Number 4043                                                                   
                                                                               
 CHAIRMAN MASEK said the intent of having the hearings is to hear              
 from the small business people as to how they feel about the                  
 tourism and what can be done to make it better.  By bringing                  
 everyone views and opinions to the table, it is only going to                 
 help with the recommendations that the committee will be putting              
 fourth in coming sessions.  It is important the committee hears               
 from all sides of the industry.  She said we need to broaden the              
 scope of tourism so it will be based on winter months and not                 
 just summer months.                                                           
                                                                               
 MS. GAIPTMAN said she thinks the committee will discover                      
 throughout the year that both the Alaska Tourism Marketing                    
 Council and the Department of Commerce are both working really                
 hard to increase shoulders and winter tourism into the state.                 
                                                                               
 Number 4201                                                                   
                                                                               
 REPRESENTATIVE JAMES referred to winter tourism and its potential             
 and said she agrees that particularly in the southern part of the             
 state that there is real potential for winter tourism.  She said              
 her problem in Interior Alaska is she doesn't want these people               
 driving on our roads if they don't know how.  She said the only               
 way she feels we can have winter tourism is if we provide                     
 transportation and other things for them.  The only other thing               
 she sees as a real negative is the ability to get winter tourism              
 if our weather is not dependable.  Representative James said if               
 she spent all her money to come and spend two weeks in Fairbanks              
 and it was 60 degrees below zero the whole time, she doesn't                  
 think she would give a recommendation to come to Alaska.  To just             
 say winter tourism without having some sort of plan turns her                 
 off.  She said she doesn't want these people driving and causing              
 more accidents on the highways than we're having now.                         
                                                                               
 MS. GAIPTMAN said they are looking at primarily focusing on                   
 special events like the Yukon Quest or Iditarod.                              
                                                                               
 MS. WOLF referred to highway marketing said they don't do any of              
 their highway marketing targeted it towards winter but they do                
 for spring and fall.  She referred to the Alaska Railroad and                 
 said in the winter it is the Japanese who are riding the                      
 railroads.                                                                    
                                                                               
 Number 4543                                                                   
                                                                               
 MS. WOLF said referred to the issue of revenues to the general                
 fund and said there is an attachment in the Marketing Alaska                  
 Report that they will be submitting to their executive committee              
 the following Wednesday.  She said the group looked at several                
 things.  The infrastructure was the first issue to be discussed.              
 The funding for infrastructure was a very big topic and they are              
 building some recommendations on that.  There is a hugh section               
 on rural and small tourism development.  Ms. Wolf noted the                   
 Governor had mentioned in his speech the previous day that we are             
 going to create a world tourism development center which will be              
 a joint venture with Alaska village initiatives in which they                 
 create a one stop shopping situation...                                       
                                                                               
 TAPE 95-9, SIDE B                                                             
 Number 001                                                                    
                                                                               
 MS. WOLF informed the committee they are also working on visitor              
 education and visitor industry awareness so that the public can               
 understand the role of the visitor and also learn how to train                
 Alaskans to work in the industry.  Ms. Wolf said the final                    
 recommendation deals with doing some comprehensive planning.                  
 Everybody has a plan but this would bring them all together to                
 look at them on a regional basis.  They would take all the land               
 management, community and marketing plans and try to build some               
 sort of picture of what tourism in that region is all about and               
 then figure out where to best use the resources.                              
                                                                               
 MS. WOLF said attached to the recommendations is a study that AVA             
 sponsored by McDowell in 1992.  It is the total of the revenues               
 to the state of Alaska general fund.  Ms. Wolf said it is revenue             
 generated by visitors.  The thing that is interesting about it is             
 the visitors spend money on a lot of things and the agency, like              
 state parks who takes in those receipts, would also like to claim             
 credit for these receipts.  It is a controversy as to who these               
 belong to.  The fact is this is nonresident use.  There are state             
 parks, fish and game tags and out of state licenses.  Ms. Wolf                
 noted Holland America and Princess pay major dollars to the                   
 Alaska Railroad Corporation to haul those cars on the tracks.  So             
 that is money which comes into the railroad which, of course, is              
 a state entity.                                                               
                                                                               
 Number 150                                                                    
                                                                               
 REPRESENTATIVE JAMES said she had heard they are losing money.                
 MS. WOLF said if they are, then they need to look at it.                      
                                                                               
 REPRESENTATIVE JAMES said they lose money on the passengers but               
 make money on the freight.  MS. WOLF said she thinks they charge              
 the cars a pullage fee plus a percentage of the passenger.  She               
 said according to data from 1992, the industry is putting about               
 $7 million into the Alaska Railroad for haulage fees plus a                   
 percentage of the ticket receipts.                                            
                                                                               
 MS. WOLF said one thing that was talked about was taxing, such as             
 fuel tax, to pay for the infrastructure.  Visitors come, they                 
 drive, they use the roads and they use the parks.  That does have             
 an impact.                                                                    
                                                                               
 Number 309                                                                    
                                                                               
 MS. WOLF referred to the European travel fair and said Ms.                    
 Gaiptman has been working on it.  She said it was a lot of work.              
 Operators met with people all over the state and ended up in                  
 Fairbanks where they met with different businesses.  She                      
 indicated this worked very well and was a very successful effort.             
                                                                               
 Number 426                                                                    
                                                                               
 REPRESENTATIVE PETE KOTT said he seems to recall some type of                 
 reorganization which affected the Division of Tourism.                        
                                                                               
 MS. WOLF explained a new assistant commissioner, Debbie Sedwick               
 was hired.  Ms. Wolf said she would call her the assistant                    
 commissioner for Tourism, Trade and Economic Development.                     
 Currently, in her bailiwick there is a Division of Trade and                  
 Development that took the Office of International Trade and                   
 Economic Development and consolidated them.  The division still               
 sets there separately.  Ms. Wolf said what they did do in the                 
 process was lower the (indisc.) for the Division of Tourism to                
 make it more part of the scheme of working together more.  They               
 have talked about submitting an executive order to have them as               
 one.  There would still be a person called the director of the                
 Office of Tourism or the Division of Tourism.  Ms. Wolf said they             
 hired Tom Garrett to be director of the Division of Tourism.  She             
 explained what the Administration is trying to do with the                    
 structure is say, "Lets find opportunities to work together."                 
 Ms. Wolf discussed marketing techniques in relation to the                    
 Ketchikan Pulp Company and the Alaska Bowl Company.  She said it              
 is important for connections to be made between companies.  When              
 they go out to promote tourism, they are also thinking seafood.               
 Ms. Wolf noted they put on a lot of events where salmon is sold.              
 When they go to implement the recommendations of marketing                    
 Alaska, they take the people who are really good at what they do              
 and they can work on a variety of projects.  There will still be              
 a Division of Tourism focused on doing the things they do best.               
                                                                               
 Number 637                                                                    
                                                                               
 CHAIRMAN MASEK asked if there were questions or comments.  Mr.                
 Stone and Ms. Loper indicated they didn't have any comments.                  
                                                                               
 CHAIRMAN MASEK thanked everyone for attending the hearing.  She               
 asked if there was any further testimony.                                     
                                                                               
 Number 836                                                                    
                                                                               
 DAVE CARP, Executive Director, Alaska Tourism Marketing Council,              
 referred to ways to get visitors to visit Alaska during the                   
 winter months and said he would like to throw consideration into              
 the mix and that is the activities of the local convention and                
 visitor's bureaus.  Mr. Carp said all too often he thinks we                  
 overlook the word "convention" and go right to "visitors."  Even              
 though conventions are visitors, that market and those efforts                
 are certainly an essential focus point for drawing visitors to                
 Alaska in the winter.  One change the ATMC is faced with in terms             
 of the ATMC is that with the limited resources that we have, we               
 have a responsibility to go out and try to bring the maximum                  
 number of visitors with those resources.  At this state of the                
 game and development in the Alaska visitor industry, they find a              
 good portion of that comes during the summer months.  He noted                
 they have been able to modify the program and incorporate aspects             
 of winter and year round visitation to the state and the program.             
 Mr. Carp said what he would like to point out to the committee is             
 that as they deliberate, please consider the notion of convention             
 marketing.  He said he isn't just speaking of domestic convention             
 marketing but international convention marketing as well.  One                
 thing they find with meetings and conventions is the cost per                 
 conversion in terms of what it takes you to go out there and get              
 a group of people to come up.  It is far greater when you look at             
 conventions.  It is all a crucial part of the mix in terms of the             
 overall cost for conversion in terms of investment.                           
                                                                               
 Number 1100                                                                   
                                                                               
 CHAIRMAN MASEK thanked Mr. Carp for his testimony.  She thanked               
 everyone for attending the meeting and adjourned at 4:25 p.m.                 
                                                                               

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