SB 194-TOURISM MARKETING BOARD  4:31:41 PM CHAIR OLSON announced that the final order of business would be CS FOR SENATE BILL NO. 194(FIN), "An Act creating the Alaska Tourism Marketing Board; and relating to tourism marketing." 4:31:51 PM REPRESENTATIVE REINBOLD moved to adopt the proposed committee substitute (CS) for HB 194 labeled 28-LS1497\R, Martin, 4/9/14 as the working document. CHAIR OLSON objected for discussion purposes. 4:32:07 PM GENEIVIEVE WOJTUSIK, Staff, Senator Lesil McGuire, Alaska State Legislature, explained this bill would create the Alaska Tourism Marketing Board within the Department of Commerce, Community & Economic Development consisting of 21 members, including one member appointed by the House and Senate and one DCCED member. She stated that 18 members will represent Southeast, Southcentral, Southwest, Interior Alaska, and the far north. The categories would include accommodations, activities, attractions, transportation, cruise travel, tour operators, and destination management organizations (DMOs). She explained that SB 194 would require the department and the board to work together to plan and execute a destination tourism marketing plan for Alaska. The public members on the board serve at no cost to the state and the board will sunset in 2018. The quorum to conduct business would require nine members but must include one representative from each part of the state. 4:33:16 PM MS. WOJTUSIK explained the changes in the proposed committee substitute, Version R. She referred to page 3, line 16, changing "governor shall" to "governor may." It also changes the number of appointees from a "list of three" to a "list of nominees." It also clarifies on page 3, line 31 and page 4, line 1, that the state does not pay for the per diem or travel expenses for the 18 remaining board members to attend meetings. 4:33:53 PM REPRESENTATIVE JOSEPHSON referred to the sponsor statement noting that the bill is an important step in continuing the growth of one of Alaska's most important industries. He asked how this bill would do that beyond what is currently happening. MS. WOJTUSIK answered that it formalizes the Alaska Tourism Marketing Board as a process, and she hoped the 18 members plus the legislative and department members can create [the additional industry growth.] 4:34:34 PM REPRESENTATIVE JOSEPHSON referred to page 2, line 30, which reads, "(1) the 18 members appointed by the governor who are members of the leading statewide nonprofit tourism association ...." He offered his belief the Alaska Travel Industry Association is the leading tourism association MS. WOJTUSIK agreed. REPRESENTATIVE JOSEPHSON referred to page 3, line 16, "(C), which allows the governor to appoint the members from a list of nominees for each seat submitted by the leading statewide nonprofit tourism marketing association and asked for clarification on "shall" and "may." He said it is mandated on page 2, but the governor "might" pick from there on page 3. MS. WOJTUSIK referred to page 3, which clarifies the number of nominees since it had previously read "three" nominees, but is now a list of nominees. 4:35:44 PM REPRESENTATIVE CHENAULT expressed concern that regions of the state are represented, but he did not see the Kenai Peninsula represented. He suggested that the Kenai Peninsula is as much a destination of the Far North. He wondered if anyone has raised this issue when the bill was considered by other committees. MS. WOJTUSIK said it has not been brought up. She deferred to the Alaska Travel Industry Association. 4:37:32 PM REPRESENTATIVE JOSEPHSON referred to page 3 of the bill and said it seemed as though if the governor selected someone not on the statewide nonprofit tourism marketing association, the person would need to join the association. MS. WOJTUSIK agreed with that assessment. 4:37:57 PM REPRESENTATIVE JOSEPHSON asked whether the bill has another committee of referral. MS. WOJTUSIK said it would go to the House Finance Committee next. REPRESENTATIVE JOSEPHSON suggested the requirement to join an association may come up. 4:38:18 PM REPRESENTATIVE REINBOLD asked if this bill is for the tourism industry or if the sponsor would like to create the vision of what Alaska looks like in the future. MS. WOJTUSIK offered her belief that this is limited to the current tourism industry. She recalled some preliminary discussions about doing something with other divisions, but at this point, SB 194 is limited to tourism. 4:39:13 PM REPRESENTATIVE REINBOLD remarked that if the state knows what it wants to look like in the future, it would make it easier to manage where tourism, roads, and infrastructure is placed. REPRESENTATIVE CHENAULT noted the proposed board was a 21-member board, but only 9 members would be needed to establish a quorum. He was not aware of any instance in which a minority of membership could establish a quorum since the quorum typically requires half or more of the board membership to be present. MS. WOJTUSIK answered that initially the quorum was 11 members, but Senator Fairclough pointed out that it can be hard to get a quorum. Thus the figure was changed, but it requires one member from each region. 4:40:50 PM REPRESENTATIVE CHENAULT commented it can be hard to hold meetings that work with everyone's schedule so sometimes it is easier to get a smaller group together. He acknowledged that meeting during the tourism timeframe could be difficult. REPRESENTATIVE HERRON acknowledged that a lot of tourists don't want infrastructure and seek a lack of infrastructure. He suggested it could be an important quality. REPRESENTATIVE JOSEPHSON commented that the Kenai Peninsula is a unique, stand-alone place and arguably is the most remarkable place in the state. He also agreed some people want to be "off the grid." He hoped that if the board is created it will consider some opportunities for non-consumptive use. He said, "That's what tourists want as well. They want to see wildlife, and we've got to make sure that happens." REPRESENTATIVE REINBOLD agreed. She wondered what locations should be identified as natural locations and where accommodations should be located. She further asked what the state would like to see in 10, 20, 50, or 100 years. 4:43:26 PM REPRESENTATIVE SADDLER referred to page 3, line 16-19, [subsection (d)], which allows the governor to reject a list. He asked whether it is the sponsor's intent that there isn't any duplication. MS. WOJTUSIK answered that she was unsure. She suggested that this language was used for other boards. REPRESENTATIVE SADDLER could understand the request to consider non-consumptive use, but he thought it was equally important to have "consumptive" use represented so all aspects of tourism are on the proposed ATMB. 4:44:56 PM BILL PEDLAR, Government Relations, Alaska Travel Industry Association (ATIA), related he is also president of Knightly Tours, which is a small tour company that specializes in in- bound vacation travel to Alaska. He said Knightly Tours has been in business for over 45 years. He said, most notably, the ATIA recognizes the Kenai as a hugely important area in tourism; the definitions of the areas represent the areas the state uses to market Alaska in the state's Alaska Travel Planner. Thus, this is where the five regions were derived from and it was thought it would be easier to use the regional definitions the travel industry currently uses. 4:46:07 PM CHAIR OLSON answered that the visitor guide will link up. MR. PEDLAR agreed. 4:46:18 PM MR. PEDLAR explained that the ATIA has often discussed the "rings of tourism" including high, mid, and low density. In fact, over the years, the travel industry has come forward with several plans that mirror the way agencies manage state and federal lands. From that point the ATIA believes there is pretty good synergy. He said that this board's function is to renormalize a relationship between the industry and the DCCED that went awry several years ago. However, the statute has been in effect since 1988. Further, the industry would like a broad representation to have small to large businesses. He characterized it as bringing the best marketing talent to the table to help the state efficiently market the money. He suggested that thus far it has worked out well. 4:47:46 PM REPRESENTATIVE HERRON remarked that he recalled the conversation on tourism and the board. He offered his belief that this "reset" is a good way to move forward. He suggested that this group of people decide together on sustainable and practical approaches to tourism because the state wants people to visit. MR. PEDLAR commented on the quorum. He recalled that Senator Fairclough pointed out she didn't want a quorum not to occur if the three government employees serving on the board could not attend. Thus the quorum was reduced to nine, he said. 4:49:23 PM JOSEPH JACOBSON, Director, Division of Economic Development, Department of Commerce, Community & Economic Development, stated that this this essentially formalizes the relationship that the department currently has with the Alaska Travel Industry. He said the department supports SB 194. 4:50:31 PM REPRESENTATIVE CHENAULT asked for clarification on how the members would be picked to serve on the board. He further asked whether the seats would be dedicated. MR. PEDLAR answered the ATIA has found that the broadest representation, such as three members from each region and three "at large" appointments, always tends to work the best. The industry has found that if it does not have broad based representation that the industry can miss part of the market. He emphasized the importance of the ATIA to make sure the membership represents very balanced representation throughout the state. He said the ATIA doesn't want people complaining they have not been listened to. He acknowledged that it was left "a little loose" intentionally so it wasn't too highly defined to get best marketing talent available to the state. 4:52:32 PM REPRESENTATIVE SADDLER said sometimes there are informal allocations of seats and asked him to identify three representatives, and whether it would be for categories of big boats and aviation. He asked for the "understood" division. MR. PEDLAR responded that currently there are about six different classes of tourism operators defined at the state level. The ATIA's goal would be to have a balance, that it would not be a board of big cruise, big airlines, helicopter operators, or fishing operators. He said people volunteer to serve from the big Westmark chain of hotels to bed and breakfasts and emphasized the importance of achieving diversity. 4:53:52 PM REPRESENTATIVE SADDLER asked for the six general areas. MR. PEDLAR listed the six areas as being accommodations, activities, attractions, transportation, cruise travel, tour operators and destination marketing organizations, predominately the convention and visitor bureaus. 4:54:42 PM REPRESENTATIVE SADDLER referred to page 2, line 30, which read, "(1) 18 members appointed by the governor who are members of the leading statewide nonprofit tourism association ...." He asked him to identify the organization that is the leading statewide nonprofit tourism association. MR. PEDLAR answered the ATIA is the only organization that currently fills that role. He clarified that the language is general so if the association changes its name, or the ATIA is no longer the leading association, that it would still apply. 4:55:10 PM REPRESENTATIVE SADDLER asked whether anyone would feel that they are "aced out" of serving on the board. MR. PEDLAR acknowledged there is always someone who wants to serve. He stated that the goal is to have people bring ideas to the table. In the past, ATIA has had a significant subcommittee structure that allows interested parties to serve. He said that for the key 18 members, the industry tried to narrow it down from a larger board to one that is still representative of all the facets of the industry as well as the geographical distribution of the industry. 4:56:16 PM REPRESENTATIVE HERRON asked for further clarification, that the definition of Southcentral and Interior is understood. He wondered about the Southwest and the Far North. He asked whether a loose geographical description would be the area west of the Alaska Range to the end of the chain, up to the Yukon and that the Far North would be north of the Yukon, wrapping around the coast to Barrow and Kaktovik. MR. PEDLAR answered yes. 4:56:57 PM REPRESENTATIVE JOSEPHSON asked whether segments of the tourism economy feel unappreciated by the ATIA, such as eco-tourism or subsistence tours on the North Slope. MR. PEDLAR acknowledged that many years ago it was probably true. He said that there was some general animosity, but the industry has "grown up" and that "all inclusive" tends for better ideas and decisions. He noted that members and segments may not always agree, but everyone's ideas are allowed to come to the table and be heard. He did not believe that there is any group left out of the current way the state is marketed. 4:58:24 PM REPRESENTATIVE CHENAULT acknowledged the intent is to ensure that all industry and all user groups are "under the tent." He said he does not have any amendment at this point, but he just wants to be sure the Kenai Peninsula is represented. He expressed confidence that the ATMB will ensure all Alaskans are represented. 4:59:05 PM CHAIR OLSON, after first determining no one else wished to testify, closed public testimony on SB 194. REPRESENTATIVE HERRON moved a conceptual amendment that can be dealt with at a later time to add Kenai as an area of the state that could be added to the five areas represented by the ATMB. In response to a question, he agreed that some committee members could further discuss this with the sponsor. REPRESENTATIVE REINBOLD noted that Eagle River wants to be remembered, too. 5:00:17 PM REPRESENTATIVE REINBOLD moved to the proposed committee substitute (CS) for SB 194 labeled 28-LS1497\R, Martin, 4/9/14, with individual recommendations and the accompanying fiscal notes. There being no objection, the HSC CSSB 194(L&C) was reported from the House Labor and Commerce Standing Committee.