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LFP,
I’m not sure if you were watching the same council meeting as me but this presumably unbiased (since I have no stake on this subject) observer from his couch (I watched on t.v) saw a very different set of presentations.
You say that the Martins made “strong financial, business-like and experience-based facts against the tax increase”. From my vantage point I saw a very strong presentation from Sharon Martin. She presented a good libertarian argument that the previous gov’t programs haven’t worked for the Traveller’s and it was time to let them do their own marketing without the yoke of added gov’t costs. An excellent free market argument and so I send a Bravo to Sharon.
Wally gave a political/legal argument. It dealt with the process of the vote. It had to be said, and was a good presentation but certainly would not be described as “strong financial, business-like and experience-based facts against the tax increase”.
As for the heavy hitter Michael Martin, I personally feel that he swung and missed. His technical argument was too technical for the hall and clearly went over the head of the audience (as no one asked any questions on that portion of his presentation). The (in my mind) overly technical nature of his argument meant that it was left to his credibility to sway the group one way or another. Given his credentials that shouldn’t have been a hard thing but then he threw up that graph and totally lost my respect and (in my mind) blew his credibility away. How anyone trying to make a legitimate point could present a graph of that type is beyond me. He graphed two seemingly unrelated facts on the same graph (gross economic figures on the left and minor municipal events on the right) and then tried to indicate that the graph was not supposed to link the two? If you graph two relationships on the same graph you have by definition linked them...because you put them on the same graph! If he had wanted to present the data without the linkage he could have shown one graph, followed by the second except that the second graph provided no additional context to the discussion. Furthermore, to be picky, on the left side of the graph Mr. Martin appears to have truncated the X axis by not including the zero, this distorts the relationship between the X and Y axis and is a no-no in technical presentations because once you truncate the zero you can manipulate the X axis and can make any trend look as big or small as you like. As a CFA and CA he should know better. By the end of the presentation I had simply ceased accepting his statements on face value.
So to summarize, one excellent presentation, one solid presentation and one less than stellar effort but certainly not “strong financial, business-like and experience-based facts against the tax increase”.
My two cents.
Anything would in my mind have been way more financially impresive than the yes side essentially just saying it will pay back (hopefully!), we don't know how much nor will we ever measure it, nor do we have any financial comparitive results from others!
It is good to see that Langley Township Council does function as a democratic government body and that on the brink of making a decision, based in part on misinformation gathered in an improper manner, that they can pull back and try to do it right before it is too late. I don't agree with the tax, or the method being suggested to promote our communities. But, if the new vote from the hotels clearly shows that they favour this idea, I agree to the decisions made based on this information. I would, however, like to see a plan to promote our communities that does not involve spending nearly half a million dollars when all that is being collected by the tax is a suggested third of that amount. Perhaps the Chamber of Commerce can match the amounts paid into this tax and can continue doing what they have to promote the Langleys?
Blair - very perceptive comments! I too watched a very different meeting from that reported on the (LFP) Liberal Federal Party blog. You analysis is much closer to reality than reported - ONCE AGAIN!
Hi Blair - We would love to have more information on the 2% hotel tax.
What we have from Tourism BC are numbers that show a 11% decline in tourism revenue in the province over the past 5 years. During that same time period the number of districts that are collecting the additional 2% tax has increased by 371%. With that many districts collecting tax to promote and increase tourism we ask the simple question. What is being accomplished? We do intend to do more research on this and any assistance you can provide would be appreciated.
Wally,
I'm not claiming to be an expert on the topic of hotel taxes by any stretch of the imagination. I am, however, educated in the use and misuse of scientific information in the decision-making process. It is on this basis, and as a casual observer of the Langley scene, that I commented on this blog.
You note an increase of 371% in municipalities collecting the hotel tax. The interesting thing about statistics is that they mean very little without the underlying numbers (remember what I previously wrote about truncating the X axis in a graph) and nominal increases of small numbers can be made to look quite impressive. If I remember Michael’s presentation he noted that 23 municipalities currently have the tax. Given that the UBCM lists 157 municipalities (quick count so I may be off by a bit) on their web site, that would mean that about 15% of the municipalities in BC currently have the tax an increase from 4% having the tax in 2001. So if you avoid truncating the data you discover that the increase is actually 11% of the whole. Admittedly that is less sexy than 371% but it has the benefit of being statistically defensible.
You also indicate that tourism dropped 11% in the last 5 years of collected statistics (not calendar years) that would mean you are comparing pre-2001, pre-SARS numbers to post 2001 post-SARS numbers. According to the net I also see that since 2001 the Canadian dollar has appreciated by about 25%, thus making travel to BC more expensive for American tourists.
While I am, admittedly, not an expert in this field I would be willing to lay down a modest wager that the 11% decrease in provincial tourism revenues over the last 5 years cannot be causally linked to the 11% increase in municipalities who collect a 2% hotel tax (which I might add most visitors don’t discover until after they have visited and are paying the bill). I would also note that from Michael’s presentation it would appear that many of those municipalities only recently implemented the tax and their effect would most likely not be seen in the statistics at this time.
More likely, but equally unproven, the change is due to a strengthening Canadian dollar in association with negative news about Canada in our primary market (the US) thanks to SARS and negative press resulting from certain Canadian politicians’ needs to say bad things about our neighbours whenever they needed to distract the press from issues at home.
While Vancouver and it's surrounding communities are wonderful places to visit, almost everything here is more expensive than across the borders to the east and south. This, along with the rise in the value of our currency and the political, social and economic uncertainty in the USA, and the high cost of labour and shortage of workers here, puts BC's tourist industry on shaky ground. That may be why there is such a "damn the torpedoes" attitude towards the Olympics and getting things built and paid for. The government knows we need this to try to excite the world and get them to give us a try. On the other hand, what really do we have here that will keep them coming back? Sure, the wealthy ones can afford to pop up for a salmon fishing trip, or an excursion to the ski lodges and such, but what does BC do to attract the average person? Every State and province has lakes, streams, mountains or some variation of these natural wonders, but what is happening here that is such an attraction? And now we want to add another tax to their accommodations? The idea that most don't notice the tax until it is too late, when they are paying the bill, is not a great defense or excuse to put it in place. Perhaps they are becoming disillusioned with this offense and won't be coming back. Maybe folks have found other places to go. I hear they have excellent rates on hotels in Vegas and it seems to me that even with the exchange rate, I can drive my car a lot further on $50.00 in the USA than I can here. I think our Township should press the government to dish out some of the cash they currently collect from the taxes already in place and use that to promote Langley. Bring on some special events and brag about them to everyone you know. The Langley Good Times Cruise-in is a perfect example. Word will get around and people will come to look. If they find they can stay, affordably, they will likely come back. They will also likely tell their friends as well. That is how you promote tourism, in my opinion. But, I too, am no expert.
Hi Blair -You make good points. Proponents of the tax would have you believe that the tax will increase tourism $ flowing in to the community. We are searching to find numbers to support that position. Your assistance in finding those numbers would be invaluable. The data we have found to date indicates that increased taxes causes a down turn in tourism revenue. I have given you those numbers. The tourism revenue numbers we used were for the calender years 2000 to 2005 (5 years) 2006 will be available in about 6 months. The number of municipalities using the 2 % tax was also compared for those same years.
We have noticed that persons wishing to defeat our numbers like to use other causes to support their position of declining tourism numbers eg. SAARS, 911, Iraq,Mad Cow, US Dollar, Passport issues, Airport security and on and on. No doubt everything has an affect on tourism. However the purpose of the tax is to create promotion that overcomes obstacles and causes tourists to visit and spend $ regardles of what else is happening in the world around them. We have not seen evidence that it is working. We believe that a better approach would be to give the visitor the best value for the $.
Regarding your point about when tourist discover the actual cost of their visit you make a good point. We have visitors that have children attending school at Trinity University. We have seen a decline in the numbers. These folks come in August for a few days to get their child settled in to the school. They come back in the fall and winter and spring for 4 years. They may make 20 or more visits here. Should they be driving from Oregon or California as we have seen they can just as easily stop in Bellingham (there are 25 hotels in Watcom County) When they go home and read the numbers on the Visa bill they will do their shopping for the next trip north. The 2% tax gives them 2 more reasons not to stay in Langley. We have seen people drive across town to save 2 cents on a litre of gas and they will do the same for accommodation. Langley has specific vulnerability as a border town and cosumers do seek out value. You might get away with sticking it to the tourist in a place like Whistler (far from the border) but it won't work in Langley. I am certian that had the numbers shown an 11% increase instead of the 11% decline in the past 5 years that the tax and spend lobby would be taking credit for the dramatic positive affect the tax was having. Surrey has had the tax for 5 years. Is tourism in Surrey doing better than Langley? We need more numbers. In 4 years the world will be looking at Whistler. 1000's of travel writers will be here. They can tell the folks back home "A beautifull place to visit but the taxes are a killer" or "A beautifull place to visit and great value too." Your choice?
Wally Martin
Wally,
As I noted, I’m not an expert on this subject. If you are looking for someone who might be able to give you the information you need (or point you in the right direction), I would call the folks up at SFU in the “Centre for Tourism Policy and Research” (http://www.sfu.ca/~dossa/index.htm) since that’s what they do for a living. Heck if you sell it to them right it is possible they could set a student to the task of collecting all the data for you (sometimes profs will do this if they see it as the start to an interesting research project). Given the increase in municipalities who are adding the tax this sounds like a rather interesting Master’s Program for an up-and-coming academic out there (heck it is likely they have someone working on a similar program as I write).
Just a note about the tax, my understanding is that this type of tax is used a lot in the US (especially to pay for sports stadiums). Seattle has a tax of this sort and last time I visited I got dinged, but it wouldn’t stop me from going back because I had a good time. So while the tax can be a turn-off it also can have a negligible effect if the rest of your trip went well. Admittedly, if you had a marginal time it could be the straw that breaks the camel’s back. Still anyone who is having that bad a time isn’t likely to come back in the first place.
http://www.cbc.ca/news/backgroun...m-
troubles.html
Hi Blair - Thanks for the tip. I called SFU and spoke to one of the professors. It sounds like they are going to help us with some research on this. It does not sound like it has ever been done before. I will keep you posted.
Bonus,
You get the information you are looking for and a grad student gets a relevant topic for their research project, sounds like a win-win to me.
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