Tourism- Cost/Benefit Analysis

By Malcolm Noden

Photo courtesy of JMIR.Org

We are all aware that our tourism “industry” here in Nassau County, is a mixed blessing to us all. On the one hand we have all that money that we get from tourists, which provides employment, and helps to reduce our personal tax contribution to the required community spending programs, and on the other hand we have to deal with lots more people, lots more traffic; lots more crowding; lots more construction, etc.

So in order to look carefully at these sometimes very divisive issues, we need to apply what is known to scholars in the field as a Cost/Benefit analysis.* This simply means reviewing, assigning values, and counting all of the stuff we don’t like-Costs; and all the stuff we do like-Benefits.

In the case of tourism, a list of the elements involved would include the following:

Benefits

• Employment opportunities-skilled and unskilled because it is a labor intensive industry
• Increase incomes
• Is built on existing infrastructure
• Helps to develop new infrastructure that stimulates local commerce and industry
• Helps to diversify the economy
• Spreads development
• Has a high multiplier impact
• Increases governmental revenues
• Broadens educational and cultural horizons
• Reinforces preservation of heritage and traditions
• Justifies environmental protection and improvement
• Provides employment for artists, musicians and performing artists, enhancing cultural heritage
• Provides tourist and recreational facilities that may also be used by the local population
• Helps to break down barriers: socio-cultural-class-racial-political, and religious
• Creates a favorable world-wide image for the destination

Costs:

• • Develops excess demand for resources
  • Creates difficulties associated with seasonality
  • Causes inflation
  • Can result in unbalanced economic development-some communities versus others
  • Creates social problems
  • Degrades the natural physical environment and creates pollution
  • Degrades the cultural environment
  • Increases the incidence of crime, prostitution and gambling
  • Increase vulnerability to economic and political changes
  • Commercializes culture, religion and the arts
  • Creates conflicts within the host communities
  • Contributes to disease, economic fluctuant and transportation problems

As with all change, tourism exacts a price. However, it is here, it is huge, and it needs to be planned and managed. Our local Tourism Development Council, (TDC), is charged with the responsibility of the challenge to get the right balance, which is to have the benefits outweigh the costs, and to take the necessary steps to lessen the unfavorable impacts, that are a part of change. Tourism development must be a part of overall economic development, and must be done in a manner that is sustainable. Thus, for our own interests, it is important that we all help to provide public input to the TDC.

The Amelia Island Tourist Development Council, (AITDC), created by the Nassau County Board of County Commissioners in 1988, oversees the development and marketing of Amelia Island as a world class tourism destination. As provided by Florida law, the AITDC is responsible for the expenditure of revenues received from the levy and imposition of the tourism development tax.

The goals of the AITDC are to generate visitation to Amelia Island and its attractions/special hospitality industry, thereby increasing tax revenues, including sales taxes and those imposed on the hospitality industry. In turn, those tax revenues may be used to improve the quality of life for the citizens of the community, provide support for beach re-nourishment, and to ensure a viable hospitality industry. The AITDC is made up of nine members who serve four year terms, and who do not receive any compensation for their time and or travel expenses. The AITDC has received many public awards and accolades in the past few years, and Gil Langley, the Managing Director is justifiably proud of their performance record. For any questions or suggestions you may contact Mr. Langley at (904) 277-277-0717 or visit their website at www.ameliaisland.com

*Tourism: Principle, Practices, Philosophies. Goeldner/ Ritchie. Wiley & Sons. 2003.

Editor's Note: Malcolm A. Noden, who is the (Retired) Senior Lecturer in Management, Economics, Marketing and Tourism at the School of Hotel Administration, at Cornell University, is a well-known expert in the applied economics of hospitality and tourism policy, promotion and development.

Noden is the past Chairman of the New York State Tourism Education Task force, an advisory board appointed by former Governor George Pataki of New York. Noden serves on the editorial board of TEOROS International, a theoretical research journal for education in tourism, and was the Cornell University representative to, and a founding member of, the World Tourism Organization, Educational and Training Board.