Pueblo’s Tourism Problem

When you talk to city officials about the Pueblo Convention Center expansion one major point always arises: It will be a great way to attract visitors to Pueblo. Ultimately, a bigger space will attract bigger conventions, trade shows, the possibility to host some sporting events and, most importantly, people with money to spend.

The expansion is often talked about as a tourism fix. City officials say the convention center has outgrown its space, not because they cannot physically handle the amount of visitors, but because the events that would bring in all of those tourists aren’t interested in the square-footage currently available.

So, the fix is that if everything goes as planned the expansion will impact the economy in terms of fuller restaurants and more hotel rooms sold. When that happens local businesses are happy because profits are up and the city is happy because it’s making money from sales and lodging taxes.

But most city officials don’t mention what it takes to help attract those events, and really, tourists in general.

It takes marketing, and, more specifically, money for marketing. That money, partly allocated from the city budget, has been dwindling over the past few years as cuts have been made. For recipients of the money that has meant less than adequate marketing or maintaining the status quo in recent years.

The Pueblo Greater Chamber of Commerce and the Colorado State Fairgrounds receive money from the city’s budget specifically for year-round marketing for tourism. The convention center receives its marketing money from the Pueblo Urban Renewal Authority, but partners with the chamber on nearly all projects. The chamber partners with the State Fair as well. So, much of the tourism effort in Pueblo is intertwined.

In the 1980s, a group of business owners from the hospitality industry in Pueblo and the chamber asked city council for a 2 percent lodging tax, which is an additional tax added onto hotel rooms.  The tax would ultimately pay for year-round marketing of the city to continue to grow the city’s tourism. City council approved the tax and set up a pass through so the revenue would go straight to the chamber.

Later the Colorado State Fairgrounds asked the same thing of city council. The fair wanted money for year-round marketing for events other than the Colorado State Fair. For instance, this includes the 14 additional horse shows the grounds host each year.

“We need a person to be out travelling and selling Pueblo in other states. And this person would not only be talking about the convention center but opportunities with parks and rec, the university, state fair and how we can sell a city-wide event.” – Donielle Gonzales, Visit Pueblo coordinator for the Greater Pueblo Chamber of Commerce

The lodging tax was raised 1.5 percent and another pass-through was created, this time for the fairgrounds. Later on, the state fair received a grant to build the events center and asked the city to match $1 million over 10 years. An 8/10th of a percent was added to the lodging tax, which brought the total to 4.3 percent – the current rate.

But when the 8/10th of a percent didn’t pay for the events center the city froze the pass throughs to pay off the events center. The city ended up allocating what they could to the chamber and state fair. Today, the events center is paid off. But the pass through hasn’t been reinstated because of city-wide budget cuts.

The city’s deficit meant marketing money for tourism got put on the back burner.

“In the 2000s back starting in 2004-2005 we started getting 2 percent and it went that way until the great recession,” said Chamber President and CEO Rod Slyhoff. “In 2012, we saw council starting to push back and have to make reductions in the money that they were giving us, and we understood that. We aren’t upset with city council. We fully understood. It was a recession and they had to make cuts everywhere.”

In July, Slyhoff proposed to city council during a work session that the chamber return to receiving the full 2 percent instead of allocations. Even during the recession, lodging didn’t take a big nose-dive like other areas within the sales tax, Slyhoff said. The lodging tax remained fairly stable, but the amount the chamber receives from the tax has not.

In 2015 and 2014 the chamber received $350,000 for year-round promotion. In previous years it has been more: $400,000 in 2013, $440,000 in 2012 and at its high point $459,000 in 2009.

The punch of the presentation was the convention center.

The allocated amount of money is stretched pretty thin with advertising mostly in the Denver Metro area, and the city is already running behind in attracting events to the future expanded convention center, according to Donielle Gonzales, Visit Pueblo coordinator for the chamber. She was also at the July work session to present with Slyhoff.

“To be competitive you have to be marketing that stuff two to three years or even five years in advance,” she said later in an interview about the proposal.

Pueblo Convention Center General Manager Brian Hoffman said so far everything is on schedule for the bigger space, which is expected to be finished with construction in the fall of 2017.

“Right now we’re right on track, there has been a trend change in the industry where a lot of conventions and conferences of our size were booking three or four years in advance. But now they’re booking about a year in advance,” Hoffman said. “We have quite a few on the books for 2016 and we have some on the books for 2019.”

The renovated convention center will require more marketing, Hoffman said. But that will hopefully be accounted for in future budgets, which are approved by the convention center’s owner, the Pueblo Urban Renewal Authority.

Sometimes the chamber and convention center will split costs on print ads, Hoffman said. Usually, the chamber helps the convention center with events that are already booked. That could mean arranging a reception, putting together welcome bags or arranging visits to local museums.

In terms of actual marketing, Hoffman said if the chamber didn’t receive any additional money for marketing, the convention center would get by just fine, but more money is good for everybody.

“It won’t hurt, but it would definitely help,” Hoffman said. “We don’t have a huge budget, but we try to work within our means. Any additional assistance would be great.”

The convention center has its own marketing person, but Gonzales and Slyhoff say it is not enough to draw in the types of events the chamber is wanting to sell. The chamber’s proposal included the possibility of adding a “city-wide sales person” if the city returned to giving the chamber the full 2 percent of the lodging tax.

“We need a person to be out travelling and selling Pueblo in other states,” Gonzales said. “And this person would not only be talking about the convention center but opportunities with parks and rec, the university, state fair and how we can sell a city-wide event.”

The fair works closely with the chamber, said Colorado State Fair General Manager Chris Wiseman. So, any more money the chamber could get would be good for the fairgrounds, especially because “there isn’t really any year-round marketing right now,” Wiseman said in a recent interview.

Technically, the city gives money to the fairgrounds for year-round marketing, but Wiseman said that is spent on incentives for events already taking place at the fairgrounds.

This includes, for instance, sponsorship of the Rocky Mountain Street Rod Nationals, which takes place each June. Wiseman said he might throw in a barbeque to “sweeten the deal” with a group using the fairgrounds as another example of what the money is used for.

Instead of looking for new events to occupy the fairgrounds, Wiseman is tied up keeping the current events coming back each year.

The Colorado State Fair – the event – isn’t included in marketing woes. Wiseman said he easily spends just under half a million dollars on direct marketing for the 11-day event, but that’s all budgeted. It’s the rest of the year that spells out trouble for the fairgrounds.

An audit earlier this summer pointed out the state fair is losing money. That prompted media outlets up and down the Front Range to write headlines that suggested the Colorado State Fair could leave Pueblo for Denver. A Denver Post editorial supported the idea.

“Year after year, auditors have told the same story. The fair is not generating enough money and the state is asked again and again to keep it afloat,” the Denver Post editorial board wrote. “A move would be sad, but it’s the only way to set the fair permanently on its feet.”

But the editorial board uses the Colorado State Fair (event) and the state fairgrounds interchangeably. A rebuttal from the Pueblo Chieftain quoted Wiseman as saying that the actual event does fine, it’s the fairgrounds that is losing money.

So, yes, while the Post’s editorial stated that the city of Pueblo has reduced financial support from $315,000 in 2006 to $125,000 in 2014, that has nothing to do with the Colorado State Fair (event). It actually has to do with marketing of other events, which doesn’t happen because there isn’t enough money to both keep current events happy and attract new ones.

“We appreciate all that we’ve gotten from the city and county in recent years,” Wiseman said. “We’ll have some meetings coming up (with the city) that spell out some of the fair’s needs.”

City Council President Steve Nawrocki said he wasn’t aware the state fairgrounds wasn’t using the money for marketing but rather for incentives.

Nawrocki added that the convention center expansion and talk of moving the state fair creates urgency in allocating more money to marketing, but Nawrocki said he is in favor of rebranding the city over other options.

“We’ve already started that process,” Nawrocki said. The hospitals have done some marketing work to try to lure more healthcare professionals into the city, but they are early in their effort, working largely on their own and focusing on jobs, not tourism.

Part of the rebranding plan Nawrocki said he would like the city to pursue would involve hiring a consulting group, which would cost around $100,000.

Previously, Nawrocki has said the city could benefit from have a couple of billboards that direct travelers on I-25 to stop off downtown for lunch and shopping.

The problem with that, Slyhoff said, is that the money isn’t really there and the chamber is really looking to direct their marketing to overnight visitors. If the chamber can sell hotel rooms there is more lodging tax, which would ideally go right back into marketing.

“It’s all about having a uniform approach,” Nawrocki said of any plan the city goes forward with for marketing and tourism.

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