Tourism Shifts With Business: Benton County Booms With 70 Percent Wal-Mart Travelers

Over the past decade, according to the numbers at least, tourism has taken off in the northwest corner of Arkansas, while traditional tourist meccas like Eureka Springs and Hot Springs have shown little improvement.

Collections of the state’s 2 percent tourism tax indicate tourism in Benton County jumped 147 percent from 1993 to 2003, and that’s comparing the 10 months of stats available for last year against an entire 12 months in 1993.

More than $28.7 million was spent on theme parks, lodging, camping and marinas in Benton County last year (the four things the tourism tax applies to).

Carroll County, home to Eureka Springs, was down 1.7 percent over the past decade but will surely make that up when the November and December tax collections are added. Carroll County’s tourism-tax collections were $517,327 last year, indicating people in that county spent $25.9 million on the four tourism-related businesses mentioned above (See chart, p 15).

Garland County, where Hot Springs is located, saw tourism-tax collections increase by 13.9 percent from 1993 to 2003 to $727,620, reflecting $36.4 million spent that applied to the state’s tourism tax.

Pulaski County, home to Little Rock, was still the dollar leader by far. Pulaski County had a 12.4 percent increase in tourism-tax collections last year with $1.67 million, which translates to $83.3 million spent on the four businesses where the tourism tax is applicable.

“I think we’re seeing a real shift,” said Dale Christy of Bella Vista, executive director of the Northwest Arkansas Tourism Association. “I guess our big challenge today is to continue to show the attractiveness of the area in consideration of the growth of the area. Some people are viewing us now as a metropolitan area.”

Regional Differences

The Northwest Arkansas region — Washington, Benton, Madison and Carroll counties — ranked second out of the 12 regional tourism associations in the state in the “economic impact of travel” last year with $550.1 million in total travel expenditures. That’s 14 percent of the state’s total and an increase of 55.7 percent over $353.3 million in 1992.

The “economic impact of travel” is much more inclusive than the state’s tourism tax. The measure includes money spent on food and retail in addition to everyday travel-related expenditures like automobile insurance and depreciation.

As a result, the metropolitan area around Little Rock had a huge increase in the “economic impact of travel” study, but it’s difficult to determine how much of that money was spent by tourists as opposed to business travelers and residents.

The Heart of Arkansas region — which includes Pulaski, Faulkner, Lonoke, Prairie and Saline counties in central Arkansas — ranked first with $1.08 billion, up 70.1 percent from $635.2 million a decade ago.

The Diamond Lakes region — which includes Garland, Clark, Hot Spring, Montgomery and Pike counties — was third with $468.4 million, up 32.4 percent from $353.8 million in 1992.

The Arkansas Delta Byways region came in fourth with $415.5 million spent on tourism, but that region includes 15 counties stretching from Missouri to Louisiana along the Mississippi River in eastern Arkansas. That region had a 25 percent increase from $332.6 million a decade earlier.

Wal-Mart Effect

Benton County’s increase in tourism-tax collections may be a bit deceiving, though. Much of the state tourism tax comes from lodging, and the majority of travel to Benton County is from vendors heading to Bentonville to call on Wal-Mart Stores Inc. The joke around Bentonville and adjoining Rogers is that hotels are full during the week but empty on weekends.

Joe David Rice, Arkansas’ tourism director, said his “seat of the pants estimate” is that about 70 percent of the “tourist travel” to Benton County is actually from business travelers. That compares to about 25 percent from business travelers statewide. Chances are, less than 70 percent of the tourism tax collections in Benton County in 1993 were due to business travelers, but it’s impossible to estimate what that figure would have been a decade ago.

But that doesn’t mean the business travelers to Benton County aren’t getting used to the place and deciding to spend an occasional weekend there. Tourists are also coming to the county for hunting, fishing and Civil War reenactments, Rice said. And Wal-Mart in itself is becoming somewhat of a tourist attraction. Last year, more than 50,000 people visited the Wal-Mart Visitor’s Center in Sam Walton’s original store on the downtown Bentonville square. Mr. Sam’s red 1979 Ford pickup truck is a prominent feature of the museum.

Branson Effect

To the east of Benton County, people in Carroll County are trying to find new ways to market Eureka Springs. They don’t want tourists to get the been-there-done-that syndrome that afflicted Branson, Mo., a few years ago.

“Carroll County is essentially the same product it was a decade ago,” Rice said, referring to the dip in tourism-tax collections there. “One rule of a theme park is you add a new ride every year. Frankly, Eureka Springs hasn’t been adding that new experience every year.”

Rice’s office and the Eureka Springs City Advertising and Promotion Commission are spending about $30,000 this year for television spots and three billboards in Branson. They were trying to get a smidgen of the 6 million tourists who go to Branson every year to head south of the state line to Eureka Springs.

“Down here in Arkansas, we’re looking at all those visitors like a fox gazing into the hen house,” Rice said.

But, he admitted, $30,000 isn’t much money in the advertising world. Arkansas spends about $2 million per year on television advertising. Most of that money is spent in the nearby cities of Tulsa, Oklahoma City, Dallas and Memphis.

Eureka Springs’ numbers could also have been affected by a fire that destroyed the 15,000-SF Best Western Inn of the Ozarks Convention Center 2001. After rebuilding, it takes a while to rebook large conventions and get that revenue coming in again.

Game and Vichy

Most travelers to Arkansas come here by automobile and don’t usually drive more than a day to get here, Rice said. For people in the cities mentioned above, Arkansas offers the nearest retreat to wilderness, mountains and clear lakes. The Ouachita and Ozark mountains of Arkansas are closer than the Appalachian or Rocky mountains for residents of our neighboring states.

But, then again, the wilderness angle can work against a state, too.

For the past 25 years, the Department of Parks and Tourism has worked hard to promote Arkansas as “The Natural State.” Previously, the state motto was the “Land of Opportunity.”

“But for many people, they think that’s all we have — hunting, fishing and hiking,” Rice said.

Those are activities men tend to enjoy, but why would most women want to come to Arkansas?

Rice said his department is working on a campaign to lure women to the state. The ads will promote Arkansas’ fine restaurants and spas in cities like Hot Springs and Eureka Springs (where Vichy showers have become popular). Shopping for antiques is also a big pastime for some female tourists in Arkansas.

Arkansas ranks 16th nationally in the amount of money allotted for its state tourism office. Last year, that office’s budget was $12.26 million, up 42 percent from $8.61 million a decade ago. Arkansas spent less money on its tourism office than any of its bordering states except Oklahoma, which spent $10.9 million, and Mississippi, which spent $9.3 million (See map, p. 14). Texas is Arkansas’ neighbor with the best-funded tourist office. The Lone Star State spent $31.09 million on that office last year, ranking it No. 4 nationally.

Washington County

From 1993 to 2003, Washington County had a 54.9 percent jump in tourism-tax collections. That’s a reflection of growth in the two-county area that is home to the Fayetteville-Springdale-Rogers metropolitan statistical area, Rice said. The Milken Institute rated the MSA as the “best performing city” in America last year. The MSA includes Bentonville and even one county in Missouri, McDonald County.

Rice said the University of Arkansas Razorbacks sports teams have little effect on tourism in the area. Most Hog fans drive up from central Arkansas and return home after the game instead of spending the night in area hotels, he said.

Madison County had the biggest percentage increase in the area, but the 328.9 percent jump still reflects only $283,010 spent on tourism last year.

Tab Chart:

Tourism Tax Collections

tttt

County	1993	1998	2003*	1993-2003 % Change
Benton	$232,589	$343,068	$574,837	147.1%
Carroll	$526,293	$518,691	$517,327	-1.7%
Crawford	$35,436	$67,679	$65,184	83.9%
Madison	$1,320	$1,567	$5,662	328.9%
Sebastian	$221,448	$303,141	$354,333	60.0%
Washington	$404,362	$541,359	$626,161	54.9%
Pulaski	$1,483,361	$1,742,075	$1,666,646	12.4%
Garland	$638,895	$756,623	$727,620	13.9%

Notes: Based on 2 percent state sales tax collection on tourism-related businesses including theme parks, lodging, camping and marinas.t* For the first 10 months of 2003 because that was the most current information available.tt

tSource: Arkansas Department of Parks and Tourism