Making sense of Penticton's tourism dispute

Tourism Penticton CEO Jessie Campbell said research shows more and more tourists are coming to Penticton to experience wine country.
Image Credit: Tourism Penticton


PENTICTON - The issue between the Penticton Hospitality Association and the City of Penticton and Tourism Penticton boils down to one fundamental question: Is Penticton's tourism future in beaches and peaches or the area's wineries?

After numerous interviews on all sides of the discussion, that appears to be the crux. Tourism Penticton and the city believe it's the more sophisticated—and spendy—wine tourist. But that doesn't necessarily benefit the existing hotels that generate the two per cent Hotel Room Tax. Many of those businesses are, yes, on the city's beaches. The hospitality association says that's where they directed big chunks of the $400,000 generated annually by the Hotel Room Tax. And they say it's working.

Association president Rob Appelman said 2013 was a great year with full hotels and restaurants, thanks to their targeted spending. His business, the Lakeside Villa Motel, did very well with staff having trouble finding rooms.

"We've done a great marketing job to promote the city and make the city's name more of a household name in the past three or four years," Appelman said.

But not according to the city. It has assumed control over the tax revenues, prompting possible legal action from the hospitality association, in part because it's not following what city studies said was the best way to spend—wine and food—and for not providing progress statements which Mayor Garry Litke said are contractual obligations.

"You are not providing us with financial statements, we have some questions about whether the money is being spent on external marketing or not, and where is your annual general report? Those questions were not answered to our satisfaction," Litke explained. He is referring to the Hotel Room Tax contract signed in early 2012 by the city, the association and the provincial government. Infotel News has sought public release of that contract.

Even if this legal dilemma is resolved there are still opposing philosophies causing divison with the city's biggest tourism promoters; should marketing focus on the beaches and peaches or the wine country experience?

Before the 2012-2015 Penticton and Wine Country Tourism Business Plan was presented to council in March, 2012, the Penticton and District Chamber of Commerce was in charge of tourism marketing as well as economic development and running the visitor centre. When the contract expired, the city took on economic development, Litke said.

"We could have run tourism ourselves as well," he explained but the city put out a request-for-proposal instead and the accommodation industry stepped forward. "There was a strong interest... to exert some influence over how the money was spent, but it had to be for external marketing."

The association got the responsibility for spending revenues from the Hotel Room Tax while Tourism Penticton would continue with its marketing.

"We had two organizations trying to do the same thing," he said. The mayor said the city talked to both groups about having one tourism force but so far it still hasn't worked.

"They (the accommodaters) said they were interested in that, but we've seen no evidence of them actually moving towards that."

Miranda Halladay, chair of Tourism Penticton, resigned earlier this month saying it didn't appear her goal of uniting the groups was ever going to happen.

"My goal in taking on the role of inaugural chair... was to see tourism marketing efforts in Penticton coalesce into a unified, effective organization," she said in a prepared statement.

"Unfortunately, for reasons confounding the majority of tourism stakeholders... the PHA has chosen a program of stall and delay, ultimately derailing this process."

Part of the 2012-2015 tourism business plan was to have partnerships between the two tourism advocates complete with regular meetings and exchanging of progress reports. Officials from both sides have also talked last year about the benefits of coming together under one umbrella but remain at odds.

When asked when the city and the association began to have issues Litke was brief. He said a letter outlining the city's concerns about the association not meeting its contractual obligations was sent on May 22, 2013.

His response to when Tourism Penticton and the association began to drift apart was similarily short. He would only say those two sides entered into mediation in September 2013 but so far matters don't appear to have been resolved.

According to association operations director Tim Hodgkinson the city needs to win back more of its historic customer base, low to middle income famililes who come for the beaches, before putting more of its resources towards other markets.

Tourism Penticton CEO Jessie Campbell said research conducted by a Vancouver-based marketer shows more and more people are coming to Penticton for the experience of wine country - touring the wineries and hiking and biking in and around the vineyards as well as coming for the beaches.

"It's about having the ability to interact with a winery, be able to cycle in wine country, hike in wine country and it's about being able to go to the beach in wine country," she said, of the reasons more tourists visit the city.

"This has been a big shift in the last decade," the CEO explained. About 45 per cent of visitors have the wineries on their minds when they come to Penticton and they are not just coming during the summer months.

Campbell said research has dictated where Tourism Penticton should focus its advertising and marketing efforts. Studies have also shown how long people want to stay. Instead of planning in January for a two-week summer stay, people are booking a few weeks in advance for a three or four-day stretch.

"Our consumers have gotten more savvy. It's always changed, from what they are prepared to pay and the types of places they want to stay. That has all shifted.

"If we don't listen to what our visitors are telling us and don't give them what they want we are not doing our job," Campbell said.

To contact a reporter for this story, email Shannon Quesnel at, call 250-488-3065 or tweet @InfoNewsPentict.

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