Record-setting beach tourism: Good and bad for coastal Alabama
By John Sharp | jsharp@al.com Press-Register
Gulf Shores, AL
Business has been good for Brant Frazier's family-run charter fishing business in Gulf Shores since gooey balls of black tar floated onto Alabama's beaches five years ago after an oil rig exploded in the Gulf of Mexico, creating one of the largest ecological disasters in U.S. history.
"Certainly, anytime there is a major upheaval, there is doubt but things have been very good," said Frazier, who operates Fins and Family Fishing year-round with his son, Dylan. "To be in business for yourself is to be generally an optimist. Just like the economic changes at that time, I figured things would get back quickly."
And quickly, they have. According to state and coastal Alabama tourism figures, Baldwin County's tourism industry is expected to reach a fifth year of record breaking returns since the oil spill kept tourists away. The county, with the beach cities of Gulf Shores and Orange Beach as the main attractions, experienced a 4.7 increase in visitors from 5.5 million in 2013 to 5.8 million in 2014. Jefferson County attracted 3.1 million visitors in 2014, with Mobile County a close third at 3 million visitors.
But with growth, comes problems. In particular, South Alabama public officials are fueling a county-wide theme of being mostly forgotten by state officials when it comes to road work even though Baldwin County's beaches account for nearly 40 percent of tourism spending in Alabama. The angst is heightened every summer when tourists flock to the state's coastal beaches, creating gridlock along major arteries such as Interstate 10 in Mobile and Ala. 59 through south Baldwin County.
Lately, the frustration has been amped up following this past summer's settlement in the BP oil spill case. The settlement, which was led by Alabama Attorney General Luther Strange's office, funnels nearly $1 billion into the state's General Fund to help pay off debts. As Gov. Robert Bentley has repeatedly said, "the whole state was harmed."
'A tremendously hard sell'
South Alabama's tourism surge isn't an anomaly: Many U.S. destinations have seen big increases as the economy recovered following the 2008 financial crisis.
But state statistics show that no other area in Alabama comes close to drawing out-of-state tourists the way Baldwin County does.
Statistics show that travelers spent $4.6 billion in the Gulf Coast in 2014, accounting for 39 percent of the $11.8 billion spent across Alabama last year.
The coast's percentage is up since the BP oil spill. Tourists spent $3.3 billion in 2008, or about 35 percent of the state total that year.
The beaches also make up a considerable chunk of the lodging tax revenue coming back to Alabama, and the proportion is growing.
In 1999, Baldwin County's annual state lodging tax returns were $5.9 million. That was just 22 percent of the state's overall $27.1 million. By 2008, Baldwin County's tax generated $11.2 million for 24 percent of Alabama's $46.8 million. And in 2014, the lodging tax drew $17.8 million, or 31 percent of the state's $58 million.
Mobile and Baldwin counties "account for more than a third of all travel expenditures in the state," according to Alabama Department of Tourism and Travel Director Lee Sentell. "Baldwin County itself has traditionally been between 25 and 30 percent of all travel expenditures and Mobile County adds another 7-8 percent."
Said Keivan Deravi, an economist at Auburn University in Montgomery, who has compiled an annual economic impact report on travel for the state since 1999: "Alabama would be a tremendously hard sell" without the Gulf Coast. "It's easy to sell the beach but once you get out of Baldwin County, there is not a natural draw."
Baldwin County public officials are leveraging the data in a push for more state resources, especially for road projects that would help alleviate traffic bottlenecks. Aside from the 12.8-mile stretch of the Baldwin Beach Express running from Interstate 10 toward Foley, little state investment has been made to build new roads aimed at reliving congestion.
A bridge running over Portage Creek next to The Wharf entertainment and shopping complex was built by a private company and motorists are charged a $3.50 toll to take it.
"It's realistic to assume if we want to continue to grow and maintain (the positive growth)," Gulf Shores Mayor Robert Craft said. "So that people are not fed up with waiting in lines and (look to) go somewhere else."
Baldwin County Commissioner Tucker Dorsey echoed the frustrations. "We're tired of being taken for granted down here. We need investment into our infrastructure to continue being the tourism draw in the state that we are. Quite frankly, from a traffic capacity stand point, we'll start turning away our visitors if we don't figure out a way to solve the traffic problems. We're certainly getting frustrated down here."
'Take that off the table'
Bentley continued to fuel the frustration when, speaking before a group of business and civic leaders last week, told them to stop quibbling over the state's settlement with BP. Lawmakers, including Bentley's former gubernatorial opponent U.S. Rep. Bradley Byrne of Fairhope, have repeatedly criticized the settlement as being unfair to the coastal area.
More than half of Alabama's portion of the settlement, an estimated $1 billion, will be sent directly into state coffers after Alabama sued for economic damages based on lost tax revenue.
"My goal is to pay off debts first," Bentley said. "What's left over, we'll look favorably (at the Gulf Coast) at that. So let's take that off the table so we're not arguing over that."
That might not be so easy to do for lawmakers representing coastal Alabama constituents. Of the $1.8 billion coming back to Alabama, only about $500 million will be directly controlled by Gulf Coast officials. It's not nearly enough to address a list of environmental and infrastructure "wish list" of 187 projects totaling $1.59 billion that some Mobile and Baldwin county officials believed could have been dented by a much more lucrative spill settlement.
"The governor said (the matter) is off the table, but it's really not off the table," state Rep. Randy Davis, R-Daphne, said. He cited the potential for legislation to address the issue. State Rep. Margie Wilcox, R-Mobile, is sponsoring a bill that would redirect $500 million of the state's $1 billion be dedicated to South Alabama.
Bentley also has promised the first $50 million of the settlement to go into the Gulf State Lodge project, which includes a new convention center that would be Alabama's answer to similar attractions along Florida's Emerald Coast. The convention center, he said, will open in May 2018.
"You have to make sure you are constantly reinvesting for the future." - Keivan Deravi
"I am absolutely sick and tired ... I'm not going to Sandestin to speak to Alabama people anymore," Bentley said during a Nov. 6 luncheon before a group of Gulf Shores and Orange Beach politicians and business people. "I've been invited. But I'm not going coming down there."
Orange Beach Mayor Tony Kennon said while he appreciates the state's investment in a new convention center, he isn't sure about what's going on with it. "I feel like we're in the dark." He also said he it's important for the state to prioritize transportation money into the region where he said a chunk of the city's 5,400 residents are increasingly growing frustrated with gridlocked roadways.
"Montgomery needs to understand it is very difficult finding middle ground here for a full-time community that lives in the middle of a tourism destination," Kennon said. "And the backlash could be detrimental for revenues to Montgomery if the state doesn't help us maintain the quality of life for the voters."
There are some projects in the works that state officials hope will address traffic problems within Orange Beach and Gulf Shores. Among those is a $1.5 million resurfacing and widening of Canal Road/Ala. 181 that could be completed by summer 2016. Also, the state is planning to invest in a $600,000 project to improve business access along Ala. 59 in Gulf Shores. The city, with help from federal grants, is planning to build new sidewalks along the same route that will help pedestrians get to the beach more safely.
'Future looks very good'
Herb Malone, president and CEO of the Alabama Gulf Coast Convention and Visitors Bureau, said transportation will remain at the forefront of challenges for the region. Other challenges have crept up including an adequate labor force for businesses to maintain a year-round presence in an area that sees, by far, its greatest activity during summer months.
According to tourism data, hotel occupancy is nearly 100 percent during July, with an average daily rate at $230. Condos, at 90 percent capacity during July, go at an average rate of $328 per day.
July, considered the peak travel month of the year, generated $118.9 million in taxable retail sales for Gulf Shores and Orange Beach in 2015, a record for the two cities. It was a 5.5 percent increase over July 2014.
Even more impressive was in May 2015, which generated $79.9 million in taxable sales – a 26.2 percent increase over May 2014 and the largest annual monthly increase recorded by the area since at least 2012.
"More and more, we are seeing people coming here with the exception of that period of time for (Hurricane) Ivan (in 2004) and the oil spill," Deravi said. He said a challenge for the area will be with private investment for more eating establishments, attractions like golf courses and newer condominiums to keep up with developments in the Florida Panhandle.
"Many times at the beach, during the Fourth of July, you can't even get the elevator to get to the beach," Deravi said. "It's so overcrowded and at some point, you give up. You have to make sure you are constantly reinvesting for the future."
Malone said that officials "work real hard to stay on top of trends" and changes in consumer spending. "We have a lot of momentum going. Once we get people here our first time, they have a high satisfaction rate on how they enjoyed (their experience)."
CVB data shows high satisfaction among visitors. Of those travelers surveyed in 2014, 93 percent reported being "satisfied" with 96 percent saying they would likely return to Gulf Shores and Orange Beach again to visit.
And while Gulf Shores and Orange Beach are often perceived as a cheaper alternative than beach destinations in Florida, tourists responded by saying that overall costs of their trips to South Alabama are "about the same" as elsewhere.
"I think our price points for the individual quality of product are somewhat similar," Malone said. "In some cases, we are a better value."
Of course, there is one thing that coastal Alabama has that Florida lacks – the lure of a Deep South experience. "If you want true southern hospitality, you'll find that in Alabama," Malone said. "You won't find that in Florida.