Council Scales Back Town's Tourism Master Plan

Council approves a modified plan
Last Wednesday, the Oro Valley Town Council approved a modified version of the Town’s Leisure Travel Destination Management Plan by a 6-1 vote. The approval excluded Section 5, “Big Ideas and Action Plans,” except for the Tohono Chul expansion concept. Council also added language stating that approving the plan does not authorize projects, capital spending, staffing increases, policy changes, or implementation actions without future council approval. In other words, any actions will have to come before council during a budget approval process.

What council "approved"
The plan is intended as a 10-year roadmap for leisure tourism in Oro Valley. It focuses on generating tourism tied to outdoor recreation, wellness, arts, culture, dining, sports, and community events , It does not focus on building business travel or convention activity. The plan recommends a regional events and festivals strategy to address summer seasonality, increasing sports tourism and evaluating additional sports facilities, activating Steam Pump Ranch as a cultural and culinary venue, creating themed visitor itineraries and trail guides, expanding boutique and wellness lodging options, and establishing resident tourism sentiment tracking and additional performance measures.

Staff presented economic scenarios

As part of its presentation, staff showed example first year scenarios for selected recommendations. A regional events and festivals strategy assumed 5,000 additional Tucson visitors spending $50 per day and 1,000 Phoenix visitors spending $100 per day, producing an estimated $325,000 in economic activity and about $4,000 in Town bed and sales taxes. A sports tourism example modeled a small regional market capture with visitors staying three days, producing an estimated $520,000 in economic activity and about $6,500 in Town taxes. Other examples included a Steam Pump Ranch strategy estimated at $150,000 in revenue activity and about $1,900 in Town taxes, and a culinary tourism scenario estimated at $400,000 in activity and about $10,000 in taxes.

Why this matters

The purpose of the Town’s tourism strategy is to attract additional visitors who spend money in Oro Valley, generating economic activity, supporting local businesses, and increasing Town tax revenues. As part of that effort, the Town recently reported estimated economic impacts of nine selected FY2025-26 tourism events. Staff discussed these at last week's Tourism Advisory Commission Meeting.  The events ranged from major events such as the Legendary Women’s Cup and Tucson Marathon to smaller festivals and community events. Together, staff estimated that these events generated $3 million to $4 million in economic activity. LOVE translated those figures into approximate Town revenue impacts using Oro Valley tax rates and also analyzed the reported hotel room activity tied to several events. See the above panel for those calculations, including estimated bed and sales tax impacts, and for an explanation of how the Town says tourism event impacts are calculated.

Process has been underway for months
The plan  cost the town $150,000.  It has gone through months of review involving staff, the Tourism Advisory Commission, and council discussions. Staff described the plan as a community-based framework shaped through research, stakeholder engagement, resident surveys, and tourism analysis intended to guide future tourism-related decisions.

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Council Lists Criteria as Oro Valley Weighs Tourism Strategy

Draft tourism plan reviewed by Town Council
The Oro Valley Town Council held a study session last week to review a draft Leisure Travel Destination Management Plan, a long-range strategy intended to guide how the Town approaches tourism over the next decade. Presented by consultant CSL International, the plan reflects earlier input from residents, stakeholders, the Tourism Advisory Commission (TAC), and Council members. The draft emphasizes leisure-based tourism (outdoor recreation, wellness, arts and culture, events, and culinary experiences) rather than business or convention travel. The plan frames tourism as a way to enhance resident quality of life rather than simply increase visitor volume.

Council sets criteria for what will be done
Much of the discussion centered not on the overall vision, but on how the plan’s recommendations would be prioritized, funded, and phased. Council Member Mary Murphy outlined three criteria she was using to evaluate the draft plan: Whether recommendations put residents first; whether the fiscal impact and long-term financial responsibility are clear; and whether there is accountability in what the Town is

being asked to do. Other Council members agreed with those criteria. Council Member Elizabeth Robb then added three additional considerations: The need for clear sequencing; whether the Town has the capacity and staff to carry out the recommendations; and whether proposed actions are sustainable over time. Together, these six criteria will likely shape future Council discussions about the plan.

Visit Tucson discussion clarified scope and intent
Council members also discussed why Oro Valley ended its formal relationship with Visit Tucson and what that decision means going forward.  That discussion was not about reopening the decision, but about making sure the draft plan is evaluated with a clear understanding of what Oro Valley does and does not intend to do going forward.

The discussion made clear that the Town does not intend to replicate Visit Tucson’s role or scale, particularly its convention, meetings, and large-group sales functions. Instead, Oro Valley’s approach is focused on smaller-scale, leisure-oriented tourism that aligns with the community’s character and existing assets. 

Council members emphasized that the plan is not about building a destination marketing organization comparable to Visit Tucson, but about developing a strategy tailored to Oro Valley’s size, priorities, and fiscal capacity.

Aspirational ideas are not near-term actions
The draft plan includes a set of longer-term “big ideas,” such as expanded cultural venues, enhanced event programming, and new destination-defining spaces. Council members emphasized that these concepts are aspirational and do not represent approved projects or commitments. Any such ideas would need to return to Council with detailed cost, feasibility, and operational information before moving forward.

TAC review reflected more caution than Council summary
Several of the concerns raised by the Tourism Advisory Commission (TAC) closely mirrored the evaluation criteria Council members said they were using during the study session. TAC reviewed the plan the previous week. The TAC comments on the draft plan was presented to Council as having been completed and incorporated into the materials, and that description was accurate as far as it went. 

However, the TAC’s January 26 discussion reflected a more mixed and cautionary review than was conveyed in the summary presented to Council. While commissioners offered technical and prioritization comments that were incorporated into the draft, several also said they were uncomfortable moving forward with the plan as written and questioned whether the Town is prepared to implement it at this time. Those commissioners raised concerns about staffing capacity, cost, and the pace of moving ahead following the Town’s decision to end its relationship with Visit Tucson. The commission did not vote to reject the plan and took no formal position, as its role is advisory, but the individual concerns expressed went beyond technical edits and were not fully reflected in the high-level summary presented to Council.

Next steps
Because the item was a study session, no action was taken. Staff will compile Council feedback and use it to revise the draft plan. Any future decisions related to funding, governance, or implementation will return to Council as separate agenda items.

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Tackling Key Challenges in Oro Valley’s Latest Five-Year Financial Forecast

Reasons for optimism

Yesterday, we discussed the town’s latest five-year financial forecast and highlighted the challenges ahead. Today, we focus on what the town can do to meet these challenges.  We think there's reason for optimism.

Returning Operating Fund reserves to historic levels would eliminate the capital fund "deficit"

The town maintains a General Fund reserve of 30% of General Fund expenditures, an increase from the previous 25% level implemented five years ago to address economic uncertainty from the pandemic. 

At the meeting Vice Mayor Barrett suggested that reducing the reserve back to 25%, which could free up approximately $2.5 million as a one-time boost for capital projects. Gephart acknowledged this benefit but warned that “it doesn’t address the long-term closing of our excess ongoing revenues over ongoing expenditures” in the general fund. However, what it does is to release funds that more than cover the shortfall of $1million in the 2030 projected balance of the capital fund. 

Bond financing would provide needed spending for major items 
Unlike last year, there was no significant discussion of bond funding for capital projects in this year's discussion. However, there were indications that bonds might be issued to finance a new police facility study next year. The town’s latest grant request status report includes a $3.8 million request from the Department of Justice - Byrne Discretionary (Law Enforcement), a fund designed to support community justice projects. The grant is pending.

The town could sell for capital projects that will not be covered by grants. This is a common use of bonding and the town's current debt service [panel above] decreases substantially by 2027.  In addition, the town's future debt service projection indicates a substantial drop in debt service funding, thus freeing up the capacity to bond future projects.

Annexing retail rich areas can improve the General Fund sales tax revenue "picture"

We have not seen a recent Town of Oro Valley annexation plan. The last one we saw was in 2021. That plan identified a number of areas that are target rich for Oro Valley. Here are a couple of areas; and we've added in one of our own.

As for the General Fund and the shortfall in sales tax revenues, move forward to annex retail rich areas for annexation. One area is the east side of Oracle north of Ina that has Guadalajara Grille and other retail already in place. A second area is to annex the retail businesses on Oracle south of Ina Road. Retail there includes Safeway and Whole Foods. 

In the longer term, focus on annexing the "New Foothills Mall".  The town considered this almost 20 years ago. The town concluded that it just wasn't a good idea at that time. That was before the La Cholla Blvd became a "highway".  Now La Cholla Blvd as a giant siphon for bringing business out of Oro Valley. That's because it's far easier for residents who live in that area to quickly get to shopping rather than traveling across town to get to Oracle Road, which is where most of the retail is  located in Oro Valley.

"Reducing retail leakage" will help too

One area on which the town is focused is finding ways to reduce “retail leakage.” That is when residents spend money outside of Oro Valley instead of supporting local businesses, leading to lost sales tax revenue that could fund town services. The town has already identified challenges such as significant retail leakage in categories like automobile dealerships, clothing stores, gasoline stations, electronic shopping, and general merchandise, with total estimated lost revenue exceeding $776 million. Some of the actions the town is considering include educating residents about the benefits of shopping locally, targeting specific audiences for year-round campaigns to promote local shopping and dining, and strategically recruiting businesses that align with local consumer demand. The next steps include setting recapture goals, aiming to reduce the leakage gap by a percentage through a combination of shopper retention efforts and attracting new businesses to meet local demand. (Source: Presentation to Town of Oro Valley Town Council by Economic Development Director Paul Melcher, 3-5-25)

Bringing focus to revenue generating touring is another avenue 

Oro Valley is conducting a Leisure and Travel Study to develop a tourism strategy after taking over destination marketing from Visit Tucson in March 2024. Initial efforts, including hiring a marketing manager and launching digital campaigns, have shown limited success, leading two major resorts to rejoin Visit Tucson independently. The study, led by CSL International and a town-appointed steering committee, aims to assess the effectiveness of current tourism investments, explore sports and arts tourism, and consider regional partnerships with nearby communities. Some residents are concerned about the study’s focus, transparency, and the town’s lack of experience in tourism management. Critics argue the strategy should prioritize generating tax revenue rather than simply increasing visitors and note that the decision to leave Visit Tucson was made without consulting key stakeholders. The study, expected to take six to eight months, will present its first update in April. (Source)

And remember

Financial forecasts are conservative planning tools rather than definitive predictions. The future is almost never what is predicted. In addition, town leadership is actively seeking alternative funding sources, including federal grants and strategic fiscal policies, to ensure continued support for essential community projects. With thoughtful planning and careful adjustments, Oro Valley can navigate these financial hurdles effectively in the years ahead.

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Residents Wary of Town's Travel and Leisure Study

Need to evaluate and plan a viable path ahead for the town's destination marketing efforts
The Oro Valley Town Council discussed a Leisure and Travel Study the town has undertaken. The discussion was one of many topics at the council's February strategic planning study session. The study is an attempt to develop an effective destination marketing strategy and program. The study is badly needed because the town is...

"Babes in the Woods" when it comes to destination marketing

The town took over destination marketing from Visit Tucson last March. It did so without a plan and without experience. Since then, the town hired a destination marketing manager, developed a mobile app, and launched digital marketing efforts (Source). However, results have been minimal regarding significant leads, leading the two resorts most affected by the change to rejoin Visit Tucson on their own.  The town simply was not capable of or prepared to effectively engage in destination marketing. It should have done this study long before it made the change.

There are so many questions to be answered...questions that should have been answered before the town took on this reponsibility

At the February meeting, council members:

• Expressed interest in understanding how the $522,000 previously allocated to Visit Tucson are currently being used before committing to additional tourism investments. 
• Suggested that rather than increasing marketing efforts, the town should focus on evaluating existing programs to determine their effectiveness.
• Identified areas that could benefit from enhanced tourism investment like Steam Pump Ranch NS Sports Tourism
• Discussed upgrading recreational facilities to attract tournaments and large-scale events. Additionally, expanding arts and cultural programming was highlighted as a way to increase community engagement and strengthen Oro Valley’s identity as a destination for arts and outdoor experiences.
• Consider partnering with nearby communities that do not use Visit Tucson, such as Marana, Sahuarita, and Green Valley, to develop a regional tourism strategy... perhaps even engaging a shared tourism consultant

Town plans structured study process
Town has hired consultant CSL International to lead the study and established an internal steering committee, including
• Town Manager Jeff Wilkins
• Community and Economic Development Director Paul Melcher
• Destination Marketing Manager Crystal Franke
• Parks and Recreation Director Rosalyn Epting
• Tohono Chul Executive Director Jamie Maslyn Larson
• SAACA Executive Director Kate Marquez

But will that be enough? Some residents do not think so
Although there has been no public discussion of this study, some residents have expressed concern to regarding the study's focus, transparency, and execution. Some believe town staff may not fully understand the economic benefits of a well-structured tourism strategy...that they may not know what one is. The current Path Forward draft suggests increasing tourism to support resorts, hotels, and businesses, but critics argue that the true purpose of tourism should be to generate tax revenue for town services by attracting outside dollars into the local economy.

The cancellation of Visit Tucson without input from key stakeholders, particularly Oro Valley’s two world-class resorts, has also led to skepticism about the town’s ability to develop an effective tourism strategy internally. Group business, such as corporate meetings and events, generates far more tax revenue than leisure tourism, yet this is not reflected as a priority in the study.

Long timeline for completion
The study is expected to take six to eight months to complete, after which recommendations will be presented to the council. The first update is expected in April, which will provide a clearer picture of how the study aligns with Oro Valley’s long-term tourism strategy. At that time, concerned residents may have an opportunity to voice their thoughts on the process and its direction.

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