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Arizona tourism fears long-term effects

By A. Pawlowski, CNN
Arizona offers visitors memorable sights such as Sedona. About 35 million travelers visited the state last year.
Arizona offers visitors memorable sights such as Sedona. About 35 million travelers visited the state last year.
  • Arizona leisure travel seems unaffected by the immigration law controversy
  • Hotel occupancy has been up across the state compared with last year
  • Tourism officials say they worry about long-term impact on lucrative business travel
  • Hotel group: "It's definitely not going to be the year of recovery that we had hoped"

(CNN) -- It's been a long, hot summer for Arizona even without the help of the scorching temperatures that have made the state's landscape so unforgettable for many visitors.

Tourists are still flocking to beautiful places such as the Grand Canyon, Lake Havasu and the resort town of Sedona, and hotel occupancy is up across the state despite a political storm that prompted some to call for a boycott of Arizona's hospitality industry.

But while the leisure snapshot seems encouraging, tourism officials say they are worried about the long-term impact on lucrative business travel, which they say may be affected for years to come.

At least 40 groups have canceled meetings or conventions in Arizona since Gov. Jan Brewer signed a new immigration bill, said Kristen Jarnagin, a spokeswoman for the Arizona Hotel & Lodging Association.

It's a blow to hotel owners who had been hoping for a boost in business after a dismal 2009.

"It's definitely not going to be the year of recovery that we had hoped," Jarnagin said.

"What we're hearing from people who say they can't consider Arizona to even book a meeting right now is that it's not because of their personal feeling on the legislation. It's more just because they need to avoid the controversy. They don't want to have a meeting where there's any kind of controversy that could risk their attendance."

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Since meetings are often booked three to five years in advance, the full impact of the cancellations may not be felt for a while, Jarnagin said.

Hotel occupancy up

The controversy stems from a new law that would have required police to question people about their immigration status if they were detained for another reason and if there was reason to suspect they were in the United States illegally.

A federal judge blocked those hotly debated provisions from taking effect Thursday but chose not to block the bill in its entirety.

Fifty-five percent of Americans say they favor the measure, while four in 10 are against it, according to a new CNN/Opinion Research Corp. poll released Tuesday.

Opponents have said the law will promote racial profiling. Supporters counter its aim is only to enforce federal law.

After the measure was signed into law in April, critics began calling on tourists and businesses to avoid the state. This month, the American Civil Liberties Union even issued a travel alert for Arizona.

The effect of those efforts appears limited for now.

"It seems there's been little impact on tourism in Arizona thus far," said Genevieve Shaw Brown, senior editor at, noting that destinations such as Phoenix, Flagstaff, Sedona, Scottsdale and Tucson saw strong year-over-year growth.

Hotel occupancy across Arizona rose almost 6 percent in May and more than 8 percent in June compared with the same months last year, according to Smith Travel Research, a company that tracks data for the hotel industry. Those figures are about in line with the national average.

Phoenix and Scottsdale both saw a 6 percent rise in hotel occupancy in May and a 10 percent boost in June over last year, STR reported. Sedona saw an almost 12 percent boost in June, according to the company.

The controversy also isn't keeping tourists away from visiting and staying at the Grand Canyon.

"There's been no indication, anecdotal or otherwise, that it has affected the lodges of the Grand Canyon," said Bruce Brossman, director of reservations and sales for Xanterra, the company that runs the lodges at Grand Canyon National Park's South Rim, in a statement.

"Reservations are quite similar to previous years for the summer as well as into the winter."

Looking ahead

But summer is Arizona's low season, and it mostly attracts leisure travelers, Jarnagin said. The lucrative meetings and conventions many of the state's hotels eagerly wait for typically take place in the fall and first quarter of the year so that's when the occupancy numbers will be closely watched.

The encouraging summer hotel figures also come after 2009 -- "basically the worst year in our industry's history," Jarnagin added. The tough economy combined with the H1N1 flu scare led to a 10 percent decline in travel spending in 2009 compared with the previous year, according to the Arizona Office of Tourism, so it would have been surprising not to see some kind of rebound.

At a gathering of state tourism officials in Tucson this month, the governor acknowledged the industry is facing big challenges, including boycotts related to the new law.

"The focus needs to be on educating travelers about the realities and truths about [the law] and clearing up misinformation and misunderstandings," Brewer said.

"Our tourism industry is critical to the future economic vitality of Arizona."

More than 35 million domestic and international overnight travelers visited Arizona in 2009, spending $16 billion, according to the Arizona Office of Tourism. Their vacations also brought in more than $2 billion in tax revenues and generated 157,000 travel industry-related jobs, the office said.

No wonder tourism officials are encouraging travelers to keep Arizona on their itineraries.

"Tourism is caught in the middle of this political tug of war," Jarnagin said. "This issue has zero to do with tourism. ... We need to let people know that Arizona is still a warm and welcoming destination."