Las Vegas Sun

April 24, 2019

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TOURISM:

New season of politics could affect travel, transportation

The people elected this month to represent their constituents have begun learning their new jobs and getting familiar with some of the lower-tier issues that weren’t discussed in debates and pre-election news stories.

While vitally important to Nevadans, issues involving the tourism industry didn’t get much attention during the long campaign. The public was more locked in on taxation and budget issues, education, health care, immigration and how to fix the economy.

Elected officials will consider a number of matters in the months ahead that will affect travelers and their trips to the Silver State.

Gov.-elect Brian Sandoval has announced that he intends to retain Susan Martinovich as the head of the Nevada Transportation Department.

Martinovich and her team have been working for months to develop high-speed transportation between Southern Nevada and Southern California with the California-Nevada Super Speed Train Commission, which advocates a system involving the American Magline Group and its magnetic-levitation transportation system.

Gov. Jim Gibbons has supported maglev technology during his term, and he and Martinovich have been frustrated that the Federal Railroad Administration has held up a contract that would enable American Magline to begin work on environmental approvals necessary to build the first link of the system.

So where does Sandoval stand on the maglev contract? We’ll find out in the weeks ahead.

Sandoval also will be appointing a director of the Nevada Commission on Tourism following last week’s announcement that Dann Lewis would resign that position next month.

Sandoval will have some help on that selection, because the Tourism Commission is responsible for delivering a recommendation to the governor.

The selection of Lewis by Gibbons was a circus when the governor first attempted to circumvent the commission. Gibbons attempted to appoint a replacement for Tim Maland when he resigned the post in 2008. But the commission stood up to Gibbons and chose Lewis from several candidates interviewed.

Some in the industry are eager to see if Sandoval will attend next month’s Governor’s Conference on Tourism and whether he will try to consolidate the Tourism Commission with another agency, the Commission on Economic Development, as Gibbons attempted. Industry leaders convinced Gibbons that was the wrong move and the two agencies stayed separate.

But Sandoval has a far bigger budget problem than Gibbons so there’s no doubt every potential solution is on the table. Stay tuned.

Another Sandoval appointment that affects the tourism industry in Southern Nevada will be the selection of an administrator for the Nevada Taxicab Authority, the agency that regulates Clark County’s cab industry.

Former Administrator Gordon Walker grew weary of the internal politics of the job and made no secret of wanting to get out as soon as he could find a new gig.

The agency is being overseen temporarily by Joseph Wingard.

Meanwhile, on the federal side, it will be interesting to see how Congressman-elect Joe Heck blends in with the rest of Nevada’s congressional delegation on tourism and gaming matters.

Heck has expressed disdain for the Travel Promotion Act signed into law this year by President Barack Obama. The legislation was supported by every major tourism organization in the state and the rest of the delegation and enables the United States to collect $14 from travelers entering the country.

The resulting fund, matched by private enterprise, will be used to promote the United States abroad and explain our country’s security and entry procedures.

Heck said charging travelers the extra fee when entering the country would spur other countries to do the same thing, making travel abroad more expensive for Americans.

Lame-duck Rep. Dina Titus raised the issue of Heck’s lack of support for the legislation during the campaign.

It isn’t likely Heck would lead an effort to repeal the Travel Promotion Act, I’m sure his comments on it will lead the tourism industry to keep a close watch on him and his votes.

Meanwhile, Sen. Harry Reid, who has championed many a tourism cause on Nevada’s behalf, will surely catch his share of barbs from maglev supporters who view his defection from its camp to support the DesertXpress high-speed rail project as one of the worst examples of how politicians care more for well-financed friends who support their campaigns than their less-connected constituents.

While the maglev project languishes because the Federal Railroad Administration won’t answer the state’s or the American Magline Group’s calls, it was quick to find $1 million to begin environmental studies for the critical link between Victorville and Palmdale, Calif., that the DesertXpress needs to complete the Las Vegas-L.A. route.

Meanwhile, several groups have a bone to pick with Reid and Sen. John Ensign over their support of proposed legislation involving the collection of taxes from Internet travel companies that sell hotel rooms.

The American Hotel & Lodging Association is leading a coalition of groups that include the National League of Cities, the National Association of Counties and minority hotel associations representing black, Asian and Hispanic hotel owners.

Shawn McBurney, senior vice president of governmental affairs for the association, said Reid and Ensign are among lawmakers who have shown support for draft legislation known as the Internet Travel Tax Fairness Act.

Disclosure: In Business Las Vegas and the Las Vegas Sun have a sister company, VEGAS.com, that sells hotel rooms online.

Counties and municipalities nationwide have complained about not getting all the tax revenue they’re due from third-party intermediary companies such as Orbitz, Expedia, hotels.com and VEGAS.com.

A very simplified explanation of the issue is that third-party companies contract with hotels and get an inventory of rooms at a discounted wholesale rate. When customers book through that company, they pay a rate above that wholesale price and pay taxes and fees on that amount. But when they square up with the hotel, the company pays taxes based on the lower wholesale rate.

State and local governments have filed suits against the operators to recover those taxes and have had mixed success. Some jurisdictions have redefined their tax ordinances to force the third parties to pay taxes based on the rates they sell to customers.

The Interactive Travel Services Association has asked the hotel industry to back proposed legislation that would create a national standard — there are 7,000 municipal tax authorities in the country with different taxation formulas.

The proposed legislation hasn’t been introduced, but the draft bill bans states or their political subdivisions from collecting occupancy taxes or lodging fees.

The Hotel & Lodging Association thinks that would put hotels and their own booking websites at a competitive disadvantage to third-party operators.

Clark County and the Nevada Commission on Tourism have debated the issue and determined that they back the third-party booking companies, which resorts view as partners in the process.

For now, McBurney said his association is educating people about the issue and waiting to see if the draft legislation that has been floating around Washington is introduced.

If and when it is, expect Nevada lawmakers to be in the middle of it.

McCarran stats

October traffic at McCarran International Airport was up 2 percent over a year ago to 3.6 million passengers, according to statistics released last week by the Clark County Aviation Department.

Over 10 months, traffic is off from last year by 1.9 percent to 33.5 million passengers — not bad, considering McCarran has 4.5 percent fewer flights now than it had a year ago.

Only one of the 14 domestic air carriers that serve McCarran had fewer passengers in October than in the same month a year ago. US Airways, which dropped out of the top five air carriers at McCarran for the month with its 42.7 percent decline in passengers in October was the only airline that was off from the previous year.

Delta Air Lines, the No. 2 carrier at McCarran, had 9.3 percent more passengers for the month thanks in part to an

11.1 percent increase in the number of Las Vegas flights it has, an average of just over 41 a day.

Market leader Southwest Airlines had 1.4 million passengers, a 5.8 percent increase over a year ago, and American was up

5.3 percent to 206,151, and United, 4.2 percent to 264,868.

Las Vegas-based Allegiant Air saw an 11.4 percent in passengers to 155,219 for the month.

International growth

Delta Air Lines, the No. 2 operator at McCarran, announced expanded service to Europe and Asia, which will result in one- or two-stop service between Las Vegas and several markets next spring and summer.

The most significant expansion is in Asia, where Delta has applied to begin new routes to Beijing and Guangzhou and additional service to Shanghai and Manila via its Tokyo hub.

In Europe, Delta is expanding service to London’s Heathrow International Airport, Amsterdam and Paris. The company also is adding service between New York and Reykjavík, Iceland.

The bulk of the new service is through Delta hub airports.

Delta has applied to fly from Detroit to Beijing, the third China flight for the airline, which has nonstops to Shanghai and Hong Kong.

Delta will resume its nonstop service between Atlanta and Shanghai, first launched in 2008 but suspended when the global economy tanked.

The airline picked up new takeoff and landing slots at Heathrow and will add flights there to and from Boston and Miami, supplementing existing nonstop service from New York’s John F. Kennedy International Airport, Atlanta, Detroit and Minneapolis.

Delta is capitalizing on its alliance with Air France-KLM to offer flights from Pittsburgh to Paris and Seattle to Amsterdam.

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