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Ontario Tourism Infrastructure Research Study February 2009

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Ontario Tourism Infrastructure Research Study February 2009 Ontario Tourism Infrastructure Research Study February 2009 Prepared for: Ministry of Tourism Ontario Tourism Competitiveness Study Prepared by: Malone Given Parsons Ltd. HDR Decision Economics 140 Renfrew Drive, Suite 201 480 University Avenue, Suite 404 Markham, ON Toronto, ON L3R 6B3 M5G 1V2 © Queen’s Printer for Ontario, 2009 Although copyright in the research papers is held by the Queen's Printer for Ontario, the papers were prepared by external companies and their conclusions do not necessarily represent the views of the Government of Ontario. The research papers were commissioned by the Ontario Ministry of Tourism for the Tourism Competitiveness Study and as such their conclusions are intended for this purpose only and shall not be relied-upon by third parties. ISBN 978-1-4249-8936-2 (PDF) PREFACE PREFACE Introduction and Objective The early years of the 21st Century have brought many impacts to consumer confidence and the tourism industry in Ontario. These include the events of September 11, 2001, the outbreak of SARS, appreciation of the Canadian dollar and the current recession. Despite these events, there have been some major developments for Ontario that have helped offset these negative shocks—new and expanded cultural facilities in Toronto; conventions centres in Niagara, Windsor and Ottawa; new resorts in Muskoka; reinvestment in provincially owned attractions; and a growing calendar of festivals and events. Notwithstanding these recent investments, most of Ontario’s tourism infrastructure is now at or nearing the end of its lifespan. While tourist attractions form a powerful component of the supply side of tourism—enticing, luring and stimulating interest in travel—they are only one component of the necessary tourism infrastructure. Investment in supporting businesses (e.g., hotels, transportation companies), soft infrastructure (e.g., local community colleges, universities, and trade and professional associations) and hard infrastructure (e.g., roads, airports, marinas, water and sewer lines, and telecommunications) is the key to developing a successful tourism destination. Their interdependence dictates a need for a strategic wide-angle approach to tourism infrastructure development. The Ontario Ministry of Tourism commissioned Malone Given Parsons Ltd. with HDR Decision Economics to develop frameworks for identifying and prioritizing tourism-specific and transportation infrastructure projects, and a funding framework for supporting investment in tourism-specific infrastructure. The main objective of this assignment was to provide the Ministry of Tourism with recommendations for a tourism driven infrastructure strategy that will: ¾ Inform the Ministry’s understanding of the current state of and gaps in Ontario’s tourism related infrastructure; ¾ Guide government decisions for supporting and prioritizing tourism- specific and transportation (access) infrastructure projects; and ¾ Help to maintain the competitiveness and growth of Ontario’s tourism industry. Malone Given Parsons Ltd. * HDR Decision Economics Page iii PREFACE Background to Assignment In March, 2008 the Province of Ontario launched the Tourism Competitiveness Study. Its goal is to help ensure the province can compete in the global market for tourism activity by taking advantage of new opportunities. The three main objectives of the study are: getting all Ontarians talking about the future of Ontario tourism; raising the tourism industry’s profile; and designing a strategy that identifies clear actions for industry and clear roles for all levels of government. This paper contributes to the third objective by proposing recommendations for a tourism driven infrastructure strategy. Scope of Work This infrastructure research study report addresses tourism-specific infrastructure and access (transportation) infrastructure. The latter is integrated into the report analysis and recommendations, and supported by its own analysis as provided in Appendix E to the report. The study scope is outlined below: Tourism-Specific Infrastructure: ¾ Identification of tourism-specific infrastructure development and funding best practices including those related to public-private partnerships in key jurisdictions; ¾ A review of secondary sources of information pertaining to tourism trends; ¾ A review of existing Premier-ranked Tourist Destination reports and the annual reports of provincially owned tourism agencies, attractions, convention centres and parks to identify infrastructure needs and gaps; ¾ Consultations with government services consultants and key tourism organizations and associations to identify infrastructure needs and gaps; ¾ Examination of capital funding programs provided by federal, provincial and international governments; and ¾ An analysis of the Ontario Government’s owned and operated travel information service infrastructure. Access (Transportation) Infrastructure (Appendix E): ¾ Identification and assessment of five jurisdictions that have experienced growth through transportation infrastructure improvements; ¾ Identification of criteria and rating approaches for assessing transportation Malone Given Parsons Ltd. * HDR Decision Economics Page iv PREFACE infrastructure connectivity in and between regions; ¾ Assessment of the travel patterns of Ontario tourists to identify the major connection points for transportation infrastructure; and ¾ A literature review to identify how transportation infrastructure impacts tourist visitation and investment in the tourism sector. Overview The Tourism Infrastructure Research Study examines best practices in tourism infrastructure development and funding, identifies gaps in the current physical plant in each of Ontario’s twelve tourism regions and at Ontario’s provincially owned facilities, analyzes the current infrastructure in provincial travel information centres, and recommends a framework for identifying, prioritizing, and funding tourism-specific infrastructure. Appendix E: Access (Transportation) Infrastructure builds on these findings and develops a framework for tourism public policy assessment of transportation projects from a tourism perspective. It shows that the generalized cost of travel in and between Ontario’s tourism regions is an important lever to aid the future development of tourism. By reducing the cost of travel through more, faster, or easier access the Government of Ontario can remove the barriers to: ¾ Attracting non-domestic visitors to gateway centres then dispersing them to surrounding areas; as well as ¾ Pulling the domestic traveller from major centres out into regional surrounding areas and the larger province. This ultimately leads to definition of a cost-effectiveness framework for prioritizing transportation initiatives from a tourism perspective. Malone Given Parsons Ltd. * HDR Decision Economics Page v TABLE OF CONTENTS EXECUTIVE SUMMARY 1.0 INTRODUCTION ...............................................................................................................1-1 1.1 Organization of the Paper..........................................................................................1-1 2.0 TOURISM INSIGHTS –TRENDS IN TOURISM IMPACTING INFRASTRUCTURE DEVELOPMENT .............................................................2-1 2.1 Ontario Tourism Outlook 2008-2012........................................................................2-1 2.2 Visitation by Region 2012 ........................................................................................2-2 2.3 Activities by Canadian and American Travelers ......................................................2-5 2.4 Rating Ontario’s Products.........................................................................................2-6 2.5 Important Considerations in Choosing a Destination ...............................................2-7 2.6 Emerging Geographic Markets .................................................................................2-8 2.7 Rating of Ontario by Service Type ...........................................................................2-9 2.8 Summary/Implications ..............................................................................................2-9 3.0 NEEDS-BASED GAP ANAYLSIS ....................................................................................3-1 3.1 Ontario’s Government Owned Attractions and Agencies.........................................3-2 3.2 Ministry of Tourism Attractions and Agencies.........................................................3-2 3.3 Ministry of Culture Tourism Attractions and Agencies............................................3-3 3.4 Ontario Parks.............................................................................................................3-4 3.5 Infrastructure Gaps by Tourism Region....................................................................3-5 4.0 TRAVEL INFORMATION CENTRES............................................................................4-1 4.1 Background...............................................................................................................4-2 4.2 Purpose of Visitor Information Centres ....................................................................4-3 4.3 Trends in Service Provision ......................................................................................4-3 4.4 Trends in Ontario Visitations....................................................................................4-4 4.5 OTICs ......................................................................................................................4-6
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