Home » Featured » J. Rick Normand: Sedona Mayor on Tourism Ad Dollars Unnecessary

J. Rick Normand: Sedona Mayor on Tourism Ad Dollars Unnecessary

J. Rick Normand, examines City of Sedona contract with the Sedona Chamber of Commerce in his two-part Op-Ed series

In a time of universal deceit, telling the truth is a revolutionary act!- George Orwell

Have you seen the Chamber’s new signs? “Let’s Fix Traffic…Vote Yes on Visitors Rule!” (..over us, that is?)

OK, the signs actually say “Vote Yes on Home Rule,” but Home Rule enables the funding of the Chamber and it is that direct funding mechanism for tourism advertising that is causing the slow traffic strangulation of our once lovely little town. Those signs have a singular purpose…which is not to convince you, but to confuse you. Home Rule is an intentional misnomer that sounds like a good thing, when, in fact, it’s a budget tool to allow the City to increase City borrowing capacity and related indebtedness without constraints and, therefore, to fund the Chamber’s unrelenting advertising campaign to draw hordes of day trippers to Sedona.

As you read the article below, keep in mind that the Arizona Department of Transportation has already published a study projecting that Sedona’s traffic congestion will DOUBLE in just the next five years. If you think its bad now, just wait five more years to see your town die of strangulation of its quality-of-life standards and its economy. Voting “Yes” for Home Rule will guarantee this fateful demise of Sedona as we once knew it. And, yet, we’re using public money that, in fact, belongs to the City upon payment of bed taxes by tourists which is then used to pay for our own destruction by targeting advertising of Sedona to a tourism sector that spends far less here that the high-end traveler.

Notwithstanding that the Chamber and Sedona Lodging Council think they own Sedona, all of our City’s prospective voters need to know that on July 18, 2018, at the videotaped “Meet the Candidates for Mayor” forum at the Sedona Public Library, Sedona Mayor Sandy Moriarty made the following comment… “Tourists aren’t goin’ to go away whether the Chamber advertises or not, frankly. They’re not goin’ away! There’s a million ways people hear about Sedona. They’ve been hearing about it for years…everybody knows about it!” Click here: https://www.youtube.com/watch?v=amliK0cf8a8

This clearly proves the point that public money paid annually to the Chamber (yes, bed taxes are the property of the City when they’re collected at the front desk on check-in) is a total waste of public money that could have been used for city infrastructure building and maintenance and/or pay-down of the City’s ever-increasing debt load.

The Mayor’s clear statement also reveals that the City has been perpetrating something akin to a fraud upon its own unsuspecting citizens. After all, our Chamber of Commerce is the only municipal Chamber in the U.S., save one, that is financed with public money rather than merely membership dues, as well as corporate profit givebacks and donations.

The one other Chamber which enjoys public financing? It is the city of Myrtle Beach, South Carolina (17.5 million annual visitors) wherein the FBI has conducted its ongoing investigation of Operation Myrtle Beach Mafia. Operation Myrtle Beach Mafia concerns cashier’s checks paid to local politicians by Chamber President Brad Dean after a 1% advertising tax was awarded to the Chamber of Commerce. The 1% tax brings in as much as $30 million and was passed by their City Council. Indictments there should put an end to the lock that one local hotel group (represented by a City Lodging Council, no doubt) has had on running the Myrtle Beach Area Chamber.

Does this raise any City eyebrows in Sedona? Hmmm!

In a study from the American Chamber of Commerce Executives entitled “Revenue Models…An examination of income trends for Chambers of Commerce” [a white paper from the American Chamber of Commerce Executives] in cooperation with the Western Association of Chamber Executives, subsection entitled “Economic Development Funding” by Katherine House, it is stated that the Western Association of Chamber Executives…have noticed some local governments in western states “going back to local chambers asking them to pick up the slack” when government funding is not available. Furthermore, the study says “It’s more important than ever to provide as much transparency as the organization possibly can in relation to services agreements with public entities,” says Jay Chesshir, CCE, IOM, president and CEO of the Little Rock Regional Chamber of Commerce in Arkansas, “It protects both the organization and the elected officials.”

The Sedona Chamber has never submitted to a public audit to ensure transparency. Why not?

There’s another wrinkle in generating revenue, says Rob Radcliff, managing principal of Resource Development Group in the Columbus, Ohio: “…the face of corporate giving is changing. Corporations ‘do not give less money, but they give to fewer people,’ he says, making it more critical for executives to present a strong strategy to position themselves as worthy in a competitive field.” In addition, there has been a “steep rise” in the number of corporate foundations in the past 10 years. Some of the funds a chamber or economic development organization seeks may come from a donor corporation’s operations, while others are donated by corporate foundations, making it necessary for community leaders to be well versed in a foundations’ [private funding benefactor] goals and operations.

“Quality of place and the whole notion of making the community better” is front and center in today’s economic development strategies! Does our Chamber, Sedona Lodging Council, and or Sedona’s city government understand any of this? Not hardly!

Imagine this readers at The Eye: While the American Chamber of Commerce Executives are telling the rest of the country that Chambers should be raising funds from their corporate members and benefactors in order to fund their host cities, the Sedona City Council and Chamber are preaching precisely the opposite. Most all other Chambers are raising money from corporate donors and channeling it back to their municipal hosts while our Chamber sucks its host dry! When will the residents of Sedona say “enough is enough!” or, more importantly, ask the ancient Roman question, “Qui Bono?” (Who benefits?) Dare we ask since none of this adds up?

Meanwhile, Sedona is now deep into a muckraking election campaign that has devolved to the level of federal politics. No facts are employed, just innuendos, name calling, failures to disclose, and fake news and fake slogans! All an interested party can do to find the truth is employ logic to arrive at a fair conclusion. So, to do that, let’s employ the elements of George Orwell’s most famous quote posted above.

Part One: Elements of Universal Deceit in Sedona

Sedona’s tourism and Home Rule debates are bogus by design! Sleight-of-hand (make ‘em take their eye off the ball) is the tactic to promote a counterfeit argument over “more or less tourism” when the correct argument is about the “quality of tourists – high net worth” targeted in the Chamber’s marketing plan.*  (*Part Two of this article.)

The Chamber is suddenly supporting high-net-worth traveler destination marketing, ever so reluctantly, after justified relentless badgering from those who support the cut-off of City funding to the Chamber vis-a-vis the City’s 55% pass-back of bed taxes to the Chamber. (OMG, the City’ calculation of 55% may be incorrect…it may have paid out 65% which would have been discovered in a scheduled audit which the City has never done!)

The TENTATIVE BUDGET for the 2018-19 Fiscal Year was adopted as the Final Fiscal Year 2018-19 Budget by the City Council on June 26, 2018. Entitled “Tourism Management & Development” totaling $2,187,250 (65% of bed tax collections?) go to www.sedonaaz.gov/home/showdocument?id=34616 – click on “City Manager’s Office, Table of Contents.

First, let’s examine City/Chamber partnership shenanigans:

The sole local print media, the Chamber of Commerce and the Sedona Lodging Council, as well as their captive Council members and certain City Staff members (let’s call all of them together the “Cabal”) are attempting to channel the primary election debate into an intentionally misleading argument which is…“Does Sedona benefit from more or less tourism?” Of course, they will make sure that the answer turns out to be “Yes.” But, that is NOT the cogent argument which will determine Sedona’s deliverance from daytrippers.

Moreover, the singularly compelling argument is…“What TYPE of traveler will reduce traffic congestion, increase bed-tax revenue to the City, provide more funding for infrastructure upgrades and maintenance, reduce trash on our streets, reduce trash on our hiking paths and trailheads, reduce the wear-and-tear damage to our streets caused by our high traffic count, as well as, reduce the excessive downstream human waste in the waters of Oak Creek?” And, of course, the imposition of the right argument, and its logical and correct conclusion, into this current election mish-mash will put constraints on the relentless drive of the lodging industry to enhance profits at the expense of all the rest of us.

The correct answer to this dilemma “how do we bring the right kind of high-spending tourists here while simultaneously imposing budget constraints on our free-spending Council” will also force the City of Sedona to finally live within its means – subject to a passed voter proposition known as the Permanent Base Adjustment to [ARS §41-563. Expenditure Limitations] which is, more or less, a hybrid offshoot of the “Home Rule” statute known as the Alternative Expenditure Limitation in our State’s revised statutes.

The deceptive argument of the Sedona Chamber of Commerce, stated at public forums as a political belief system of the City of Sedona’s (Minister of Propaganda?) City Manager, Justin Clifton, and his Assistant City Manager (Assistant Propaganda Minister?), Karen Daines-Osborn, that the bed tax (now 55%/65% paid back to The Chamber who is a functionary of the Lodging Industry) is paid by tourists and not the citizens of Sedona is also bogus and yet another sleight of hand.

Tourists dump mountains of trash and use City and Village roads, public rest rooms, State Parks, trailheads and hiking paths, sewer systems, utilities, parking lots, water channeling facilities and more, causing wear and tear and overuse at an accelerated pace which, then, requires the expenditure of citizen provided City funds to clean them up and repair, modify, or extend them.

How about the fact that the Sedona Chamber of Commerce subcontracts out its DMO (Destination Marketing Organization) services to Miles Management who is almost always a primary DMO anywhere else in the country?

In light of this, why does the City need the Chamber at all to charge us this humungous extra mark-up? At the very least the Chamber needs to, but certainly will not, submit to competitive bidding for the City’s DMO services and submit to annual audits of their books which has never been done by the City.

Roger Brooks International, the world’s premier DMO specialist in community branding, product development and marketing in the U.S. with 1,500 municipal clients, has just relocated its headquarters to Peoria, AZ. Why is the City of Sedona not soliciting a DMO services proposal and bid from Roger Brooks International, not to mention a direct primary bid from Miles Management? We, the residents of this City are being used and abused…period!

Non Chamber businesses in town will tell you, as will many uptown retail merchants who are Chamber members, that the Chamber has an anti-business attitude towards non-members and even members who aren’t in the lodging industry.

The City of Sedona’s attempt to paint the State of Arizona investigators as evil is nothing less than heinous as well. Why is the State of Arizona inherently evil while the City of Sedona paints itself as holier-than-thou?

Just remember these rules (taken from Germany’s WWII Reich Minister GOEBBELS’ PRINCIPLES OF PROPAGANDA):

  • Rule 2:    Propaganda must be planned and executed by only one authority (a govt entity). (This is the Council’s tactic in Sedona.)
  • Rule 12:  Propaganda must be facilitated by leaders with prestige.
  • Rule 14:  Propaganda must label events and people with distinctive phrases or slogans.
  • Rule 16a: Propaganda must reinforce anxiety concerning the consequences of defeat (such as…Are we doomed if the passage of Home Rule is denied by the voters?).

City Manager Clifton and Assistant City Manager Osborn, while pushing the envelope of questionable lawful activities, with the support of Chamber President Jennifer Wesselhoff, have clearly exercised all four of the above rules of Propaganda engagement. They’ve done it in print, along with verbal presentations supporting tagging as “evil” any suggestion of a need for change in the City’s current path of fiscal and social mismanagement.

Sedona voters voted for Home Rule in 2014. As I write this, “Let’s Fix Traffic-Vote Yes on Home Rule” signs are appearing all over town. At the same time as you read those signs, you can see the traffic congestion that was brought about by the last favorable vote for Home Rule.

Home Rule gives the Council the opportunity to funnel huge sums of money ($2.4 million this year alone) to the Chamber who spends it on advertising Sedona to daytrippers. These signs currently going up, as just mentioned above, with the help of certain Realtors associated with the Chamber, in my opinion are undeniably and deliberately fraudulent.

The various State of Arizona investigations of the city of Sedona: (Maybe this is why our little town has four staff attorneys and a standby arrangement with an outside law firm?)

  • On July 17, 2018, the Office of the Arizona Attorney General delivered to the City of Sedona a Notice of Submission of Legislator Request for Investigation Pursuant to A.R.S. 41-194.01, more commonly referred to as a “1487 Complaint.” The latter designation references Arizona Senate Bill 1487, which created the right for individual state legislators to demand that the Attorney General investigate alleged violations of state law by local jurisdictions. In the July 17 complaint, Senator Judy Burges (R-District 22), Chairwoman of the Senate Judiciary Committee, whose legislative district includes the cities of Glendale, Peoria and Surprise, alleges: (1) that the City of Sedona’s bed tax ordinance violates the Arizona Constitution’s gift clause, AZ Const. Art. 9 sec. 7, because 55% of the revenues are distributed to the Sedona Chamber of Commerce and Tourism Bureau Chamber); and (2) that the City’s Tourism Promotion & Visitor Services Agreement with the Sedona Chamber violates the gift clause due to a lack of adequate consideration given to the City; and (3) that the Chamber, also in violation of the gift clause.

Nevertheless, Sedona City Attorney Robert Pickels replied to the State’s investigation through an article written by Christopher Fox Graham entitled “Pickels: Legislator’s ‘grossly deficient’ SB1487 Complaint against Sedona is missing 5 key pages.” Furthermore, he (Pickels) says ‘While the complaint alleges the absence of any specific performance metrics by which the Chamber is accountable to the city, the complaint conveniently did not include Pages 4-8 of the contract, which specifically and in great detail outline the performance metrics required under the agreement.’ And, finally, the ‘It can only be inferred that this was an intentional omission done to misrepresent the facts and mislead the investigation,’ Pickels continued.”

Inferred by whom?

Isn’t it interesting, though, that amongst the multiplicity of alleged missing Chamber performance metrics in the State’s Notice of SB1487 Complaint, the performance metric that the City Attorney never mentions as even existing, in fact, is the one of a requirement of submission by the Chamber to a City audit relative to the Chamber’s compliance with the performance metrics of the subject co-ownership contract?

By contract provision, the City apparently intends to rely upon the Chamber’s good faith monthly reporting of its own contract required performance metrics compliance.

Oh sure. I mean, given that there are, indeed, four pages of Chamber performance metrics in the 401 Jordan Road co-ownership contract, how can the City possibly determine if the Chamber of Commerce is performing to the performance metric standards it is required to meet? This is just another sweetheart deal that the City gives to no one else? In fact, this contract may very well be illegal and what if the City knew that when it entered into it?

Furthermore, the City Clerk says that the City follows ARS 42-17103.A (not ARS 9-481) thus the GFOA requirement to submit the budget within 90 days of adoption (June 26, 2018). The GFOA’s (Government Finance Officers Association of Arizona) deadline is the end of August. The GFOA is not the law. Arizona Revised Statute 9-481 is. Yet, the City hasn’t submitted its current legally required budget as of the writing of this article. Are they trying to figure out what part their budgeting plays in the tourism debacle Sedona now faces?

    • State Law ARS 9-481 – Audits of cities and towns; posting; budget states: “The financial statements must be retained and accessible in a prominent location on the official website for at least sixty months.” It is against the law to NOT have the FY 19 ANNUAL BUDGET document posted on the City’s website. It could have been done last June.

The “Cabal’s” favorite ploy is to bring up “fake news” yet never mention the first cousin of fake news, namely their favorite tactic, which is failure to disclose. So, who’s backing the “Cabal”? A PAC by the name of AZ Elections 18 Pac. And, who are its financial contributors?

WHO’S MONEY IS BEHIND AZ ELECTIONS 18 PAC?

Residents First Vote YES on Home Rule:

STEVE SEGNER (El Portal & Lodging Council but whose Sedona residency is questioned) $ 2,855
ROBERT HOLEMAN (Sedona Real Inn) $ 1,000
WENDY LIPPMAN (Tlaquepaque) $ 750
NANCY MATHEWS (Sedona School of Massage) $ 700
CHERYL BARRON (Courtyard by Marriott) $ 500
HOLLI PLOOG (CGI Technology & Solutions) $ 500
SUBTOTAL INDIVIDUALS – $ 6,305

SEDONA LODGING COUNCIL (Steve Segner and Lonnie Lillie) $ 2,000
DIAMONDROCK (L’Auberge) $ 1,000
SEDONA REAL INN $ 1,000
SEDONA ROUGE $ 1,000
CANYON BREEZE (Al Spector) $ 1,000
CANYON PORTAL (Al Spector) $ 1,000
L’AUBERGE DE SEDONA $ 1,000
OPEN RANGE RESTAURANT $ 500
SEDONA PIZZA $ 500
CANDLE MAGIC $ 1,000
SINAGUA PLAZA $ 1,000
SUBTOTAL BUSINESSES – $11,000
GRAND TOTAL AS OF JUNE 30, 2018 – $17,305
Source: June 30, 2018 Campaign Finance Report submitted to the Secretary of State.

AZ SR 89A trash

The “Cabal’s” attempt to push to the limits the envelope of ethical behavior, if not the law itself by virtue of bending every rule of ethics, including interlocking board and association directorships, questionable real estate fees paid by the Chamber to family members who are Realtors and or agents, and allowances of relentless influence peddling (the provision of campaign financing to friendly Councilors and Mayors) to Council candidates by the Chamber and the Sedona Lodging Council, not to mention exotic travel destination benefits provided to City employees as a circuitously channeled taxpayer expense, all to ultimately enhance the relentless no-cost profiteering of the lodging industry in Sedona and in the Village. And a print partner reportedly used its sacrosanct platform to threaten one current candidate with this: “Don’t pick a fight with someone who buys ink by the barrel and newsprint by the ton.” The “Cabal” must feel that they are entitled to operate outside any known code of ethics?

The treatment of those whom the “Cabal” has disenfranchised, including not only non-Chamber businesses, but many of the Uptown Chamber business members, is abominable!

This Sedona Arizona City Council has raised taxes every year and has approved new annual rate increases through 2020. Several council members are up for re-election August 28.

The 401 Jordan Road Chamber real estate purchase, as well as its less than arms length beneficial broker (Rick Wesselhoff), in this (corrupt?) deal structure stands as proof of the Chamber’s complete lack of ethics; this said in light of the fact that there are interlocking directorships between “Cabal” players and the Chamber, not to mention the guarantee of the Chamber’s private purchase money mortgage by the City.

What a sweetheart deal solely at taxpayer risk! If the Chamber resells the subject property for a profit, the Chamber gets to keep it all, but if its sold at a loss, or foreclosed, the City absorbs all the loss on the defaulted mortgage payback. But, meanwhile, at least the Chamber does provide perks given to key City employees especially for exotic travel. Yet, despite all the questionable business deals between the Chamber and the City, with no downside to the Chamber, the City is using City employees to push political pro-Chamber messages to an unsuspecting voting public…Clifton and Osborn are pushing scare tactics…

IF the City Manager does not cover Permanent Base Adjustment and Override, then the question is “Mr. Clifton, a Permanent Base Adjustment to $36 million should be on the ballot in November 2018 which sets the spending limit for the City well within past audited financial statements the City has posted on its website. With that VOTER SET LIMIT, not a STATE SET LIMIT, the voters can vote on that in November. If Home Rule goes down, the City will get along just fine. The Council can also ask the voters to approve an override in MAY 2019 before the start of the next fiscal year. Why has the city NOT explained IN DETAIL these two very viable options and safety nets to the our citizens?

Sedona Mayor caught on tape saying, “Tourists aren’t goin’ to go away whether the Chamber advertises or not, frankly. They’re not goin’ away! There’s a million ways people hear about Sedona. They’ve been hearing about it for years…everybody knows about it!” See it here: https://www.youtube.com/watch?v=amliK0cf8a8

IF the City Manager says that Home Rule is better because the City can spend more, or that the City needs more, or some other such blather, the answer is “…The issue is you’re proposing huge increases in a budget that (more than likely) will never be spent, and the STATE has given voters the power to control spending through limitations. In an emergency, the Council can still come back to the voters in May.”

So, why does our City government not want its citizens to be involved with their government? Quite clearly, the City of Sedona DOES NOT want its citizens to be involved in influencing City government, except through influence peddling.

Read this and think carefully about its implications: A local PAC has filed a lawsuit against the City of Sedona because the City Clerk refused to accept 111 legitimate signatures collected from citizens living in the Coconino County side of Sedona to place Permanent Base Adjustment on the November 6 election ballot because she said the signatures were not from the “county of majority” in the City. This is the City’s unfounded interpretation of the law. Election officials in both Coconino and Yavapai Counties say they have no knowledge of such language or requirement. It’s as if the City doesn’t believe that the citizens living in the Uptown area are part of Sedona because the county of the majority in is Yavapai County. The purpose of this underhanded tactic is to keep the Permanent Base Adjustment off the November 6 ballot thus eliminating a third choice for voters to either Home Rule or No Home Rule! The City feels that No Home Rule will scare our voters into voting for Home Rule which will leave the Council with unbridled authority to run ever-increasing deficits.

Always remember “A Nation of Sheep Breeds a Government of Wolves!”

Coming soon Part Two: The Revolutionary Act of Telling the Truth and What To Do Now!.

Read www.SedonaEye.com for daily news and interactive views!

52 Comments

  1. E. Johnson, Goodyear says:

    Every single person has rights in guaranteed under our unique American Constitution, the only world document that gave the middle finger to the global powers that said WE THE PEOPLE are more powerful than any tyrant or socialist regime.

    WE THE PEOPLE in Arizona need to stand up like the late Sen. John McCain did. He wasn’t always right but he was always transparent and he paid consequences for poor decisions and reaped benefits for the good ones. Bless us all. And to Arizona we need God’s forgiveness and his blessings. Bless John McCain for his service to America and Arizona.

  2. Mary C says:

    Public institutions have become grossly inefficient and ineffective, via their wasteful processes and institutionalized incompetence. The other public-sector systems are equally Kafkaesque; building permits that once took hours to process now take months. Our institutions have substituted signaling and compliance for productivity.

    In other words, having a City is a total waste of time and money.

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