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|Tuesday, May 10, 2011|
BY COREY PAUL
The recession took away business just when Newport’s Oregon Coast Aquarium needed it most. The nonprofit had progressed toward the black after a more than a decade of financial trouble, only to find itself defaulting on its debt at the end of a rough 2010 tourism season, then cutting its budget and staff.
But an anticipated increase in attendance this summer could bring a change in tide for the aquarium and for other Oregon attractions that have struggled through the weakened economy.
The Oregon Coast Visitors Association, which promotes tourism, says attractions' performances varied during the recession. But director Rebecca Lutz, says "everybody has felt the pinch."
Coastal lodging revenues indicate a drop in traffic from 2008 to 2009, then recovery through 2010, says Brett Quick, whose Quick's Bookkeeping Services contracts with coastal organizations, including the visitor's association.
But more traffic doesn't mean better revenue for coastal attractions. For travelers with tighter budgets, lodging comes first over spending money on souvenirs or admission fees. Last year, the Oregon aquarium saw a 32,000-person drop in attendance.
While coastal attractions nationally, such as zoos, actually saw attendance recover slightly in 2010, aquarium attendance dropped 5.4%, according to the Morey Group, a national trade organization that tracks cultural attractions. Aquariums tend to cost more to visit than the other attraction.
After the recession was in full swing in 2008, consumers opted for regional travel. Local attractions were popular staycation spots, which would explain the aquarium's relatively normal 2009 season. The plummet in 2010 occurred as people avoided repeats of summer activities.
Aquarium CFO Rick Goulette also pointed to location as one of the causes of its financial woes, along with high unemployment and spiking gas prices.
John Morey says the Oregon Coast Aquarium is hurt by its distance from a metro area."It would be much more impacted than some of the other locations," he says. "Almost three hours is not close. That's still an overnight trip."
And it's true the aquarium's past sets it apart from the other attractions. When Keiko left aquarium in 1998, the orca that starred in "Free Willy" took a large number of attendees with her. Then an expansion proved too costly, made worse by a scandal after the organiztions’s former president took on $2 million in bank loan debt without the board’s approval. She plead guilty to forgery charges. Bonds were issued in 2005 to finance recovery, but last year's low attendance lead to default.
No payments due to bondholders have been missed, and their response reflects some optimism: A forbearance request, made short-term to catch up on payments. Then a 12-month holiday on debt payments the aquarium says its on track to resume in December
There’s encouragement. The state and national economies are growing. “And we had a good spring break," said aquarium CEO Carrie Lewis. Attendance was up 1,000 over last year. "We had a very good spring break."
Corey Paul is a contributor to Oregon Business.
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