Arizona's Scarlet letter? State's tarnished image hurts our economy, critics say

Stigma from passage of SB 1070 plagues tourism, job recruitment
2011-05-03T14:00:00Z 2011-05-03T14:11:07Z Arizona's Scarlet letter? State's tarnished image hurts our economy, critics sayBrady McCombs and Tim Steller Arizona Daily Star Arizona Daily Star

Editor's note: This story first appeared Sunday as an exclusive for our print readers.

The headlines and boycotts over Arizona's attention-grabbing immigration law have largely faded.

But a year after Gov. Jan Brewer signed SB 1070 into law, the lingering economic effects are coming into focus:

• The state's resorts and hotels are still having trouble landing lucrative meetings of national associations, which often avoid controversy to ensure maximum attendance from their diverse memberships.

• The University of Arizona has heard from top professors and graduate students that they don't want to move to Arizona because of the law, which would require law enforcement officers to question anyone they stop for another reason about their immigration status if they suspect the person is in this country illegally.

• Business recruitment in Arizona has been hindered by the controversy surrounding SB 1070, along with deep cuts to the state's education system and proposals to allow guns on Arizona campuses.

Arizona "definitely has a stigma attached to it," said Frances Merryman, a vice president for Northern Trust Bank in Tucson and member of several economic development boards.

Francisco Marmolejo travels the world as the executive director for the Consortium for North American Higher Education Collaboration, based at the University of Arizona.

"Arizona is famous in many parts of the world," he said, "and unfortunately not for the right reasons."

When Marmolejo arrived in Arica, Chile, last May, he told his driver from a local university that he was from Arizona.

"That's where migrants are hated, isn't it?" the driver said.

Later, the driver told him, "I don't understand how you can live in such an unwelcoming place," Marmolejo said.

At that moment - nearly 5,000 miles away from Tucson - Marmolejo realized the extent of the damage to Arizona's image caused by SB 1070, he said. After a 6.3 earthquake that occurred the night before in Chile, the new Arizona law was the second headline in local newspapers.

Tourism

In late July, a federal judge enjoined several key provisions of SB 1070, and last month a federal appeals court upheld that decision. In July, Rep. Raúl Grijalva stopped supporting the economic boycott of Arizona he had called for in April 2010.

But none of that has erased the damage, said Richard Vaughan, senior vice president of sales and marketing at the Metropolitan Tucson Convention and Visitor Bureau. If anything, the continuing court battle keeps the law in the news.

"There's no doubt that there's a lingering effect," Vaughan said. "Anything that detracts from visitors having a positive image of our state hurts the brand."

After the boycotts were announced, many groups canceled meetings in Arizona, though exactly how many is unclear because tourism groups and businesses are reticent to name the groups they lost. Members of the Arizona Hotel and Lodging Association reported losing about 40 meetings that cost hotels about $12 million, but that was an incomplete survey.

The American College Personnel Association canceled its Mid-Manager Institute Conference planned for Tucson in January because SB 1070 didn't match the association's core principles and core values, said President Heidi Levine. The conference would have brought 100 people from around the country.

The national board of the College and University Professional Association for Human Resources voted unanimously to move its 2011 meeting of about 100 people from Tempe to Salt Lake City because the "law is in direct conflict with CUPA-HR's commitment to diversity and inclusion," the association said in a statement to its members.

The North American Student Mobility Project Directors moved its annual meeting of 250 educators from Canada, U.S. and Mexico to Minneapolis because the Arizona law caused concerns among its members, said program manager Frank Frankfort. The group was going to stay at Loews Ventana Canyon Resort in Tucson, he said.

Beyond examples like those - and perhaps even more significant - are the groups who won't even consider coming to Arizona because of SB 1070 or other factors, said Debbie Johnson, president and CEO of the Arizona Hotel and Lodging Association.

"We can know who canceled," Johnson said, "but we will never know who's not calling."

One key figure followed by the tourism industry - revenue per available room - shows that Tucson and Phoenix recovered more slowly from 2009 to 2010 than three other regional cities, Denver, San Antonio and San Diego. The revenue per available room grew last year by 1.8 percent in Tucson and Phoenix, compared with 3.4 percent in San Diego, 4 percent in San Antonio and 10.5 percent in Denver, show figures from STRGlobal.

Statewide, Arizona's revenue per available room grew by only 2.2 percent from 2009 to 2010, the figures show. By comparison, that rate went up by 6.8 percent in Colorado, 6.7 percent in Texas and 5.5 percent in California.

Some of that is likely due to the state's image issues, tourism executives said.

Associations "want to make sure they're putting their attendees in a politically correct state," said Alan Klein, chairman of the Southern Arizona Lodging and Resort Association and general manager of the Westward Look Resort. "There are other destinations they can go to that don't have the baggage associated with the immigration issue."

Arizona may be losing future conferences in 2013-2015 because of what's happening now since associations plan three to five years out. The personnel association that canceled its midmanager meeting here plans its annual conference for 4,000-5,000 members at least four years out, Levine said. This summer, they'll be deciding on where to take the 2015 conference, and Arizona is not in the running.

While the greatest problem has been with meetings, some individual tourists also have decided to avoid Arizona.

Patrick Dalton and his wife, Eva Sanchez, used to travel often from their home in the Albuquerque area to Scottsdale, Dalton said. The couple, who own a homebuilding company, bought cars at the Barrett-Jackson auto auction, as well as expensive jewelry and meals. Not anymore.

"We've spent a lot of money there, and the more we heard about how crazy the state has become, we didn't want to spend time there," Dalton said. "Every time I spend a dollar there, a share of it goes to support those policies, and I don't feel good about it."

Then again, some have also come here to support Arizona's politics. Last year, Tucsonan Tony Venuti, publisher of AZ Tourist News, started a "buycott" effort, encouraging people to travel to Arizona and buy from the state in support of SB 1070.

The law's critics got news-media attention, Venuti said. But supporters of the bill also came, some of them in organized groups, to support Arizona.

BUSINESS IMPACT

Negative publicity about Arizona has hindered the ability of the University of Arizona and some businesses to lure the best and brightest to Tucson, some officials say.

The amount of time the state has been in the national news for SB 1070, the boycott, gun laws and other policies has affected the university's ability to recruit, said Allison Vaillancourt, the UA's vice president for human resources.

When the College of Education was looking for a new faculty member this past winter, several candidates pulled out because of the state's politics, said Jeff Milem, the McFarland distinguished professor in the UA's College of Education. The college ended up getting a great person for the job, but the perception that Arizona is hostile to people of color was on candidates' minds, he said.

Last spring, two high-quality doctoral students decided not to come to Tucson because of the state's politics, he said.

"They straight out told me: They weren't going to come here because of the climate," Milem said. "It's tough to argue with that. I'm upset about that - I lost what could have been two outstanding doctoral students to other grad programs."

Though his professional experience has been tremendous, Milem admits he's thought about leaving, too. The passage of SB 1070 was the latest move by the Arizona Legislature that has rubbed many the wrong way, he said, along with this year's ethnic studies bill and last year's Proposition 107, which banned affirmative action in publicly funded entities.

"I've seriously had to consider whether this is a place I want to be," said Milem, who's at his third institution after stints at Vanderbilt and the University of Maryland.

The passage of SB 1070 was the most dramatic of several hits Arizona's image in the past few years, said Merryman, of Northern Trust Bank. Major cuts to primary and higher education budgets have caused parents concern for their children's education, along with the passage of Prop. 107 banning affirmative action and HB 2281, which bans ethnic studies in Arizona schools, Merryman said.

"Companies are now diversified and they believe in diversification, and they are not going to want to come to a state that is so blatantly against diversity," Merryman said. "What message are we sending to sophisticated business people?"

The controversy has kept some companies from moving into Michael Pollack's dozens of Arizona shopping centers, Pollack said. He's not heard of a single business that's been helped by SB 1070, he said.

"We've had companies that have told us, 'Right now we're not looking in Arizona,'" said Pollack, owner of a big Mesa-based commercial real-estate firm. "They'd say it's a little bit controversial now for us."

Similarly, Garrett Kowalewski has heard from job candidates who didn't want to come to Arizona. Kowalewski owns Staff Matters Inc., a Tucson recruiting firm, and heard from three candidates in the last two months who were worried "about noncitizens having trouble" in Arizona, he said.

That was three from about 50 out-of-state conversations over the time period, Kowalewski said. "If three said something, probably 15 or 20 thought it," he said. "I've never had comments like this before in my 11 years in the industry."

But representatives of three local firms in the aerospace and defense sector - Raytheon, Honeywell and Sargent Controls - said they've had no trouble recruiting employees from out of state.

"That has not been an issue at all," said David Dunn, vice president of human resources for Sargent, which recently announced an expansion at its northwest-side facility and has been hiring for positions at a variety of levels.

"We've attracted people from out of state for those jobs," Dunn said.

"FIX THE PROBLEMS"

To the extent Arizona's "brand" has been damaged, "the only way to repair the damage is by fixing the problems which caused it," Simon Anholt, a British policy advisor, author and expert on place identities, said via e-mail.

Explaining that most of the controversial measures in the law are not being enforced is important, too, said Marmolejo of the UA.

During a trip last year to Mexico, UA President Robert Shelton clarified this and reminded people that Tucson continues to be the community long known for its diversity and familiarity with other cultures, he said. That was enough to avoid the cancellation of several programs, Marmolejo said.

Many Arizona business people thought the Legislature took a big step when it voted down five immigration-related measures this spring. The bills didn't pass thanks in large part to a letter sent to Senate President Russell Pearce by 60 Arizona executives including Johnson of the state Hotel and Lodging Association, Tucson auto dealer Jim Click and Brian Johnson, managing director of Loews Ventana Canyon in Tucson.

While careful to ensure the letter wasn't interpreted as "pro-illegal immigration," they told Pearce of the damage done by the boycott and suggested that Arizona redirect its energy to pressing the federal government to handle border security and meaningful immigration reform.

"It is an undeniable fact that each of our companies and our employees were impacted by the boycotts and the coincident negative image," the March 15 letter says. "Tourism, one of our state's largest industries and employment centers, also suffered from negative perceptions after the passage of SB 1070."

Tourism and business leaders made sure they didn't repeat the mistake they made in 2010 - staying silent as Brewer and the legislature mulled over SB 1070, Debbie Johnson said.

"Last year was a wake-up call for our industry," she said. "We recognize that we didn't play the role we should have, and so we took a bigger role the second time around."

On StarNet: Find extensive coverage of immigration issues at azstarnet.com/border

Contact reporter Brady McCombs at 573-4213 or mccombs@azstarnet.com. Contact reporter Tim Steller at 807-8427 or tsteller@azstarnet.com

Copyright 2014 Arizona Daily Star. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.

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