It’s a genuine pleasure to be here. My firm, ERA, has had a long and active involvement in the Buffalo area. We have done a number of consulting assignments here for a number of different public and private clients and we have a connection to Buffalo that we feel is more than just professional. There are a lot of people in the office who like Buffalo, who like to come here, who like to talk about Buffalo. So I feel like Buffalo is sort of a part of our family. We work all over the place, but we work a lot here.

As Wendy said, I’ve been involved with the Port Authority in New York for about 15 years and I’m about to start another project with them and no matter what we do, it’s still not fixed. We’re still trying down there, but the Port Authority is wrestling with a lot of the same issues that you are here, although in a very different economic climate: How to deal with change. How to deal with growth. How to deal with proper roles for public agencies and the private sector. These are all factors that are occurring in cities all over the country.

What I wanted to do this morning — Elaine and I have worked out an arrangement whereby I wanted to talk in a broad sense about the economic values and other values — because they are not just economic — of tourism as an industry, of travel as an industry and in particular, of heritage tourism and cultural tourism, which we think has some genuine applicability to this region, to Western New York.

I want to give you a lot of sort of boring factoids, but they put in perspective what this industry means to the United States. You’ve heard a little bit about that this morning, about it being an enormous contributor to the national economy, about it being potentially the largest retail service industry in the country, selling more even than Wal-Mart, which in itself is extraordinary.

This is a huge, huge business and unless you think about it, we think of it as “well, it’s a vacation.” Or it’s a business trip, or “well, I’m just going to go see the family somewhere for just a few days.” It is a business and it has profound economic and financial implications for any region or city that has managed to capitalize on it. It’s not without pitfalls and Elaine is going to mention some of those because there is also, you know, whenever there is a broad concept like that, there are a lot of anchors that will try and drag it down.

One of them is, people say, “well, tourism is the solution.” I’m not a gambler either. Tom and I don’t gamble. I like to diversify my risk and I guess I would begin this by saying: I’m going to talk a lot about the potential impact of travel and tourism and what it might mean in this area. But I don’t think that’s the only strategy you ought to pursue. This is part of a much larger economic picture and that’s part of the long range changes that Buffalo’s wrestling with now.

So what I want to talk about is heritage, tourism and values, economic values for Buffalo. Now, what are some of the general economic principles that affect travel and tourism?

Well, tourists in relative terms offer very high returns on your investment in infrastructure. And I know you’ve heard this before. You don’t have to build schools to educate the children of tourists. They don’t stay long enough. They go back to wherever else they came from. You don’t have to particularly build new roads for them, because they’re using the roads you use. You don’t have to build new sewer lines or new water treatment plants, the heavy-duty, high cost infrastructure elements that cities have to provide, because they come and use what you already have in place.

What’s interesting about it is they’ve worked somewhere else all year and saved their money and they’ve come here and offered it to you. And you don’t have to pay a whole lot extra to get them to do it. They’re using the infrastructure you largely already have in place. This is the sort of hard-core infrastructure. I’m not talking about the experience infrastructure. That is what we’ll come back to with heritage and cultural tourism. But in terms of investment, particularly for the public sector, travel and tourism offers you a very high return.

The economic benefits that grow out of this are both direct and indirect. People spend directly on hotel rooms, on gasoline, on plane and bus and boat tickets, on all the stuff that they spend directly on — meals, on beverages and that’s a big factor in a city where you have a lot of professional meetings. The lubers, I guess, were down in bar last night pretty late, getting lubricated, because that’s what they do. So you get the direct benefits of all that.

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