State Halts Its Phone, Online Travel Service

Facing pressure from travel agents and tour operators, the California Division of Tourism clamped a 60-day moratorium on its new toll-free telephone and Internet program that allowed travelers to make their own reservations.

The tourism office will schedule a series of meetings to take comments on whether the state should be offering a service similar to travel businesses. The department then will present recommendations to a legislative committee.

A lot of small businesses felt that the new system was hurting their business, said Assemblywoman Susan Davis (D-San Diego), who chairs the Committee on Consumer Protection, Government Efficiency and Economic Development.

“What we’re looking for is to strike a balance” between state tourism efforts “while at the same time not compete inappropriately with private enterprise,” Davis said.

Davis said she believes her 11-member panel backs business owners. “We need to see whether there’s a way to promote hotels and motels, but in a way that hooks people in who engage in this enterprise as private businesses,” Davis said.

Last December, the state established an online booking system, and soon afterward, a toll-free phone number through which travelers could book their own reservations at more than 300 California hotels, motels and inns. Participating businesses were listed free of charge.

The system generated 50 bookings--18 from California, 18 from other states and 14 from other countries, state director of tourism John Poimiroo said.

He contends the new program isn’t hurting private businesses.

“People who want the travel services, the price savings and the convenience of using a travel agent will continue to do so,” said Poimiroo. “This is directed to the self-motivated traveler who does [his] own travel arrangements.”

Poimiroo added that a number of states will be offering online reservation systems soon. New York state, as well as several cities including San Diego and San Francisco have set up booking systems, he said.

The state program also aided many smaller operators that cannot afford to pay advertising costs involved in reaching a broader audience, Poimiroo said.

A tourism marketing official agreed.

“We’ll have a number of small mom-and-pop hotels who will be provided an opportunity to connect with a major reservation system,” said Bob Warren, general manager of the Shasta Cascade Wonderland Assn., a tourism marketing organization that represents eight counties in Northern California.

But travel groups say the state should leave reservations to specialists.

“The state should not be making hotel reservations at all,” said Coranne Gibson, president of the California Coalition of Travel Organizations, a statewide coalition of travel groups. Gibson, who has owned an Orange travel agency for 18 years, said that the state’s system would “take a little bit of business away from everybody.”

If travelers who don’t use an agent are unhappy with their accommodations, she said, they have little recourse.

“These are my tax dollars supporting a state-wide system, and they’re competing against me,” she said. “That’s the bottom line.”