Mammoth Real Estate Q&A – Marketing and Dispersed Thinking

This Mammoth Real Estate Q&A appears in the Thanksgiving weekend 2020 issue of The Sheet. 

Nobody goes there anymore. It’s too crowded.”

                                             —Yogi Berra

Q: We all witnessed the crazy and often dis-respectful crowds this past summer and it certainly has made many in this community re-think various aspects of our tourist-based economy and marketing. If this level and type of visitation continues into the future, do you think it can negatively impact real estate values?

A: What happened this past summer was truly eye-opening for this community. And even though many younger local residents reacted strongly, I think most of the longer-term residents were rather shocked too, but not surprised. We could see it coming. It was really a culmination of events driven by lock-downs, closures and restlessness. All of this brought droves of people into the mountains including the Mammoth Lakes region. And if this incredible demand continues, it could impact real estate values, but which way is uncertain in my mind.

I always support the practice of critical thinking whether it is about the local economy, politics, real estate, etc.. But today it appears there simply isn’t sufficient questioning as we go about our lives. The events of last summer have made many in the community re-think what the goals and priorities of our resort economy should be and how we should go about achieving them. Hopefully the thinking wasn’t lost in all the smoke. 

While the overwhelming crowds may have been alarming and annoying, the volume of visitors, cash flow and general business may have kept many of our tourism related small businesses in business. The TOT/TBID numbers are indicating this. This is the good news. The bad news is that our local environment, both natural and man made, took a beating. The reaction by local residents, second homeowners and random visitors to this degradation is applauded and inspiring. And encouraging. It alone is an indicator of what is tolerable and what isn’t. Our public officials should take note.

Hopefully this past summer’s experience was an anomaly. Once things like amusement parks, music events, and other hedonistic venues reopen, this recent crowd may quickly abandon their desire for the mountains or the camping experience. We can only hope they found it boring, or too difficult (cleaning up after oneself is for other people?). But because it happened and this community didn’t like what it saw, it is time to reflect on what the future of tourism in the Mammoth Lakes region should look like. The wonks at Mammoth Lakes Tourism (MLT) appear to be only concerned about (high) visitor numbers. But the rest of the community, including our Town Council, are the ones who should be weighing the future value proposition of the local economy. But again, it may already be lost in the craziness of current life.

So where to start? Does anybody remember the legal premise for the Sierra Club’s litigation against the Environmental Impact Report (EIR) for the expansion of Mammoth Airport in the early 2000s? The Club contended that the EIR didn’t sufficiently consider the “growth inducing impacts” of the Airport expansion. (Ironically, we can look back and get good laugh about that concept). But the legal challenge itself made us reflect on the topic, and the delays itself may have seriously eroded the success of the expansion. Momentum is everything.  

Has anybody at the Town or MLT ever considered the growth inducing impacts of excessive marketing? Are we now seeing that maxed-out visitation numbers and TOT/TBID revenues aren’t the end-all? There are other things to consider. I often go back to one of the laws of the weird pseudo-science called economics; the law of diminishing returns. Mammoth Lakes received a harsh lesson about the law of diminishing returns this past summer. It wasn’t all our fault, the pandemic conditions magnified everything for us. But we need to learn from it. More is not better. Unruly visitors are degrading and damaging. And unwanted. For decades Mammoth has strived to become a “destination resort.” This past summer we went backwards. Is the goal of a destination resort manifest in quality not quantity?

As a proper framework for the future, perhaps the community needs to go through an EIR-type process for marketing and tourism. It may be long overdue. Without the proper assessment and protection of our local environment, the future desirability of living or visiting here will deteriorate quickly. And don’t think the Forest Service or federal or State government will do anything. And forget the Sierra Club, they’re too busy saving frogs in far-away places. We’re on our own.

The EIR process is quite applicable to our current and future quandary, especially if this level of demand continues. The government requires these studies and process for just about everything that happens, so why not for marketing and tourism? But it has to be done right. The EIR process has become cheapened too. Some 30 years ago there was a man by the name of Larry Johnston who produced EIRs for various projects around Mammoth. Yes, the same Larry Johnston that was a County Supervisor and was known for his awesome Fourth of July parade floats. His EIRs were truly local in knowledge, flavor and sensitivity. They were real. 

Today our EIRs are just hired out to an international company that sits in a massive building down in Irvine. They are big cut-and-paste jobs and the consultants come to Mammoth for an afternoon and make expert conclusions. Basically, they are just reams of B.S.. But they cost less, and are worth less (or worthless?). And the “lead agency” –– the Planning Commission and Town Council just rubber stamp the whole thing. Real scrutiny is absent. The EIR for the ice rink/MUF at Mammoth Creek Park was a classic example. This certainly isn’t the type of EIR process we need for what faces us. It needs to be real. I dislike the term “organic” in many contexts but this is what it needs to be.

There are many potential “elements” or sub-studies to an EIR; they can assess impacts on various topics including traffic, visual, biological resources, noise, aesthetics, cultural resources, public services, recreation, water quality, etc.. How did these fair last summer? Many times these elements are specific studies conducted by consultants or experts. But they really need to be conducted and expressed on a local level, not boilerplate rhetoric pulled from some other EIR. Once a “draft” EIR is produced, including all of the appropriate elements and potential mitigation measures, the public gets to comment on the content of the document. The final EIR product should include the public comments and any proposed mitigation measures. But what is really important is to go through the process, a real process. And predicate future decisions on what we learned.

It is interesting to think about some of the more alarming aspects of last summer and what the potential mitigation measures could be. I have a few and a public process would certainly bring out others. One Council member recently laughed as he commented that so many people were “bathing in our drinking water” at Horseshoe Lake this summer (does that give you the Covid-creepies?). My list includes the overall volume and disorderly congestion in the Lakes Basin. And the out-of-control “dispersed camping” all over the forest including visitors leaving trash everywhere, dangerous illegal campfires, and RVs just dumping their holding tanks randomly in the forest. I have no doubt that a public EIR process could create a long list of relevant concerns. Including many that aren’t necessarily obvious.

Once we have this list we can start discussing potential, and real mitigation measures. But first we might have to complete some “studies.” I’m wondering if there are marketing consultants who do these types of analysis?? Or do they just know how to spend money on more advertising? And do we need to reallocate some of our marketing budget for this sort of assessment? One of the first topics might be the simple volume of visitors we are attracting to the area. Covid may have exaggerated last summer’s volume, or not, but it should help us understand how the law of diminishing returns impacts local tourism. Ironically, many local STR owners have been asking for months if they should be raising their rates. They think they can have the same amount of revenue with less traffic, headache and wear-and-tear. They have the foresight.

And whether we realize it or not, this community might be a victim of Airbnb’s dynamic pricing model. And we haven’t properly adapted. An increasing number of Mammoth’s visitor’s book through Airbnb and many are booking based on price. During non-peak periods this means they are most likely booking last minute, and some even as they are driving up Hwy. 395. Airbnb’s algorithms can drive the price down the closer to the actual booking dates. It is up to the STR owner to accept this lower price, and most do. Our guests are increasingly figuring out how to visit Mammoth on the cheap. And even worse, some have discovered it can actually be free (dispersed camping). Is this the best for our community and economy? Does MLT have this answer?

One thing that failed us this past summer was communicating with our visitors, especially our new visitors. The pandemic shut down some of the critical communication lines like the Visitor’s Center. But if the visitors were finding all sorts of (questionable) information on social media, why weren’t we communicating with them in a similar manner? We had signs at the entry to town demanding masks but silent on illegal campfires. Bad behavior in the Lakes Basin had to reach a critical level before our leaders realized some personal interaction with visitors might be helpful. And dispersed camping became such a disaster the Forest Service ultimately closed the entire forest (for the first time ever). Maybe our tourist economy needs to be a little more proactive than reactive?

All of this is telling Mammoth Lakes it is time to step back and re-think our tourism based economy. There is no doubt that similar mountain resort communities are too. Maybe we should be interacting with them. The process could bring about some very positive changes. Maybe the TOT hamster wheel isn’t the right answer. Quality of life is in the balance for both local residents, second homeowners and our visitors. And after all, isn’t that why we’re here in the first place? Real estate values be damned.

Let’s hope our Town leaders can head us in a more intelligent direction rather than just dumping more dollars at marketing. Mammoth’s future may be on the line. 

Happy Thanksgiving!

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