Published in cooperation between AskGamblers and The Healdsburg Tribune
Healdsburg is one of Wine Country’s true success stories. In the last decade, the town has grown from a sleepy hideaway off the beaten path to a major tourist destination able to draw visitors from around the world.
The boom has impacted Healdsburg in many different ways. While the population of Healdsburg has remained fairly stable over the last decade, the number of businesses has exploded. There has been an influx of corporate developments, including resorts and luxury condominiums. Huge changes in the numbers of visitors can have a massive financial benefit while also stressing services and resources.
The main concerns from residents have been about the loss of affordable housing for the people who have always lived and worked in Healdsburg. This article will look at another important topic: how Healdsburg’s tourism boom affects local businesses.
Growth
The most powerful impact of any tourism boom is a revenue growth. Higher number of tourists leads to a higher footfall in the city center as well as more people interested in spending.
Tourists typically spend more than locals, mainly due to impulse buying, but for other reasons as well:
• the desire to commemorate a trip
• they need something important for their daily activities
• they are willingly ignoring budgets due to ‘vacation mode’
Local businesses in Healdsburg have seen positive growth thanks to tourist spending. There also has been a huge increase in the number of businesses operating in Healdsburg because the tourist economy has made it possible for them to be successful.
One facet of the tourist economy that local businesses need to consider is seasonality. Very few destinations consistently attract tourists year round. Local businesses need to plan accordingly and also appeal to locals in order to remain profitable throughout the entire calendar year.
The Tourism Improvement District model
Healdsburg had one benefit from being one of the later Sonoma County towns to become a tourist destination— could learn from the experience of similarly sized towns that already had undergone a tourist boom. Some towns become so dedicated to satisfying the needs of tourists that they fail to consider their residents and ultimately stop being attractive destinations.
One solution for this is the Tourism Improvement District (TID) model—and that is what Healdsburg has been successfully implementing. The TID is a development model that puts tourist money back into the community. In Healdsburg, there is a 16 percent tax on hotel stays. That money is then reinvested into community services, public safety, affordable housing and marketing.
Local businesses don’t benefit directly from the TID model, but they benefit in the long term. Reinvesting in the community keeps Healdsburg livable, which makes it possible for local businesses to find staff and thrive.
In 2022, the TID model generated $11 million for Healdsburg. That is an important source of revenue that will only continue to increase as Healdsburg’s popularity as a tourist destination increases. It is a stable addition to the local economy that benefits everyone.
Formula retail debates
The current issue facing Healdsburg’s local businesses is the regulation of formula retail businesses and areas they will be allowed to operate in. The definition of formula retail businesses is still being debated, but essentially these are businesses that follow a formula of what to sell and how to brand. These aren’t necessarily chains, but they also aren’t truly local or independent businesses.
Protecting town center areas from formula retail is one of the best ways to protect local businesses. The main arguments against extending the formula retail exclusion zone have come from people who are prioritizing profits above other values. This approach can have big immediate financial benefits, but it is shortsighted and over time can erode the local community and make Healdsburg feel less unique.
Room to grow?
Card rooms are one area where Healdsburg is still lacking. California’s gambling laws prevent the opening of new casinos (with exceptions for Tribal Casinos) but they do allow for card rooms. Small card rooms can be designed to cater to different demographics, from boozy poker dens to high-stakes games rooms.
The popularity of in-person gambling has continued to grow, surprisingly thanks to the rise of online gambling. Online gambling has become so popular that many players consult guides—like the roulette strategy guide at AskGamblers—to hone their skills before sitting down at a real table.
For Healdsburg to become the leading resort destination in the Sonoma area, it needs to offer everything to its visitors. Plus, locals can also enjoy playing a few hands of cards at a downtown card room, instead of having to drive to a resort. It can also contribute to building a community between residents, local business owners and frequent visitors.
Final thoughts
Local businesses have been some of the biggest winners in the Healdsburg tourism boom. While the number of local residents hasn’t increased by much, the footfall from tourist traffic has had a positive impact on the local economy. Competition has increased and there is still room for improvement, but a sympathetic and responsible City Council can promote growth and protect local businesses.
