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Best of Benjamin Spillman

Gaming Guru

Benjamin Spillman
 

Loosened travel restrictions could pay off for Vegas

23 February 2007

LAS VEGAS, Nevada -- A proposal to make it easier for foreign travelers to visit the United States could be a jackpot for Southern Nevada's tourism industry, especially if it doubles the number of Koreans visiting America as projected.

The proposal, which could go before the U.S. Senate as early as next week, would authorize the Department of Homeland Security to increase the number of nations whose citizens are eligible for the Visa Waiver Program, a list that now includes 27 countries. Although the changes don't specify which countries would be added, the criteria favor friendly states such as some in Eastern Europe, the Mediterranean and South Korea, the fifth-largest overseas source for Las Vegas tourism.

For Las Vegas the changes have the potential to increase the amount of spending by Koreans alone by more than $120 million annually -- and that doesn't include gambling.

For starters, Koreans and other international travelers would be likelier to make advance reservations in places like Las Vegas if they didn't have to worry about U.S. officials denying their visa applications because of a bureaucratic error, said Eun Seok Kim, minister-counselor for congressional affairs at the Korean Embassy in Washington, D.C.

"When you are not sure you are going to get the visa, you cannot go ahead and make the deposit with the credit card," said Kim, who added the average Korean visitor spends about $3,500 during a trip to the United States. "You are losing huge amounts of money."

Kim said adding his nation to the list of waiver countries would increase Korean visitation to America annually from about 860,000 to 1.6 million.

The proposal to ease restrictions on foreign travel comes at a time when overseas visitation to the United States, as well as Las Vegas, has remained stagnant for several years.

Overseas visitation to Las Vegas has still not rebounded to the level of more than 2.3 million people in 2000, the last full year before the Sept. 11, 2001, terrorist attacks. Overseas visitation to the United States as a whole has dropped 17 percent since before the attacks.

An increase in travel from Canada and Mexico has offset the overseas losses, but on average visitors from within North America don't spend as much time or money in Las Vegas as their overseas counterparts.

Vince Alberta, spokesman for the Las Vegas Convention and Visitors Authority, said increasing overseas visitation is critical to Las Vegas maintaining hotel occupancy rates around 90 percent even as 40,000 new rooms are added to the market in the next five years.

Existing visa headaches can have travelers from emerging nations waiting six months or longer just to get an interview with U.S. officials who will determine if they are eligible to come to the United States, Alberta said.

"That makes it really difficult to attract international visitors. They have the opportunity to go other places much more conveniently," he said.

The foreign travel slump is of such concern to Las Vegas that a forum on the issue earlier this week attracted about 200 gambling industry insiders. The forum drew heavyweights from Nevada's biggest resorts such as Wynn Las Vegas, Mandalay Bay and Bellagio. Terry Lanni, chairman of MGM Mirage, which has 10 properties on the Strip including Bellagio, The Mirage and MGM Grand, was one of those in the audience.

"We have got to be able to reach out to markets across the world for tourism," said Alan Feldman, an MGM Mirage spokesman.

Feldman said the existing visa process is dysfunctional and prevents Las Vegas from tapping deeper into lucrative international markets. Easing restrictions on Korean travel, for example, could have a huge payoff for Las Vegas, which already has three weekly flights to Seoul.

Feldman said he believes there is enough pent-up demand for Las Vegas travel in Korea to eventually support twice-daily nonstop flights between McCarran International Airport and Seoul.

China and India, two countries whose citizens also face significant hurdles coming to America, are home to 500 million people with the means and desire to visit the United States, Feldman said.

"It is all there for the taking if we can get out of our own way," he said.

How soon the U.S. government can get out of the way of foreign visitors remains to be seen.

The proposal before the Senate is an amendment to the much larger bill called the Homeland Security Management Act of 2007.

Sen. George Voinovich, R-Ohio, added the amendment to expand the list of visa-waiver-program-eligible nations. Citizens from now-listed countries, which include Las Vegas-loving places like the United Kingdom and Japan and smaller states like San

Marino and Iceland, aren't required to get visas to visit the United States if they are staying 90 days or less.

The waiver saves citizens from having to travel to an American consulate in their home country for an interview and paperwork and waiting as many as several months for approval. It also means they don't have to worry about being denied entry because of a paperwork problem.

"All they want to do is come here and spend money. For that we are putting them through an interrogation," Feldman said. "An interrogation that, I might add, no American would put up with."

The program makes a difference in Las Vegas. Four of the top five overseas sources of Las Vegas tourism are in the program. Korea, which sent 112,000 people to Las Vegas in 2005, is the only non-waiver country in the top five.

Voinovich's proposal wouldn't automatically add new countries to the waiver list, it would change the waiver criteria. For example, instead of basing eligibility on the number of people in the source country who apply for and are denied visas, a statistic called the rate of refusal, it would be based on the percentage of source-country citizens who leave the United States before their visa expires.

The change puts the onus of tracking visa overstays, one of the major worries of the government when it comes to foreign travelers, on America instead of the travelers.

"If we don't know they are going to leave, that is not their fault. That is our fault," said Geoff Freeman, Executive Director of the Discover America Partnership, a hospitality industry-sponsored group that promotes tourism.

Freeman said if the Voinovich proposal is implemented it would establish a system to track when people actually leave, as opposed to simply rating the likelihood that they will overstay their visa.

"Right now we don't have an exit system in our airports," Freeman said. "You have an agent simply guessing if they are going to leave."

New waiver nations would also need to cooperate in U.S. counterterrorism efforts, issue secure, biometric passports that are machine-readable and offer reciprocal visa-free travel to Americans.

The visa proposal wasn't in the House of Representatives' version of the homeland security bill.

Rep. Jon Porter, R-Nev., said easing travel restrictions and increasing security are both possible.

Porter said that in some cases travel restrictions in the wake of the 2001 terrorist attacks were overzealous.

Expanding the visa waiver program isn't the only restriction the government is reconsidering.

On Thursday a Bush administration official said children could be exempted from a plan to require travelers to show passports at American land and sea borders. The move is expected to benefit church groups, youth sports teams and school trips when the passport requirements go into effect in 2008.

"We want to make it easier," Porter said. "But we also want to make it more efficient so it is more secure."