The Aspen Effect -- in which communities outprice their own workforce by building economies around high-priced tourism -- can be prevented through purposeful efforts to diversify the economy, provide housing with a price ceiling and through taxes.

I came across an article on the topic, which discusses Napa, near where I grew up, reminds me of Santa Cruz, where I went to school, and echoes of Nantucket, where I vacation. There are many similarities to these beautiful places -- once they are “discovered” as vacation destinations, the influx of visitors influences their character and affordability. From my observation, preventing the Aspen Effect takes community purpose and planning. If communities aren’t equitably controlled, there may not be anyone to fight for the policies that can help to preserve community character while also nurturing a vibrant tourism industry.

Here are policy ideas that communities can use to make tourism work for them:

1. Tax the tourism industry at higher rates than other industries. If a community has a high-value tourism industry, people visiting it from outside the community expect to pay high prices already. Higher taxes, which can ease the tax burden on residents, won’t deter tourism spending. Additionally, the way a growing tourism industry affects the host community can be disproportionately negative to the preexisting residents, and tourism services should pay accurately for the detriment, such as increased use of public services (hospitals, police, etc). Having the extra tax base allows cities to flourish due to the tourism industries they are hosting, not struggle to afford living there.

2. Purposely maintain affordable housing stock and limit access to year-round residents. As areas increase in popularity for tourism, part-time newcomers purchase second homes, absorbing housing stock and driving up housing prices. Cities must intentionally create housing stock, control pricing and be sure residents can afford to remain in the community.

3. Maintain a diverse economy of which tourism is only a part. City officials must do this because they may be forced to preserve economic staples to the detriment of the tourism community, for example, declining an additional hotel project in favor of a school or a much needed housing division, etc. Maintaining a diverse economic portfolio is a form of security in many industries in case one asset declines in value. The things that make tourism boom at one point can decline. For instance, Napa’s appeal will lose value if grapes catch a blight or if a new area becomes the ‘It’ spot. Communities should be sure they have developed other aspects of their economy.

4. Ensure turnover in municipal elected positions. This is important so that no one party can direct economic priorities. It’s as harmful to have a decade of tourism-dictated economic policy as it is to have staunchly anti-tourism people in office for that long. Balance is key.

5. Incentivize small businesses. As tourism grows, it can attract outside venture capital. Cities should continue to develop and nurture local business interests so that during the off season, communities still have economies they can rely on. Tourism can happen to municipalities, where the city is basically passive, or cities can work to manage it. There are good examples of successful tourist destinations -- LA, San Francisco, Seattle, and New York among them. Tourism is likely to change communities, but as long as the whole economy grows with the tourism industry, it can drive economic expansion in a positive way.