Targeted aid to tourism will help restart local and state economies in Kentucky

We were hit first and hit hardest by the economic impact of the coronavirus.

Travel industry losses will exceed any other sector. Nationally, they are expected to be nine times the losses after 9/11 with a total economic damage of more than $1.2 trillion. That also translates into more than $50 billion in reduced tax revenue.

In Kentucky, 75 percent of workers in our industry were laid off or furloughed.

Tourism must get back to work if the Kentucky economy is going to rebound. Hotel, retail, restaurants, historical and cultural sites, distillery and brewery tours, performing arts – all depend on the tourism industry, which yields $11.2 billion in statewide spending annually.

It’s also the recipe to improving our government’s budget because tourism generates more than $93 million in local tax revenue each year.

Tourism depends on convention and visitors’ bureaus such as ours to market hotels and attractions. Our convention and visitors’ bureaus result in sales leads that book group hotel room sales for a direct spending impact to our communities.

But our revenue stream – the hotel (transient room) tax – has been decimated. In Lexington alone, we’ve already lost more than 58,000 room nights from 138 group/meeting cancellations due to the pandemic. That’s more than $22 million in economic impact.

The industry was disproportionately impacted by the necessary safety steps being taken to protect everyone’s health, so it needs federal support to bring it back to life.

As Congress begins negotiations over the next coronavirus relief package, we need to invest in recovery for the tourism industry.

Providing direct and flexible assistance to state and local governments and recognition of the central role of tourism will help Lexington successfully navigate this crisis.

Tourism investments will give taxpayers the biggest bang for their buck in terms of jobs and tax revenue. And every worker brought back to his or her job is one less person and family dependent on public assistance.

Both local governments and convention and visitors’ bureaus depend on travel taxes to fund their essential operations. This unexpected loss of funding means that tourism may not be fully leveraged as a driver of economic recovery. Our activities are being curtailed just as the community is looking to us to serve as the backbone of the recovery effort.

No other economic sector can match tourism’s ability to quickly re-engage businesses and put employees back to work. Restaurants, hotels and attractions can re-open, but without the support of our office to drive visitors to those businesses, they will not fully rebound.

Unfortunately, like most convention and visitors’ bureaus, our organization is not eligible for CARES Act relief programs, which are available to small business or charitable non-profits.

Three policy proposals would ensure that tourism is able to reach its full potential as a driver of recovery:

▪ Include another round of emergency funding for state and local governments in the next coronavirus relief package and ensure that the rules are flexible to allow every community to directly address its unique impacts.

▪ Amend the CARES Act to ensure that including 501(c) tourism organizations and tourism-related quasi-governmental entities are eligible under the Small Business Administration’s Paycheck Protection Program.

▪ Allow some Community Development Block Grants to be distributed exclusively to official tourism organizations for development and promotion. In previous disasters, states and cities have utilized these grants after receiving a waiver from the Department of Housing and Urban Development.

Brighter days lie head for Kentucky. But to rebound quickly will require smart, and targeted investments in recovery.

Mary Quinn Ramer is executive director of VisitLEX. The letter was also signed by Eric Summe, Meet NKY; Karen Williams, Louisville Tourism; Sherry Murphy, Bowling Green Tourism; Nancy Turner, Kentucky Association of Convention & Visitors Bureaus; Hank Phillips, Kentucky Travel Industry Association; Joy Brown, Morehead-Rowan County Tourism; Erin Carrico, Murray Convention & Visitors Bureau and Michelle Allen, Lake Cumberland Tourism.