Pa. House committee hearing presents dire picture for state tourism industry

Visit Johnstown executive: "We've lost our entire summer in Cambria County"

  • Benjamin Pontz

The effect of the coronavirus on the hotel industry could be nine times worse than the losses incurred in the wake of the Sept. 11 attacks. Just under half of county fairs have already been canceled for 2020. Twenty to thirty percent of restaurants may never reopen.

These were among the comments from industry representatives at a hearing of the Pennsylvania House Committee on Tourism and Recreational Development held Wednesday morning.

With a tenor that shifted between defeatism and subdued hope for the 2020 tourism season, representatives from the amusement park, restaurant and lodging, county fair, and destination marketing organization industries testified that they have been in touch with the Wolf administration and had some productive conversations. But they said the industry remains in need of more guidance, that with each passing day time is running out for businesses that remain closed during what is typically their busiest season of the year.

“From Pittsburgh to Philadelphia to Erie and Lancaster, from the Endless Mountains to the Laurel Highlands, when businesses closed and the travel bans and stay-at-home orders went into place, it created a domino effect across our industry,” said Lisa Rager, executive director of Visit Johnstown, who added that her organization lost most of its revenue from hotel occupancy taxes and has furloughed most of its staff.

“Tourism is the engine that can pull our economy out of this crisis when people are ready to travel again,” said Rager. “We can’t move forward until this fog of uncertainty is lifted so that we can resume the work that is so critical to our communities’ recovery.”

Sally Nolt, president of the Pennsylvania State Association of County Fairs, said that many communities have decided to cancel their fairs rather than await state guidance that she said has so far remained elusive.

“We’ve desperately been seeking guidance from the state for over two months as to the likelihood of having our 2020 fairs,” said Nolt.

The present state guidance has been more general, limiting businesses in green phase counties to 50 percent occupancy and restricting gatherings of more than 250 people. The county fairs association has interpreted that to mean that no more than 250 people can attend a fair at one time, while the amusement parks association testified that their understanding is that, so long as their total property is at less than 50 percent occupancy, the limit of 250 applies only to shows or other discrete events.

Wolf administration deputy press secretary Elizabeth Rementer confirmed that the administration views fairs differently than events.

“Because fairs are events — that is, transitory gatherings of people rather than a permanent business or operation — they are capped at 250 in green phase counties regardless of the fire code occupancy,” said Rementer. “The administration will continue to monitor public health indicators and will revise restrictions as necessary.”

For its part, the amusement park industry struck a tone of guarded optimism, noting that Pennsylvania Amusement Parks and Attractions (PAPA) has released guidance in consultation with the state about how to safely reopen.

“Amusement parks are an inherently safe form of entertainment,” said Garrett Gallia, vice president of Hershey Entertainment and Resorts, which is targeting an early July reopening assuming Dauphin County has moved to the green phase by then. “This is because we manage capacity as part of what we do. In that vein, we have the planning and infrastructure in place to effectively manage or reduce capacity in order to achieve social distancing requirements … Guests don’t tend to congregate in any one area.”

Amusement parks are only permitted to open in the green phase of the state’s three-tiered reopening plan. Thirty-four of Pennsylvania’s 67 counties will be in the green phase by Friday.

Pennsylvania Restaurant and Lodging Association President John Longstreet said that restaurants and hotels are working to adapt to the state guidelines, and he praised the Wolf administration for being responsive to industry concerns. He noted, for example, that the administration had initially proposed opening restaurants at 25 percent capacity, but after hearing that restaurants could not operate profitably at those levels, agreed to increase the benchmark to 50 percent.

Still, it has been a challenging time for the industry; 332,000 restaurant employees and 95,500 hotel employees are currently out of work, and between 80 and 90 percent of hotel rooms are currently unoccupied, said Longstreet. Industry projections show that the hotel industry may not recover to 2019 revenues until 2023, and up to 30 percent of restaurants may close permanently.

“The restaurant industry has thus far been the most decimated industry in the entire country, and we want to make sure that doesn’t happen to the attraction industry,” said Longstreet.

One opportunity for the Pennsylvania tourism industry is its standing as “the largest drive-to market in the country,” meaning that, if attractions can reopen safely, there are opportunities to capture revenues from tourists driving to Pennsylvania from population centers in neighboring states.

“We have the ability to actually begin to bring people back to this state, but we have to have our attractions to get them interested in making that drive,” said Longstreet. “It would be an absolute shame if we did not capitalize on … our opportunity to have a better rebound than almost anywhere else in the country in the hotel business and in the travel and tourism business.”

State Rep. Jack Rader (R-Monroe) argued that it is crucial to reopen the tourism industry as soon as possible so that the summer season can be a viable tax revenue generation tool in addition to benefiting the economy.

“We have to make our state budget work,” said Rader. “If we don’t have that [revenue] in November when we’re trying to make this budget work, we’re going to be in trouble.”

Legislators on both sides of the aisle agreed that there is a brewing sense of urgency to get the tourism industry operating again.

“Time is not on our side here, and we know that so many of these businesses are seasonal in nature or at least have a substantial portion of their business that is conducted during the summer months,” said the committee’s minority chairman, Mark Longietti (D-Mercer), who argued that, particularly for outdoor attractions where the risk of coronavirus transmission appears to be lower, working with the industry towards a safe and fast reopening is important.

“It’s critically important that we work with these partners to find a way to allow them to safely reopen so that not only our constituents and people that are visiting Pennsylvania can enjoy them, but also for all the economic reasons and for their survival, quite frankly,” said Longietti.

Committee Chairman David Millard (R-Columbia) said that he hopes to introduce legislation to accelerate the reopening process for the tourism industry soon. He said he asked for a meeting with Gov. Wolf and Secretary of Health Rachel Levine, but he has not yet heard back.

“My goal through all of this will be to eliminate the color coding, eliminate the crowd gathering [limit] of 250. I’m trying to do this following industry standards that these individual entities came up with — safely, and I do want to emphasize that,” said Millard. “No one wants somebody to go home and be ill or say that they went to this facility and contracted COVID-19. Nobody wants that.”

“I’m trying to do everything that I can,” said Millard. “Chairman Longietti and I are going to try to work together and try to battle time and try to go against the clock and get things open as quickly as we can.”

Editor’s Note: This article was updated with a comment from the Wolf administration.

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