By Katy Savage
Business owners in the tourism and hospitality industry, the hardest hit by the Covid-19 pandemic, are desperately seeking more funding to stay afloat.
Perry Armstrong, the owner of Rain or Shine Tent Company in Randolph, said he’s contacted just about everyone he can in the Legislature and he’s testified in front of the House and Senate.
“We’re struggling,” Armstrong said. “The hospitality industry is pretty sick right now. We’re just dying on the vine here. Nobody seems to have the answers.”
Armstrong said earlier grant money, which capped at $50,000 per business, was inadequate to meet the losses. Business owners can apply for a second round of grants up to $150,000, but Armstrong said that still won’t meet the need.
Armstrong is anticipating he’ll lose $1 million by next spring with the cancelation of weddings and events. Meanwhile, he’s sitting on about $4 million worth of inventory and has monthly payments of $20,000. Though he’s recently picked up business from schools and restaurants that need tents, he said that’s not generating enough to make payments.
“It’s not in the tents where we make money, it’s all the other products,” Armstrong said, mentioning chairs, tables and silverware that the company rents.
“This is a state that charges rooms and meals tax and sales tax on basically everything we in the hospitality industry do,” Armstrong said. “Wouldn’t you think they’d want to prop us up?”
Vermont’s $2.8 billion tourist industry brings in almost $400 million in tax revenue a year. Weddings alone are estimated to bring in about $415 million in economic activity to the state. Most wedding business owners make their money in May through October, with fall foliage season being the busiest time for wedding venues. September is usually the busiest month.
Talena Companion, the treasurer of the Vermont Wedding Association, testified before the House Commerce and Economic Development Committee on Aug. 26, where she said business owners in the wedding industry are down an average of 77% in revenue.
Many of the state’s weddings have budgets over $1 million. About 46% of the people who get married in the state don’t live here.
“We’re going to be a big part of bringing the economy back,” Companion said.
The state has an estimated $200 million of CARES funding left to distribute. In mid-August, Gov. Phil Scott proposed directing $73 million of that money to economic recovery grants and tourism and hospitality grants. The House and Senate are now considering how to allocate the money.
Josh Eckler, the owner of the Trailside Inn in Killington, said the state needs to act quicker.
Eckler received PPP funding in the spring, but like other business owners, he said that wasn’t enough.
“My issue with the state grant is it wasn’t adequate from the losses we’ve seen,” he said.
About 45% of Eckler’s business comes from the ski season and 55% comes from the wedding season. He lost about 15 scheduled weddings this year and is unsure what the ski season will look like.
Eckler said he has monthly fixed costs of more than $10,000, including heating costs for his 25,000 square foot building.
“We’re stuck in a mud puddle,” he said. “It’s not like we can pivot and start doing takeout. I can’t do takeout lodging.”
Vermont Farms Catering owner Kevin Lasko said he was supposed to do 45 weddings this summer but lost about 95% of his work. Many of his weddings have rescheduled for next year, but he and other business owners are unsure if normal activities will be able to resume by then.
“Every step along the way the country has been consistently behind the ball,” Lasko said. “You’d like to think next summer it’s going to be back to normal. It seems we’ve been saying for months now and it’s not really going that direction.”
Meanwhile, large businesses like the Woodstock Inn and Resort don’t qualify for any relief.
“We’re hurting,” Woodstock Inn Vice President of Marketing Courtney Lowe said in a testimony before the Legislature on Aug. 26. “We’re a very low margin business to begin with.”
Lowe said the inn has gone through about five years’ worth of savings so far.
“This event took it all away in the blink of an eye,” he said. “It was like our savings account was hacked.”
Lowe estimated the state would see a $1.2 billion loss in tourism revenue statewide due to the pandemic. He was concerned about the long term impact the pandemic would have on the industry.
“My worry is that the Vermont brand is shut down,” he said. “I’m concerned about the long term and what we’re going to do.”