As Kentucky slowly recovers from the COVID pandemic, tourism representatives appealed to legislators Wednesday morning for help rebuilding the industry. Many cities lost revenue because of canceled conventions, shuttered businesses, and travelers staying home. While that should change this year, experts anticipate slow growth.
Tourism, Arts, and Heritage Cabinet Secretary Mike Berry told members of the Budget Review Subcommittee on Economic Development, Tourism, and Environmental Protection that tourism in Kentucky is an $11.8 billion industry. Although people continued to participate in a few endeavors since the pandemic began in 2020, such as golf and camping, the public health emergency significantly impacted tourism.
VisitLex President and CEO Mary Quinn Ramer testified that Lexington hotels lost $120 million from March 2020 to March 2021.
LinGate Hospitality owns and manages nine hotels in Kentucky. Claude Bacon, vice president of sales, marketing, and e-commerce for LinGate, told legislators the drastic decrease in hotel occupancy resulted in a $134.8 million drop in state and local tax revenue.
A growing number of people indicate plans to travel this summer, and hotel occupancy is climbing. The U.S. Travel Association expects 72% of Americans to travel this summer. Nationally, travel spending was $69.5 billion in March 2021 ‒ up from previous months, but roughly 30% lower than March 2019.
Kentucky has designated some of the state’s CARES Act funds to encourage tourists to return to the state. In addition to $5 million dedicated to marketing, Berry stated that Kentucky spent $45.5 million on Main Street programs in several cities.
Berry noted that Kentucky hotels and motels were 43% occupied in April. But Louisville Tourism President and CEO Karen Williams indicated that industry estimates predict it will take more than five years to return to pre-pandemic levels. The slow recovery is having an impact on local employment.
Bacon stated that hotels and other tourism locations could not bring back workers or increase pay until occupancy rates improve. “We can’t bring these people back just yet,” added Williams, “because we don’t have a consistent business just yet.”
Those testifying on Wednesday urged legislators to allocate $75 million of Kentucky’s American Rescue Plan Act (ARPA) funds to market state and local tourism. They urged legislators to adopt a plan that sets specific amounts for local communities and to recruit meetings and conventions. “There is a huge pent-up demand for travel,” stated Ramer. “Competition in the coming months will be fierce, especially in the meeting and convention space.”
Roughly 44% of Kentucky cities have a tourist and convention commission. Some operate independently, while others are joint endeavors with local governments.
