Counties use ARP funds to boost tourism after big pandemic hit

Indian River County, Fla. had some unexpected time in the sun last year, but the timing of COVID-19 pandemic restrictions still left the county feeling cold.

With funding from the $61.5 billion American Rescue Plan, leaders in counties across the country are hoping to make up for lost revenue that their tourism operations, along with the rest of the county, missed out on during the height of the pandemic and stay on their toes bringing in new visitors and boost their vacation budgets this year.

Summertime is usually pretty slow in Indian River County, but in July and August 2020, the county saw a surprising number of visitors, taking their hotel tax revenue well above typical late-summer hauls.

It’s a problem most counties faced for at least part of 2020, when, particularly during the pandemic’s peak in the spring and summer, Americans dramatically reduced nonessential travel, which was often accompaned by two-week quaratine periods that dissuaded many travelers.

Amended rules on ARP spending

The U.S. Treasury released additional clarification June 8 on eligible uses and reporting requirements for Fiscal Recovery Funds. Although Treasury has stated the agency will release additional FAQs in the coming weeks, NACo strongly suggests counties submit comments for the record in response to Treasury’s Interim Final Rule on the Fiscal Recovery Fund to ensure the county voice is reflected in the public comments when it comes time to finalize the rule. The deadline to submit comments is July 16, 2021. Read the Treasury Department’s updated FAQ on updated reporting requirements, NACo’s FAQs on the Recovery Fund and NACo’s analysis of Treasury’s Interim Final Rule here.

When restictions loosened, many avoided air travel and opted for lower-key destinations.

“One of the reasons we were so quick to rebound was that we aren’t Miami Beach, we aren’t Fort Lauderdale,” said Kristin Daniels, director of the Indian River County’s office of management and budget. “We’re less crowded, people didn’t want to be around crowds. Our beaches are quiet, and you didn’t have to wait two hours to get lunch outdoors.

“They felt safer here.”

Those qualities drew people to the county, despite the late-summer heat, but it wasn’t enough to make up for the damage in March and April 2020.

“March is when we collect our highest hotel taxes and see our busiest restaurants, so it definitely affected us in our highest revenue-generating month, having a statewide moratorium on short-term rentals and safer-at-home orders,” Daniels said.

The Board of County Commissioners has allocated $275,000 of the county’s American Rescue Plan money to the Indian River Chamber of Commerce for a repeat business campaign.

“If you’ve stayed in the county before, you can get a voucher to come back, stay at a hotel, get discounts for restaurants and activities like skydiving,” Daniels said.

“We’re hoping that will help to drive tourism in the slower summer season. We figure we already have an audience of people who have come, so we’re banking on them having a good experience, they’re comfortable with traveling, maybe they have the money to do so, so we’re trying to encourage them to come back.”

Greater Lansing Convention and Visitors Bureau gets a percentage of the Ingham County, Mich.’s hotel tax revenues, which were down significantly.

The County Board voted to use a portion of the $11 million allocated to small business grants for the bureau, making up their lost 2020 revenue.

“We wanted to make sure they had the resources to promote people staying local this summer and seeing more of Ingham County,” said Controller Gregg Todd.

“We lose a lot of travelers to the Upper Peninsula in the summer. If our hotels are empty, that means our restaurants are empty which means the bars and everything else get hit. We’re trying to get people back in Lansing.

“Our commissioners really wanted to get that first tranche of money to people and businesses who need it now.”

While the pandemic is waning, it didn’t wane fast enough for the 2021 Arts Festival in Centre County, Pa. In March, the festival’s Board of Directors canceled the event, held in July, for the second straight year, taking one of eight big tourism weekends off the board for the central Pennsylvania county.

The festival is a high point for a community that sees visitors peak in the fall for Penn State football games, though Commissioner Mark Higgins sees potential for more diversification.

The festival draws an international crowd of roughly 200 vendors, and the accompanying People’s Arts Fest features 160 local artists.

“The second week in July is like a football weekend that goes on for five days,” he said. “Tourism is one of our largest job creators and supports local businesses, so supporting those events and opportunities is important to our economy and quality of life here.”

Centre County’s commissioners allocated $49,000 in ARP funding to the Happy Valley Adventure Bureau to promote tourism. The county’s longstanding tourism grant program funds local nonprofits that attract tourists, including the Arts Fest.

“If it takes hold and gets some legs, we’ll give them more,” Higgins said.

“Some local nonprofits are doing scaled-down art walks this year, but we wanted to help them. Maybe we can take some of this funding and give them to these tourism-related fundraisers for the local nonprofits where there isn’t the money from the grant program, because it’s based on the hotel tax.”

In the meantime, Centre County has highlighted its outdoor recreation resources for hiking, biking, fishing and agricultural tourism.

A burgeoning farm-to-table dining scene, sourced from local farmers, kept supply lines short when resources got scarce during the height of the pandemic.

On the southeastern edge of the state, Bucks County is still determining how much to allocate to tourism efforts, but county spokesman Larry King said the commissioners know what’s at stake.

“Given recent history, and the role that travel, tourism and hospitality play in the Bucks County economy, I would suspect that the industry will be part of the decision-making conversation,” he said.

“Last year, a significant allotment of Bucks County’s CARES Act funding – more than $3.7 million – was directed to Visit Bucks County for use in supporting the industry in Bucks County.”

Bucks County sees more than 8 million visitors annually, generating $1 billion for the local economy and supporting nearly 30,000 jobs in the travel and hospitality sector.