LOUISVILLE, Ky. (WDRB) – Louisville Tourism was approved last week for a $ 1.3 million PPP loan, which will be the first financial support the agency has received to overcome the COVID-19 pandemic.
The loan will go specifically to payroll and rent to free up the already tight fiscal budget to do the necessary work of marketing the city, attracting more tourists and hosting more conventions.
“Tourism has been devastated nationally,” said Karen Williams, President and CEO of Louisville Tourism. “For us, tourism is the third largest industry in the state, and we want to be able to be competitive when we get to the other side of that.”
Williams and his team have been fighting for months to allow travel agencies to apply for federal loans through the SBA. These Kentucky organizations faced a major hurdle in finding financial support until 2020 as they were technically unqualified.
“We have been classified as a quasi-government agency,” Williams said. “We haven’t received any money from the city or the state, but this is how we collect our transitional room tax through the Revenue Commission.”
About 95% of Louisville Tourism’s budget comes from the transitional room tax, which has been drastically affected by so few people traveling and booking hotel stays during a pandemic. The remaining 5% of the budget comes from advertising and partnerships, which have also suffered.
The tourism agency’s budget before the pandemic was nearly $ 25 million, but it has been cut to around $ 10 million now. And without that loan, Williams said the group was preparing to have to make more cuts.
“We had to make cuts – pay cuts – we put people on leave, we fired people,” Williams said. “And we’ve been limping at best over the last six months. So it couldn’t have come at a better time. And we’re excited to be able to get through – if you will – the next four or five months and really be able to promote, market. and to be competitive. ”
A state task force was formed over the summer and successfully worked with Congress to change the classification of tourism organizations. So, once the latest wave of federal relief was approved, Louisville Tourism applied for and got a $ 1.3 million PPP loan last week. Williams said the SBA determined the loan amount based on Louisville Tourism’s current budget and size.
On Thursday, the board met to revise the budget for the fourth time to include the new boost. It’s unclear how much of the loan will be repayable, but Williams said the revised budget took this into account.
“We have planned accordingly,” said Williams. “We are looking to see if it’s 20 to 30% that we have to reimburse. We are in a good position to do so. But if it’s 100% forgivable, then we have a lot to celebrate. “
Williams predicts that leisure travel will begin to pick up in the spring with the availability of more vaccines nationwide, and she believes convention activity will be more stable starting in the fall. Earlier in January, Louisville Tourism predicted that the city’s top 15 events and conventions tentatively scheduled for 2021 could create a economic impact of more than 350 million dollars.
“We are booking conventions at 22 and 23 and 24 and 25 and beyond,” said Williams. “And not only do you need the team to do it, but you need the ability to do it to be competitive with these other cities bidding against us. Louisville was a hot destination a year ago. And when. we’ll get to the other side of that, we’ll be that hot destination again. And now with the PPP, it allows us to catch our breath, to let the staff we have do the work that we need to do. “
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