As island's tourism slowed, so did revenue stream

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Numbers of visitors on Hilton Head Island beaches have been down significantly since the coronavirus pandemic began. This photo was taken in 2019. DEAN ROWLAND

The coronavirus pandemic has made life miserable and uncertain for everyone and everything, everywhere.

A recent economic impact study from the College of Charleston focused on the devastation inflicted on Hilton Head Island and in Beaufort County from March through July. The findings: $310 million in lost revenue in the tourism industry.

"The impact is truly significant and far more than with any other events we have experienced, including 9/11 and the '08 recession," wrote Daniel Guttentag, Ph.D., director of the Office of Tourism Analysis at the College of Charleston. "After 9/11, tourism did not fall off the cliff like it did in April."

The Hilton Head Island-Bluffton Chamber of Commerce commissioned the study, with data being collected from March 8 to July 11.

"Tourism losses have secondary impacts throughout the economy," Guttentag said. "The compounding benefits of their direct expenditures extend to every other economic sector of the community."

Charlie Clark, chamber vice president of communications, also understands the ripple effect and how it affects all aspects of the business community and its people. It has taken a toll on the human condition and disrupted ordinary lives.

"The loss of jobs, especially in the tourism and hospitality segment, has been tremendous," she said. "It's easy to look at the statistics, but it's critical to remember those numbers represent people and jobs and livelihoods.

The Charleston study reports that an estimated 7,644 food service and accommodations employees in Beaufort and Jasper counties had lost their jobs by the end of April. Fortunately, about 4,400 returned to work in May and June, according to the South Carolina Department of Employment and Workforce.

"Tourism is nowhere near previous levels," Clark said. "We're just paying much closer attention to it right now based on what's happening with the pandemic."

The Town of Hilton Head Island also has taken a direct bottom-financial hit from the crises. According to the study, these tourism-specific losses include:

• $3.5 million in local accommodations taxes

• $736,000 in local hospitality taxes

• $14,843,000 in local taxes overall

"The tourist-based (revenues) have been impacted the most ... beach fees, accommodation tax, hospitality tax are feeling the effects from the pandemic," said town finance director John Troyer. "Tourism stands out ... in the rooms and the restaurants."

Troyer stressed that the town and council have been making adjustments to spending over the past several months.

"The town has been very purposeful in adjusting the spending levels," he said. "The town has scoured the budget in order to delay or reduce or cut any items we could in order to manage a short-term crisis."

All capital improvement and other projects currently underway will be completed, he said, noting that future projects on the action board are suspended until the recovery takes hold, as well as others being deferred, such as staff raises.

Little did the town council know when it adopted a $76 million budget for 2020 before the pandemic, down $3 million from the year before, that the dividends would pay off so soon.

"We're already reducing and conserving," he said. "We are now the beneficiaries of some really good decisions by town council that had some tremendous foresight. We're operating well under the lower budget and are being cautious and careful."

It helped that since this year's budget went into effect last July for the start of the new fiscal year, collections were strong for the first nine months. It helped to buffer the economic fallout from the pandemic.

"It helped offset and mitigate some of the pandemic effects," Troyer said. "We're managing under difficult circumstances. We're trying to be financially responsible ... and keep operations as slim and lean as we can."

So, what about the future?

"We've had an economic recovery plan since the pandemic began, and it's morphed and changed to adapt to what's happening in our world," Clark said.

"The lack of group and corporate travel has greatly impacted our hoteliers," she said "We're starting to see groups begin to look at travel for later next year, which is a promising sign. We remain nimble and flexible and cautiously optimistic about what the future of tourism holds, for not just our region but for our nation and our world."

"Hilton Head Island has fared better than many other vacation destinations and is well-positioned to recover its tourism business," the study reported.

Lowcountry resident Dean Rowland is a veteran senior editor and freelance writer.

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