WASHINGTON, D.C. – Today, U.S. Senator Jacky Rosen (D-NV), Chair of the Subcommittee on Tourism, Trade, and Export Promotion, convened a hearing to examine the economic impacts of the COVID-19 pandemic on international travel to the United States, with a particular focus on the ripple effects in other industries, such as hospitality and tourism. It also reviewed the regional impacts of COVID-19 on the communities and workers hardest hit by decreases in international travel to the United States. Witnesses – including Nevada’s Rosemary Vassiliadis, Clark County Director of Aviation and head of McCarran International Airport in Las Vegas; William Talbert; President and CEO of the Greater Miami Convention and Visitors Bureau (GMCVB); and Christopher L. Thompson; President and CEO, Brand USA – provided insight into these critical issues and discussed solutions for supporting, promoting, and revitalizing safe international travel to the U.S., increasing international tourism, and supporting businesses and workers dependent on leisure and business travelers from abroad. A transcript of the Senator’s questioning can be found below, and a video of the Senator’s full exchange can be found here.
ROSEN: McCarran International Airport is the gateway to Nevada’s tourism-driven economy and is in normal times one of the busiest airports in the country and the world.
Ms. Vassiliadis, as you well know, before the outbreak of the coronavirus pandemic, McCarran was on track to surpass its previous record of 51.5 million passengers in 2019, with traffic up more than 6% in the first two months of 2020. This momentum stopped of course, as a result of COVID, and for the first time since the assassination of President Kennedy in 1963 – the Las Vegas Strip totally shut down. It brought air travel to a virtual halt. And, international travel to and from Las Vegas was hit especially hard – with just over 780,000 international travelers passing through McCarran in all of 2020, compared to 3.8 million passengers in 2019.
Ms. Vassiliadis, how has depressed international travel impacted America’s airports, including McCarran? What about the airport workforce and the small businesses that make up your concessionaries?
VASSILIADIS: Thank you, Senator. I think you hit it right on the head. The tentacles of this has such a huge effect. McCarran International Airport employs 16,000 people directly, but more importantly, indirectly and directly we support 25 percent of all the jobs in Southern Nevada.
So, [COVID] of course, did take a big toll on all the companies that do service the airlines, the airport, and the concessionaries by furloughs and some of the smaller companies not being able to make it through. Our international benefit is $6.2 billion, and what’s really important for our town is the per capita spent for the international visitor. It’s almost double that of the domestic visitor. Domestic is very nice, it’s almost $775 per [visitor]. But our international [spending per capita] is almost $1,500 per visitor. So, that is the stimulation that we absolutely need to have back, not only for the airport, but for all of the companies in Southern Nevada.
ROSEN: I’d like to move now to international travel promotion because the American Rescue Plan Act set aside $750 million in grants to assist states and communities that have had job and GDP losses in the travel, tourism, and outdoor recreation sectors.
Congress allocated these funds – part of an effort spearheaded by my colleague from Nevada, Senator Cortez Masto – because we recognized that the pandemic disproportionately impacted states like Florida, Alaska, Nevada, Missouri, whose communities are dependent on travel and tourism.
In April, I joined Senators Cortez Masto, Klobuchar, and others in sending a letter to Commerce Secretary Raimondo requesting that the Department not only disperse these funds expediently and responsibly, but also make clear that tourism marketing and promotion activities are eligible for such funds, so that we can help increase safe travel that can drive the economy.
Mr. Thompson, these direct funds to communities will supplement some of the international travel promotion work that Brand USA does, but they won’t go to every city and state in need. That’s where you come in.
I’m worried, though, that with your funding tied to international travel fees that are already down, Brand USA might not have the resources to support its mission and enhance the efforts we really need coming out of COVID.
Are you [Brand USA] financially equipped to help the U.S. recover from the worst international tourism drought in modern history? And if not, what do you need [Congress] to do to help?
THOMPSON: Chairwoman Rosen, you are exactly right. This pandemic brought our industry to its knees. It disproportionately affected the hospitality industry. We often talk about how the things that make the U.S. the U.S. is what we use to attract people to the U.S.A., but it’s actually the fabric of our communities. I think this pandemic and its impact on our communities has brought that to the forefront.
I think our industry lost nearly 20 percent of its overall jobs, and that represents nearly one third of all the jobs that were lost. Many of our most invested and engaged partners are at the local level. Their funding source has been bed taxes, and those were pretty much cut off. Although it hit them right away, it was a delayed reaction to us, because our funding source is dependent on international visitation, and it is dependent on what is collected in the year prior. When we got into this current fiscal year, there was not $100 million for us to match.
As we’re coming out of this pandemic, as the domestic traveler economy has come back – probably quicker than anybody had anticipated – a lot of what is returning our travel and tourism industry to what it needs to be in order to reach the levels in the past is great, and that domestic tourism has to come back before we can do our international tourism, but we’re going to be ill-prepared to respond when the time is right.
So, our challenge is the funding source, our challenge is lack of funds in that source, and that’s why – in working with the Travel and Tourism Advisory Board within the Department of Commerce – they came up with the recommendation that in the interim, we would need some help that’s outside of what we would normally need.
Our funding model – there was nothing wrong with our funding model, it just got its knees knocked out from under it, and we need a bridge to get us from where we are now so that we will be resourced when we have the opportunity, when the time is right to start promoting international travel.
So, the measures that they laid out, that I highlighted in my oral testimony and the written testimony are the ones that will be really helpful to put us in the best position to be able to help the industry when they need it and what they depend on us for.
ROSEN: Thank you.