Hospitality industry sees decrease in revenue during pandemic

Hospitality industry sees decrease in revenue during pandemic

JONESBORO, Ark. (KAIT) - The Jonesboro A&P Commission spent Thursday afternoon, discussing the 2020 budget in light of the pandemic.

The year 2020 started out strong for the hospitality industry in Jonesboro, but with COVID-19, it’s taken a harder hit than anyone.

In May, revenue fell 55% for hotels.

The trend continued in June at a 51% loss.

A&P Commission Chairman Jerry Morgan said while we have seen a decline, Jonesboro is faring better than other cities.

“Other cities have seen downturns, cumulative for this year of anywhere from 40-50%. So far, for the first seven months of the year, we’ve only been down 14%,” said Morgan. “Obviously, the last couple of months were a lot worse than the first so we’re just still waiting for the rest of the year to see how that ends up altogether.”

The commission is estimating being down around 30% for the rest of the year for each month, but that number could change.

The A&P commission also said they will have to make significant cuts to grant funding this year, due to the loss.

“All of our funding comes from the hotel tax revenue,” said Morgan. “We’ve got new things that have got to come online and we’ve got to be able to create funding for that to continue to keep it fresh in Jonesboro and keep people coming into the hotels for the revenue.”

Officials said that reducing funding for longstanding programs is something the committee has also been working toward.

The commission also approved delaying their contract with the convention center.

The contract is to reimburse the center’s tax dollars, up to $2.5 million for 10 years.

“With the conventions being canceled this year, we thought it was only fair and right to just extend the beginning of the contract,” said Morgan. “They’ve made an over $55 million investment into our city and we’re excited for when the COVID restrictions do get lifted that we had a lot on the books that will continue to come into our city.”

Now, the contract will start in July 2021, instead of starting when the hotel opened in January of this year.

The application for the grant funding has also changed, due to the pandemic-

You can find that application here.

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