Travel, accommodations, hospitality seek bailout as federal fiscal update slated for Monday

The federal government will present a fiscal economic update on Monday and the Northwest Territories Chamber of Commerce is calling for a bailout for tourism and related sectors that have struggled this year due to Covid-19.

"Hospitality, hotel accommodations and tourism are the three hardest-hit sectors and nothing short of a sector bail out needs to be considered," said chamber executive director Renee Comeau in a Nov. 25 email. "We have heard time and again that the federal government isn’t wanting to offer sector-specific supports but as we move closer to one full year into this pandemic, these sectors need injections, as they have years before they can even consider any form of normalcy."

Comeau stated that for the government to arrive at an appropriate response for Northerners, decision-makers need to respect the distinctions among businesses represented within these sectors.

"Time and again we see the accommodations sector lumped into tourism, same with hospitality, and they are quite separate.

"Specifically, here in the NWT, our hospitality is operating on the tiniest of margins, if any margins at all," she said. "But (they) are the only sector that is subjected to weekly inspections, which is an additional level of stress that is unnecessary."

Ed Romanowski, president and chief operating officer of Nunastar Properties, which owns Explorer Hotel, said he has been advocating for Northern hotels and he's trying to get federal and GNWT ministers to understand their unique contribution to the Northern economy.

Romanowski points out that, unlike in the south, Northern hotels rely on only a very small percentage of vacationers or leisure travellers. Instead, hotels in the North tend to be more aligned with necessity-based travel, such as for government, business, corporate and health care.

He agrees with Comeau that a federal bailout that would help hotels break even – particularly those in small communities – is "desperately needed."

"This would be not to support for profitability but to just survive because in the North, hotels are more of a critical part of Northern infrastructure," he said. "Without hotels, it is hard to do anything. How can you bring doctors into communities? Or experts to help train people? Or advisers for economic development or politicians? The list goes on and on and it is not something that you can just say 'the heck with them.' So that is the reason I'm advocating hard for at least sector support with enough to assure it breaks even."

Romanowski reiterated numerous times that the impacts of the pandemic are felt most acutely by smaller communities where there tends to be only one accommodation-type business.

He added, however, that it has been an especially tough year for the Explorer Hotel, too.

"In terms of the business that we normally do, we are probably doing 40 per cent," he said.

At this time of year, the hotel is typically between 60-85 per cent full.

These days, and heading into the new year, the hotel has been seeing and planning for being anywhere between 20-30 per cent full. Romanowski added that it wouldn't be shock for that figure to drop into the teens in the coming months.

"Last March at the Explorer Hotel, we would have had 117 people on payroll," he said. "Now we have about an average of around 45 or 46 people on payroll."

This has spiraling impacts for the North, including some staff being forced to leave for the south to seek assistance from family members, and it reduces the hotel's ability to support charitable causes in the community, such as food banks, said Romanowski.

GNWT response 

Romanowski sent letters to the federal Economic Development Minister Melanie Joly in June seeking support as well as to Premier Caroline Cochrane and NWT Industry Minister Caroline Wawzonek in September.

In the latter letter, he sought assistance for tourism and related sectors following an announcement by the Yukon government. They provided support to that territory's industry through the Tourism Accommodation Supplement at up to $400 per room per month between October and December 2020 "until the point of break even for each hotel."

"To put the Northwest Territories’ accommodation sector on equal footing, it is of great importance that consideration be given to a similar program in the NWT," Romanowski wrote. "The accommodation sector is very important in the NWT due to the role it plays in supporting government services, health care, airlines, personal travel, etc."

Wawzonek replied with a Nov. 20 letter stating that her department is reviewing Yukon's Travel Accommodation Supplement and trying to best identify funding gaps for the tourism sector. 

She added that she and tourism ministers across the country are calling for more federal support in the sector. She also attended the Northwest Tourism Association annual general meeting earlier in November, where delegates voiced their concerns for both the short- and long-term, she wrote.

"Our government understands that the situation facing the tourism sector, including the hospitality sector, is grave, especially if the need for travel restrictions continues for some time," Wawzonek stated.