With millions unemployed, hotel industry lobbies to spend stimulus on other needs
Hotels were among the earliest businesses to feel the economic sting from coronavirus shutdowns and the first to ask Congress for aid, as top executives hurriedly met with President Trump to ask for $150 billion in mid-March.
But less than three weeks after Trump signed the stimulus package into law, hotel owners say they may not even be able to use the funds unless Congress makes changes.
One provision, for instance, requires that hotel owners rehire their staff by the end of June, even though many owners say they have little idea when the business will return.
Bookings at her Econo Lodge outside Buffalo began disappearing in early March, said Julie Stone, a third-generation owner of the property. When business dropped off completely, she laid off 12 of her 14 workers. She has applied for a small-business loan from the stimulus package but isn’t sure she could use it if she gets approved.
“If this sickness drags on and on, then I need my people when I am ready to really go back to business,” she said. “It’s not clear that if I get a check tomorrow, is that good? Because I don’t really need them right now because I don’t have any business.”
Altering the legislation, as the industry’s top lobbying group called for in a letter to congressional leaders April 8, carries its own concerns. Workers and unions say the multibillion-dollar chains that own the hotel brands, such as Marriott and Hilton, are angling to use the $2 trillion stimulus package, called the Cares Act, to prioritize payments to shareholders and Wall Street lenders over workers.
One proposed change in the letter to congressional leaders from the American Hotel and Lodging Association would allow hotel owners to use more of the stimulus money on fixed costs such as franchise fees, which they pay monthly to the chains, even as workers remain home.