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Shutdown costly for industry

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October 23, 2013

Shutdown costly for industry

As the U.S. government got back to business last week, the travel and tourism industry assessed its losses and began to look at ways to minimize the impact of any future federal government shutdown.

In a letter to President Obama and Congress earlier this month, the U.S. Travel Association estimated that a partial government shutdown would cost the country $152 million a day in lost travel-related activity. With the shutdown lasting 16 days, the expected losses would total more than $2.4 billion.

As a result of the shutdown, the U.S. Department of the Interior said it had no choice but to close all 401 national park units and furlough more than 20,000 National Park Service (NPS) employees. Approximately 3,000 employees were exempted from the furlough to ensure property protection and human safety at the sites.

Domestic tour operators and travel suppliers with product and itineraries that depend upon the national parks, monuments and museums reported suffering heavy losses as a result of the closure of those sites.

NPS data indicate that in October, the parks typically welcome more than 700,000 people per day and generate an estimated $32 million per day in visitor spending.

The losses to destinations that depend on the parks to attract visitors grew so great during the shutdown that the states of Utah, Colorado, South Dakota, Arizona and New York decided to reach into their own coffers to reopen some of the most popular parks and federally funded sites for as long as the government remained closed.

New York Gov. Andrew Cuomo set aside $61,600 per day to pay the salaries of NPS personnel who were needed to keep Liberty Island National Park open during the shutdown, enabling the Statue of Liberty to reopen on Sunday, Oct. 13.

That same weekend, Utah Gov. Gary Herbert reopened his state?s five national parks, Cedar Breaks and Natural Bridges national monuments and the Glen Canyon National Recreation Area at a cost of $166,572 per day.

Similarly, Arizona Gov. Jan Brewer negotiated an agreement with the U.S. Department of Interior to reopen Grand Canyon National Park using state and local funds. The state paid the NPS $93,000 per day to reopen the Grand Canyon and maintain park operations for up to seven days.

Reimbursement unlikely

Whether or not the states will be able to recuperate any or all of those funds remains unclear. They were reportedly allowed to finance the reopenings based on the understanding that they likely would not be reimbursed once the shutdown ended. But the state of Arizona said last week it was urging its congressional delegation to secure reimbursement of all state dollars used to reopen the Grand Canyon.

However, Cuomo said that would require legislation.

?These payments will not be reimbursed unless Congress passes a law to provide refunds to individual states,? Cuomo said in a statement.

Click here to read more.

Source Travel Weekly,

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