The COVID-19 pandemic has significantly impacted the Las Vegas economy, particularly affecting casinos and associated businesses. However, Nevada Senator Catherine Cortez Masto hopes that a new bill will bring some respite to these struggling sectors.
Recently, Democratic Masto and Republican Sen. Kevin Cramer introduced a new bipartisan bill named the Hospitality and Commerce Job Recovery Act of 2020. This legislation aims to offer relief and recovery measures to certain industries.
- Conventions
- Trade shows
- Entertainment
- Travel
- Hospitality
The resurgence of visitors will also have an effect on employees across all industries. Pew research reveals that leisure and hospitality workers make up 25% of Nevada’s workforce. As more job opportunities arise, more money will be injected into the local economy.
This proposed legislation could significantly impact the economy of Las Vegas, which hasn’t hosted a major convention since the Consumer Electronics Show in January. Leisure travel has gradually resumed during weekends, but weekdays remain relatively quiet in casinos and related businesses. Normally, these weekdays are bustling due to conventions filling up hotel rooms, restaurants, and bars.
Proposed bill needed to stimulate Nevada economy
Masto stated that the Hospitality and Commerce Job Recovery Act is designed to stimulate the Las Vegas economy as well as economies nationwide. She explained that the bill would establish new recovery incentives for the hospitality sector and trade shows. Additionally, it would enhance the employee retention tax credit.
In summary, this bill would assist in preserving the relationship between workers and their employers. Furthermore, it would provide incentives for families to travel when it is considered safe.
Masto said that hospitality, travel and tourism need the assistance.
The COVID-19 pandemic has wreaked havoc on industries and economies nationwide, with Nevada’s hospitality, travel, and tourism sectors bearing the brunt of it. These sectors are the financial lifeblood of our state and our communities. The immense difficulties they are currently grappling with due to the coronavirus necessitate our focus and intervention in Congress.
This legislation aims to assist both employers and employees during the gradual path to recovery.
A look inside the Hospitality and Commerce Job Recovery Act
The proposed legislation aims to bolster the convention and trade show sectors through several methods. It stipulates that companies should be given a tax credit for expenses incurred while attending or organizing a convention, business gathering, or trade show in Nevada from January 1, 2021, to December 31, 2025.
The potential impact of the bill could extend to major corporations and smaller regional businesses seeking to hold socially distant gatherings, providing a significant incentive for businesses of all sizes to revisit Las Vegas.
This would notably impact MGM Resorts, Wynn Las Vegas, The Venetian, and other Vegas casino operators. All of them have unveiled fresh health and safety protocols for meetings and conventions. Staff at all these firms, as well as nearby eateries and bars, would likewise experience the effects of the tax credit from businesses choosing to come back to Las Vegas.
A further credit will be directly provided to Nevada restaurants. The proposed legislation aims to bolster the restaurant industry by implementing a tax credit for establishments in the food service sector. The credit will absorb any expenses arising from reopening or expanding service at facilities that had to shut down or scale back operations due to the COVID-19 pandemic.
This credit, which covers the costs of renovations, testing, and labor required to prevent COVID-19 spread, will stay effective until December 31, 2022.
Plenty of support for the bill
Local and national representatives in the travel, dining, and gaming sectors support the Hospitality and Commerce Job Recovery Act.
The following is from Tori Barnes, who is the Executive Vice President of Public Affairs and Policy at the US Travel Association:
The Hospitality and Commerce Job Recovery Act aims to significantly boost travel jobs by focusing tax incentives on the areas that need them most, such as the meetings, events, and entertainment sectors. This will help secure financial stability for the millions of Americans who depend on travel for their income.
The following is from Virginia Valentine, the President of the Nevada Resort Association:
We commend Senators Cortez Masto and Cramer for their proactive steps to prevent long-term job losses and additional harm to our beleaguered industry and workforce, by concentrating on practical solutions.
Nevada’s resort industry is working tirelessly to recover and safely return Nevadans to work, but achieving economic normalcy is anticipated to take years. The bipartisan Hospitality and Commerce Job Recovery Act is set to expedite this recovery, offering immediate relief to Nevada families and businesses reliant on the meetings, conventions, travel, and tourism industries.
Lastly, a statement from Bill Miller, who is the President and CEO of the American Gaming Association:
“The Hospitality and Commerce Job Recovery Act, which has bipartisan support, will empower the gaming industry to keep its employees and boost non-gaming aspects such as meetings and conventions. These elements constitute the majority of our revenue in areas such as the Las Vegas strip.”
A long road to recovery
In an attempt to mitigate the spread of COVID-19, Nevada casinos were mandated to shut down in mid-March. They received permission to recommence operations on June 4. However, the recovery process is still sluggish, owing to the fact that people remain hesitant about travelling and inhabiting large public areas.
The recovery from the effects of COVID-19 in Las Vegas won’t be swift. Conversely, regional casinos across the nation should see a relatively fast improvement in business. These establishments primarily rely on leisure travelers who are within driving distance. These visitors have already begun to return to the casinos.
However, Las Vegas casinos are a unique beast. These establishments rely on local patrons as well as tourists and businesses from both the US and globally. The restoration of business and international travel, along with leisure travelers flying to Las Vegas, will take an extended period.
The Las Vegas Convention and Visitors Authority’s 2019 profile revealed that 49% of visitors reached Las Vegas by airplane. There has been an annual increase in the number of visitors flying into Las Vegas since 2015. However, the COVID-19 pandemic has significantly reduced this number.
A full recovery for Las Vegas, in terms of Americans and international visitors flying in as frequently as they once did, may not occur until 2025, a Fitch Ratings Service analyst said this week. It will likely take some time for this to happen.
The Hospitality and Commerce Job Recovery Act could potentially expedite Las Vegas’ recovery.
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