California tourism businesses

Jul 15, 2020
California tourism businesses

California tourism businesses have provided plenty of stories of resilience and cooperation during the coronavirus pandemic.
Few are as compelling as the partnership hotels have forged with state agencies in Gov. Newsom’s efforts to protect homeless people and other vulnerable populations.
As the pandemic emerged, sheltering California’s most needy became an urgent priority, and Gov. Newsom suggested that he may need to commandeer accommodations. For an industry segment already feeling deep economic pain from the beginning of the crisis, the idea that government would seize properties generated more than a little anxiety.
But the industry came forward, made deals and regained some financial footing when traditional occupancy ceased to be an option.
By mid-April, the governor had announced the state had negotiated for almost 11,000 rooms to house 4,211 individuals. By the end of June, “Project Roomkey” had signed up 15,679 rooms to house 14,200 people. Nearly 300 hotels in 52 counties have participated.
For Rob Pelleschi, CEO of G6 Hospitality, operator and franchisor of Motel 6 properties, including more than 140 in California, stepping up was never in doubt.
The company worked out a landmark template occupancy agreement for company-owned hotels and franchisees. In April, Gov. Newsom chose a Motel 6 in Campbell to detail the program’s progress, and he announced Motel 6 had set aside 47 California properties -- more than 5,000 rooms. The company also helped Los Angeles County implement a property management system.
“We said, ‘we stand shoulder-to-shoulder with the state, however we can help,’” Pelleschi recalled in a recent interview on the “No Vacancy” podcast. “If I could get rid of one word in our industry it would be ‘competitor’… we’re all peers. We’re all trying to do the right thing.”
The program, funded largely with money from the Federal Emergency Management Agency, has been extended on a month-to-month basis. The state budget Gov. Newsom just signed provides $550 million to purchase a variety of housing types, including hotels and motels, for the homeless population. Project Homekey, he said, will afford “a sense of permanency, a sense of place, a framework of opportunity” for vulnerable Californians.

The weekly consumer sentiment data from SMARInsights arrived Tuesday with little change – more than half of Californians are planning to venture out as little as possible over the next week.

Drilling down on the California numbers, nearly two-thirds of Californians believe tourism is important to local businesses and local economies. But the percentage of residents ready to welcome tourists back to their area has slipped in six weeks from about a third to less than a quarter.

All bars and restaurants in California are now subject to the same state rules after Gov. Newsom this week broadened the application of restrictions that already were in place for 30-some counties on the watchlist for having coronavirus caseload spikes.
Bars and breweries statewide now may serve customers only outdoors and only if they have sit-down food service and sell alcohol and food in a “single transaction.” That means meals prepared by third parties, such as food trucks parked at a bar or brewery, must be purchased in the same transaction as the alcohol.
These rules have evolved over time and now don’t allow bars and breweries to meet the meal standard by serving just popcorn, peanuts or other snacks. The state Department of Alcohol Beverage Control has issued detailed rules about what constitutes a meal. 

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