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April 22, 2021

Legislation would create recovery fund for Maine hospitality businesses

a large building with a copper dome on top File Photo / Maureen Milliken Maine's state government is in line to get $997,495,130 in funding through the American Rescue Plan.

The Maine Legislature will consider a bill that would provide recovery grants for hospitality and tourism businesses in the state that have lost revenue because of the COVID-19 pandemic.

Money for the fund would come from any federal stimulus or relief federal aid the state got this year, as well as public and private sources. The bill, LD 1493, was introduced by state Sen. Joe Rafferty, D-Kennebunk, and is before the Committee on Innovation, Development, Economic Advancement and Business.

"The tourism industry in Maine makes up for a massive part of our economy, but an even larger part of who we are," Rafferty said. "Standing up for our small businesses that make Maine ‘Vacationland’ is the right thing to do.”

He said the help is vital in light of the fact that one in six jobs in Maine is linked to the tourism industry, which in normal times accounts for $6.2 billion a year, more than 10% of the state’s economic output.

The program would be overseen by the Department of Economic and Community Development, which has administered other COVID-19 grant programs. There would be a revolving application system with grants allotted on a first-come, first-served basis until the fund is depleted.

Greg Dugal, director of government affairs for HospitalityMaine, told the committee Tuesday that the fund would be a welcome addition to funding programs last year that kept many businesses afloat.

"People tell me every day that they would not still be in business if not for receipt of some or all of these grants," Dugal told the committee. He said that the proposed grant program, coupled with the Restaurant Revitalization Fund recently established by the American Recovery Act, "businesses should get enough capital to restart or ramp up their service to busy summer levels and we would very much appreciate that help."

"Things are still not normal at this time and may not be for some time to come," he added. With restaurants still at 50% capacity and an increase to 75% on May 24, their revenues will still be affected, and the 6-foot distancing rule makes it impossible for many restaurants to even achieve between 60% to 75% occupancy, he said.

The money would be for businesses that had revenue and profits in the 2020 calendar year that were less than those of the previous year, and had gross annual sales between $24,000 and $12 million before 2020.

Excluded from the grants would be gambling and adult entertainment firms, as well as country clubs and golf clubs and fraternal and social organizations. There would also be a number of financial restrictions.

Some who testified, including Dugal and Dirk Gouwens of the Ski Association of Maine, said that restrictions in the bill should be looked at more closely.

"To be clear, ski areas are in need of economic assistance after a difficult ski season," Gouwens said. "However, some of the restrictions in this resolve would not be favorable to ski areas. We are also confused about why golf courses are exempt from this program. Several of our ski areas have golf courses."

He encouraged the sponsors and the committee to continue to push DECD to establish economic recovery grants for Maine tourism businesses like ski areas, but also to wait to see whether guidelines from the federal government would be more inclusive and assist more businesses in need.

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