Business improved for some hotels and restaurants this summer after pandemic-related disruptions during the spring, but representatives of the hospitality industry say they’re still suffering.
Bob Fuchs owns restaurants and a winery and brewery in the Black Hills, including the Firehouse Brewing Company. He testified virtually Monday to the Legislature’s Joint Commerce and Energy Committee.
“The city of Rapid City actually shut our business down for a couple of months," Fuchs said. "During that time, between all of our locations, we’re probably down a million dollars.”
The pandemic-related shutdown happened during the spring. Fuchs said the summer brought more customers. But the federal government offered unemployed workers an extra $600 a week in benefits. Fuchs said that encouraged workers to stay on unemployment longer and made it difficult to hire help. So his restaurants were only partially staffed.
“Throughout the summer I was probably short at least 30 people the whole time," he said.
Hotels are facing similar struggles. Jasper Diegel, executive director of the South Dakota Hotel and Lodging Association, told the committee that statewide occupancy is down 25 percent compared to last year.
“Yes, there were some shining lights here in the summer and it did get better in July and early August," Diegel said, "but by no means are hotels out of the clear.”
The Commerce and Energy Committee is one of several legislative committees taking testimony on federal pandemic relief money. State government received $1.25 billion in aid. About half of the money remains unspent or uncommitted.
Governor Kristi Noem wants to use $400 million for grants to small businesses. The committee made several recommendations Monday to ensure the program reaches businesses and nonprofits that need the help.
Noem also announced Monday that she’s calling a special legislative session on Oct. 5 for legislation dealing with the remaining federal aid.
-Seth Tupper is SDPB's business and economic development reporter.
