Hospitality sector gets $125 million in federal funds from state budget

[April 21, 2022]  By Andrew Hensel | The Center Square

(The Center Square) – The new state budget allocates $125 million in federal taxpayer funding to help Illinois' hospitality industry after it was badly affected by economic restrictions during the COVID-19 pandemic.

The state's budget, which passed earlier this month and was singed by Gov. J.B. Pritzker Tuesday, contains $75 million for a hotel jobs recovery program and another $50 million for a restaurant employment and stabilization grant program.

During the COVID-19 pandemic, both industries were hit hard by the lack of tourism coming to the state after Pritzker issued mandates ranging from a stay-at-home order to capacity restrictions and gathering limits. In 2020, the hotel and lodging business saw its revenue dip by 44% when compared to 2019.

The restaurant industry also saw a revenue decrease of 49% when compared to the previous year, according to EnjoyIllinois.com

Michael Jacobson of the Illinois Hotel and Lodging Association said overall the budget that's set to begin July 1 is a success for the lodging industry "when you look at the combination of support that we have long been asking directly for the hotels and their workers was included at the amount of $75 million."

"We also had the unemployment insurance trust fund contribution to shore up so that doesn't fall directly on the backs of employers by tax increases," Jacobson said. "So that was a big success."

The state-approved $2.7 billion from federal COVID-19 funds to pay down some of the $4.5 billion in unemployment debt, but there’s still $1.8 billion in debt remaining and more work to be done, Jacobson said.

"Our two major asks were the hotel jobs recovery and the unemployment insurance trust fund," Jacobson said. "I know there is more still to be done, we still have left a pretty good-sized hole."

If the unemployment debt isn't addressed, taxpayers pay interest and the remaining debt would be filled with higher business taxes and decreased benefits for the unemployed. In the budget, lawmakers delayed a deadline for a deal to be made from July 5 to Jan. 1, 2023.

The food and beverage industry will also be receiving $50 million from the budget. That will come in the form of dedicated grants for restaurants and taverns and a waiver of state retailer liquor licenses fees for one year.

The Illinois Restaurant Association was pleased.

"The IRA thanks leaders in the House and Senate for appropriating this crucial grant funding for our industry, which will help restaurants in every corner of the state on a path to recovery." The statement reads. "Thank you to everyone that engaged in the IRA's call to action, met with legislators, and shared your stories to help secure this enhanced financial support for restaurants and their employees."

The dollars are coming from billions the state received from federal tax funds to help provide relief during the COVID-19 pandemic.

Andrew Hensel has years of experience as a reporter and pre-game host for the Joliet Slammers, and as a producer for the Windy City Bulls. A graduate of Iowa Wesleyan University and Illinois Media School, Andrew lives in the south suburbs of Chicago.