Yukon hotels get new funding to help with COVID-19 downturn

The Yukon government is pledging to help save hotels and rental cabins from bankruptcy this winter, giving business owners up to $400 per room each month until 2021.

Jeanie McLean, Yukon's minister of Tourism and Culture announced on Monday $2.88 million in new "funding for businesses to stay alive."

"We need them to be here when tourism comes back," said McLean. Visits to Yukon by road and air have declined more than 90 per cent during the COVID-19 pandemic.

The Tourism Accommodation Sector Supplement will give funding to accommodation businesses which have already maxed out funding from existing programs such as Yukon Business Relief Program.

Accommodations that remain open until January can get up to $400 per room a month between Oct. 1 and Dec. 31, until they break even.

McLean said the goal is to keep hotels from shutting down, and this will help hotels "meet their break-even requirements."

She said this is one part of a larger funding package of up to $15 million over three years, as relief for Yukon's tourism industry.

Funding comes too late, says opposition

But Yukon Party MLA Wade Istchenko said the funding comes too late, now that the summer tourism season is over.

The industry suffered "complete and total devastation," Istchenko said, speaking in the Legislative Assembly on Monday.

He questioned why it took government "until our streets and driveways were covered in snow" for the announcement. He also asked for answers on when travel restrictions will lift.

McLean said there is "no room for politics" in helping the tourism sector, saying this is a long-term effort.

She said the government will have further announcements which will cover other sectors, including the guided tour and restaurant industry.

About 1,200 eligible rental rooms

A government spokesperson estimated there may be 1,200 rental rooms eligible for the funding. Eligible businesses must have three or more individual rooms, suites or cabins available as short-term rentals.

There are about 1,600 rooms in the Yukon, she said, however a number are shut down for the winter.

Several smaller accommodations may already have enough support from existing programs to make it through the winter, said Alicia Debreceni, a communications analyst with Tourism and Culture.

The businesses have to prove they operated at a loss for every month they apply for support. The deadline to apply is February 15, 2021.

"We know we have to work hard with our partners to protect the infrastructure that we have," said McLean.

"We have some large hotels in Yukon that we need to have around if we're going to have a tourism sector at all. Some of them have already maxed out their access to the Yukon Business Relief Program, and we know this sector needs to be supported through this difficult downtime."

Industry association says hotels have been in 'crisis mode'

Neil Hartling, chair of the Tourism Industry Association of the Yukon, said the new measure is "definitely what the industry was looking for."

Hartling said hotels have been in "crisis mode," in Yukon and says some have been considered too big for relief funds targeted to small business. 

One fear is that hotel closures now would hamper future recovery in tourism.

"It's super important that these accommodations are able to continue to be dedicated to tourism. If that relief didn't come, they would have to be re-purposed and we would lose them, and it would take a decade to get back," he said.   

Funds allocated for long-term revival and marketing

The Yukon government is also pledging for future marketing and longer-term recovery, to inspire tourists to return.

"The borders do remain closed but this is a longer-term plan," McLean said.

"When it is safe to do so, Yukon will welcome the world again."

The government says the funding package was informed by consultation with the Yukon Tourism Advisory Board and consultation with tourism businesses, First Nations and NGOs.

McLean said that in 2018, tourism was the second largest contributor to Yukon GDP at five per cent. The sector at that time accounted for 13.5 per cent of Yukon employment, which is about 3,500 jobs.