Report: Federal shutdown cost Yosemite businesses $6.7M

Merced Sun-Star and The Fresno BeeMarch 3, 2014 

The federal government shutdown last October cost communities near Yosemite National Park an estimated $6.7 million in reduced spending by visitors, according to a new report.

Issued Monday by the U.S. Interior Department, the report says that nationally the shutdown cost communities that are gateways to national parks $414 million in spending by visitors. Yosemite had 3.85 million visitors who spent $378 million despite the shutdown, the report says.

Government shutdowns such as the 16-day hiatus in October harm local economies near the parks because they are dependent on visitor spending, Interior Secretary Sally Jewell said.

The government shutdown resulted in about 8 million fewer visitors nationally, Jewell said. Five states, including California and Arizona, lost more than $20 million during the shutdown, the report says.

The timing of the shutdown was especially bad for businesses. “October is a very important month for park visitation,” National Park Service Director Jonathan Jarvis said.

The situation in the Central Sierra was made worse by the massive Rim fire, which closed roads and limited transportation in the region, driving away tourists in mid-August, the peak of the season.

Mary Foster, owner of the Mariposa Hotel Inn, said her business has yet to recover from financial damage the shutdown caused. Foster said the federal closure drove tourists to other destination spots, costing her money she can’t recoup.

“We’re a very seasonal business,” Foster said. “The money we make in the fall has to last us all year. With the (Rim) fire and then the closure, we just didn’t have enough business. If it (a shutdown) happens again, we’ll be out of business for good.”

Foster said she closed her hotel’s doors for two weeks in February to curtail overhead costs during the traditionally slower winter months.

“We’re starting to get some reservations coming in for the summer,” Foster said. “Hopefully that will turn things around. I think it will; I’m optimistic.”

Kathy McCorry, chief operating officer of the Mariposa County Chamber of Commerce, said the county will feel the long-term effects from lost hotel taxes.

“There’s the immediate impact of what was lost during the shutdown, but the long-term impact is what we’ll feel if we don’t make up for the lost ... taxes,” McCorry said. “Where do we take the cuts in county spending to balance the budget?”

Richard Benson, Mariposa County’s chief administrative officer, said the shutdown cost county businesses at least several million dollars.

One businessman who felt the effect is Steve Eicholtz, owner of The Bed of Roses bed-and-breakfast inn near Coarsegold.

“We probably have 90 percent of our business being Yosemite-related,” Eicholtz said. “When the National Park Service was shut down, that was a gigantic issue in Europe and Asia in terms of bookings.”

Unlike the hotel industry, a local Mariposa winery saw a slight increase in business during the government shutdown.

“People had made plans to come to Yosemite, and when they came down and realized the park was closed, they were looking for other things to do,” said Harold Casto, 76, co-owner of Casto Oaks Fine Wine & Art. “They already had reservations, and when they couldn’t get into the park they came down here.”

Casto acknowleged the park’s huge impact on local businesses. “If the park closes, we might as well move Mariposa to another state,” he said, “because it’s dead in the water.”

Another report issued Monday, “2012 National Parks Visitor Spending Effects,” shows the powerful influence a park can have on a local economy. It breaks out spending and jobs for every national park.

In 2012, the national parks had 282 million visitors, generated $26.75 billion in economic activity and supported 243,000 jobs in restaurants, hotels, grocery stores and businesses such as outfitters, the report states.

For every dollar spent by the National Park Service, $10 of economic activity is generated, Jewell said in a telephone news conference with reporters.

“That’s a good return” on investment, she said.

Of the jobs created, more than 200,000 were in gateway communities, defined as within 60 miles of a park, according to the report.

At the edge of that 60-mile radius is Merced, which sees Yosemite tourism spillover, according to Tammia Gunnuscio, general manager at Hampton Inn and Suites in Merced.

Gunnuscio said tourists from out of the area or out of the country often go to the park without reservations and end up heading back into Merced when they find no rooms.. “We definitely get a lot of backflow,” she said.

From April to November the hotel gets about half of its business from tourists who will or have visited the park. When the park closed for 17 days in October, many of the roughly 25 staff members saw their hours cut. “People did feel the crunch,” she said.

Sun-Star staff writers Thaddeus Miller and Rob Parsons, and The Associated Press contributed to this report.

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