Saratoga Springs ponders a tourism-free summer to a tune of $979 million

Saratoga Springs ponders a tourism-free summer to a tune of $979 million

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Locked main gate at the Saratoga Race Course on April 2 in Saratoga Springs. The tourism bureau in Saratoga Springs says the city and region could lose nearly a billion dollars if Saratoga Performing Arts Center and New York Racing Association are affected. 

SARATOGA SPRINGS — On a typical spring day in the city, excitement is palpable. Flowers are placed in street-side planters, outdoor tables are pulled from storage, and sidewalk racks with Saratoga wares are rolled out. It’s all in anticipation of the city’s May-to-September high season that has made the Spa City one of New York state’s premier tourist destinations.

But this year will be different. The COVID-19 pandemic has either shuttered or slashed the operations of shops, restaurants and hotels. Typically bustling Broadway is eerily quiet. The hotels are welcoming few guests and usually scarce parking spots are plentiful.

The desertion of downtown is leaving many in the city fearful that the region’s tourism cash cow — estimated by Saratoga County’s economic development organization to result in $979 million worth of impact each year — will dwindle away.

While Gov. Andrew Cuomo’s current stay-at-home order ends in two weeks, and the federal government has urged people to social-distance until the end of April, there is a common belief that the pandemic could freeze business and recreational activity in Saratoga until into the summer.

“If this goes into May, it will have an effect,” said Marianne Barker, co-owner of Impressions of Saratoga, a 42-year-old shop on Broadway selling Saratoga souvenirs and locally crafted items. “We are lucky, because we’ve been here a long time and have resources. But if we are looking at the end of April and early May, I’m very concerned.”

If current social-distancing rules are kept in place through the summer, they will force the closure of the city’s two biggest economic drivers — the Saratoga Race Course and the Saratoga Performing Arts Center. Based on figures from the New York Racing Association and SPAC, the two venues combined attract about 1.5 million people to the city each summer, with a total economic impact of $337 million on Saratoga and much of the Capital Region.

But NYRA spokesman Pat McKenna insists there is no reason to panic about the Saratoga race season, which last year attracted 1,056,053 paid attendees who wagered a record-setting $705 million — a sum that bested 2017’s haul of $677 million.

“While we are monitoring the current conditions and consulting with the New York state Department of Health, we are planning for Saratoga to open as scheduled and run in its entirety across the 40-day meet,” McKenna said. The 2020 season is currently scheduled to launch July 16.

McKenna would not say if the track would considering running its races without fans in the stands, as is currently happening in Florida and California. The usual April 15 opening of the Oklahoma Track, Saratoga’s training circuit, will be delayed, but he said “this decision does not impact the start of the Saratoga racing season.”

SPAC’s President and CEO Elizabeth Sobol is more cautious, and said that if the shed is not fully operational this year, the impact on the city would be “severe.” The Dave Matthews Band, which typically sells out its two-show stand at SPAC every summer, still has its July 10-11 performances scheduled. The band was recently forced to cancel all its April shows in Australia because of pandemic shutdowns; the band currently expects to be off the road until mid-June, according to Matthews’ website.

“It’s hard to even contemplate the impact on Saratoga if the total attendees through the gate starts to drop by tens of thousands, not to mention hundreds of thousands, of people,” said Sobol. “We are preparing for the worst — and hoping for some version of ‘the best,’ obviously monitoring and adjusting on a daily basis.”

The Saratoga Casino Hotel, which attracts about 1.6 million visitors a year, has been closed since mid-March after the initial state shutdown of gatherings of more than 500 people. (On March 20, the state banned non-essential public gatherings altogether.)

Amy Brannigan, the hotel’s senior director of marketing, said the casino has furloughed 98 percent of its staff of about 600 people. She said the losses in sales and bed tax will also mean that the city and Saratoga County will take a hit on their revenue shares.

James Featherstonhaugh, one of the hotel’s owners, said he doubts the casino will reopen before June or July — and he’s skeptical about people’s desire to quickly resume normal leisure habits.

“Money that is being lost now will never be recovered,” Featherstonhaugh said. “The question is how long, if ever, will we return to this same level we had before. It will take a long time because the habits people are forming now — with social distancing and lack of doing things in large groups and venues — won’t change immediately.”

Tourism Economics, the company that came up with the nearly $1 billion figure for the value of tourism in the area for the year 2018, said visitors to Saratoga spent $589 million; $321 million was paid in wages for 11,500 workers, and another $69 million went to state and local taxes. The Saratoga County Prosperity Partnership, which released the study, said two-thirds of businesses had been anticipating growth before the pandemic, with 70 percent planning new investments and 50 percent adding employees.

But by mid-March, as coronavirus infections increased and New Yorkers were told to stay home, those plans were largely scrapped and most businesses have gone into survival mode. A March survey of 234 businesses in Saratoga County, also conducted by Prosperity Partnership, found that 93 percent were being directly affected by the pandemic. Also, 59 percent said they were laying off employees and faced the risk of closing. Another 78 percent said they have business interruption insurance — but their policies don’t cover pandemics.

Darryl Leggieri, president of the Saratoga Tourism and Convention Bureau, said it’s impossible to know what is going to happen, because “this is nothing we have ever seen before.”

In March and April alone, Leggieri said, the city lost 16,000 group hotel room bookings, and the number continues to climb.

Saratoga Springs City Center, which brings in 250,000 people to the city each year, has lost 20 conference bookings so far and furloughed most of its back-of-the-house staff.

“The good news is there are groups that have canceled conventions but are rebooked in 2021,” Leggieri said. “My team is working diligently to keep them on the books in our destination. If we can’t get them in town, there is an amazing trickle-down effect” in lost revenue.

It’s not just businesses that will suffer. Saratoga Springs officials are bracing for a $7.8 million to $16 million drop in revenue — up to a third of its annual budget — due to losses in the city’s expected share of sales and hotel taxes as well as admissions to the Race Course. Some of that pain will be alleviated by the likely restoration of $2.35 million in state video terminal lottery aid, but city officials aren’t confident that all of that money will come back if the casino and track can’t be fully operational.

City Commissioner of Finance Michele Madigan said it is unclear if the city will have to lay off workers or increase property taxes in 2021, something the city has not experienced in eight years.

Saratoga Springs has faced greater challenges before — downturns that lasted decades. Historian Tim Holmes, the author of “Saratoga Springs: A Brief History,” said the city was doing well in the 1920s until the Great Depression hit. Then came World War II and Saratoga Race Course was shut down. Though it was reopened on an August-only schedule, the city continued to falter, hitting an all-time low in the 1950s.

The U.S. Senate’s clampdown on organized crime “drove gambling out, and all of the great hotels were obsolete,” Holmes said. “They were completely out of style. They burned, they fell into ruin. In the 1960s, city leaders knew they had to do something.”

That’s when the Holiday Inn on Broadway was built and the state broke ground for SPAC. The city has steadily grown ever since; Holmes believes it will weather the pandemic.

“The slowdown in Saratoga Springs’ economy will go for maybe a year, but the opportunities will still be exceptional,” Holmes said.

Meanwhile, business owners are doing everything they can — short of opening.

Catherine Hover, owner of Saratoga Paint and Sip and Pallette Cafe, is selling paint kits outside of her shop. She is also doing delivery of pastries and other food items from her café menu through DoorDash and Grubhub. She has ordered additional milk, eggs and bread from her suppliers to sell outside the café for those who need basic groceries.

Hover also runs a listing on Airbnb, but said all reservations have been canceled through the end of May. While Airbnb and other rental platforms have not shut down, they’re recommending that both homeowners and renters follow local, state and federal officials’ guidance for preventing infection.

Hover, who lived through Hurricane Katrina as it destroyed her family home, said she’s reliving that nightmare. She is prepared for the worst.

“It’s kind of hard to accept and acknowledge, built off of what I learned from Katrina,” Hover said. “I wish I didn’t have to do any of this.”

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