Coronavirus takes a toll on Lake County economy
Tourism impacted by stay at home order
LAKE COUNTY -- The local economy in Lake County and the surrounding areas depends a great deal on tourism to keep small businesses going and to add to the tax base.
In 2018, Lake County generated $144 million in visitor spending, with a state and local tax revenue of $14 million, according to a report from the Michigan Economic Development Corporation (MEDC).
With the summer tourist season about to get into full swing, business owners and community leaders worry that an extended stay-at-home order due to the concern over the spread of the coronavirus will have a devastating effect on the local economy.
Jane Allison, chair of the Lake County Community Foundation (LCCF) and the Downtown Development Association (DDA), said, "Speaking both as a small business owner and chair of the LCCF and the DDA, I believe the impact, unfortunately, will be huge."
The LCCF has already canceled one of its annual fundraising events, the baked potato supper, and others may be in jeopardy depending on whether or not the order is extended, Allison said.
"While closures and cancellations are necessary, they cannot help but effect the local economy," she said. "The cancellations, and the inability to conduct 'business as usual' will surely have a negative economic impact."
Local business owners are already feeling the pinch, with some having to shut down completely and others having to go to limited service.
Nick Miller, owner of Baldwin Bowling Center, said he has been closed since Gov. Gretchen Whitmer's executive order March 16.
Miller said most of his business is league play, and, with that, he would not be able to comply with the social distancing order, so he decided to just close for the time being.
"I tentatively plan to reopen on April 13, depending on further restrictions by the governor," Miller said. "Even being closed for these two weeks will have a great impact on the business, and the longer this goes on, the greater the odds are of not re-opening."
Miller said he counts on tourism to help his business, as well, and hopes the stimulus package will get money out to people for discretionary spending.
"That's a market I depend on," he said, "and if people don't have the money to go out and do things like bowl, that won't do any of us any good."
Many small business owners live week-to-week, he said, and not having that revenue coming in will make it hard for them to meet their obligations.
"Right now, I am maxed out on what I can pay out in loan payments," he added. "I can't afford anymore, so hopefully the government will offer some kind of grants or low-interest loans for reconsolidating finances at a lower payment.
"I'll take it one day at a time," he said. "If I come out of this in the end and am doing okay, well then that's great."
Bridgette Lamoreaux, owner of the Government Lake Lodge restaurant in Baldwin, echoed those same sentiments, saying small businesses struggle normally, and with this added to it, it only makes it harder for them to survive.
They have had to go to take-out service only since the governor's order to restrict places of "public accommodation."
"We depend on tourism a good bit," Lamoreaux said. "We are already coming off a rough winter with the limited snowfall, now coming into the summer tourist season, with the shutdowns everywhere, sales will definitely fall off. People will be limited as to what they can do financially, as well.
"We are hoping tourism will eventually pick back up," she said. "I feel like it will be a big bounce, once it does, but I don't know how long it will go like this.
"Right now, we have a few people passing through stopping for food and eating in the parking lot," she added. "And some are already at their cabins just to get away, but they are not out and about a lot. If the governor allows us to go to 50 percent capacity for inside dining, that will help."
Lamoreaux said they have had to let all their employees go. She works the restaurant by herself and they are using the time to do some remodeling and repairs that they didn't have time to do when they were busier, she said.
"We can only do what we can do," Lamoreaux said. "The outlook is uncertain, and only time will tell how it will work out."
Linda Ringler, owner of Chase Creek Smokehouse in Chase, said her sales are drastically down since they have had to go to take out only service.
"Our goal is to keep as many employees on as possible, so we are trying to get enough sales to make payroll and cover our food purchases," Ringer said. "We are keeping one server and three cooks on every day and trading off shifts trying to make this work. Once we are past all of this, we will be calling everyone back."
Ringer said they have reduced their hours of operation and may possibly go to opening for just the dinner hour to save on expenses.
"We feel confident we will survive it all," she said. "We don't owe a lot of money, and we are making cautious financial decisions. If we have to shut down temporarily, we think we can recover.
"We are hoping for a surge once all this is over and tourism picks up again," she added. "People from downstate are looking to vacation and come to stay in the cabins, so we are hopeful that things will get better."
Matt Bearup, Lake County Economic Alliance Board chair and owner of Best Bear Lodge and Campground in Irons, said he believed the stay at home order will have a lasting, devastating effect on the local economy.
"Many businesses in Lake County will not be able to recover from the shut down," Bearup said. "After a soft snowmobiling winter, lodging resorts and restaurants were counting on a busy spring. Although ATV and hiking trails remain open, the stay at home order is preventing travelers from coming to Lake County.
A post on the Lake County Chamber of Commerce Facebook page said the Chamber and the Para Dice Motorcycle Club made the decision to cancel the annual Blessing of the Bikes event due to COVID-19.
"We are looking out for the safety of our community," the post read.
Bearup said that's a loss of around $200,000 to the local economy.
"If the stay at home order continues indefinitely, or the coronavirus continues to spread, there will be several area businesses that are forced to close," Bearup said. "Many area tourism businesses will not be able to make up the losses caused by the slow down."
A $2-trillion stimulus package passed by Congress last week will provide small business loans up to $10 million, at 4 percent interest, to businesses with fewer than 500 employees. If used for payroll, rent, mortgage payments and/or utilities, the principal amount may be forgiven, leaving the business owner liable for only the interest on the loan.
The Economic Policy Institute is projecting a possible loss of around 400,000 jobs in the hospitality and leisure industry in Michigan because of the coronavirus pandemic.
For displaced workers, the stimulus package provides an additional $600 per week in addition to any state unemployment benefit, up to four months, and extends the eligibility period up to 26 weeks.
Workers who are let go are encouraged to contact the Michigan Unemployment Insurance Agency (UIA) at michigan.gov.