CAPC revenue falls short by $150K during pandemic
By Samantha Jones
The Eureka Springs City Advertising and Promotion Com mission saw its revenue fall $150,081 below projections during the COVID-19 pandemic, but finance director Rick Bright said he expects tax collections to pick back up over the next few months.
According to the monthly collection report, the commission had a shortfall of $99,140 in May. Bright said the commission’s shortfall in April was $50,941, bringing the total loss to $150,081. The commission voted May 27 to reduce expenses by $390,600, with $139,000 cut from special events, $78,800 from media, $3,000 from production, $15,000 from group travel, $50,400 from the Aud and $87,400 from office expenses.
The commission has projected a revenue shortfall of $500,000, but Bright said he doesn’t think the commission will lose nearly that much now that tourism is picking up again.
“The economy is back in swing. Everybody’s busy,” Bright said. “Everybody’s buying stuff. Once we get past this month, I don’t see a problem with the rest of the year unless something new happens.”
Bright said the commission’s numbers were up by $20,000 in the first quarter of the year, saying the commission halted most of its advertising and all of its special events in March.
“We were having a great year the first three months. We were up all three months,” Bright said. “I think we’re going to get right back to that. This month will be short … but I think by July’s collections, we’ll be back in the saddle and hopefully be up, not down.”
Considering the budget cuts the commission has already made, Bright said, he expects to meet or exceed the budget by the end of the year. He hasn’t had to move any money from reserves yet, Bright said, and he doesn’t think he’ll have to.
“We’re still set good with cash,” Bright said. “Hopefully, we’ll never even have to get into the reserves. I really think we’re going to have a good rebound. We’ll be down for the year from our first budget, but I think we’ll be above the revised budget in our collections.”
Commissioner Susan Harman said she’s feeling “comfortable” with the budget at the commission’s regular workshop on Wednesday, June 10, when chairwoman Carol Wright asked if the commission would like to cut the budget more. Wright said the commission previously considered cutting the budget by 35 percent, saying the commission has cut 28 percent so far. Harman, who owns a bed and breakfast in Eureka Springs, said business has been on par with past years even with COVID-19 regulations since Gov. Asa Hutchinson reopened the state to out-of-state travelers in May.
“Based on the business that we’ve been doing, I’d be comfortable staying where we are,” Harman said, “and reviewing it at another time.”
Commissioner Jeff Carter agreed.
“Businesses that are open are doing well,” Carter said. “People are actually starting to get more energized to stay at places where they feel like they can distance. We’re seeing some of those smaller rentals do well.”
Commissioner Bobbie Foster, who runs two restaurants in Eureka Springs, said she doesn’t plan to open again for a while. Foster said she’s considering reopening the restaurants during phase II of Hutchinson’s reopening plan, which started Monday, June 15.
“That will probably make me more ready to open,” Foster said, “if I could have 66 percent capacity as opposed to 33 percent. Thirty-three percent, for me, would have probably been trading dollars and not making money … but at 66 percent, I think I can make money that way.”
McClung agreed with Harman, saying he’d like to look at the budget once collections come in for May and June.
“I’m not worried about what we’ll see in May or this month,” McClung said. “I’m more concerned what we’ll see in July or June.”
McClung said he’s seen more people than he expected downtown.
“It’s one of those deals … where we benefited because people took shorter trips,” McClung said. “I think they canceled their long trips, because they weren’t able to go. We’re going to reap that benefit.”
Special events coordinator Tracy Johnson said she’s still waiting for a concrete budget to move forward with putting entertainment downtown.
“The events budget has been cut quite substantially,” Johnson said. “I have just enough for the Folk Festival, with a handful of thousands of dollars left. That’s not even enough for an Auditorium show.”
Johnson added, “Once we finalize what’s happening with the budget, I’m going to work my tail off to try stretch that handful of thousands of dollars out. With what money you do allow me to have, I have to stretch that out and make it the most impactful.”
Wright said she’s concerned a second wave of the virus will hit in the fall.
“Our mission is to continue to promote the city regardless of if there’s a virus or not,” Harman said, “and do it within the guidelines — drawing people here safely. We are collecting tax dollars and that’s what those businesses expect us to do.”
Carter said he expects the commission to keep an eye on the budget as the rest of the year unfolds.
“I just think we ought to be prepared,” Carter said.
Bright agree, saying he’s more concerned about promoting the city over the winter than the summer.
“We have to have some money in the bank, because these businesses can’t have a soft winter,” Bright said. “We have to have a strong winter to keep our businesses afloat.”
The best way to do that, Harman said, is by keeping the budget for Paradise marketing where it is. Harman said 30 percent of the people who have stayed at her bed and breakfast recently had never come to Eureka Springs before.
“The goal is to keep Paradise in business with whatever we can,” Harman said, “because, in my opinion, the word is getting out there somehow. I don’t think we can afford not to have them. We can’t afford to cut their budget that much.”
Wright agreed and said the commission would address the budget further at its regular meeting scheduled for 6 p.m. Wednesday, June 24, at The Auditorium.