By Aaron Bergh, Columnist
Paso Robles is unexpectedly finding itself downstream from a crisis 300 miles away: the flood of unaccompanied child migrants at our southern border.
In April, it was announced that Camp Roberts, an Army National Guard base just 15 minutes north of Paso Robles, will become the Biden Administration’s next holding facility for underage migrants.
As the base prepares for a massive influx of occupants, there are concerning signs that some of the burden will fall on the back of local small businesses and the economy.
A month ago, it was anticipated that there would only be potentially 1,500 children housed at Camp Roberts. However, last week, the San Luis Obispo County Board of Supervisors were notified to expect the arrival of 5,000 children. There are rumors that the number could be considerably higher.
Hundreds, if not thousands, of federal employees, will be needed to support the children. This has serious potential to overwhelm Paso Robles and San Luis Obispo county hotel capacities and take away space from tourism – the vital backbone of our city’s economy.
According to John Arnold, the General Manager of the Holiday Inn Express and Chair of Travel Paso, hoteliers are receiving calls from booking agencies and government subcontractors requesting government per diem pricing to house 600 to 2,500 government workers for the duration of six months up to one year. For perspective, Paso Robles only has about 1,500 hotel rooms. Beds are an incredibly scarce resource for our tourism industry. Although it’s not peak tourism season yet, the total hotel occupancy is already surpassing 90 percent on the weekends.
Before the pandemic, 60 percent of my customers were tourists. That number dropped to 25 percent when COVID occupancy restrictions were imposed on distilleries, wineries, breweries, and restaurants. After a long 15 months of lockdowns, the business community is starting to feel momentum towards a return to normal. If a large portion of hotel beds are occupied by government workers, our region will not have enough capacity to accommodate the tourists that businesses are relying on to make a full comeback.
Because hotel guests who stay longer than 30 days consecutively are exempt from the 13.5 percent Transient Occupancy Tax (TOT), long-term stays by government workers will result in significant revenue loss for our community. Most of the TOT revenue is allocated to the City of Paso Robles, which relies on the proceeds to fund essential public services like the police and fire departments. About a quarter of TOT revenue is allocated to the Travel Paso Robles Alliance and Visit SloCal travel bureaus that promote our city and county to attract more awareness and tourism.
Assuming an average nightly hotel room rate of $150, the City of Paso Robles and travel bureaus will lose out on collecting $20 per occupied room each and every day the federal program is operating. On the low end of the anticipated need, if 600 rooms are occupied by government workers for one year, the city’s revenues would dramatically fall by over $4.3 million – a massive hit to the city’s projected $5.6 million TOT budget for 2021 identified prior to the announcement of the federal program. As noted, the need for rooms could be more than triple that level and, if so, would land a devastating blow to the city’s annual budget.
Due to economic strains caused by COVID lockdowns, the City of Paso Robles found itself in a budgetary lurch that resulted in increasing the sales tax rate a full percentage point. The city cannot afford to undergo further financial burden as it struggles to find its post-pandemic footing.
Beyond hotel overcrowding, the convergence of migrants and support staff in Paso Robles could lead to other adverse effects. There will be increased traffic on roads and demand for emergency services that locals rely on. In the face of an impending drought, higher water consumption by Camp Roberts will further strain our water supply and result in increased withdrawals from the severely overdrawn Lake Nacimiento.
As a business owner, I’m not interested in inserting myself into the divisive debate on immigration policy. Like any other compassionate member of society, my heart breaks for the children that have walked thousands of miles, enduring abuse from adverse weather and human smugglers along the way, by no fault of their own.
As fellow humans, I want to see our generous country help them in some way – it’s the American thing to do.
It’s important to make management decisions that do not further harm reeling small businesses that collectively have been severely stressed like no other time in contemporary history. There are other regions less dependent upon the tourism industry for their survival that have adequate housing and hotel capacities to accommodate such programs.
