Proposed $25M economic stimulus package would aid tourism industry recovery

Coronavirus New Mexico

SANTA FE, N.M. (KRQE) – In response to the COVID-19 pandemic, Governor Michelle Lujan Grisham has proposed a $25 million special appropriation as an economic stimulus package for the state tourism industry. The proposed fiscal year 2022 package would help by expanding marketing efforts and could shorten the estimated recovery timeline for the industry.

The New Mexico Tourism Department reports that tourism is the state’s second-largest industry and based on estimations from the U.S. Travel Association and Tourism Economics, it may take five years for the national tourism industry to recover to pre-COVID levels of travel spending. The department states that other factors, such as the relative size of New Mexico’s tourism industry compared to other sectors, suggest the state may be looking at a recovery period that could take up to seven years to complete without a substantial investment in recovery.

The 2020 total projected cost to the state is an estimated $4.3 billion and accounts for lost visitor spending, lost state and local taxes, and paid out unemployment benefits. The estimates don’t include long-term economic losses from business closures, tourism infrastructure losses, and workforce migration.

The Tourism Department explains that this investment would provide the necessary funding to generate economic activity by bringing visitors to the state after the pandemic where they will contribute to local economies and spending it on restaurants, events, retail, transportation, arts, entertainment, accommodations, outdoor recreation and more. The department states that overall, an annual investment of $25 million in tourism recovery over the next three fiscal years could save New Mexico an estimated $2 billion per year.

The $25 million stimulus package is being proposed as a special appropriation for the Tourism Department and will be considered during the 2021 Legislative Session.

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