ASTA is going to bat for travel agencies and, at the moment, is focusing its efforts on encouraging Congress to provide relief to these small businesses.
Ninety-eight percent of travel agencies are categorized as small businesses by the Small Business Administration’s standards, and two-thirds are operated by women.
At last count, there were close to 15,000 retail locations in the U.S., employing over 108,000 people, according to ASTA, and there are an additional 40,000 self-employed travel advisors working as independent contractors.
The industry is being hard hit by the coronavirus outbreak with 52.5 percent of ASTA members saying on March 6 that they expected to be out of business in six months or less if the situation continued to deteriorate.
Airlines and airports are requesting more than $60 billion in relief, and the president has promised relief to hotels and the cruise industry as well. ASTA is fighting for travel agencies to be included.
“We feel strongly that any targeted relief for the travel industry should be open to travel agencies and not simply limited to the largest companies in the industry,” ASTA said in a statement. “A scenario where the largest travel companies survive and recover from this crisis while the thousands of overwhelmingly small businesses that distribute their products are allowed to fail is an unacceptable outcome.”
ASTA is advocating for several ways Congress can provide relief:
Grants—ASTA is looking for grants for ticket agents of $7.7 billion to compensate for reduced liquidity.
Loans—ASTA would like to see a voluntary liquidity facility program in an aggregate amount up to $6 billion pursuant to which the Federal Reserve would purchase financial instruments from or provide zero interest unsecured loans or zero interest unsecured loan guarantees to ticket agents.
SBA Loans—“We were pleased to see that the recently-enacted Coronavirus Preparedness and Response Supplemental Appropriations Act of 2020 (P.L. 116-123) included funding to enable the SBA to provide an estimated $7 billion in loans to help small businesses impacted by financial losses as a result of the coronavirus outbreak. More funding is certainly needed, as is immediate action to get the first batch of loans quickly to the businesses who need them,” ASTA noted.
ASTA suggests that Congress fully fund President Trump’s March 11 request for an additional $50 billion in SBA loans and broaden eligibility for SBA’s Economic Injury Disaster Loans and that loan collateral requirements be reduced.
Tax Provisions—“We support any and all tax relief initiatives like payroll tax suspension, deferrals, carryback of losses. The more these measures are targeted at travel industry businesses and/or small businesses, the better. With regard to a payroll tax suspension, if an across-the-board payroll tax cut/suspension is too challenging, consider targeting at the travel industry using Census/NAICS codes and further targeting at small businesses use SBA size standards,” said ASTA.
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