ASIAN AMERICAN HOTEL owners and other advocates for the U.S. travel and tourism industry made their presence known this week on Capitol Hill.
In the spotlight on May 8 was Jagruti Panwala, vice chairwoman of AAHOA, who testified before the House Committee on Small Business Subcommittee on Economic Growth, Tax and Capital Access about the impact of the industry on the American economy.
Addressing the subcommittee chaired by Rep. Dave Brat, R-Virginia, and ranking member Rep. Dwight Evans, D-Pennsylvania, Panwala said this week she was among “hundreds of AAHOA members meeting with their elected officials and sharing their stories of small business success and helping our lawmakers understand how the policies they create are affecting their constituencies.”
This week marks AAHOA’s Spring National Advocacy Conference as well as the 35th annual National Travel and Tourism Week.
Panwala, a resident of Pennsylvania who owns five hotels with her family, outlined several issues of concern – creeping gas prices, international travel restrictions, the limitations of the Visa Waiver Program and continued funding of Brand USA. She also asked the congressional leaders to make permanent the new federal tax breaks for small business. Most of the tax cuts passed in December will expire in 2022.
“One of our biggest concerns centers on increasing gas prices,” said Panwala. “History has shown us that increases in gas prices limit available discretionary income and consumers cut back on some activities including travel.”
The retail price for a gallon of gas is 45 cents higher than a year ago, reports AAA. The spike is related to the increased cost of a crude oil, which makes up 72 percent of the price of gasoline. Kiplinger predicted in April the price of crude will settled into a range of $60 to $65 per barrel in June. “Global crude demand is strong, and OPEC is serious about curbing its production,” it said.
Higher gas prices would threaten to curb domestic travel, but international travel is just as crucial to the state of the U.S. hospitality industry. Panwala noted while national agencies have reported a drop in the number of foreign visitors to the U.S. in recent years, the National Travel and Tourism Office is reviewing its analysis to verify whether it undercounted the number by the millions. “We are eagerly following this development and encourage our congressional leaders to do so as well to ensure the data we use to make business decisions is sound and reliable,” she said.
“International travel is our largest service export. While conventionally it may seem strange to categorize tourism to the United States as an export, international visitors spend hundreds of billions of dollars on travel and tourism and each foreign visitor spends nearly $4,500 and stays 18 nights per visit,” Panwala testified.
The AAHOA leader also asked the committee to reauthorize funding for Brand USA and to expand the Visa Waiver Program beyond the current 38 participating countries.
She called the 8-year-old Brand USA, “a unique public-private partnership promoting the United States as a destination for foreign travelers at zero cost to American taxpayers.” The program, supported by fees levied on international visitors, has generated $40 billion in revenue. It supports more than 50,000 American jobs. “It is a remarkably successful program for both the American economy and our industry,” she said. The program, renewed in 2014 for five more years, is facing a sunset in 2019 and program advocates fear losing leisure travelers to other developed nations.
The Visa Waiver Program permits travelers from participating countries to visit the U.S. without first obtaining a visa. The trips are limited to 90 days and include various security measures to protect against misuse of the program by bad actors. India is not part of the program.
Panwala ended her testimony by telling committee members the most-talked-about topic among hoteliers and hospitality professionals “is the importance of the new tax law on small businesses.”
“Small business confidence is growing, and we are able to create new jobs, hire new employees, increase wages and benefits, make capital improvements, purchase new properties, and expand our businesses,” she said.
“Small business owners thrive when there is certainty in economic conditions and are reserved when there is ambiguity in circumstances. Economic uncertainty breeds hesitation and hinders growth.”
Panwala’s May 8 testimony is the second time she has represented hoteliers before congress. In June 2014, she appeared before the House Committee on Education and the Workforce Health, Education, Labor & Pensions Subcommittee in a hearing on the joint employer status that the National Labor Relations Board had expanded to include franchisers.
In December the NLRB under the Trump Administration overturned the standard in a 3-2 vote, but in February the board unanimously reversed its decision, citing a conflict of interest in December’s vote. The law might be overturned a second time either by the NLRB or by federal legislation that has been approved by the House and is before the Senate.