Expect another spring and summer in Saint Paul without large festivals and other civic events due to the lingering effects of the COVID-19 pandemic. The annual Festival of Nations in May has been scratched. Organizers of Cinco de Mayo and the Grand Old Day celebration in June are already looking ahead to 2023. And Highland Fest as people have known it will not be back in July.
The Minnesota Irish Festival is moving ahead with plans for August, and the Ramsey County Fair will return in July, but without the traditional White Bear Avenue parade due to increasing costs and security requirements.
This will be the third summer without a Grand Old Day and Highland Fest. James Farnsworth, executive director of the Highland Business Association, said his group may hold a smaller event or a series of events in lieu of Highland Fest.
Speaking for the Grand Avenue Business Association’s board of directors, GABA president Chris Jensen said, “while we considered bringing Grand Old Day back in 2022, we ultimately decided that our community will be better served with a well-planned event in 2023.”
The last Grand Old Day in 2019 attracted 200,000 people, even though the event had been canceled that spring and was only revived at the 11th hour. GABA will be going ahead with its pet-friendly Paws on Grand in August.
Uncertainty of pandemic, dearth of funding
Business groups that have traditionally sponsored large festivals have experienced a big downturn in revenue over the past two years. For some, the uncertainty of the pandemic and the need for lead time to raise money was an issue. However, COVID-19 has not been the only factor curtailing festivals. Rising police costs and increased safety measures are other factors.
The cancellation of the White Bear Avenue parade was announced in February by Lisa Theis of the White Bear Avenue Business Association. Volunteers used to block the side streets during the parade. That task would have been handled by concrete barricades and law enforcement personnel this year. As a result, security costs rose from around $5,000 to $15,000, Theis said.
Visit Saint Paul, the city’s convention and visitors bureau, promotes festivals and other events as part of its mission to support tourism. However, it is struggling to catch up from deep cuts in revenue caused by the pandemic. According to Terry Mattson, president and CEO of RiverCentre/Visit Saint Paul, tourism in Ramsey County generated $2.3 billion in sales and supported 30,000 jobs in the years before the pandemic. Since then, Saint Paul has lost more than $1 billion in sales, more than $70 million in related tax revenue and as many as 20,000 jobs.
Hotel/motel tax revenue takes a hit
One big source of revenue for Visit Saint Paul has been the hotel and motel tax. Hotel occupancy in downtown Saint Paul has run at around 60 percent historically. However, downtown hotel occupancy was only 25 percent in 2020 and 32 percent in 2021. The resulting drop in hotel and motel tax revenue led to a 70 percent decline in Visit Saint Paul’s sales and marketing budget, Mattson said.
Saint Paul’s hotel and motel tax raised $4.6 million in the prepandemic year of 2019. Visit Saint Paul’s share of that was $2.3 million. The lodging tax was increased by 1 percent in 2020, and a record $5 million in revenue was expected, but only $1.5 million was collected.
The Saint Paul City Council has attempted to rectify the shortfall in festival and other event money with a $4.5 million grant program funded through the federal American Rescue Plan. Grant applications were due on March 28, and city officials hope to announce the recipients soon. Applicants had to demonstrate that their normal, prepandemic operations made a significant contribution to tourism in Saint Paul, and that they draw 40,000 or more visitors to the city each year.
— Jane McClure
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