Mark Mitchell, president of the Lake Houston Economic Development Partnership, said not only will the coronavirus affect local sales, but it also will likely cause a strain on small-business owners for months to come.
“When is the lion’s share of the consuming population going to be comfortable sitting shoulder to shoulder in a movie theater?,” Mitchell said.
As the economy begins to restart, some business owners said they are unsure of when they will be able to open, and city sales tax revenues have declined as a result of closures. Officials said they believe events and tourism, which have also decreased during the virus, will likely be the last to return.
Businesses remain closed
Before Abbott’s April 27 executive orders, restaurants were offering takeout and delivery. Businesses including restaurants and retail were able to reopen with limited occupancy May 1, but some still cannot open, according to Abbott's order.
Green Oaks Tavern, a bar that features live music in downtown Humble, has been closed since mid-March due to the restrictions. Co-owner Debbie Bixby said the closure has been hard on her employees and the musicians she hired nightly to perform at the tavern.
“We just have to strategize and figure out how to stay here until we can open again,” she said.
Meanwhile, Hairgoals Club owner Barbara Lane-Snowden said she will not be able to reopen her downtown Humble business until a vaccine is developed, as her wig shop caters to groups at high risk for the virus, including cancer and lupus patients and the elderly.
“I can’t consciously allow these ladies to come in, and they’re trying on the wigs,” she said.
As of April 25, 1.7 million people had filed unemployment claims in Texas since mid-February, according to the Texas Workforce Commission.
To provide relief to businesses, President Donald Trump signed another stimulus package into law on April 24, which added $310 billion in funding for the Paycheck Protection Program. The U.S. Small Business Administration resumed taking applications on April 27.
Sales tax decline
Even with some businesses reopening in late April, Humble city officials anticipate a decline in sales tax revenue this year.
Although the city of Humble’s sales tax revenue for March—the month when stay-at-home orders began—will not be available until after press time, Humble City Manager Jason Stuebe said he is “dreading” receiving the sales tax numbers.
“I couldn’t even begin to tell you what that’s going to look like,” he said. “Anything less than a 30% drop would be considered a good thing.”
According to the most recent sales tax data from the Texas comptroller’s office, the city of Humble collected about $1.23 million in March 2019. A 30% decline would be a more than $368,658 loss for the city.
In the fiscal year 2019-20 budget, the city estimated $13.5 million in sales tax revenue. With the estimated decline, Stuebe said the city’s $3.65 million Rankin Road expansion project—which was set to begin this summer—has been delayed indefinitely.
With sales tax revenue declining as well as a loss of rebate funds from the Metropolitan Transit Authority of Harris County’s general mobility program, the economic effect on the city and its business owners will likely be larger than that of Hurricane Harvey in August 2017, Stuebe said.
“There’s a good portion of the population that just doesn’t have a job,” Stuebe said. “They’re not going to have disposable income to spend even when things start opening.”
A hit on tourism, events
As the city of Humble and its business owners adapt to coronavirus restrictions, many events in the Humble area have also been postponed or canceled by their organizers.
As of April 20, the city canceled 48 events at the Humble Civic Center, Director Jennifer Wooden said. She said the city refunded $133,000 worth of event fees.
As the area begins to reopen, Wooden said the civic center, the Charles Bender Performing Arts Center and the Humble Senior Activity Center will likely be the last of the city departments to reopen. However, Wooden said the theater is planning to potentially offer virtual performances this summer.
Wooden said the city has not abandoned ideas of tourism.
“We were ... getting people who have businesses in downtown and who have their hearts invested in Humble to come together to cast visions,” she said.