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Red tide brings red ink: Losses in the millions

By Staff | Sep 19, 2018

The trickle-down effect of the blue-green algae and red tide events has moved through Southwest Florida businesses just as water releases have moved down the Caloosahatchee.

Both have left significant harm in their wake, with financial losses following the devastating environmental fallout.

On Sanibel and Fort Myers Beach, the economic impact has been drastic with the two losing nearly $41 million combined in the last two months. A survey conducted by the Sanibel Chamber of Commerce shows eye-opening statistics and staggering losses.

In July and August, the island economy incurred a total estimated loss of $19.1 million in lost revenue, with a 41.2 percent decline in August alone.

Hotels, resorts and vacation rental companies were asked if the current water quality has negatively impacted their business and all 42 businesses surveyed said yes.

The same 42 unanimously said they have had cancellations due to water quality. Collectively, they reported a loss of 11,198 room nights for a total of $3,119,874.

Twenty-six hotels/lodging businesses reported early departures as a result of water quality, at a collective loss of $144,584.

All 29 hotels/lodgings responding said that they have seen a year-over-year decrease in the month of August.

Those 29 reported booking 13,198 fewer rooms, representing almost 30 percent of their revenue.

Thirty-eight restaurants reported back to the survey, with all of them saying they have been negatively impacted.

All 38 reported a decrease in business for the month of August, costing them a combined 2,698 tables-42 percent of their revenue.

The same trends continued for retail, real estate, and “all other industries.”

Some $15,129,680 in losses were estimated on Sanibel in the month of August, along with $4,004,122 in July.

Environmental conditions on Fort Myers Beach have immensely improved, according to President of the Fort Myers Beach Chamber of Commerce Jacki Liszak, but not before impacting the local economy.

She said things were rolling along better than ever in July, with many restaurants and hotels reporting record numbers-but then things took a nose dive in August.

The Fort Myers Beach Chamber conducted a survey from July 27- Sept. 14.

For businesses, a total of $24,477,607 was estimated to be lost in that time due to the beach being a “ghost town” after a severe red tide outbreak washed dead fish onto white sands, accompanied by a foul smell.

“And that’s not even with our heavy-hitters (largest properties) being accounted for in the survey,” Liszak said. “We were cooking with gas and then hit a brick wall.”

The chamber also surveyed 4,536 employees who reported a collective estimated loss of $985,951 in lost wages per week.

She said that August was one of the worst months she’s experienced, with cancelations in “the tens of thousands.”

Though the numbers are quite discouraging, Liszak is hopeful that as beach conditions come back to normal, so will the activity they’re used to.

“People are making a point to come and help the beach out,” she said. “There are lots more community events and locals are helping locals.”

Some hope to make the recovery effort countywide.

“The past few months have been very challenging for our community and our tourist industry,” said Lee County Commissioner Cecil Pendergrass, chairman of both the Tourist Development Council and the Lee Board of County Commissioners, in a prepared statement. “We need to spend money at our local shops and restaurants in support of the businesses and employees who have lost significant income due to harmful algae blooms.”

To that end a new promotion entitled, #OneLee, has been started by the Lee County Visitor & Convention Bureau, that aims to help local businesses impacted by the red tide and algal blooms.

The campaign is designed to motivate residents to dine, shop and play locally, with dozens of deals from area businesses available.

“There are a myriad of reasons that the #OneLee campaign is important but perhaps the two most significant are that it continues to build on the strength of the fabric of our community and promotes neighbors helping neighbors,” said President and CEO of the Sanibel Chamber of Commerce, John Lai. “Lee County is being put to the test but we are resilient. Our community is joining together to help local businesses, our citizens, and we’re working with local organizations to clean up our shores and do our part. There is no better nor important time to support each other, shop small, support local restaurants, and help your neighbor.”

Residents can use the #OneLee hashtag on their social media accounts to support the movement.

Deals will launch Saturday, Sept. 15, and can be found online at www.fortmyers-sanibel.com/onelee.

Special offers will be from businesses in coastal communities such as Sanibel and Captiva, Bonita Beach and Fort Myers Beach.

Fort Myers Beach is getting a head start on the #OneLee movement.

The Chamber is working with five local radio stations to air commercials promoting the beach, hopeful that it will bring people back to the usually vibrant area.

Liszak advocated for the local waiters and waitresses who rely on tips for their income.

“Continue to ‘tip the bill’ (a growing movement to tip your server the same amount as your meal), continue to help local businesses, tell your family and friends-even those up north-that things are getting better and that the beach is beautiful,” she said.

For Cape Coral, it is unclear the exact monetary hit the city and its businesses have taken, according to city officials.

The Cape Coral Chamber of Commerce is currently in the process of surveying its members to get a better idea of what businesses are going through. They also continue to work hard on getting people informed on the efforts of the city to mitigate the issue.

“We are continuing to receive visitors in our welcome center daily. However, we are receiving calls from people who have their vacations booked during our seasonal months and are concerned about coming down,” said Donna Germain, president and CEO of the Cape Chamber. “We are sharing the information we have received regarding clean up efforts from the city and county and the long-term projects such as the Hoover Dike repair and the EEA Reservoir. And most importantly, we are encouraging them to keep their travel plans and to come visit Cape Coral and the surrounding areas.”

Interim Cape Coral Economic Development Manager Terri Hall said that there are no hard numbers yet on the impact these water events have had on the economy, and that it may be some time until the city sees what the long-term impact truly is.

For the short term, she said, “There has definitely been negative impacts for some businesses, especially those that rely on the water. But there are no specific numbers to see exactly what the losses have been.”

It has also come to her attention that some short-term loans have been applied for by small businesses that may be affected, looking for relief until season begins.

In speaking with restaurants along the water, it was a mixed bag of reviews, according to Hall.

The real estate market hasn’t seen too much of a change, according to Gloria Tate of Raso Realty in Cape Coral.

The Royal Palm Coast Association of Realtors Database shows that in the last 120 days, 361 Gulf-access homes were sold, including the “crown jewel of Cape Harbour,” 5832 Armada Court, for $4.125 million.

The 361 Gulf-access homes sold is a 59- house increase from last year, over the same 120 days.

Tate also hasn’t heard of any cancellations for winter residents, and that she continues to get new inquiries every day from people wanting to spend the “winter months” in Southwest Florida.

She believes it will be a strong visitor season coming up.

“Those of us who live here are cautious and concerned about conditions we see in our canals,” Tate said. “But we are optimistic that our government is working to fix the issue.”

Lee County is also working to compile numbers on the impact of red tide and blue-green algae blooms on the economy.

On Sept. 4, the Lee County Visitor & Convention Bureau sent out a survey to 1,430 tourism industry people/businesses to gather data, asking for information on business revenue for July and August.

They asked the aforementioned to fill out the survey “If you are experiencing losses due to red tide or algae blooms.”

Those numbers are not yet available.

“Lee County Economic Development is working to connect local businesses with state and federal resources,” said Betsy Clayton, Lee County spokesperson. “We continue to encourage businesses being affected by the Lake Okeechobee blue-green algae and red tide to complete a business damage assessment survey that can be accessed.”

You can visit www.florida disaster.biz/BusinessDamageAssesments to find said survey, and then select as applicable; Lake Okeechobee/algae blooms or red tide.

The Small Business Development Center at Florida Gulf Coast University is also reaching out to those who complete the damage assessments that indicate that they want more information on bridge loans.

Connect with this reporter on Twitter: @haddad_cj

Editor’s Note: Figures for the economic impact on Pine Island businesses is not yet available. As stated in the story, Lee County is still collecting data. The Pine Island Chamber of Commerce is in the process of conducting its survey of on-island businesses and an update will be provided when available.