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How travel tech companies got covered under CARES Act

June 5, 2020
Simon Gros
Simon Gros

As you will have seen in one of our recent blog posts, Travelport played a significant role in winning representation for ticketing agents in the CARES Act before it was signed into legislation. Our own Kelly Kolb, VP, Government Relations and Industry Affairs, was one of the driving forces at the negotiating table.

Initially, the US government had ring-fenced a fund of $25 billion for the airline industry. Thanks to Kelly and other Travel Technology Association members, coverage of the relief package was extended to ticketing agents. This much needed financial aid will go some way to providing support for businesses, workers, and families during these tough times.

Simon Gros, the company’s Chief Development Officer, caught up with Kelly to talk about the behind the scenes work that went into extending the CARES Act to more travel companies.

Simon Gros—One of the most remarkable things about the CARES Act is the speed at which it was proposed and signed into law. Given that COVID-19 was relatively new, how long had you been working on the proposal prior to the signing of the Act on March 27?

Kelly Kolb— Before the U.S. was significantly impacted by COVID-19, Travelport had been actively monitoring government proposals and travel restrictions across the world. In early February, based on what had occurred in Asia, it became obvious that it was not a case of ‘if’, but a case of ‘when’ the virus would impact the rest of the world, including the US.

At the time, we recognized there would likely be a long-term ripple effect on global economies. The biggest threat to economies was the required lockdowns to protect populations. Albeit necessary given the health concerns the pandemic was posing, once you get to this point it is impossible not to think of the devastating effect these actions would have on the entire travel industry.

By late February we had begun to engage with industry peers including TTA, GBTA, ASTA, and companies, such as CWT and BCD, to form a plan on lobbying the US government for relief and support for the industry.

Simon Gros—The speed at which you and the other companies reacted is to be commended. Did you feel the government may not have acted quickly enough?

Kelly Kolb— Not really as there were already signs that the government was going to respond. However, we were concerned about the scope of the relief program. The government support programs were initially focused on major airlines only. As we know from working in the industry, a healthy travel sector depends on a wide range of industry players like ticket agents, which provide a valuable channel for airlines and other suppliers to serve travelers. Some airlines source approximately 50% of their bookings through ticketing agents. Without these intermediaries, any recovery by airlines could take longer.

Funding the airlines is definitely part of the solution, but we strongly advocated that you also need to fund the companies selling the airline tickets to really support the industry as a whole. If ticket exchange businesses did not get the support they need and were severely impacted, airline business models, and the broader travel ecosystem, would suffer in the long-term.

Simon Gros—How significant a role did you and Travelport play in forming the proposals and the negotiations?

Kelly Kolb— We were certainly one of the early ones to the table but the coordinated efforts of many industry partners are what helped get the proposals ready in a relatively short space of time. Through the Travel Technology Association (TTA), we issued formal proposals to the government. We were also able to secure a meeting with Vice President Mike Pence’s staff, prior to the lockdown, based on having a clear list of proposed actions to provide relief for the wider industry.

At the same time, Travelport CEO, Greg Webb, wrote letters directly to Congressional members in the Georgia and Colorado delegations asking them to advocate on behalf of Travelport and ticket agents for a dedicated CARES Act relief fund.

Through the process, we’ve worked closely with our allies at  TTA, as well as GBTA and ASTA, to identify the most applicable opportunities for ticket agent assistance considering payroll protection, government loans, and payroll tax relief initiatives.

Simon Gros—Based on your groups’ tremendous efforts, $25 billion has been made available to assist a number of our travel agency partners who are too large to qualify for the small business loans but might otherwise lose out to other industries seeking financial assistance in programs like the Main Street Lending Program. Do you know how was this figure reached?

Kelly Kolb— The government had already set the figure of $25 billion for the airline industry. This was great news, but as I mentioned above, we needed support for more than just the airlines. We requested an additional $17 billion to be added for the coverage to extend to ticketing agents also. While the federal government has not, at this point, agreed to an additional level of funds targeted at non-air travel industry businesses, it did add ticket agents to the recipient group for the initial $25 billion in relief. We applaud the government for its decision to include ticket agents in the CARES Act relief package.

Simon Gros—On behalf of everyone at Travelport and the wider travel industry community, thank you for all your efforts in getting this done.

Kelly Kolb— I appreciate the kind words and sincerely applaud the government for the actions they’ve taken so far.  The entire group of our industry allies all deserves credit for the work they put in. Coordinating efforts have certainly helped to quicken the process and showed solidarity for a genuine cause.

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