SALEM — Travel Oregon, the state’s tourism promotion commission, has implemented deep budget cuts as it copes with plummeting revenues — potentially a sign of things to come for a variety of state agencies unless the federal government comes through with a sizable bailout package.

The agency, funded exclusively through lodging taxes, has seen all key measures of industry activity and health fall through the floor. Statewide hotel occupancy rates have declined 63% compared to the same time last year. Fewer than 1 in 4 rooms are filled.

Daily room rates are down by a third. And the revenue per available room has plummeted 75% to $18.37.

As a result, Travel Oregon forecasts that its revenues will be cleaved by nearly two-thirds in the quarter ended June 30, from a budgeted $8 million to $3 million. For the following year, if trends continue, revenues will be 40% to 50% less than predicted before the pandemic.

Late last week, the agency announced internally that effective June 1, it would lay off 17 of its 64 employees, furlough another three indefinitely and eliminate two vacant positions. Overall, the moves affect about one-third of its employees.

The agency also implemented salary reductions for all remaining positions ranging from 5% to 20%, with the larger reductions for executives and managers whose fat salaries were called out in a state audit early this year.

The agency is canceling or reducing contracts, ranging from media buys to independent representatives who promote travel to Oregon both domestically and abroad. It also plans to close its Salem office.

By statute, 20% of the agency’s lodging tax receipts are distributed to seven regional tourism organizations in the state on the pro rata basis of where the lodging taxes are generated. Another 10% go to a competitive grant program to develop and improve tourism activities around the state, from the wine industry to trail networks. The overall decline in lodging revenues will directly impact those regional organizations as well as funding available for grants.

Travel Oregon CEO Todd Davidson will take a 20% hit to his nearly $400,000 pay package. He said that in 30 years in the tourism and travel industry in Oregon, he’d never seen such a broad, deep and sudden decline.

The entire fabric of the industry in Oregon is in free fall, Davidson said, with seven in 10 lodging employees and eight in 10 food service workers laid off or furloughed in the span of six weeks.

Tourism was a $12.8 billion industry in Oregon last year, with 117,500 employees, according to the agency. Restarting it is likely to come with fits and starts.

Davidson said it was difficult to predict how industry conditions will play out in coming months as the governor’s office implements plans to reopen the economy, perhaps on a geographic basis.

“People’s lives and people’s health have to be the No. 1 priority,” Davidson said. “The question becomes, how do we lift that? How does it reopen again. … What are the standards that need to happen?”

Davidson said the industry is working with the governor’s office, regional organizations, and trying to learn from the experience of other regions and countries. He said the pandemic may change the way people travel, just as the 9/11 attacks did. Initially, people may be reluctant to get on an airplane or go far from home. They’ll go on driving vacations. And that tells the agency where to direct its marketing dollars.

“We’ll be reaching out to Oregonians and urging them reconnect with other Oregonians that have been hurt by this downturn, and very tangibly reconnect with the state,” he said.

This article was originally published by the The Oregonian/OregonLive, one of more than a dozen news organizations throughout the state sharing their coverage of the novel coronavirus outbreak to help inform Oregonians about this evolving heath issue.