In what represents the first major civic casualty over fears of the spreading coronavirus, Austin officials announced Friday that they are forced to cancel the annual South by Southwest festival, which last year alone delivered to the Texas capital an estimated $356 million in economic impact.

City leaders said they were being forced to take such a drastic action despite the fact that neither Austin nor Travis County has a single case of COVID-19, the disease caused by the virus.

The festival was scheduled to take place March 13-21 and annually brings in tens of thousands of musicians, filmmakers and other entertainers, as well as high-tech entrepreneurs and business leaders. Participants travel from all over the globe to attend.

It’s the first time in 34 years that SXSW won’t take place, according to a statement from the festival leaders.

During a press conference Friday afternoon, Austin Mayor Steve Adler said that “based on the recommendation of our public health officer and director of public health, and after consultation with the city manager, I’ve gone ahead and declared a local disaster in the city, and associated with that, have issued an order that effectively cancels SXSW.”

On late Friday, the Austin Chronicle reported that SXSW organizers do not have cancellation insurance related to a disease outbreak or one that is triggered by the city declaring a local state of disaster. SXSW co-founder and managing director Roland Swenson explained in a text message to the Chronicle: “We have a lot of insurance (terrorism, injury, property destruction, weather). However, bacterial infections, communicable diseases, viruses and pandemics are not covered.”

Dr. Mark Escott of the Austin-Travis County Health Authority confirmed there are no known cases of COVID-19 in Travis County.

Dr. Mark Escott, Austin Public Health Interim Health Authority, provided an update to the community about COVID-19 during a press conference in Austin, Texas on Friday, March 6, 2020. (Ricardo B. Brazziell / Austin American-Statesman)

“Having said that, the COVID-19 threat is growing across the United States,” Escott said. He stressed that “now is not the time to panic. Now is the time to prepare and provide a measured response to that threat.”

There has been no announcement as to whether refunds will be available for those who have already purchased tickets. A statement released by SXSW notes that festival leaders are “exploring options to reschedule the event and are working to provide a virtual SXSW online experience as soon as possible for 2020 participants, starting with SXSW EDU.” They plan to publish an FAQ when information is available.

Chip and Joanna Gaines were two of the featured speakers invited to SXSW 2020. (Courtesy photo / Magnolia)

Previously, SXSW organizers had said that the festival would go on, and that Austin public health officials had not advised them to shut down the event.

Still, a flurry of high-profile cancellations had already been announced. One of the more recent celebrities to bow out of SXSW because of coronavirus fears was rocker Ozzy Osbourne. He also canceled tour dates in February to get treatment for Parkinson’s disease, pneumonia and a recent fall. Representatives from Facebook, Twitter, TikTok, Amazon Studios, Intel, Mashable and Vevo pulled out of SXSW recently. Apple and Netflix, too.

As city officials considered a cancellation, Escott said they looked at “the size and magnitude of the event” and the “nature of the venue." He also said the lack of a vaccine was a factor. And, of course, there was growing public pressure.

An online petition at change.org, asking for SXSW to be canceled, has been marked as a “victory” now that the event is canceled. Its author wrote that “having an event like this is irresponsible amid an outbreak.”

At least temporarily, the economic impact on Austin will be devastating. In 2019 alone, South by Southwest delivered an estimated $356 million to the Austin economy, according to a report by Greyhill Advisors, whose work had been commissioned by SXSW. That was an increase of about 1.5 percent over the 2018 event, when the total was figured at $350.6 million. Greyhill noted that the 2019 event had the largest economic impact in SXSW’s 33-year history.

For comparison, the NFL and host committees claim that the Super Bowl brings between $300 to $500 million to its host cities.

SXSW launched in 1987, initially as a music festival. While it maintained an emphasis on music throughout its more than three decades, its popularity took a sharp upturn in the 1990s with a new emphasis on media and film. By the 2000s, it had become a multi-industry extravaganza with media coverage all over the world.

The mayor called the cancellation “really unfortunate,” and noted that the longtime event is tied to Austin’s identity. In its own statement, SXSW officials spoke of feeling “devastated.”

Brian McCullough, Dallas-based wholesale manager for Spec’s, had planned to go to the festival and had mixed thoughts about the cancellation.

He worries about the cancellation’s impact on the hospitality industry, noting that it may “hit a lot of people in the pocketbook.”

And festivalgoers will be hit financially as well, McCullough noted. “A friend of mine got a hotel room down there, $260 a night for four nights, and the cancellation date was yesterday, so now he’s stuck,” he said. “There’s a lot of people who spend the money to go down there, so that’s tough.”

As for Tamara Saviano, a Nashville, Tenn.-based music executive and filmmaker, she was crushed by the cancellation. It would have been her 25th year at the festival. Her documentary about late Texas songwriter Guy Clark, titled Without Getting Killed or Caught, was to have its world premiere at South by Southwest.

“But,” Saviano said, “it was not meant to be.”

Dallas Sonnier, CEO of the Dallas-based film company Cinestate, said many in the film community won’t get to debut their world premieres. Some of them are "canceling flights and struggling [with] how and where to launch their movies,” he says.

Sonnier said he was not planning to attend but was sending four members of his company to Austin to see a pair of films to consider buying them.

After the cancellation was announced Friday afternoon, Sarah Eckhardt, Travis County judge, spoke to the potential hysteria that could erupt from such news.

“Panic will weaken us," she said. "This is not a panic-based decision. This is a decision based on expert medical opinion.”