Some of the brightly plumed hats at this year's Kentucky Derby will be covering up a secret brought on by the lame economy: They're retreads picked from closet shelves, not new finds from fancy boutiques. Whether adorned with feathers or flowers, hats are as much a part of the Derby Day spectacle as fast horses, mint juleps and the twin spires at Churchill Downs. Derby-goers ranging from monarchs to middle-school teachers sport the hats that can cost hundreds of dollars. Two years ago, Queen Elizabeth II threatened to overshadow the horses in a lime green hat with fuchsia trim. Ahead of this year's race on Saturday, though, some women are looking for bargains, borrowing from friends or redoing hats from their closets. The country's financial woes inspired the Kentucky Museum of Art and Craft to enlist a local designer for a recent hat-makeover session. The spruce-ups, costing as little as $70 or so, received rave reviews from customers used to the fashion-conscious crowds at Derby week events. "Who's going to know? I think that's probably a secret kept with the ladies," said David McGuire, the director of gallery sales at the Louisville museum, where new Derby hats average $400 to $500. Therese Zinser stopped by the museum to buy fuchsia feathers to add another splash of color to a deeply discounted hat she bought for $41 at a department store. "I was definitely bargain hunting," said Zinser, who's attending her second Derby this year. The hat makeovers are emblematic of tough economic times that could dent the nearly $120 million typically generated for area businesses the week of the big race. Hotels usually booked months in advance still have vacancies, local restaurants are bracing for lower tabs and some festivities have been scaled back. Jim Wood, president and CEO of the Louisville Convention & Visitors Bureau, predicts overall business will drop by 15 percent to 20% for hotels, restaurants and other hospitality businesses. "People are being a little bit more conscious with their spending and kind of waiting to see if this economy turns around," said Rita Reedy, a marketing director for the company that owns the Galt House Hotel downtown. Some corporate clients scaled back room bookings by half or more, while others backed out completely, she said. While the popular Jeff Ruby's Steakhouse downtown is fully booked for Thursday, Friday and Saturday nights of Derby Week, general manager Jason Johnson expects some diners to order less-expensive wine. Fewer companies bought hospitality tents at the massive fireworks show that opens the Kentucky Derby Festival, and overall sponsorships were slightly down for the series of events that also includes a parade, steamboat race and concerts, said Mike Berry, the festival's president and CEO. Gov. Steve Beshear will ferry VIPs to the race from the state capital of Frankfort by bus instead of the scenic Kentucky Derby train. The state will also charge for a race-day breakfast buffet at the Capitol that used to be free. As far as the hats, looking drab isn't an option at the country's premiere hat-wearing event. "A lot of people - they'll never admit to it - really look forward to watching the Derby and seeing that. Everybody, across the United States," said Ellen Goldstein, chairwoman of the Accessories Design department at the Fashion Institute of Technology in New York. Donning hats at the races had more practical origins: To protect women from the sun, said Pamela Fiori, editor in chief of Town & Country magazine. As time went on, fashion overtook practicality as women sought "the prettiest, most noticeable hats that they could possibly find," she said. With that in mind, the art and craft museum brought in Louisville designer Vicky Hoskinson for its first hat-remake event. She blames the economy for curtailing sales of her new hats this year, but said her hat makeovers - always a part of her business - are steady. "I've been trying to stay positive and not get in panic mode," she said. "Unless something really remarkable happens, I'm just not going to reach the same numbers that I hit last year." Jane Sprake sought a makeover for a hat she bought in 2003 and intends to wear to a Churchill Downs outing two days before the Derby. Springing for a new hat and buying Derby tickets were too pricey for Sprake and her husband, who moved into a new home in 2007. "It's all about saving money," said Sprake, a paralegal. Still, it was uncomfortable for her to watch Hoskinson disassemble her hat. Sprake winced, then looked away when Hoskinson, armed with scissors and glue gun, snipped off black feathers and later rearranged them with some new, more colorful feathers. But she approved of the final product. "It was definitely worth it," Sprake said. Less expensive hats are also an option. Prices average about $69.99 at the Stein Mart in Louisville, where business has been booming, said general manager Tim Whelan. Not every local hatmaker has taken a hit. Designer Angie Schultz said her business is about even from last year, with new clients making up for past clients who skipped buying new hats. Borrowing was the way to go for Diane Pschigoda, who raided her friend's closet for a hat redone for about $70 by Hoskinson. Pschigoda plans to wear it to Kentucky Oaks, a race for fillies that draws a huge crowd the day before Derby. The next day, Pschigoda's sister-in-law plans to wear it to the Derby. "I'm in real estate, so it's been a hard year," Pschigoda said.