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MAY BE RECALLED with earlier due date if requested. DATE DUE DATE DUE DATE DUE 2105 c:/ClRC/DateDue.indd—p.15 SPLAN B PAPER Hurray, David Roger. 2004. Mlchlgan State Umversuy Department Of Urban and Regional Planmng ‘r . . 'r Analyzlng the Economlc Impact of Tounsm 1n Mld-Mlchlgan s Trl-County Reglon A Platt B *Paper Smeltted t0 Michlgan State Univet‘sity " ' in partial fulfillment of the requuements for the degree of a A Master of Selence U than and: Regional Elanm'ng, ‘ .A .- DAWDROGER MURRAY a ‘ DECEMBER, 2004 * Ll.lfln'lhllllltit."-..!!DII.'I!'}II11. Table of Contents Chapter # Title Page Abstract 2 Forward 3 Organization of Paper 4 1 Introduction 5 1.1 Setting 5 1.2 Problem Statement 6 1.3 Purpose 7 1.4 Need 7 1.5 Methodology 9 1.6 Limitations 9 2 Community Profile for Lansing/Tri-County Region 11 2.1 Geograpy and Location 11 2.2 Climate 12 2.3 Demographics 13 2.3.1 Population Information 13 2.3.2 Employment Information 1 4 2.3.3 AIirce/laneonr Information 17 3 Introduction to Tourism 18 3.1 A (Brief) Description of Tourism 18 3.2 Importance of Tourism for Today’s Cities 22 3.3 Impacts of Tourism 24 3.3.1 .Yoa'a/ Impact: 25 3.3.2 Plylrzk'al/ Environmental Impact: 26 3.3.3 Economic Impact: 30 4 Tourism and the Tri-County/ Lansing Region 36 4.1 Current Status of Tourism in the Region 36 4.2 Tourism Opportunities and Potential for the Region 44 5 Case Studies 47 5.1 Michigan’s Adventure, Muskegon, MI 48 5.2 AutoW’orld, Flint MI 49 6 Tools for Estimating Economic Impacts of Tourism 52 6.1 Multipliers 52 6.2 Michigan Tourism Spending and Economic Impact Model (MITEIM) 55 6.3 Federal Reserve Fiscal Impact Tool (FedFIT) 61 7 Summary and Recommendations 76 7.1 Overview of Content 76 7.2 Using the Economic Impact Models 77 7.3 Future Recommendations 80 7.4 Closing 82 Bibliography 84 Appendix 88 A. Map: Michigan’s Tri-County Region 89 B. Map: Regional Population Density 90 C. Map: Median Household income by Census Tract 91 D. Map: 1999 Land Use 92 E. How Tourists and Travelers Create Jobs and Income 93 F. MITEIM Data Tables 94 G. MITEIM Summary of Results 99 H. MITEIM Output Charts 102 I. FedFIT Input-Output data 107 J. Sample Questionnaire for Estimating Visitor Spending on Trips 123 1 -"-«'0---'0'.-.--..OU...‘O----...-----------‘ Abstract ourism is one of the top industries in the world today, and is one of the few truly global industries, accounting for billions of dollars in revenue world-wide. Many communities attract tourists because of the historic significance, the multitude of cultural activities and special events, or the unique geographical or climatic characteristics. Typically, the wider the variety of activities a city or community has to offer, the greater number of tourists it will attract. Not only does tourism benefit the travel industry, but many communities across the country have also seen tourism as a way to subsidize growth and maintain a steady revenue flow. Often times, these communities may hold the perception that tourism can be used as a “Band-Aid” and can help an ailing economy or replace a lost industry. Despite the fact that the success of such a strategy is difficult to predict or plan, many American cities are constantly trying to find unique characteristics and attractions of their communities to promote as tourist attractions. This paper begins to establish a groundwork of research related to regional-scale tourism developments with a specific focus on amusement parks. Amusement or “theme” parks, have proven to be economic saviors to many communities across the country, especially those that have taken time to carefully prepare and plan for future growth and development that accompanies such an attraction. This is not to say that all amusement parks are successful or without problems, as will be pointed out later in this document. Some basic information on the benefits and costs of such developments will be included, as well as a preliminary study of ways to accurately estimate the economic impact of tourism-related developments such as amusement parks. .. (Pr. ...-4 I I. f I. "gg303"""'"OU-oooovocovvvvvvvvvvvvvv.‘ Forward his paper is intended to be an evolving piece of research that can be amended and added to over time. Areas lacking existing literature and areas needing more research will be pointed out when appropriate. This research document is not meant to be a detailed background into the intricacies of tourism or a complete history of tourism related developments. There are many texts that go into great detail on these topics. It is the author’s intent to use this paper as a basis for others to build upon and to provide a general overview of the topic of tourism as it relates to local and regional economies, as well as amusement parks as a specific economic development project. The intended audience of this document includes members of academia that are looking for a base of research to expand upon, local land-use and economic development planners, and anyone that may be interested in a basic understanding of the topic. .--..-‘fi.-..‘u“l“'t‘ttf41.0!lt.......-.....II.IIII.[F¢!‘TIIII;-4. Organization of Paper This document is divided into seven chapters that address various components of the research. C/Japtcr 7: Introduction includes a description of the paper including the purpose, need, and methodology. C/Japter 2: Community Profile for t/Je Dinning Tri-Connty Region describes the region and presents important information about the region’s geography, location, climate, and demographic characteristics. C/Japter 3: Introduction to Tocmlrm discusses the importance of tourism as an economic development tool and also describes the costs and benefits associated with tourist developments. C/Japtcr 4: Tonri:m in tbe Tn'-Connty/Lan:ing Region discusses the current state of tourism in the region as well as the areas of opportunity. C/Japtcr 5: Ca:e Staci/c: looks at two examples of amusement facilities in Michigan and points out the lessons learned from each. C/Japtcr 6: Tool: for E:timating Impact: ofTo/m'fln begins to analyze the available economic impact analysis tools and points out their functionality in a municipal planning setting. Finally, C/Japtcr 7: Sam/nag and Recommendation: summarizes the findings of this research and lists various research opportunities. Chapter 1: Introduction to Problem 1.1 Setting here are many cities and regions in every state that are trying to promote tourism and increase travel into their region, and Mid-Michigan’s Tri-County Region is no exception. There are a number of large cities in the southern half of lower Michigan that strive for increased tourism in order to reap revenue from tourism-related businesses. All of these cities promote their cultural attractions, historical sites, and natural resources in order to attract and retain visitors. These cities, in conjunction with their representative chambers of commerce and convention and visitors bureaus, also promote the various entertainment venues, such as shopping areas, restaurants and night clubs, in an effort to emphasize how fun their city is. With all of the competition within relatively close proximity, Michigan cities are in a constant race to develop the winning tourism strategy that attracts more visitors. The Lansing region is one community that is trying to develop a stronger tourist economy, and to become what former Mayor David HOlliSth called a “world class City.” Fignnv 1.1/l: Base map courtesy of wxwvmapscom The Lansing/Tri-County Region will be the primary setting of this research, and was selected for a number of reasons. First, it is my belief that the Lansing region has the potential to be a great tourist destination, particularly for Michigan residents. The central location of the city within the state allows for a potentially large number of in-state visitors. The geographic layout of southern Michigan is much like a wagon wheel with the Lansing region at the hub (see Figure 1.1.A). Each spoke of this wheel would be represented by the major freeways and interstates, and the various major cities would symbolize the outer ring or tread of the wheel. It’s important to note that most of these cities are within an hour and a half drive from Lansing, making day trips to the Tri-County Region highly possible. The second reason the Lansing region was chosen was due to its close proximity, facilitating easy access to pertinent information. In addition, such a study in conjunction with Michigan State University would not only benefit the local communities in learning more about their pursuit of attracting tourism, but would also lend to a growing cooperation between the University and nearby cities. 1.2 Problem Statement Often times, communities that wish to increase tourism begin to entertain proposals for tourism- related developments or sometimes take on the design tasks themselves. The one problem that faces many of these communities when looking at tourism is a lack of information about calculating the fiscal impact of tourism. This is primarily due to the fact that unlike many other industries, there is no clear analysis of the way money is spent and the various correlative effects of tourism, positive or negative. The amount of money spent by tourists is difficult to calculate because most of the services and products consumed by tourists are often consumed by local residents as well. It becomes difficult to differentiate the revenue generated from local residents and that from outside the local economy. In contrast, it is hard to predict the negative effects that tourism will have on a q community, and therefore many communities simply ignore which is why an analysis is often overlooked or, at best, performed on a very basic level. There may be drains on local resources and services as the tourism industry grows and there may also be long-term negative social effects related to a predominately service-oriented local economy. 1.3 Purpose The purpose of this paper is to establish a framework from which to perform a cost/ benefit analysis of amusement parks or other tourist attractions in the Lansing Region. This framework is a combination of action steps that should be taken as well as a sample fiscal analysis. The Lansing Region is used for illustrative purposes in this document, however the structure of the method should be helpful when analyzing impacts, both positive and negative, of similar existing or proposed developments in other communities. Additionally, while the methods of analysis presented here may not be the only approaches, I believe they represent a few basic approaches that are easy to use and act as foundations for other studies. 1.4 Need When communities are looking to broaden their tourism potential by allowing, and even encouraging, certain types of development, they are forced to take a strategic look at the potential benefits and costs associated with such a development. Typically there is more emphasis on the negative repercussions of a development rather than on the benefits. Most likely this is due to a lack of expertise in such analyses among planning agencies, which results in a substandard evaluation of a development. Communities that wish to enhance their ability to perform detailed cost/ benefit analyses for tourism-related developments often find that there is a lack of literature that thoroughly describes a fiscal assessment process specifically for tourism. There are many tools that planners can use to estimate many factors about typical developments or industries, however they do not always take into account some factors that are relevant to tourism. There are ways to generate data on the number of employment opportunities created, the amount of tax dollars possible, and occasionally the amount of total revenue created by the development, which, of course can be important for analyzing many developments, including tourism-related facilities. This sort of analysis begins to tell the story of the potential impacts, however tourism developments are far more complex in structure than a typical industry. This is because there are a number of complex multiplier effects that are generated from tourism activities. \X’hen you calculate the impact of medium to large-scale amusement parks or other tourist attractions on related industries such as transportation, lodging, and food, this amount oflocal revenue increases exponentially. This fact would seem very apparent to many economic development professionals, however, there is little, if any, comprehensive analysis of the economic impact pertaining specifically to amusement parks. Many books have been written describing various techniques for calculating economic impacts of new developments, however the content is often too general for use in analyzing tourism-related facilities and typically lacks appropriate multiplier calculations. This study, therefore, will be filling a void in the available research and literature base on the topic of fiscal assessment of amusement parks and tourist attractions in general. Research such as this paper will also prove to be valuable when conducting feasibility studies for proposed projects. In addition, cities and other communities often lack. the resources such as time, money, and staff that are required for in-depth studies and assessments. This is where it is important for the local communities to have a good working relationship with a university such as Michigan State. If there is such a relationship however, it is important that communities partnering with academia remain open to the objective or unbiased results found within scholarly studies. These communities must also be willing to use the information effectively. 1.5 Methodology This research begins to look at the various tools available for planners to use when initiating an economic development strategy specifically targeted towards tourism. Literature from various disciplines including urban and regional planning, economic development, tourism, and market research, among others was employed by the researcher and a determination was made on the tools frequently used by municipal planning agencies as well as those tools which may be overlooked. After a framework of planning related tools was established, various methods that may be used in other disciplines were analyzed to determine the level of utility and practicality for planners. 1.6 Limitations Specific economic statistics for many individual developments are extremely hard to find due to the fact that many tourism-related developments are privately operated and the financial information is considered privileged information. Occasionally, estimated statistics are discovered in the literature, but the credibility of the data is difficult to determine. Every effort has been made by the author to convey accurate data when available. “““ 4 In addition, this paper focuses on the importance of performing detailed economic impact studies for tourism developments, however time and resource limitations do not allow the author to perform a specific example of such an analysis. Future studies should be conducted to take this step. 10 dx L.“.P.LC‘F.IL€‘..H.‘.§IM"rtlrtvlvr‘lrt.«If.0.5:.de.0.....-.I..¥€..‘_€iflal.€.€ii Chapter 2: Community Profile for Lansing/Tri-County Region efore defining and exploring the characteristics of tourism and investigating the current status and future opportunities for tourism in the Lansing region, we must first present a community profile to introduce the reader to the area. Although a community profile could very well be an exhaustive and comprehensive analysis of every possible aspect for a particular community, this community profile is simply meant to give a brief overview of the region, presenting the most appropriate characteristics for this research topic. This chapter presents characteristics on the geography, climate, and basic demographics of the Lansing/Tri-County Region that may be of significance when performing an economic development-related study such as this. 2.7 CeggrQichiiid Location The Tri-County Region, comprised of Clinton County to the north and Eaton and Ingham Counties to the south, is centrally located within the southern half of the Lower Peninsula of Michigan (See Appendix A for a map of the region). The middle of the region is approximately the city of Lansing at a latitude of 42° 42’ North and a longitude of 84° 33” W'est at an elevation of 853 feet (260 meters) above sea level in downtown Lansing (T CRPC, 2004). Politically, the region is made up of 78 separate units of government. These include 27 cities and villages, 48 townships and the 3 counties. Lansing, the region’s major metropolitan area and the state capital, is centrally located near the intersection of the three counties. Other major cities in the region include the three County Seats; St. johns in Clinton County, Charlotte in Baton County, and 11 ... ..- ... a. .1 . aIJ Mason in Ingham County; as well as other incorporated cities such as Dewitt, Grand Ledge, Potterville, Eaton Rapids, Olivet, Leslie, \V'illiamston, and East Lansing. The Tri-County/ Lansing Region is served by several major surface transportation arteries, such as I- 96, I-69, US, 27, and US. 127. These freeways intersect in and around the Lansing area and link the Tri-County region to other major Michigan cities such as Detroit and Ann Arbor to the southeast, Grand Rapids and Muskegon to the northwest, Flint, Saginaw, and Bay City to the northeast, and Battle Creek and Kalamazoo to the southwest. The area is also served by a regional airport allowing for connector flight to major destinations. As the crow flies, Lansing is 77miles from Detroit, 171 miles from Chicago, 566 miles from New York, and 1,916 miles from Los Angeles (T CRPC, 2004). 2.2 C lit/late The Lansing Region experiences warm, humid summers and moderately cold winters. The average temperature for the region is approximately 47 degrees Fahrenheit with highs and lows reaching an average of approximately 82 and 13 degrees Fahrenheit, respectively. Temperature extremes can reach higher than 100 degrees Fahrenheit in the summer months and into the negative teens in the winter. Average annual precipitation is about 31 inches (T CRPC, 2004). The weather is heavily influenced by the Great Lakes, as these large water bodies have a tendency to affect temperatures and precipitation for the region. In mid-Michigan, the lake-effect weather influences local weather in a variety of ways. In certain conditions, the lake effect can increase the intensity of storms. In other cases, the lake-effect decreases the intensity of storms and increases the stability of air masses. 12 l1 2. 3 Demogragliic: \When considering tourism, a community’s demographic characteristics serve as an important foundation on which various analyses can be built. While the demographic information provided in the context of this paper is by no means a comprehensive demographic analysis for the Tri-County Region, the maps, charts, and tables provide a basis on which to consider important features when looking at the potential impacts of a development. In this report, I have selected key population, housing, and economic data which are relevant to the research. Much of the data is from the US Census Bureau, however other sources will be pointed out when necessary. In addition to the data tables provided within this chapter, there are also accompanying thematic maps under the Appendix that address some additional features of the community. 2.3.1Popn/ation Information Figure 2.A Population of the Tri-County Region Tri- Coun ry Clinton Eaton County Ingham Region County ' County 447,822 64,753 103,655 279,414 Source: 2000 U. 8. Census Bureau The population of the region in the 2000 Census was 447,822 (see Figure 2.A), with 37% of the residents living within the Lansing/ East Lansing Metropolitan area. The population of the region has historically been climbing steadily over the last one-hundred years, although this growth has been slowing a bit in recent years (see Figure 2.8). Some communities, such as Ingham County and the City of Lansing have actually had a decrease in population. Some argue that this decline is caused by a lack of certain types of employment, housing stock, or other amenities, and others argue 13 COOO‘UOOOCO.COCO.......--Ovvvvvvvvvvvvvvvv‘ that population loss is an example of the effects of urban sprawl. Whatever the reason, it is important to note, yet the analysis of such a phenomenon will be left for another research topic. Figure 2.3 Tri-County Region 100 Year Population Trend: 1900-2000 432,674 450000 378.423 447, 728 400000 416.667 350000 298,949 ,8 250000 172,489 200000 E 150000 106'938 191.4" 5 100000 134041 96, 622 50000 0 1900 1910 1920 1930 1940 1950 1960 1970 1980 1990 2000 Source: TCRPC, 2003 Y9” 2.3 .2 Employment Information Figure 2.C Employment / Unemployment as of August, 2003 Unemployment Labor force Employed Unemployed Rate Clinton 36475 35200 1250 3.6 Eaton 59625 57475 2125 3.7 Ingham 155800 147725 8075 5.5 Tn'-C0unry Region 251900 240400 1 7450 4.8 Source: US Census Bureau There were over 250,000 people in the regional labor force in 2000, and of them roughly 240,000, or 95% were employed leaving an unemployment rate of nearly 5% (See Figure 2.C). There is a wide variety of industries in the region that employ many of those in the local labor force. Figure 2.D 14 0.00000coco0000.00cuvvvvvvvvvvvvvvvvvvvv'I depicts the major industries in the area and the percentage of the work force they account for. One of the largest employers, Michigan State University, raises the ‘education, health and social services’ industry to the top of the list, followed by the ‘manufacturing’ industry, due mainly from the strong automobile assembly presence in the region. The retail industry ranks a strong third in the list indicating a highly service-oriented economy. Figure 2.D Major Industry Gromas in the Tri-County Region: 2002 Percentage of Industry Employees Population Educational, health and social services 55,795 24.4 Manufacturing 30,085 13.1 Retail trade 25,266 11 Public administration 21,484 9.4 Arts, entertainment, recreation, accommodation and food services 18,098 7.9 Professional, scientific, management, administrative, and waste management services 16,695 7.3 Finance, insurance, real estate, and rental and leasing 15,375 6.7 Construction 12,726 5.6 Other services (except public administration) 11,324 4.9 Transportation and warehousing, and utilities 7,978 3.5 \‘C’holesale trade 6,519 2.8 Information 5,265 2.3 Agriculture, forestry, fishing and hunting, and mining 2,427 1.1 Source: Lansing Regional Chamber of Commerce The region has a number of major employers that keep the economic base fairly well balanced, as can be seen in Figure 2.E. Given that the state’s capital city, Lansing, lies in the heart of the Tri- County Region, it is no surprise that the largest employer in the region is the State of Michigan with roughly 15,000 employees. Michigan State University, and General Motors round out the top three employers in the Lansing Region with approximately 13,600 and 12,000 employees, respectively. 15 '0‘.COCOO...........-----vvvvvvvvvvvvvv'vv‘ There are many other public service employers, education facilities, as well as many private industrial and insurance companies that are among the region’s top employers, as indicated in Figure 2.E Figure 2.E Major Employers in the Lansing Region (2000) Employer Type of Business # Employees State of Michigan Government 14,998 Michigan State University Higher Education 13,636 General Motors Automobiles 12,000 Sparrow Health System Medical 6,000 Meijer 33:22::mg’ 4,261 Lansing School District Education 3,500 Ingham Regional Medical Center Medical 2,500 Lansing Community College Higher Education 2,000 US Postal Service Government 1,300 City of Lansing Government 1,200 Dart Container Containers 5,000 Peckham Industries Textiles, Auto parts 1,200 Auto-Owners Insurance Insurance 1,100 Ingham County Government 900 jackson National Life Insurance 850 Lansing Board of Water-Light Utility 765 Standard Federal Bank Banking 750 John Henry Company Printing 650 Federal-Mogul Corporation Auto parts 640 Ameritech Utility 625 Michigan Farm Bureau Insurance 600 Consumers Energy Utility 550 Spartan Motors Auto parts 525 HT Automotive Auto parts 500 Wohlert Auto parts 475 Carefree Aluminum Products Aluminum Products 450 Lansing Statejournal Newspaper 450 Delta Dental Insurance 431 FASCO DC Motors Electric motors 430 Trumark Auto parts 350 Accident Fund of Michigan Insurance 326 First of America Bank Central Banking 325 Sealed Power Auto Parts 300 Blue Cross Blue Shield of Michigan Insurance 275 US Dept of Agriculture Research 250 State Employees Credit Union Banking 220 Blue Care Network Insurance 217 E-T—M Enterprises Auto parts 195 Source: Lansing Regional Chamber of Commerce 16 VUOUCOdd-'00U--.COUOO‘OU‘O-----vvvvvvvvvv'v'vv‘ The stability of the automobile industry is often questioned despite the long history of manufacturing in Lansing, and the state agencies are vulnerable to drastic employment changes as the political environment changes with every new budget and election. GM, however, recently invested millions of dollars into building a new state-of—the-art facility in Delta Township, vowing to remain in the region. Although there are occasional threats to pull out of the area due to various regulatory disagreements, it is most likely that GM is here to stay. As far as the state government, it is certain that the capital will remain in Lansing despite employment fluctuations with the changing of the political parties. 2.3.3 Ali:ce//aneon: I rformation As mentioned previously, this is not meant to be an exhaustive community profile, but rather a brief overview of the basic demographic characteristics of the region. The table to the right contains other important statistics for the region. Fi . ure 2.F tIEri‘Ki-glnn‘gnographic Data for the ‘ 'mTri-County Region Household Data, 2000 Number of Households/Occupied Housing Units 172,143 Number of Vacant Housing Units 9,391 Average Household Size 2.48 Average Family Size 3.05 Owner-Occupied HousingUnits 115,950 Renter-Occupied Housing Units 56,463 Pgaulation Data, 2000 Gender Ratio: Male/Female 48.6/51.4 Race (Percentage of Total Population) White 84.4 Black 8.1 Asian 2.6 All Other 4.9 Hispanic or Latino (of any race) 4.7 Income Data, 2000 Per Capita Income $21,653 Median Household Income $44,441 Median Family Income $55,989 Source: US Census Bureau, 2000 17 ‘5‘-.““‘ut‘a‘-‘.f“‘fil‘ffl“¢£.€ffli‘fi‘ffl0f“fh."a‘pl Chapter 3: Introduction to Tourism 3.1 A (Brief) Description of Tourism Before the realms of tourism are explored, it is important to set a base from which to work. Specifically, it is imperative that a clear definition of tourism is presented. Of course one could go into great detail describing the intricacies of tourism such as the history and origins, as well as the motivations and characterisdcs of tourists, however, there already exists a great deal of literature on these topics, so a brief description is presented here to relate to the purpose of this paper. At first glance the word “tourism” seems like a fairly straightforward term to most people. However, upon further analysis, it appears that presenting a concise definition is more difficult than first perceived. It is for this reason that clearly defining the term becomes a challenge. Starting with a very basic source, Webster’s American Dictionary offers the following definition: “tourism n 1. The occupation of providing information, accommodations, transportation, and other services to tourists. 2. The promotion of tourist travel, esp. for commercial purposes.” Of course this definition doesn’t do you any good if you are unfamiliar with what a “tourist” is. Uel Blank (1989) states that “. . .the definition of “tourist” can be expanded to include anyone traveling away from home or the usual workplace for any purpose.” Cook (2002) provides a definition of tourism that seems to combine the essence of both of these when describing tourism as the “. . .temporary movement of people to destinations outside their normal places of work and residence, the activities undertaken during their stay in those destinations, and the facilities created to cater to their needs.” 18 Some authors, as well as practitioners, suggest that trips for the purpose of work or business do not constitute as tourism, however it is this author’s belief that any money that is spent in a community other than an individuals home or normal workplace constitutes as tourism spending. Every trip, no matter the purpose or duration, has some form of impact on the community, to a greater or lesser extent, which will be illustrated in subsequent chapters of this document. The assumption that work-related trips are not considered tourism discounts the millions of dollars in revenue that professional organization conferences generate across the country every year. This assumption also ignores the fact that the face of the hotel industry has been shifting over the past several years to accommodate more business travelers by offering amenities such as suite rooms, internet connections, complimentary breakfasts, and even free copies of The W’all Streetjournal. With new developments such as these going up in nearly every city, there is no denying the fact that there is a market for business travelers, and for someone to say that business travelers do not have an impact, good or bad, on a community would be completely inaccurate. Not to completely dismiss the validity of these arguments, it would be important in some instances to determine the differences in spending between business travelers and general tourists, but one should not completely ignore the impacts of business-related tourism. Another complication to the discussion is that there are also organizations such as the World Tourism Organization that define a tourist as “. . .any person who stays away from home overnight” (WT O, 1994). There is also a problem with this definition, especially for small communities. This assumption neglects to recognize the importance of the hundreds upon thousands of special events occurring in communities across the country, such as fairs, festivals, concerts, and sporting events. Most of these types of events are visited by those within driving distance, making a day trip the most appropriate length of stay. Special events such as these can have a tremendous impact on the 19 community. Some smaller communities spend large percentages of their funding in the promotion and facilitation of special events, yet these communities often lack adequate lodging opportunities for the potentially large influxes of people. Despite this fact, these communities often benefit from the increased interest and attention. There are countless more descriptions of tourism from various sources, however for the purpose of this research we will work under the definition of tourism provided by Cook, as previously illustrated. \We will also include trips for any purpose and of any duration in our description. It should also be pointed out that despite the fact that some research suggests that there is a minimum distance a person must travel before we can categorize the trip as tourism, we will place no such limitation in our analysis. Figure 3.1.A: Milestones in the Development of Tourism Prerecorded History Travel begins to occur out of sense of adventure and curiosity. 4850 BIL—102'7 BC. lilgyptians travel to centralized government locations 1760 801027 BC. Sang dynasties establish trade routes to distant locations throughout the Far East 1100 B.C 800 BC Phoemcians develop large sailing fleets for trade and travel throughout their empire 900 B.C-200 B.C. Greeks develop common language and currency and traveler services emerge as city-states become destinations 500 B.C-A.D. 300 Romans improve roads, legal system, inns to further travel for commerce, adventure, and pleasure A.D 300-A.D. 900 Mayans establish trade and ravel routes in parts ofCentral and North America A.D ll_i9(i-A.l). 1295 l'iuropean travel on failed religious crusades to retake the lloly Lands from Muslim control introduced these military forces to new places and cultures A.D 1275-A.D. 1295 Marco Polo's travels throughout the Far East begin to heighten interest in travel and trade 14'“- 16'h centuries Trade routes develop as commerctal activities grow and merchants venture into new territories A.D. 1613-A.D. 1785 Grand Tour Era makes travel a status symbol for wealthy indin'duals seeking to experience cultures of the civilized world 18"*-19-'-“ centuries Industrial Revolution gives rise to technological advances making travel and trade more efficient and expands markets; increasing personal incomes make travel both a business necessity and leisure activity 1841 Thomas Cook organizes firsr group tour in England 1903 \Vright Brothers usher in era of flight with the first successful aircraft flight 1913 \Y’cStinghouse Corporation institutes paid vacations for its workers 1914 Henry Ford begins mass production of the Model T 1919 First scheduled airline passenger flight debuts between London and Paris 1945 World War 1] ends and ushers in new era of prosperity, giving rise to millions of people with the time, money, and interest to ravel for pleasure and business 1950 Diners Club introduces the first credit card 1952 jet passenger service inaugurated between London and johannesburg, South Africa .fomre: Coo/e, 2002 20 For this analysis of tourism we will not need to go into much more detail about tourism beyond a clear definition of the term. It is important to point out, however, that people have been traveling and touring since the beginning of time, as illustrated briefly in Figure 3.1.A, and we can anticipate that the trend will continue into the next millennia. It is also not necessary to look into the never- ending range of reasons for why people travel and what causes them to be drawn to particular types of sites in this paper. Instead, this paper acknowledges the likelihood that people will in fact continue to travel. We also know that traveling has become easier as transportation technologies and trade relations have evolved and become more accessible to more people. This accessibility has allowed more people, especially those of modest income to travel farther away and for longer periods of time. Although this paper will not go into detail on the history of tourism and the elements that have contributed to its growth, there is a plethora of literature on these topics to satisfy anyone with an interest in such topics. 21 3.2 Importance of Tourism for Today’s Cities 5 cities and states across the US. struggle with the ever shrinking budgets and decreased federal funding, they are also facing the decline and loss of many of the manufacturing industries that were once the economic foundations of their respective communities. Some of these communities have been able to adapt to the changes in the American business economy because they were proactive in creating a diverse economy with many different types of industries, rather than relying on one main industry. Some of the more successful communities have been lucky enough to attract new and unique types of industries over the years, however, most communities have struggled to maintain a healthy economy, and as a result have also struggled to maintain and attract new residents. Often times these struggling communities may look to other communities of similar size that have been successful in developing economic development strategies in order to gain inspiration for concepts that could be implemented in their area. What is discovered, many times, is that communities will turn to tourism as a way to diversify their industrial base. Tourism is widely recognized as an ever-growing and important industry in US. cities and around the world. By some accounts, tourism accounts for 4.0% of the world’s gross product, and in the US. tourism accounts for over 5% of gross domestic product, with domestic travel accounting for over 75% of receipts and expenditures (Bull 1995). On a very basic level, however, the primary goal of tourism, as well as many other industries, is to get “outside” money into the local economy. The expectation is that tourists will spend money on services such as lodging, food, transportation, and gasoline, as well as any other expenses such as those associated with entertainment/ amusements and 22 retail. In a sense, tourism is similar to an export industry, except that in addition to selling physical or tangible goods, the product is actually the acquired assortment of experiences and memories an individual takes home, or “exports.” Money is added to a local economy when someone from outside the community buys a good or service produced within the area, essentially “leaving” their money behind during their visit. The money is then re-spent, generating additional value within the local economy (Cook, 2002). This process is often referred to as a multiplier effect or “trickle—down” effect. This phenomenon is further discussed in the economic impact portion of section 3.3.1/mam of Tourism, as well as in C bapter 6: Tool: for Evin/(11mg E commit I mpaa‘; of Tourism. Although the primary motivations for promoting tourism are typically for economic gains, there may be other impacts, both positive and negative, that can affect the host community. The following section will explore three main types of impacts associated with tourism developments and romotion; social environmental and of course economic. 9 3 23 rcee‘eocccbt‘,‘.D‘cc‘lv‘reh‘tlr.Lt!l:‘.(‘.‘iF-‘..‘-r.filv(Iv «Pi... 3.3 Impacts of Tourism Often times when a new development is desired and / or proposed, the first questions that both residents and public leaders ask is “what impact will this have on the community” or “what’s in it for me/ us/ them/ the community.” Perhaps these questions are not stated per-se, but rather raised through discussing the project or plan and expressing their concerns about the development, whether supportive or in opposition to it. Typically, people first question how a new development is going to positively and / or negatively impact their lives. They may think about how the proposed local water park is going to be more convenient than going to a distant lake or pool and how the active recreation facility will be a welcome addition to their local area. They may also think about how the new facility is going to attract more traffic in an already congested area or how the store might attract the “wrong kind of people” to their neighborhood. These types of concerns could be considered personal impacts (and there as many personal concerns about every development as there are stars in the sky) but they raise some valid questions about the various impacts of tourism developments. There are three general types of impacts associated with tourism developments, or any other development for that matter, which are consistent throughout the literature. The various concerns raised by residents and public leaders can usually fall into one of the following impact categories: social impacts; physical or environmental impacts; and of course economic impacts (Mathieson, 1982). The bulk of this paper addresses the economic impacts, however we must also emphasize the importance of other impacts that tourism developments have on a community or region. These impacts can be beneficial or adverse, however there is often a fine line between whether a specific impact is positive or negative. 24 Social I o/Qam Social or cultural impacts of tourism are situations that contribute to changes in value systems, individual behaviors, family relationships, lifestyles, moral conduct, and community organizations (Mathieson, 1982). Socio-cultural impacts of tourism are the influences experienced by residents of the host community in their direct and indirect interactions with tourists. Typically, social impacts are negative in nature and address quality of life issues. If communities are not careful, tourism can dramatically disrupt normal residential patterns. Areas with a strong tourism presence often experience a lack of nearby affordable housing, pushing people out of the community to live. This can be especially troubling when you realize that many of the employees of tourism-related businesses generally receive lower pay than other industries, and are the ones being displaced further out of the community. Richard Foglesong demonstrates this mismatch between tourist-industry wages and housing prices Oudd/Fainstein, 1999): “Athough housing prices in central Florida are only 82 percent of the national median, an Orlando city task force found in 1989 that two thirds of the existing population cannot afford the area’s median priced eighty-thousand-dollar home. This problem has been aggravated by impact fees in Orange County and high land prices in the area around Disney. Because of a shortage of lower priced homes and apartments, many Disney workers commute twenty-five miles north to Seminole County to find affordable housing.” This situation also opens up a host of other concerns such as the availability or cost of reliable public transportation. Another social impact commonly associated with tourism relates to the health implications of inviting visitors from other areas, particularly those from other nations. There are commonly public health concerns with the heavy temporary influxes of people as they may be bringing new strains of 25 infections or diseases of their home community into the local area. The 2003 outbreak of SARS in China raised this concern to a new level. Socio-cultural impacts are hard, if not impossible to quantify, and therefore hard to measure accurately. Unlike economic impacts, there are no mathematical equations that can be used to calculate the social impacts of various development decisions. There are many sociological studies that look at the social impacts of various developments, however they are more theoretical and done after the fact. The socio-cultural impacts of proposed developments may be discussed or analyzed, yet there are no tools that accurately quantify the impacts in a way that is useful for planners. For the most part, physical impacts are also difficult to quantify, although physical changes are more noticeable than social impacts. P/grl’fl'c‘a” EIIZV’Z'I‘OHMC’IIM/ I mpam Physical or environmental impacts are typically thought of as the effects that tourism has on the land, air, water, flora, and fauna. It is also important, however, to include the impacts tourism has on the built environment in this analysis (Mathieson, 1982). As with social impacts, when looking at tourism’s potential impacts on the natural environment, the literature often considers them to be negative in nature. Potential impacts on the natural environment can include everything from increased pollution (air, water, and ground), to the elimination of unique or rare habitats, ecosystems, or even species. The physical appearance of these natural areas can also be negatively impacted. For example, several peaks within New York’s Adirondack Mountains have become barren of vegetation because of hiking traffic (Cook, 2002). These are serious concerns and in most communities an environmental impact study is often 26 required for any new development (not just tourism-related), especially those in environmentally vulnerable areas. When looking at tourism in some regions, especially in Europe, there is often a great deal of emphasis placed on “sustainable development.” Sustainable development is essentially building with minimum impact on the environment and building within the community’s current carrying capacity. In the tourism sector this sort of development is often referred to as “ecotourism.” A better definition is available from the United Kingdom Government’s Sustainable Development website (bf!7).‘//n'1m'.sustainab/e-dwi'e/opmmtgoz'.11k). It states that sustainable development is “development which meets the needs of the present without compromising the ability of future generations to meet their own needs.” Some other environmental-related concerns about tourism, or development in general, are that it eats up valuable land and disturbs the natural scenery. Some argue that even in natural preservation areas, such as the National Parks, the exploitation of the natural environment is harmful, as it increases traffic which contributes to increased pollution and exacerbates weathering and erosion processes. In fact there may be some validity in this argument when you consider the visitation numbers of the National Parks. In 1940 the annual visitation for all of the National Parks was just over 16.5 million persons. By 1960 that number had risen to nearly 80 million, and by 1980, the visitation was over 20 million. Based on this data from the National Park Service, the visitation had grown 373% between 1940 and 1960 and 178% between 1960 and 1980. By 2000, the growth in the number of visitors had slowed to a 20 year increase of 30% from 1980, but still accounted for nearly 286 million visitors (NPS, 27 2004). See Figure 3.3.A for National Park annual visitation for every decade between 1910 and 2000. Of course the National Park Service has acquired a great deal of land and established a number of new parks over the years, but the numbers remain staggering. The visitation numbers seem more daunting when you consider these are lands that have been identified as being significantly unique enough to preserve, yet, as some argue, are being exploited for their beauty. There is certainly no denying that such high volumes of traffic (vehicular and pedestrian) have potential environmental repercussions for these areas that are being “preserved” for future generations. Figure 3.3.A: US National Park Annual Visitation 1910-2000 300,000,000 2 250,000,000 0 .1: .99 200,000,000 0 > 8 To 0’ : 150,000,000 31 a E .0 :5 “5- :2“ to N g 100,000,000 :9 «'7; 98 us § _ 00 N 0 / 8 0. 8'1, <5 '- 50,000,000« N ‘- m --- / -: 0 MT T ffi’ 7'_T a" V_' T' _' v T N‘ *1 " ’_"Y 7" 7‘ 1910 1920 1930 1940 1950 1960 1970 1980 1990 2000 Year Source: National Park Service, 2004 Accepting the fact that visitors to the National Parks negatively impact the environment, it’s hard to ignore the potential impacts that amusement parks have on the environment. In comparison to the nearly 286 million visitors to the 378 National Parks across the country there were approximately 28 317 million visitors to over 600 US. amusement parks and attractions (IAAPA, 2004). Although not a significantly larger attendance, environmental impacts of amusement parks can still be significant. In addition, when you take into consideration the vast amounts of impervious surfaces within such developments and sheer amount of resources (electricity, water, etc.) used to maintain operation of the rides, concessions, and other amenities associated within amusement parks, and you begin to see the importance of careful planning and consideration of all impacts prior to the construction of such a deve10pment. For this reason, an increasing number of communities are beginning to place an emphasis on requiring environmental impact studies for large developments such as these. Many tourist-friendly areas also experience what Mathieson (1982) calls “architectural pollution.” This is the case in many beach communities, especially along the eastern US coastline, where large high-rise hotels and condominiums line the coast, creating a giant wall that blocks the view for most people. These communities are also prone to sprawl development as the buildings are continually built along the shorelines in a linear pattern, filling in the gaps as it expands. Mathieson claims that this type of resort development “has been one of the most significant environmental transformations associated with tourism,” yet it has not received much attention lately. He goes on to state that, aside from architectural pollution, the environmental impacts of coastal resort developments include: ribbon/ linear development and sprawl; overloading of infrastructure; segregating of local residents; and traffic congestion. Similar characteristics can also be found in developments around amusement parks. Take Disneyland and the surrounding city of Anaheim, California for example. After the 45 acre Disneyland Park was built among the orange groves of Orange County in 1955, it was quickly 29 followed by speculative land purchases and developments resulting in a ticky-tacky cornucopia of tourist traps, motels, restaurants, souvenir shops, and the like. The typical stresses on the infrastructure resulted, as did traffic congestion and decreased air quality. There are, however, beneficial physical impacts that have resulted from the strains caused by tourism that are often overlooked. The most significant of these is the fact that tourism often leads to an improved and expanded infrastructure, such as transportation networks and public services (water, sewer, electric, etc.) (Gunn, 1994). These sorts of improvements not only benefit the tourists, facilitating easier travel, but also benefit the local residents. Conversely, though, these expansions and improvements must be pursued proactively, otherwise there could be a potential for overloading the infrastructure systems (WT O, 1994). Economic I ”{pam The primary beneficial economic impact of tourism-related developments that is usually emphasized is the creation of new employment opportunities, which in turn reduces the unemployment rate. Conversely, it can be argued that the jobs created within the tourism sector are typically low-wage, part—time jobs and, in the case of amusement parks and similar facilities, are seasonal positions that are sometimes filled by non-residents, such as students or transients. The argument is that these types of jobs are undesirable jobs in the community and tend to lower the median income levels Gudd/Fainstein, 1999). In fact, according to the 1997 US. Economic Census, employees within the “amusement and theme parks” industry (NAICS #71311) made an average of $15,258 per year, which is 79% of the national per-capita income of $19,241 from the same year. Yet it could also be argued that these types of positions provide employment to teens and young adults, inexperienced or low-skilled people, or persons otherwise not able to find professional positions. 30 In addition to tourism-related support positions, construction—related employment also increases as more facilities and enhanced infrastructure are required to support the tourism industry (WT O, 1994). The resulting low unemployment rate from a growing industry base such as tourism can also be an attractive feature to many prospective residents thinking of moving into the area. A Gallop study of over 2000 residents of Northeast Ohio found that nearly “half (49%) of residents feel job creation should be a top priority for economic development activities” (Gallup, 2004). Attracting new residents is always an important consideration for many communities, as the increased population results in increased tax revenue to support community services and improve facilities. As a result of the increased employment needs of tourism, the economic benefits of tourism-related spending can have far reaching effects. This increase in employment can benefit the economy of the host community through what is known as the multiplier effect. The multiplier effect basically refers to the phenomenon by which tourism revenue is filtered down through various economic sectors within the community by way of supplier and employee spending. To better understand this “trickle down” principle, the process must be described in terms of the various stages. Within this “trickle down” process there are three primary stages or economic effects that the money has within the community. Currency flow resulting from tourism can stimulate various sectors of the economy through direct, indirect, or induced impacts. “Direct” impacts are those economic activities which are a direct result of tourist spending (Hall, 1999). Such activities include hotel visits, meals in restaurants, and souvenir purchases from local businesses. “Indirecr” impacts are those business activities generated as a result of support or supply sector businesses. For example, revenue gained in one local industry or business, such as a 31 fast food restaurant for example, will in turn be cycled down to supporting industries, such as bakeries that supply the buns, or companies that provide cleaning supplies. “Induced” impacts are slightly more ambiguous, but can simply be described as the further expanding of the spending power from income made by direct and indirect employees (W'orld Tourism Organization, 1994). For example, when a hotel employee receives a paycheck, the money will typically be re-spent locally on various items such as housing, food, transportation and clothing, with a portion of that money going to support more employees that spend it elsewhere, and so on (Cook, 2002). Figure 3.3.8 and Appendix E further illustrate the multiplier effect of tourism spending. Multiplier effects are among the most analyzed economic characteristics of the recreation and tourism industry. Mathematical formulas can be used to Figure 3.3.8: Multiplier Effect Source: Cook, 2002 1. Sam leaves her home in Bloomington, IN, with $500 dollars. She is going to Fort Lauderdale, FL, for spring break. \ 2. Sam pays way too much For a lobster tail at an expensive restaurant on the intercoastal waterway. But what the heck - she's on vacation. Sam's ' waiter Joe goes the extra mile for her, recommending a few great night spots and even draws Sam 0 walking map. Sam is so grateful she tips Joe $25. K 3. Joeworked7daysaweekl'orthe past 3 weeks. He hasn't had time to get a haircut, do his laundry, or even visit the bank. He decides to go see his hairdresser Sarah and get a haircut - $25 with tip. 4. ”Good thing Joe came in today,” Sarah thinks. "His $10 tip was the only tip of the day. I've got to start cutting a better class of hair." Sarah looks down as she is driving and notices she's almost out of gas. She pulls over and puts the $10 in her tank. mt ll 5. The owner of the gas station lets out a sigh of relief as Sarah pays him. He was just shy 01 $10 to cover his payroll deposit - he can go to the bank now and then go home and relax for the rest of the weekend. \ And the Q continued to move through the economy increasing the multiplier effect. 32 estimate the economic impact of an industry sector and take into account inflows and outflows of money. These formulas use what are known as “multiplier” values to calculate the various impacts. Multipliers are essentially analytical factors that, when applied, or multiplied to, existing statistics, indicate the extent and level of secondary and tertiary economic impacts. These will be discussed further and applied in Chapter 6. Communities with a strong tourism industry also benefit from the influx of “foreign” money (money from outside the community or region) into the local economy. This increase in “foreign” spending resulting from tourism-related sales not only filters down to other industry sectors, but can also calculate into increased sales tax revenue, as well as hotel and other consumer tax revenue for the local unit of government. Yet this sort of increase in tourism spending occasionally results in higher prices for goods and services in the local area, and in turn can have a significantly negative effect on the local residents. Anything from groceries to gas to entertainment costs can be artificially inflated because the demand from visitors is high. If planned carefully and developed slowly over time, however, tourism—generated revenue can be beneficial to the economy and local residents will adjust to the new industry (WT O, 1994). What we have seen over the past is that with proper development and ongoing management, tourism can have a positive effect on a community and provide a more diverse and viable economy. Most American cities are now aware of the benefits of tourism, but are unsure on how to develop tourism as an industry and then promote it to the degree it needs to be. Whether a community wants to promote its small town feel or big city diversity, the goal is the same. . .attract more visitors and get them to spend money. 33 Historically, most US cities have relied on a handful of basic industries to subsidize growth and advancement by means of increased employment and, of course, increased overall revenue. Typically these basic industries included traditional construction, manufacturing, or extractive type industries such as mining, lumbering and so on. Over the past few decades many of these industries have relocated to other countries where labor and other resources are less expensive. \X/hat’s more, the industries that have remained domestic have increasingly integrated advanced technologies that allow for more automation, resulting in less reliance on the human component. This sort of trend has lead to economic crises within our metropolitan areas, and it becomes progressively more difficult for cities to encourage existing basic industries to stay and / or invest new capital within the city, let alone try to encourage new industries. Of the handful of new or expanding modern industries, many develop in rural or urban fringe areas where land prices are lower and there are fewer land use regulations placed on such developments. It is because of these difficulties that cities look for other solutions to attracting investment in the community and increased revenue, and for many cities, the easy answer appears to be tourism. Tourist attractions often attract more related businesses and allow local entrepreneurs to start souvenir-type businesses. Communities must be careful when promoting or allowing such development, as they can easily fall into a downward spiral of attracting tacky tourist-trap-like businesses and gaudy architecture and signage. Perhaps the one of the most important economic impacts that should be considered is the fact that tourism is an unpredictable and fickle industry that is heavily influenced by external factors. Also, it is because of the unpredictable nature of tourism that it must be pointed out that, in a nut shell, too 34 much of a good thing can be harmful. That is to say that too much reliance on tourism as an economic base can place a community in a very vulnerable and precarious position. There is an example of such a situation that occurred through the development of Flint’s AutoWorld described in C bop/er 5: Care Stud/'65. Another economic consideration that is often overlooked when analyzing tourism is related to transportation costs. With any export industry there are typically high costs associated with transporting the products to the consumers. Given that tourism is essentially an export industry without a tangible product, it should be acknowledged that there are transportation costs to mate the produCt with the consumer. However, in the case of tourism, the burden of these transportation costs is placed on the consumer, which is atypical of conventional export industries. Therefore, we cannot discount the relevance of the elimination of outbound transportation costs associated with tourism when analyzing the costs and benefits of such developments. 35 Chapter 4: Tourism and the Tri-County Region 4.1 Current Status of Tourism in the Tri-County Region W’ith all of the competition within relatively close proximity, Michigan cities are in a constant race to develop the winning tourism strategy, or be the first with a new or unique feature or attraction that attracts more visitors. The Lansing Region is no exception to this, and is one such community, or group of communities, that is trying to develop a stronger tourist economy. City of Lansing officials in particular, actively strive to make the city a “world class city” through the development of new entertainment venues and other visitor related opportunities. However, when looking at the impacts of a particular industry, we cannot simply look at Lansing alone, as many of the corollary effects will spill over into neighboring communities. Each of the smaller cities and villages around the region are host to a whole set of unique characteristics, industries, and special events that add to the overall tourist appeal of the region as a whole. Tourist attractions in the region include everything from natural and scenic areas, to public lands, cultural and entertainment attractions, and of course historic sites. The Greater Lansing Convention and Visitors Bureau promotes tourism and distributes information about the attractions and events that exist throughout the entire three—county region comprised of Clinton, Eaton and Ingham Counties. The fact that what happens in one community extends into adjacent communities is clear to all of the participating jurisdictions. In fact, there is also a regional economic development organization (RED Team) made up of local government and business stakeholders that explores ways to increase tourism for the region, as well as other activities that stimulate the economy. 36 When looking at the region as a tourist destination, especially for in-state travelers, there are a number of facilities that stand out as key attractions: 0 The City of Lansing, in the heart of the region, is the political center for the state and boasts a beautifully restored Capital building that stands as a democratic symbol for the state. This centerpiece of the region attracts over 125,000 visitors annually that participate in the free guided tours of the building (Michigan Legislature, 2003). O Lansing is home to the State of Michigan Library and Historical Museum featuring dioramas representing milestones in Michigan’s history as well as a large collection of Michigan- specific artifacts, books, and periodicals as well as research and archival materials 0 Although primarily targeted towards local tourists, Oldsmobile Park, just two blocks from the Capital, is home to the region’s only minor league baseball team, the Lansing Lugnuts. The 11,000 person capacity stadium built in 1996 had an average annual attendance of over 458,000 within its first seven years (MVU L, 2004). O Lansing features a variety of historically significant structures and heritage areas, entertainment facilities, and a state of the art convention center (the Lansing Center). 0 Lansing is host to a number of special events and festivals, such as the very successful weeklong Common Ground Festival, a weeklong series of concerts and carnival activities which attracted over 86,000 people in 2004 (F rye/Trier, 2004). Although a great amount of time and money has gone into developing the facilities and attractions in Lansing, there are also significant attractions in other communities throughout the region. 0 East Lansing is of course home to Michigan State University which draws people from around the world for a variety of reasons aside from the excellent degree opportunities. 37 From cutting edge research opportunities to Big 10 sporting events and Off-Broadway performances, MSU has a significant impact on the local economy. 0 Each of the three county seats in the region, Mason, St. johns, and Charlotte are historically significant in the context of the development of Mid-Michigan and feature traditional “Main Street” type downtowns with period structures in various stages of preservation. 0 Many of the small communities around the region also have a “claim to fame” of some sort. 0 Elsie, in northeastern Clinton County promotes itself as “Michigan’s Dairy Capital” and prominently displays a giant fiberglass cow (it’s actually a bull, but we won’t spoil their fun) in front of the village office. 0 Grand Ledge, as the name implies, promotes the locally unique cliffs along the Grand River. 0 Fowler simply placed a clock in the middle of the main street to distinguish itself from other small villages. The list could go on. Traveling in and around the region is facilitated by the excellent transportation network. In addition to being accessible by approximately 175 miles of major Interstate Highways and state highways, the Tri-County Region has a moderate sized airport just northwest of Lansing in Clinton County (Capital City Airport) as well as several Greyhound stations / stops throughout the region and an AMTRAK station in East Lansing (T CRPC, 2003). The Capital City Airport is classified by the Federal Aviation Administration (FAA) as a small hub airport and ranks as the third busiest airport in Michigan for passenger “enplanements” with over 260,000 for 2002 (Capital Region Airport Authority). Capital City Airport is served by several national airlines including Northwest Airlines, Continental Express, and US Airways Express. The 38 ‘ ‘. ‘ ‘ ‘ H ‘ ‘ .‘ ‘ i 4‘. ‘ .1 ‘w ‘1 ‘ ‘ ‘li‘ ‘1‘. t. t ‘c ‘l‘. ‘l‘i‘u ‘l‘l‘l‘ f.‘;.|‘.. I‘._ t r ‘i" various carriers directly serve seven “hub” airports in Chicago, Detroit, Cleveland, Minneapolis, Pittsburgh, Las Vegas, and Milwaukee (T CRPC, 2003). The location of the region, the various attractions, and the transportation amenities are some of the characteristics that result in a fairly stable tourist economy across the Lansing/Tri-County Region. Based on a study conducted in conjunction with the Greater Lansing Convention and Visitors Bureau (GLCVB), the region attracts roughly 5.1 million visitors each year, accounting for approximately $372 million in spending within the region and creating over 7,500 jobs specifically within tourism-related businesses and over 9,500 jobs when secondary effects are accounted for (Stynes, 2000). Figure 4.1.A illustrates these figures in a basic economic flow diagram for the region. Figure 4.1.A Economic Impacts of Traveler Expenditures Wifllin the Tri-County Region TRAVELER EXPENDITURES $372 lllllion :-'-""""""'-""""""""""“"""'1 | 7 7 I I I 1 403‘ DIRECT EFFECTS E E 7'7“ $270 man (Sales) : 1 i l I 1 mm mum : :----+ JOBS : : 9,517 i * ” : ; JOBS SECONDARY EFFECTS : : 1,775 8126 anion (Sdeo) ; : ~ : L--_----_----_----_--_-------------------------: MM “(3), 2M] mm 0361, 2MB 39 For comparative sake, General Motors employs roughly 12,000 people in the region (See Figure 2.E). The GLCVB study shows that although there is a tourism presence in the Tri-County Region, it currently may not have as significant an impact on the employment opportunities, and ultimately the economy in general, as one may think. Tourism only accounts for 3% of all jobs and 1.5% of dollar sales in the Lansing region (Stynes (3), 2001). This data may illustrate the need for further analysis of tourism in the region. A one page summary of the most significant tourism impacts for the region can be found in Figure 4.1.B. **This space intentionally left blank** 40 ‘1 ‘1. ‘ ‘.r‘ ‘ ‘ Irv ‘..‘. ‘ -‘i ‘u-‘. d. ‘s. 1 ‘. 1‘ r‘ ‘I. ‘. a. d a..." 5911‘- e ‘ fill-7407‘. {I‘l' .tirlfll.‘ .....vlfwlfllrf I-------vavvvvvvv-vvvvvvvvvwvvvwvvv Figure 4.1.8 Summary of Greater Lansing Region Tourism Impacts, 2000 Clinton, Eaton and Ingham Counties Visitors > 5.1 million visitors (person trips to the area) 0 2.5 million day trips, 2.6 million overnight trips > 10 million visitor days / nights 0 2.5 million day trips and 7.5 million person nights on overnight trips > 3.8 million travel party days / nights (average party size 2.6) 0 46% overnight stays with friends and relatives (V FR), 29% day trips, 23% motel, 2% camp Spending > $431 million overall tourism sales, counting half of airport activity > $372 million total visitor spending in tri-county region excluding airfares. 0 $70 per travel party per day for day visitors and VFR , $197 per party per night for visitors in motels 0 Spending by category: restaurants (23%), lodging (20%), local transportation (17%), groceries (14%), recreation/ entertainment (8%), other retail (17%). 0 Tourist spending accounts for 81% of all hotel sales in the area, 17% of restaurant sales, 20% of amusements, and 4% of retail trade > Overnight visitors staying in motels account for 46% of visitor spending. Economic Impacts ‘P Direct Effects in tourism-related businesses ' 7,500 jobs ' $110 million for wages, salaries and payroll benefits ' $170 million value added ' 2.8 million in local room tax, $22 million in state sales taxes ' Tourism jobs by sector 0 restaurants —2,600 hotels -1,900 0 amusements -1,400 retail trade - 1,400 > Total impacts including secondary effects ' 9,500 jobs ' $160 million wages and salaries ' $250 million value added ' Tourism accounts for about 1.5% of all sales in the region and about 3% of all jobs. Source: Stynes, 2000 41 “l“--‘l‘l-“r“1flt““ “11“..‘1‘v fl. ‘2.“ “ “. ‘. .0 I“. i f f. a e f {1'11 1! ‘11.: «I. It. 4111‘ .l. ...I (it. I. '_-' rvddcvvvv'vcvvvvvv'v'vvvvvvvwvvvu:v-vv The money spent by tourists directly effects many sectors of the economy that provide a wide range of goods and services. Although some businesses may cater specifically to tourists, such as hotels and souvenir shops, most also provide services to local residents. The economic impact of tourist spending depends upon the initial round of expenditures (direct effect), as well as the successive linkages within the economy (indirect & induced effects) (Mathieson, 1982). Figure 4.1.C illustrates the distribution of traveler expenditures within the main tourism-related sectors for the Lansing/Tri- County Region for 2000 (excluding airfare and rental cars). Because this data includes both overnight travelers as well as those on day trips, it’s not surprising that the “Restaurants 8: Bars” segment attracts the largest portion of spending (31%), followed by Lodging (27%), Retail Trade (20%), and Recreation & Entertainment (10%) (Stynes (3), 2001). Employment distribution within the tourism sector closely reflects the traveler expenditure distribution as can be seen in Figure 4.1.D. This figure represents the jobs that are directly supported by tourism spending in the Tri-County Region. It is also important to point out that these employment statistics do not include the employees at the Capital City Airport. As can be seen in the diagram, the largest sector for tourism-related jobs is within the “Restaurants & Bars” sector (35%). Lodging accounts for 25% of tourism jobs and both Retail Trade and Recreation & Entertainment account for 18% (Stynes (3), 2001). Figure 4.1.E also represents both the expenditure and job distribution information in tabular form. This table also includes estimated dollar amounts by sector as well as the estimated number of jobs by sector. 42 Ivccvvvvvvvv'vvvvvvvvvvvvvvvw'vvuvv.— Figure 4.1.6 Distribution of Traveler Expenditures in the Tri-County Region, 2000 DataSource: Stynes (3), 2001 Local Production _ 4% Wholesale Trade__ 4% Lodging' 27% Retail trade 20% Local Transportation 3% Other Vehicle Expenses / 1 % Recreation & Entertainment _ / 10% Restaurants 81 Bars 31 % Figure 4.1.0 Distribution of Tourism-Related Jobs in the Tri-County Region, 2000 DataSource: Stynes (3), 2001 Local Production 0% 1 Wholesale Trade, ’ l 1% Retail trade 18% Lodging' 25% Local Transportation > 3% Other Vehicle Expenses »_ 0% Recreation 81 Entertainment 18% Restaurants 81 Bars 35% 43 “ “. “....‘II‘..“r“. 411“.-.“‘11‘3‘l‘ “1‘4.“ “1‘1“ ‘ ‘. ‘_ ‘1‘.€.‘l‘ ‘ t G e t (I'l‘l‘ ‘1‘. ‘t A... t t 3‘1. P ‘.- .' ‘1'"- Figure 4.1.E Economic Impact of Tourism Spending in the Lansing/Tri-County Region, 2000 Data Source: Shim (3 ),. 2007 4.2 Tourism Opportunities and Potential for the Tri—County Region ‘11 lotel, betel, BC‘B, Cl" camping Total Direct % of Tourism- % of Spending Sector Spending Total Related Total ($Mlllions) Jobs Lodging* 75 27.1% 1,955 25.0% Restaurants & Bars 85 30.7% 2,638 33.7% Recreation & Entertainment 29 10.5% 1,427 18.2% Other Vehicle Expenses 0.7% 28 0.4% Local Transportation 3.2% 224 2.9% Retail trade 56 20.2% 1,440 18.4% W’holesale Trade 10 3.6% 88 1.1% Local Production 11 4.0% 30 0.4% Although there have been some local initiatives to supplement the economy using tourism as a catalyst, there may still be opportunities to improve upon the efforts already made. One main strategy that the communities within the region can use to increase tourism is to place more VCOCCCCCCUUOVVVUVVVVVVVVv'vv emphasis on the coordinated planning of tourism—related facilities. \V e see a great deal of inter- governmental coordination among other municipal activities such as infrastructure expansion and connectivity, however, economic development activities, such as tourism, are often handled locally. These economic development decisions should also be coordinated on the regional level. The emphasis should not only be on promoting existing facilities, but also on ways the region can advance economically as a unit, rather than individual (and often times, competing) entities. 44 “ ... “ 4?“..‘. S 1.! “z“ “LII“ fl Gal-v“ “ “-1.‘.¢ ‘ fil. E. a £10., I. .‘ £41! ‘1‘. I! A! fulfill! luvl'rl‘ltt ‘-"" \""'!V"'~vav """"'"-"-'-'---'-'-v-v- Michigan’s “Home Rule” policy causes a great deal of competition among all of the various local units of government, which ultimately results in a disjointed economy. Many of the local tourist attractions, as interesting and entertaining as they might be, end up being spread so widely throughout region that any sense of continuity is lost. Unlike many moderate to large size metropolitan areas, the Lansing Region lacks a well developed central area of attractions and tourism-related facilities. To be more effective in tourism planning, municipalities must begin to look at developing a core area of concentrated tourism facilities, rather than competing by promoting and developing individually beneficial attractions in every corner of the region. There are of course some attractions that belong in rural communities, such as agriculturally significant sites or open space and recreation areas. Also, as mentioned before, each community has a characteristic or attraction that a small segment of the population may find interesting, but in general, concentrated attractions tend to draw more of today’s tourists. People today are accustomed to the “one-stop” convenience of shopping malls, where various types of retail stores, restaurants and other services are placed in one location and oriented in such a way that a person can park their vehicle once and visit multiple stores. Today’s travelers expect much of the same when researching a location to visit. They expect to be able to find a hotel within a short distance of many attractions, and these attractions must be sited in such a way to facilitate easy movement between each one, essentially creating a chain of linked features (Gunn, 1994). The City of Lansing has made some efforts to centralize its tourism facilities near the Grand River, adjacent to the central business district and in proximity to the Capital. Their efforts have included the Lansing Center, Oldsmobile Park, and a number of museums such as Impression 5 Science 45 4‘0“!EGGA.‘QGIV“‘IS‘G‘S‘SSGQQS000‘0“.€VEPG‘((0.! ‘9 7------""-"-"'-""'vvv-W'v' Museum, RE Olds Automotive Museum, and the Michigan Surveyors Musem. Overall, Lansing has taken steps in the right direction, yet these efforts have only a moderate effect on drawing outside tourists. For example, the Lansing Lugnuts baseball team and their home stadium, Oldsmobile Park, are primarily local attractions for residents within the region, particularly Lansing residents, rather than for residents from other areas. For the past several decades, nearly every moderate sized city across the country has acquired a semi-professional baseball, basketball, or hockey team to call its own. These sorts of franchises are quite successful at capturing local money, but more often than not they lack appeal to out—of-town visitors. In order to attract more outside visitors, communities such as the Greater Lansing Region must place more emphasis on developing unique attractions that may have a wider circle ofinfluence. Such attractions include but are not limited to regional zoos, gambling casinos, luxury resorts, historically significant or unique heritage corridors, water parks, and amusement or theme parks. Each of these types of developments have their positives and negatives. In fact, the success of these kinds of developments is often hindered by the seasonality factor within Michigan, not only the cold winters, but also the abundance of rain in the warm months. However, there are many communities that survive on seasonal economies, especially if there are other industries to maintain financial stability. This again emphasizes the fact that there must be diversity in the local industries in order to support a stable economy. 46 'C'vddcv'dvvvvvvvvvv- Chapter 5: Case Studies 5.1 Case Study Introduction Promoting tourism in Michigan poses some challenges on a number of levels, especially when trying to attract travelers from other states. Michigan is at a geographic and climatic disadvantage to many areas throughout the country, yet amusement-related tourism remains an important economic industry in several locations throughout the state. The main geographical challenge of promoting tourism in Michigan is the existence of the Great Lakes that surround the Lower Peninsula which limit primary vehicular access to a few locations along the southern boundary of the state, as well as one access route via the Mackinac Bridge at the northern tip of the “mitten” and an access point between W’indsor, Canada and Detroit. Another challenge is the climate of Michigan which limits the effective tourist season for amusement parks and other similar attractions. Although winter recreation activities are also abundant, particularly in the northern half of the state, the majority of tourists visit attractions during in the summer months, avoiding travel in cold or snowy conditions. For much of the State, including the Tri—County Region, the primary tourist season (aside from the winter Holiday season) is the time between Memorial Day (May) and Labor Day (August). Although there are unavoidable challenges such as these, there have been varying degrees of success in developing a tourism industry in Michigan. For the'purpose of this analysis, the decision was made to focus on amusement/ theme park developments within the state, as there would be similar community characteristics, demographics, and challenges to those found in the Tri-County Region. The following case studies demonstrate two tourism-related developments in Michigan, particularly, moderately sized amusement parks. The first, Muskegon’s “Michigan’s Adventure” is a traditional amusement park that has found a 47 “““I“““1“““I.\“‘“v-““€‘€‘€‘C“.‘t¢(€‘éf(f‘i‘(“ """"'---vv--vvv.'"vvvvvvu,"v niche market and has experienced slow but positive growth over the course of several decades. The second example, Flint’s ill-fated “Autoworld” demonstrates the importance of careful pre-planning and the consequences of trying to do too much, too quickly. These case studies provide a brief snapshot of amusement park developments in two moderate sized Michigan communities that should not be ignored when discussing similar developments in the Tri-County Region. 5.2 Case Study: IVIichigan’s Adventure, Muskegon, Michigan he premier example of a semi-successful, regional amusement park development in the state is Michigan’s Adventure near Muskegon. The 225 acre park is located about 40 miles north of Grand Rapids in Muskegon County's Dalton Township and features over forty rides, including a nationally renowned wooden roller coaster. The park was originally opened as Deer Park Funland in 1956 and was sold to the jourden family in 1968. The park experienced moderate success over the years as the owners purchased and built new rides and expanded the park, and in 1988 the name was changed to Michigan’s Adventure (www.thrillnetwork.com). In 1990 the park expanded to incorporate a water park, Wild W’ater Adventure, as the owners felt there was a need for such a facility in the local area. Most recently, in 2001, the park was purchased by Cedar Fair, LP in a transaction estimated at $25 million (Cedar Fair, LP, 2002). Cedar Fair also owns and operates several other amusement parks across the country including Knott’s Berry Farm in California and Cedar Point in Sandusky, Ohio. Since this purchase there have been many upgrades, improvements and additions to the park, and local residents and officials remain optimistic about the future success of the park under the larger management organization. 48 “ .v . .. ‘ “ “ll“..“t‘. “i113“ 1“ “Elm-1“.“ “I“. ‘1 ‘l‘l‘ ‘ ‘4 ‘ .‘I‘V jdél ti‘if (..- ‘lél‘ ‘l-‘Ia‘... ..‘ 'O'CU'C'Cv'vavvvvvvvvv'vvvvv'vvvvv— Economically speaking, specific financial information about the park is difficult to acquire, however the Michigan Economic Development Corporation (MEDC) lists that Michigan’s Adventure employs 480 employees and one report states that the park attracted 420,000 visitors in the 2002 season (MEDC, 2004). Of course there is a lack of available data on the number of people from outside the region versus local residents, and there is also a lack of data on the average distance traveled to visit the park, but it appears that the attraction may be moderately successful at capturing valuable “outside” money, and the state and local governments seems to recognize the economic importance of the park. In fact, there was recently assistance from the MEDC in the form of a $400,000 conditional loan-to-grant to support an expansion at Michigan’s Adventure that Cedar Fair claims will provide an additional 100 jobs for local residents. This indicates a high level of trust and expectation in the park’s ability to be a boon to the local economy (Howell, 2004). Overall, the development of Michigan’s Adventure has been gradual and cautious, but at the same time has shown that a seasonal amusement park can be successful in a moderate—sized market similar to the Lansing Region. The park also compliments the other attractions, both natural and man- made, that already exist in the Muskegon region. The facility fills a gap in the marketplace, not only for the region, but also the state, as it is both the largest amusement park in Michigan, and the largest water park. 5.3 Case Study: AutoWorld, Flint, Michigan \W hen the city of Flint, Michigan announced the development of its own amusement park in 1984, it was met with mixed reactions. Throughout the seventies and eighties Flint had been struggling to maintain their long-standing relationship with General Motors, and city officials were exploring 49 “ “ ‘-“ .“ l: a“ It.“ ‘. “.41 a 1 ‘1. 1.1... S... 0.1.. 0v. ‘ II. .I'1‘¢al.. ‘I'i‘ m0. ‘1‘ t A. 4.1“ ...-01 (1-....lf f (.-....l‘ 'U'UUUUCCCCCCCUCUU'UCVVV'vv-a."vvv options to diversify the local economy and, like many other cities, quickly turned to tourism to get them out of their financial slump. Given that Flint was the birthplace of General Motors and the Buick nameplate, an automobile-themed attraction seemed a perfect fit. AutoWorld opened in 1984 under the management of the nationally successful Six Flags Inc. and fell in the wake of the excitement that accompanied the opening of the 1982 opening of EPCOT Center at Disney World, Florida. AutoW’orld, which was situated on a seven-acre site in downtown Flint, was built entirely indoors under an enormous, half-buried geodesic dome and featured a Disney-like, scaled down model of downtown Flint during its industrial heyday, as well as interactive educational and entertainment rides and exhibits. Of course there were also many automobiles of various ages, makes, and models, as well as past and current “concept” cars on display. The centerpiece exhibit of the attraction was the “W’orld’s Largest Car Engine” which apparently stood over three stories tall. The facility was partially funded with $100 million of public money (judd, 1999), and was to be the saving grace for a dying city by attracting an estimated 900,000 visitors (Reed, 2000). The development was initially met with a great deal of fanfare and excitement, although some residents were still a bit apprehensive about a government subsidized entertainment facility. This apprehension was to be justified in less than two years when AutoWorld folded. Despite a private foundation’s efforts to bail out the failing attraction, the facility never recovered and fell into disrepair. Since then, the local taxpayers have been burdened with bond obligations in excess of one million dollars per year (Reed, 1990). Ultimately the entire facility was razed less than ten years after the initial multi-million dollar investment to make room for a University of Michigan satellite facility. 50 IOCOOUOCOv‘dvvvvvvvvvvvvv'vvvwvvvv'vv Of course there is typically clarity through hindsight with economic development failures, and the AutoW’orld case in Flint is no exception. Some believed that it is impossible to fabricate an attraction and try to make a city more than it is. However, others, like Judd (1999), believe that Flint “just did not try hard enough...” to make it a possibility. He points to Disney \Vorld as an example of a successful effort to create “a sense of placeness out of whole cloth, with no reference to the surrounding context at all.” On one hand, Flint made the effort to take on a high risk endeavor, a step few cities are willing to take, but there was some disconnect with what tourists are really attracted to. AutoWorld was really designed to meet the interest of a small niche in the tourism market. Contrary to what many Michiganders think, the automobile industry is not a strong enough or universal interest area to design an entire theme around. To borrow a quote from the movie “Field ofDrm/m,” the responsible parties involved in the planning of this fiasco most likely took the “if we build it, they will come” stance, expecting swaths of visitors to come see the three—story engine. Overall we can learn a great deal from this development. It stands as an excellent example of what can be accomplished through public-private partnerships. On the other hand, it demonstrates the importance of conducting long range impact studies and analyzing worst-case scenarios prior to construction of a large development. 51 .1 I. as 1 I!“ ‘ It “‘“““‘é.“““‘l‘i‘.¢‘dl€1fflaiat-‘ (1‘.l‘-‘. It“ ...!“ ....I 70""---------CUUUUU'VVV'Vvv«vvvvv'vv Chapter 6: Tools for Estimating Economic Impacts of Tourism 6.1 Multipliers ne of the biggest challenges for a planner is the ability to be a fortune teller and predict what the future will bring. Every aspect of the planning field is filled with futuristic visions, anticipations of what will be, and a whole series of “what if” questions. As discussed before, one of the questions that is always asked is “what impact will this development have on our community?” In addition to determining the compatibility of the development with neighboring land uses, and determining the impact on transportation systems, planners are usually forced to look at the economic impacts associated with a particular development. This sort of analysis is typically no more than a determination of the potential property tax revenues that would be generated and the costs associated with any related infrastructure improvements. As described throughout this document there are many other economic factors associated with any development, especially tourism-related developments, that may not be considered or analyzed by municipal planning agencies. Planners should occasionally attempt such analyses, however, when and if they do, there are few tools they can use to accurately estimate the economic impacts. There are studies that are done by private developers that can determine the marketability and feasibility of tourism facilities. They often rely on local demographics to determine what market segment they need to focus on (age, income, race, etc.) and also statistics about the segment, such as spending habits and willingness to travel. These sort of analyses could also be used by planning professionals, but they do not paint the whole picture of the many impacts of tourism, and are performed specifically to determine the potential profit from a single development. There is no 52 4‘ ..l‘ ...i‘lfl‘ ‘11! 71‘. (I... “1“-“ 2|..- ....l‘ 1m.“ f. f ‘1‘ ..-fl‘i‘ (tfittl‘. €1€l£1€ 6-0. a. t. It .4. t ‘10.. ...... ..f ‘vvvvvvvvwvvvv r00Cd'vdvvvcvv'vvvvvvvvv'vv- analysis of the impact the development will have on other related businesses or industry sectors. Not only do these market feasibility studies neglect to take into account the multiplier effect of tourism spending, it also ignores the impacts on the municipality, either positive or negative. A method often used by planning agencies to determine the economic impact of a development is a basic cost-benefit analysis. A cost-benefit analysis essentially determines whether or not a development is a fiscal drain on the local economy. This analysis uses variables such as the market value of the property and structures, the local tax rates, and the share of actual municipal spending (public works, public safety, etc.) to calculate both a revenue estimate and a cost estimate. It’s basically a way to calculate the difference between the tax revenue and the public costs to determine the net fiscal benefit or loss of a specific development. This type of analysis addresses the impacts on the local government, and is adequate for most developments, but again it fails to address the multiplier effect associated with tourist developments. Multiplier effects are some of the most analyzed economic impacts of the tourism and recreation industry. Multipliers are essentially analytical factors that, when applied, or multiplied to, existing statistics, indicate the extent and level of secondary and tertiary economic impacts. For example, if a person stays the night in a hotel, the money spent for the room is used to support the operating functions of the business, including payroll. In most communities, there is also a mandatory hotel tax that comes right off the top of the bill that goes to support local. or state government. The money the employees of the hotel earn is usually then spent locally to purchase food from a neighborhood store that was delivered by a local trucking company that also employs people from the area who spend money elsewhere within the community, and so on. The money essentially 53 I! ‘1. fifillhlls .... tutti! Ill! It It (551‘ I! c .014! I! 0.11.01! .1. .1' .4. f f It i t! (11‘. II. t! I! ...! ... 4. (v-4. ..f I-------C""----'----'vvvvv-WVV‘VVVVvvvv-vv-v trickles down through a never ending string of financial recyclers. This is a relatively simple concept on the surface, but as Appendix E shows, there are many facets that come into the equation. Tourism multipliers, however, are primarily developed and used by tourism professionals with a propensity for tedious economic analyses rather than by municipal urban planners that may have little time for detailed analyses. Aside from a lack of knowledge about multiplier effects, most urban planners would rather have a software program or a simple form that could be filled out to make the task of estimating the economic impacts. The fact is, there are such tools available, yet they are not exactly being targeted towards planning professionals. Stynes (2001) provides the following basic equation for estimating the economic impact of tourism, although he notes that the actual model is much more complex: Economic Impact = number of Liritr * avenge Wendi/{g per mo * multiplier: The first two variables in this equation refer to the number of visitors a region attracts in a given length of time and the average amount of money that these visitors spend directly during their stay. These variables can be acquired from third party and public data sources that specialize in industry tracking. The third element of Stynes’ equation refers to the multiplier value that is used to calculate the “trickle-down” effects of tourism spending. This multiplier value is by far the most ambiguous element of the equation and is difficult to determine, let alone justify. There are various methods just to estimate the multiplier effect, and each one is dependant on information about local conditions which may or may not be reliable. To complicate matters, these multipliers are often used inappropriately to inflate or exaggerate expectations about the economic benefits of tourism. 54 IOCUUUUUvavvvvvvvvvv'vv'vvvwvvvvvv-vvv'up--. According to data available from Stynes (8) (2004), the aggregate tourism sales multipliers for Michigan range from 1.3 for rural areas to 1.6 for statewide analyses. In his analysis of the Lansing Area, Stynes calculated the tourism sales multiplier to be approximately 1.45. Basically speaking, this figure indicates that every dollar spent within the tourism sector potentially results in an additional $.45 in direct local economic impacts after accounting for outflow of money to other geographic areas. If so inclined, Stynes also provides a method for calculating an individualized economic impact multiplier, although there are two primary sources of widely accepted output multipliers simply based on industrial sector. IMPLAN (Impact analysis for PLANning) and RIMS 11 (Regional Industrial Multiplier System) are two computer-based analysis tools that are available for sale to communities interested in determining their local multipliers for various industries. Once the multiplier value is determined, there are additional computer-based tools on can use to estimate economic impacts. 6.2 Michigan Tourism Spending and Economic Impact Model (MITEIM) Stynes, working with the Travel Michigan organization, has developed a tourism spending model specifically designed for calculating the impacts of tourism in Michigan. The Michigan Tourism Spending and Economic Impact Model (MITEIM) is comprised of a series of macros—enabled Excel spreadsheets and is available as a free download at \vww.msuedu/course/prr/ 840/econimpact. The MITEIM model estimates the economic impact of visitor spending on the economy of the region. After entering some economic information about the region, the program assigns multipliers based on the study area to determine the economic impacts. The model estimates total visitor spending in 55 rVOOUCUUUC--‘VV‘vavvvvvvvvv'vwvvvvvvvvvv'v--. an area and the associated economic effects in terms of sales, income, jobs, and tax receipts (Stynes, 2001). The results of the MITEIM calculations are then broken down into various tourism-related spending segments for a more comprehensive analysis. According to this model the following twelve spending segments represent the basic areas that tourists spend money. The segments used are (in no particular order): (1) Motel, hotel, cabin, or B&B; (2) Camping fees; (3) Restaurants & bars; (4) Groceries, take-out food/ drink; (5) Gas 8.: oil; (6) Other vehicle expenses; (7) Airfares, bus, rail, taxi, ferry; (8) Admissions & fees; (9) Clothing; (10) Sporting goods; (11) Gambling; and (12) Souvenirs and other expenses. Stynes has used the MITEIM to calculate the economic impacts of tourism in several communities throughout Michigan and can conduct an analysis or provide assistance to other communities wishing to obtain such information. Stynes has used this model in analyzing tourism spending in most of Michigan’s 83 counties and he has generated reports for several convention and visitors bureaus (CVBs) including the Detroit CVB, as well as one for the Greater Lansing CVB. There have also been studies of the impacts of museums and libraries in Michigan using MITEIM. The National Park Money Generation Model Version 2, or MGMZ, also developed in part by Stynes (in conjunction with Dennis Propst, W’en-Huei Chang, and YaYen Sun of the Department of Park, Recreation, and Tourism Resources at Michigan State University), estimates the economic impact of NPS visitor spending on the economy of the region surrounding the park, and uses the same basic Excel framework, but is not limited to Michigan. 56 'UUUUUUO0:00----O'cvvvvvv'vvvvvv'vvvvv'vv--vv. Appendices F through H in this document demonstrate the data produced by the MITEIM model for the Tri-County Region. Appendix F includes a series of tables produced throughout the input process, which is described later in this section. Appendix G is a summary of the top level data including some of the input data as well as some calculated results of the model. Appendix H presents the output charts that are automatically generated after all required input data has been entered. These attachments were produced independently from the report produced by Stynes for the Greater Lansing Convention and Visitors Bureau, and some of the data also varies. Before describing the MITEIM process, it is important to explain that the model uses the concept of “party nights” as the primary unit of analysis. Stynes defines a “party” as “all persons arriving in the same vehicle or staying together in the same room or campsite.” For the Lansing Region, it was estimated that there were 3.8 million visiting travel party nights with an average party size of 2.6 in 2000 (Stynes (3), 2001). To begin the input process, MITEIM first requires that the user select a generic spending profile or manually enter location-specific data. In a 2000 study of the Lansing area utilizing visitor feedback questionnaires, Stynes (3)(2001) provides location-specific data for the Tri-County Region, and therefore, this data was used for this first table, as illustrated in Table 1 of Appendix F. The data represents the spending distribition within various categories based on the type of visitor. There are five default visitor types, or segments, within the MITEIM; Day visitors (no overnight stay), Motel visitors (includes stay in motel, hotel, cabin, or B&B), Camping visitors, Seasonal home visitors, and Visitors staying with friends and/ or relatives (V FR). There is no data on seasonal home visitors within the Tri—County Region, therefore, this segment was zeroed out. 57 S S “10;. S ...-0.?!- S 0.15..-.“ -0... 0.10.70. 0.. “AP-0255011.! f. 0.10.10- -.0. (...-.1“ (1.0.1.0. ills-.0102 trifl‘wd .---.-UU‘CCCUUCC----vavvvvvvvvvvvvV-Vv'V‘U'UV The next step within the MITEIM was to enter the number of party nights (listed above) and enter the share of total spending by visitor segment. Fortunately this data was also presented within Stynes’ analysis of the Lansing Region. Table 2 of Appendix F displays the inputs for this data. The model then allows for adjustment of economic multipliers or the use of one of three generic multipliers based on analysis area; rural, smaller metro, or state. For this analysis of the Tri-County Region, the embedded “smaller metro” multiplier set was selected. The results of this selection are presented in Table M of Appendix F. After verifying the tax levels for various direct sales categories, the model presents the Summary of Results found in Appendix G, as well as a series of charts that spatially represent the data from the various tables (Appendix H). It is important to note that much of this data varies slightly from the regional data presented in Chapter 4, despite the use of the same model. There are a few main points that should be highlighted from the charts within Appendix H: 0 Based on the data entered, the average spending per party trip for all visitor segments within the region was calculated based on the spending categories. The results of this output are represented by Chart 1 of Appendix H. This data indicates that the majority of the spending for each party is spent within the motel category (39.1%), followed by the Restaurant category (29.25%). 0 Chart 2, Average Spending per Party Trip, by Segment clearly indicates that visitors staying in motels spend more than twice as much per day than those within other segments. This is partly due to the majority of the money going towards the expense of the accommodations. This chart also indicates that visitors to the region will spend $128 per day/ night, on average. 58 "-""“-‘-"-"--"'----"---vvvvwvvvvvv-vvvvvvvv 0 Chart 3 illustrates the total spending distribution of all visitors. Again, the motel category received the largest portion of visitor spending (29%). 0 Chart 4 is similar in concept to Chart 2 except that instead of depicting the average spending it represents the distribution of the total spending for the region. 0 Chart 5 spatially represents the segment share data entered in Table 2. 0 Chart 6 represents total spending by segment. 0 Chart 7 indicates that motel visitors account for the most trips locally (1.75 million), followed by visitors staying with friends or relatives (1.2 million). \X’hen looking at the Summary of Results in Appendix G there are a number of other important findings for the Tri-County Region. 0 The capture rate for the region is 80%, meaning that 80% of tourism money spent within the region, stays within the region or is re—spent locally. 0 Total jobs as a direct result of tourism are estimated to exceed 10,000, and secondary effects account for another 2,400. 0 Total visitor spending in the region is estimated to be over $550 million with a multiplier of 1.46. 0 Total local sales tax revenue for the region as a result of tourism would be an estimated $6.7 million. 0 Tourism in the Tri-County Region could result in over $40 million in sales and nearly $28 million in income taxes. 59 I-------‘C'C----OU--------vvv‘vvvvvvvvvv'vw'vvv After using MITEIM to estimate impacts of tourism, it is apparent that this too] could prove to be very useful for planning professionals, especially those in high tourist areas. It is an effective tool for analyzing many of the economic impacts associated with tourism. Despite the usefulness, there are drawbacks to the MITEIM method which question the practicality of such a tool for estimating the total economic impact of a development. One problem is that the model fails to account for property taxes associated with the development and any new homes as a result of increased employment. In addition, the spreadsheet is a little too complex and awkward to use on a daily basis, particularly within the setting of a municipal planning office. Typically, economic impact models such as this are used to estimate the impacts of an entire tourism network within a given geographic area, over a long period of time. A practical use for this model would be for planning agencies that want to conduct an economic analysis of the tourism industry as a system for an entire city or region, perhaps as a supplement to a comprehensive plan. The goal of this paper, however was to find tools that could be used on an individual development basis, and as effective as this tool is, it just doesn’t lend itself to such a use. There could be some modifications to the MITEIM model to make more useful for estimating the economic impact of site-specific developments, such as an individual amusement park, however such modifications reach beyond the scope of this work and may not prove to be that beneficial or accurate. In order to perform such an analysis for a specific development, it would take a great deal of market research to determine the inputs required within the model. Also, because this model relies strongly on historic trends, an analysis for a proposed, locally unique, development would be purely based on initial estimates for visitation numbers (party nights) and spending habits of the visitors. Although some data exists for similar developments elsewhere, the success of a new 60 S 0‘. (Tilt .0 Jude-f S. Sin-04-..! .0. S4 S S. S. S. .0. 0.1.0.10. .0... 0. 0. 0.0. 0. 0.110.. .0. 0.. 0. 0.. .0. 1.. at 0.. .10.. ... I-U*.U.------vavvvvvvvvvvvv'v'vv‘vvww-vwww-vow-v development relies on many factors and may not be predictable, as was evident in the AutoW’orld case study described in Chapter 5. The bottom line is that MITEIM is designed to be an analysis of conditions after the fact rather than a predictor of the impacts of a proposed development. 6.3 Federal Reserve Fiscal Impact Tool (FedFIT) The Board of Governors of the US Federal Reserve System provides another macros-enabled Excel template called FedFIT, or Federal Reserve Fiscal Impact Tool, that is available for free by visiting the Federal Reserve website at littpté/“WYW.{€thl“:111‘CSC1'\'€.g()V/Cummtmltyhtm. The FedFIT application, released inJanuary 2004, was developed to assist community and economic development professionals within small and mid-sized communities to make educated and informed decisions about particular developments. Although the tool is designed to give only a rough estimate of the likely impacts of a proposed development project, it can be used to calculate likely costs and benefits of such a development or compare various alternative scenarios. This model may be more useful for estimating the economic impact an amusement park or similar development because, unlike MITEIM, FedFIT is a tool used to estimate the local tax revenues and government costs of a specific development rather than an entire tourism network. It is much like a complex cost-benefit analysis, in that it estimates the beneficial effects that a proposed economic development project will have on local sales and property tax revenues. FedFIT then compares these positive impact figures with the estimated government costs associated with the development. The process is similar to the MITEIM workbook in that user—provided information is entered into the formatted spreadsheets and the program makes other assumptions and calculates the results. 61 h if It m Wit 0“ ’8 . ‘lnt g .t. .‘hvl “I at f ‘l. m. E f E! a. E F rl , 1‘! r. F. F... E r I. Fm _[ are r F. r? [a r. [I r! r, r! L ll“ ICCCCUCU....-.UUU.UUUU‘VUUVVCWUWWU.V'YJUUVW'U. Information about a specific development, such as location, number of jobs, and average pay, and estimated property value, is entered into the spreadsheet. This data is then combined with other default values and assumptions embedded within the application to calculate the local impact. FedFIT also allows for modification of the defaults and assumptions, resulting in a more customized estimate. The application also features a database of demographic and economic information for over 3,000 counties, cities, and metropolitan areas, as well as some state data, which can be used to produce a mini economic profile for a specific community. Appendix I features a copy of a FedFIT report generated for a hypothetical amusement park development in the Tri-County Region. The report is divided into 6 sections which are indicated on the bottom right corner of each page. The one page Introduction provides some basic information about the application. The Data Entry section consists of three pages and details all of the input data about the development and locality. The three page Output section provides estimates of the direct, indirect, and induced effects of the proposed development project on employment, income, and tax receipts. The three pages within the Cost Module section detail any per~resident costs associated with the proposed development. The County Data section provides four pages of income and labor information from various government agencies. Finally, the Summary sheet is a locator for visually impaired users, and is not used in this study. Please refer to these sections as indicated in the following process description. 6.3.1 Data Entry: The FedFIT input process begins with entering a city or region as well as information about the specific development (see Data Entry section). A regional approach was selected and the counties of Clinton, Eaton, and Ingham were indicated. Estimates for the development, such as costs, 62 ‘0‘“..0u‘.(flwtj‘qttifl\.‘.......lr.‘.‘.0r.-€:€7‘.0v“Lat“.f.€-€€ftf‘.e“f“‘rflf visitation numbers, and jobs, were based on the data available for the two developments indicated in Chapter 5 and the demographics of the local area were also taken into consideration. The proposed (hypothetical) development is a moderate sized open-air amusement park similar to that of Michigan’s Adventure (detailed in Chapter 5). Because of Mid-Michigan’s climate, it is important to point out that this development would be seasonal, complicating some elements of the analysis. As previously mentioned, Michigan’s Adventure sits on 225 acres (approx. ‘/2 sq. mi.), employs approximately 480 people, and attracts over 420,000 visitors annually (Cedar Fair, LP, 2002). The proposed development would be of similar size, but would have a few more attractions, requiring a slightly larger staff force of approximately 700. There would also be a need for more employees as the number of visitors increases. This development would not only attract local residents, but the central location within the state, as well as easy freeway access and other local features mentioned previously, could attract a larger number of out of town visitors, increasing the overall visitation to approximately 700,000 annually. This number may seem a little high when compared to Michigan’s Adventure, but when you consider that Flint’s AutoWorld attracted some 900,000 visitors in the first year, it may seem more conservative. Because a traditional amusement park would be a unique feature within lV'Iid—Michigan, visitation numbers would also be a bit higher. The average salary of$16,706, although lower than the national median income from the Census Bureau, is based on data for individuals working in the tourism-related industry within the Tri- County Region (Stynes (3), 2001). 63 1‘...» 01.-....0.‘ 01 11057-0... 01.-0v...€|‘.. 0v..0t.1»lu 0.1.01.1... ... flu-.... .0. fit. 1 0. 011.141 4'. 0.1.0... 0v Iv e .0. .01 4'. .1. ..l V-..U-.-----------UUUVVVVVVVVVVVV"vwv'vvvvv Based on data from the $25 million sale of Michigan’s Adventure as well as annual reports from Cedar Fair, LP, a modest initial investment of $60 million ($40 million for buildings and structures and $20 million for equipment) has been estimated for this analysis. After entering information about the development, information about local taxes and fees are entered. The property tax data used in this analysis is based on 2003 tax information from the City of Lansing and Ingham County, however, the application provides some general data if none is available. Since there are no local sales taxes within the Tri-County Region, only the state sales tax of 6% was entered into the appropriate column. The 3.26% utility franchise fee was based off of data from the author’s utility bills. In addition to these factors, FedFIT allows the entry of other fees such as impact fees or ongoing government service fees. For this analysis, no fees were entered, however there would most likely be several fees associated with infrastructure improvements as well as various licensing and permitting for a large amusement park development such as this. The second page of the Data Entry lists various assumptions about the development and indicates whether the default values have been used. Because the unique nature of an amusement park, some of the variables have been modified, as the defaults are based on either a service industry or manufacturing industry, and as discussed before, tourism is sort of a combination of both industries. The 34% wages to sales ratio was derived based on a few assumptions. The wages are calculated automatically by F edFIT to be over $11 million annually (jobs * average salary). Using the assumption that there would be 700,000 visitors annually and that daily spending for visitors to amusement parks is approximately $49.23 per capita (Paul, 2002), the sales are estimated to be nearly $34.5 million. Therefore, $11,694,200 : $34,461,000 = 34%. 64 ‘1. (1.1.11-1 €l‘V‘wIQ ...:‘V g ‘. ‘q 1. 1‘. 1111.11 .‘ e e f ‘1 e c a... a. .1. (1‘. ‘ 1'. 1.. .‘ ... ‘. 1 .1 f ‘ I Because of the nature of an amusement park, the energy costs are typically higher than many industries. Based on US. amusement park data, 3% of the ticket prices go towards utilities, primarily energy costs. For comparative sake, the default value for a service industry provided within the application is .5%. The remainder of the Data Entry section was left to the default values except the economic impact multiplier. By default, the application uses a multiplier value of 1.25. There is also a generic table provided within the worksheets that lists some generalized multipliers based on county population that can be inserted (see Figure 6.3.A). The User Guide Figure 6.3.A Multiplier County Population - - - - , 1'05 0 to 10,000 literature included on the FedFIT disc includes mo sets 1.10 10,000 to 20,000 . . . _ 1.25 20,000 to 35,000 of more speCific industry-related output multipliers, 1.35 35,000 to 50,000 1.50 50.000 to 100.000 based on the IMPLAN and RIMS 11 models, for the 1.75 100,000 to 200,000 2.00 200,000 and above various industry categories in Michigan. The listed values of these for the hotel and amusement category are 2.38 and 1.86, respectively. For this analysis, the IMPLAN value of 2.38 was used, yet the value could easily be changed in order to compare results from different multipliers. Considering that the multiplier value of 2.38 is quite aggressive and suggests a larger impact than is likely from an amusement park in the Midwest, this would be a good opportunity to use the previously listed multiplier for tourism spending in the Tri-County Region of 1.46 provided by Stynes (3) (2001),. Because an amusement park would only be open seasonally between mid-May and mid-September, it is likely that the multiplier value would be more conservative, particularly when analyzing the economic impact over a course of a calendar year. Unfortunately, there is a lack 65 v.00dUUUUOUUUOUUUUOWUUOUUVVV'~'vvvuvvvuvvvwvvv of solid research on multipliers for seasonal industries. Therefore, the decision was made to use the IMPLAN information provided with FedFIT. 6.3.2 Output: The remainder of the report features the output of the application. The application does an excellent job of summarizing the data into a readable format. According to the information detailed below, and based on the accuracy (or inaccuracy) of the input data, it would appear that an amusement park of this size would benefit the region on several levels. These figures are based on a year-round industry, so we must keep in mind that some of the data may be artificially inflated. Some of the key findings and special considerations based on this report are as follows: 0 Lab C red/2'0” 61’5" chi'l‘ol/ I ”crease: o The 700 new jobs associated with the proposed project are projected to directly result in 5511.694 million in additional payroll. Assuming the local economic impact multiplier of 2.38, each dollar of direct payroll will generate an additional $1.38 of indirect and induced wage income locally, for a total addition to payroll of 327.832 million. Total Estimated Payroll = $39,526,000 Indirect and Induced Impact. $27,832,000 Direct Im pact, $1 1,694,000 66 AU In. 0.. 0.2.1 .... 1.0.7.0701 0.11.1.1. 41. :1 .030. 01.0.1110. 0.. (.1 .0. .0. 11-1 0! (1.4-L 0! (1.0.1.0.. «.1 fr 0.. i! a. 6.0 v vvvvvvv'vv The additional jobs related to an amusement park would primarily include hotel staff, restaurant & bar staff, retail positions, and other service sector jobs. As mentioned before in this document, there are arguments that these types of jobs are low paying and are not considered quality jobs when analyzing economic development. The response to this argument is that such businesses provide more employment opportunities to students and others lacking experience or specialized skills (Mathieson, 1982). Michigan State University attracts over 40,000 students during the school year, many of whom make a grand exodus at the end of every school year to return home or to find seasonal employment where it is available. Providing more summer job opportunities in the Lansing region would help to retain consumer spending dollars of young people that would otherwise be lost during the summer. In addition, there is currently a great deal of discussion about attracting and retaining young people in moderate sized metropolitan areas. Providing jobs to college students, even if they are part—time or seasonal, gives them a reason to make an initial investment in the local community. 0 Prgpergy Tgx Revenue: 0 Assuming that the $60 million investment in structures and equipment associated with the project ultimately finds its way onto the property tax rolls, property taxes associated directly with the project could total $1,733,253 annually. Also, assuming a local economic impact multiplier of 2.38, and a constant capital to output ratio, the $60 million capital investment could result in an additional $16.56 million in indirect and induced investment subject to property taxes. 67 Total Estimated Property Tax = $4,323,302 Indirect and Induced Impact, $2,590,049 Direct Impact, $1 ,733,253 This additional indirect/ induced investment would most likely include the development of related service industries such as new hotels, restaurants, and gas stations. Depending on the development, this could also include other investments such as complementary and/ or competing facilities such as occurs in many communities with popular amusement parks. For example, the popularity of W’alt Disney \X’orld in Florida eventually attracted developments such as Universal Studios and Islands of Adventure as well as other attractions and convention facilities to the Orlando area, further solidifying the tourism industry in central Florida (Bull, 1995). Of course this is not to suggest that the Tri-County Region would experience the same extreme phenomenon, but there would be other companies carefully monitoring the success or failure of any such development. Land use planners must be prepared for additional development pressure following a large tourism development such as an amusement park. Following the announcement and approval of any large scale development, a planning agency must immediately review the zoning ordinance, land use maps, and their master plan to determine if adequate land is zoned or designated for the appropriate land uses of possible future developments. Every effort must be made to ensure that adjacent properties ()8 have compatible land use designations. For example, if an amusement park is approved, the municipal planning agency must ensure that the designated land uses of adjacent properties allow for retail developments, gas stations, restaurants, and possibly hotels. On the other hand, if planners are proactive, they can use land use measures to control or direct growth of tourism developments. Growth is unavoidable, but planners should try to cluster similar land uses. Clustering of services like hotels and restaurants is typically more convenient and appealing to visitors, however, it also protects valuable natural areas and productive farmland by eliminating randomly dispersed services across the landscape (Gunn, 1994). o If the 700 new jobs generate demand for 140 new housing units with an average value of $50,000, the proposed project could expand the residential property tax rolls by as much as $7 million. Such as impact would be associated with approximately $181,086 in new property tax receipts annually. Because many of the jobs created would be moderately low paying or seasonal positions, and because there would be a strong reliance on student employment for the service industry businesses, the housing needs would be lower than calculated by FedFIT. By default, the application assumes an in-migration rate of 20%, meaning that twenty percent of all new jobs created will result in a new housing unit, which is high for the historically flat growth of the Tri-County Region. In addition, since the jobs created would be primarily for young people, there would be a smaller demand for new housing as most students live with parents or multiple roommates. Also, because these are seasonal positions, there are many housing options in and around East Lansing during the summer months when many students leave. 69 g ‘1 Izi‘lflw EW‘I‘W fits-..“ a... C. 11:“. (till! (1 (tie. .6. (I. it. (I fl: (.f.‘. (I (I. .6 t! ...l. r. fir 4v. II, (‘3'! Based on these assumptions, the demand for housing as a result of an amusement park and supporting businesses would be insignificant to the communities throughout the region, and there would be little to no residential property tax benefits as a result of such a development. Over time, however, as the tourism industry blossoms and more people visit the area, there may an increase in housing demand. Land use planners should keep a close eye on such developments and constantly watch housing and demographic trends for any significant changes. If there is more pressure for housing, every effort should be made to follow “smart growth” practices or develop within existing urban areas first, followed by fringe areas, so as to have a minimum impact on the municipal costs as well as the environment. Also, as demand for housing increases over time, planning agencies should examine the availability of affordable units, particularly for the service industry employees. 0 To/a/ Tax Rare/pm: o The project as outlined could be expected to generate total direct and indirect tax revenue in the region equal to $2,195,289. Of this amount, $2,161,651 would come in the form of higher property tax receipts in the region. M tax revenue generated in the area is estimated at $3,136 per new direct job. Although there are currently no local sales taxes in the Tri—County Region (other than hotel and airport taxes), there is a 6% state sales tax. Despite the fact that a local government would not experience any direct sales tax revenue by facilitating or promoting more retail sales within the community, the money eventually filters down to the local units of government in various forms from the State. A rough estimate of state sales tax revenue based on the $34.5 million in sales explained previously (7 00,000 visitors x 549.23 per-person/per-day) would equal $2,068,000 based on 6% sales tax. Many communities benefit from additional local sales taxes of 1 or 2 70 ..-‘.‘H:w-:¢“;1{‘dil€.‘.¢.‘1.“‘1‘1‘-Q“.le‘c"l¢‘.(“ ("‘(‘-‘t percent. Such funds could be used to promote business retention and investment, infrastructure maintenance and improvements, or social programs among other community services. Establishing a local. (or regional.) one percent (1 0 0) sales tax would add approximately $345,000 annually to the local economy as a result of this development. However, it is unlikely that such a tax would ever be established in the Tri-County Region. 6.3.3 Cost Module: The Cost Module section of the FedFIT report is designed to assist local governments in calculating expected costs associated with the proposed development. Information on one-time capital outlays for services such as education, public safety, and infrastructure is entered along with information on ongoing annual expenses associated with the proposed development. Due to lack of data and resources for this analysis, the one-time capital outlay data was entered as zeros and the ongoing expenses were left as default values. If this application is to be used in a real life setting, there should be a detailed case-by-case analysis performed in order to determine the public costs for the specific development. Based on the information provided in this analysis, the Cost Module report indicates that there would be an operating surplus between $700,000 and $1.1 million for the region. The per-resident cost of annual operating costs would be approximately 32.36, based on the automatically generated 2002 population estimate. There are many costs associated with large developments, whether the developments are residential, manufacturing, or tourist attractions such as amusement parks. Analyzing the various community costs associated with economic development projects is a major undertaking and would constitute an independent thesis to fully explore various cost scenarios. It is important to acknowledge within this paper that significant costs are a major factor in the decision making process for any new 71 ."l‘."“‘q ‘1‘d‘t‘.-l-alw€“.lt1...“..“r1‘1tu construction project, however the topic will not be analyzed in great detail. Nevertheless, A few major considerations should be briefly explained. During the planning of any construction project, the developer works with local engineering and planning agencies to determine how the development will connect to the various infrastructure elements such as utilities and roads. Often much of the financial burden for the extension of services to an undeveloped area falls on the local government agencies. Some of this cost is offset with revenue recouped through impact fees charged to the developer, but typically municipal governments are forced to decide between alternative projects that are all competing for limited local funding. Conducting a detailed cost assessment should be an important part of any land use decision making process. Because an amusement park requires a large expanse of land, the most likely location for such a development in the Tri-County Region would be in one of the rural townships with few existing services. The costs associated with extending adequate utilities to a rural area would be significantly higher than those for an urban infill development where the infrastructure already exists or for fringe areas where utilities are often extended beyond current needs, based on projected growth. Not only do the services have to be extended, but the municipal planning agencies must make predictions on future development and land use as a result of the proposed development. Some common examples of the types of services needed for an amusement park include electric, water, sewer, natural gas, and telecommunications systems (telephone, cable television, cellular towers). There would also be special design considerations for roadway networks that can 72 - llllI‘lllid!l‘.‘“““.‘l‘.“1‘v‘l‘£flitigio- "' 'UUO'vavvvvvvvvvvvv-v effectively support large inflows and outflows of traffic going to and from the park in the early morning and late evening as a response to the operating hours. Municipal government costs do not end at the physical construction of the infrastructure elements, however. There would be significant costs associated with the upkeep and maintenance of the roads and utilities, as well as any necessary upgrades to the systems. On the positive side, these types of physical improvements are tangible, and can be predicted fairly reliably. There are some community services that may be needed but are less tangible. Emergency services such as police and fire may be overlooked in the cost analysis of many developments, but can also be a significant cost to the host community. FedFIT includes the ability to input various costs and calculate the annual and per-job costs should this data become available. 6.3.4 FedFI T Pros and Cons: As FedFIT was released while this document was being developed in 2004, there are no known published evaluations of the application or comparisons of the results produced by it. Despite the claim by the Federal Reserve Board on their website that over 13,000 copies of the software have been distributed, searches within trade journals and other resources failed to result in examples of the model being used by any communities. Contacts to the Federal Reserve Board regarding known communities that have used FedFIT were not returned. Overall, however, FedFIT seems to be an effective tool at estimating government—related economic impacts of individual developments, a weakness of the MITEIM. The application is well organized, and once past the learning curve, allows for quick manipulation of data to test different scenarios. Also, the instructions included on the disc are much more comprehensive and useful than the 73 islll ill 1 llll llll I.“lit“‘Iv‘c‘itlatl‘f‘tl‘f‘t‘jal‘f 'UOOO'OOOW'v'vvvvvvvvovv almost non-existent instructions within the MITEIM. FedFIT does have a couple significant drawbacks, however. The main weakness with regard to the desired outcome of calculating the total economic impact of a proposed development is that the model fails to adequately indicate the specific indirect and induced effects. It includes an overall total for both indirect and induced effects, however, unlike the MITEIM model, FedFIT does not break down the various tourism spending segments to determine the full range of industries affected. Another disadvantage of the FedFIT model is that it is a tool to determine the impact of a either a typical manufacturing development or a service development, and may not be specific enough to take into consideration the complex intricacies of tourism developments. In addition, FedFIT does not allow for seasonality adjustments. The model assumes that “annual costs” are the units of analysis. Although these may also be the units of analysis used by municipal governments, analyzing a seasonal industry such as amusement parks using an annual method may cause inaccuracies in the results. The seasonality effect can be offset by using a smaller multiplier value to account for the loss ofindirect and induced effect during the off season, but such multipliers are difficult to calculate. Perhaps a function to enter month by month multiplier fluctuations would also be a useful feature to analyze the economic ebbs and flows associated with tourism developments. 6.4 Planning Applications for MITEIM and FedFIT Both the MITEIM and FedFIT models are helpful in producing economic estimates at different analysis scales. Despite the drawbacks or weaknesses in each model, both could provide a great 74 I"*'*""'vvvvvvvvvvvv-..- assistance to planners, economic developers, or other interested individuals studying the effects of tourism. Depending on the community, the data provided by these applications may be more information than would normally be acquired for research of an industry or development. Both applications require the input of very specific information, but because the economic equations are built in, they do not require any complex calculations. However, it is recommended that the user of these applications have a working knowledge of the concepts behind the automatic calculations. Planners can use the models presented in this chapter to estimate various local economic consequences of a particular project. The calculations and estimates that are produced by these applications are meant to give a broad picture of the economic impacts rather than provide specific dollar amounts of the impacts. In fact, these types analyses provide only one piece of the puzzle in the decision making process. There are also environmental, ecological, and social benefits or consequences that should be analyzed using different techniques. Using applications such as MITEIM and FedFIT, however, can provide a planner with greater understanding of the dynamics of economic development and allows for better informed decisions (Ontario, 2004). " """vvvvvvv Chapter 7: Summary and Recommendations 7.1 Overview of Content This Thesis establishes a groundwork for an economic development analysis from which to build. In order to begin to look at tourism as an economic development strategy it is important to gain a basic understanding of the industry from different perspectives. Chapter 3 provides some insight into the tourism industry by highlighting the importance of tourism and provides a general description of the tourism industry and wraps up with some of the planning-related impacts associated with tourism developments. For those interested there are also many resources available on the general topic of tourism. Once the tourism industry is understood to a satisfactory level, only then should a detailed analysis of the impacts be pursued. Before conducting an economic impact analysis, it is important to establish a framework of knowledge about the community. Chapter 2 provides a general community profile of the Tri-County/ Lansing Region with information that could be relevant when conducting an economic impact assessment. Chapter 4 provides information on the current state of tourism in the region as well as the opportunities available for improvement. Although there may be some information available on the desires of the public, promoting tourism as an economic development strategy is not something to jump unprepared into. It is important to look at case studies such as the two described in Chapter 5 to learn from the experiences, good or bad, of other communities. Chances are if your community is contemplating a specific tourism development, there are other communities around the country that have attempted the same sort of development. We should look to these communities to aid us in making intelligent choices. 76 """'--vvvvvvvvv"'-vvv Once all of the above steps are understood, a community can proceed with some degree of confidence into calculating the estimated economic impact of tourism developments. The two models presented in Chapter 6 do not represent the only methods for performing such tasks. MITEIM and FedFIT have been chosen because they are some of the best applications that provide relatively reliable data to professional in both tourism and land-use planning disciplines. 7.2 Using the Economic Impact Models The models presented in this document would be useful for land use planners interested in analyzing tourism and calculating various “what if” scenarios to determine the impacts of specific K Figure 7,2,A; 7 Steps for Completing developments. Planners are well aware an Economic Impact Analysis Step 1: Define the scope of the study and alternatives to be considered in the analysis. Step 2: Define exactly what decisions need to be made, what information is being requested, and what questions the study should answer. Step 3: Determine how detailed the assessment should be. Step 4: List in the study all fundamental assumptions and limitations. Step 5: List all economic impacts that are considered. Step 6: Determine what data are needed, what are available, and how they will shape the study. Step 7: Analyze the effect of each alternative on the individual economic areas being considered and analyze indirect effects (or cross—impacts) among economic areas. that economic growth is necessary but as increased development occurs, there are increased public service needs and expenditures, as well as increased strains on the infrastructure and natural resources. Planners must be able to make wise decisions and have an understanding of the consequences those decisions will have on the community (Ontario, 2004). Because municipalities must use their resources efficiently, planners can benefit from conducting an economic impact analysis by determining any unforeseen costs or benefits from a large Soun‘e: Ollhfl'io, 2004 j development. 77 " V'C'COCUCV‘vvvv'v'vvvvvvv Most likely an economic impact analysis would be conducted when a planning agency is approached by a developer with a specific project, however a hypothetical scenario such as the amusement park example presented in Chapter 6 could also be analyzed by a community looking at a general type of development but do not have any active pressure from developers. If a desired scenario is found to be lucrative for a community, the planning agency can begin to zone for related activities as well as begin to create policies that encourage the desired developments. Conducting an economic impact analysis is a process rather than a singular step. Figure7.2.A illustrates an example of the various steps within the economic impact assessment process. Although each step is just as important as the next, data collection (step six) is the step that will most likely require more time and research than any of the others. Occasionally some of the data may be difficult to locate or may be unreliable. Some data such as demographic data is publicly available from the US. Census Bureau and is fairly reliable for an economic impact analysis, however Figure 7 2 B De velopmen t-Specific Da ta Necessary for an much of the data used in models such Economic Impact Analysis as FCdFIT is based on SPCCUIadOU 01' Type of development (service, manufacturing, etc.) Estimated number of employees “fuzzy data.” Most of the fuzzy data Estimated wages Initial construction costs (property, structures, and relates to the specific development, and equipment) Estimated sales . . . . o 1. ' ' ' v' - 3 - must be derived usmg data from Similar anmated ““11“ C05“ and wage .Iidaptedfl‘om Ontario, 2004 developments, industry standards, or other studies. Figure 7.2.B represents some of the development-specific data that is needed to perform an economic impact analysis. 78 'U'O""".’"""-"""vvvwv For planners analyzing a hypothetical scenario, collecting this data poses a unique challenge in that the information will have to be extensively researched. However, when a planning agency is approached by a developer with plans for a large tourism facility, such as an amusement park, much of the economic and demographic data is provided to the planning department as a way to get local buy-in on the project. Development-specific information such as the type of development, construction costs, and the estimated number of employees and their wages are also collected by developers as part of their financing process. In addition, many large-scale developers conduct extensive market research using demographic information about their target clientele. The planning agency can then combine the project-specific data collected by the developer with community— specific data, such as tax information and public service costs, and plug all of the data into an economic impact model such as FedFIT to estimate the various community impacts. Figure 7,2,C Figure 7.2.C lists the Sources for Economic Impact Analysis Input Data , necessary data and posSible Data Possible Source Development-Specific Data Developers, consultants, financial reports sources for SUCh data (See Figure 7.2.A) of similar developments, other studies, trade publications needed to conduct a baSic Demographics (Population, US. Census Bureau , _ economic impact Housmg, and Economic Characteristics) assessment. For the Tri- Tax Information (Property Local Clerk's Office and Sales) County Region, much of Economic Multipliers Industry standards, other studies (i.e. . . . . Stynes), IMPLAN, RIMS 11, USDC-BEA this data IS Publicly available Traveler Spending Habits Traveler surveys, other studies, texts f . “ rom various sources, Economic Leakage and Local economic Studies, convention and Migration Information visitors bureaus, chambers of commerce although it still takes a great 79 “‘lA‘S‘l‘S‘i"‘d‘“““1“‘““““““.‘."“."A ' "UUO""""--'--""'\Ovvw-vv deal of time to track down all of the relevant data. As mentioned before, accurate economic multipliers are probably the most difficult pieces of data to locate. Although not illustrated in Figure 7.2.D the example presented in Sources for Public Service Cost Analysis Per Capita Costs: Possible Data Source Cha ter 6 FedFIT allows . . . P ’ Education School districts - - Health Care County health departments, hospitals users to enter public serVice Transportation Local planning agenCies, transportation costs into the application in departments, regional planning agenCies Public Safety Local, county, and state police agencies, order to estimate fire departments, ambulance and paramedic service agencies community COStS assoc1ated Utilities and Other Public works departments, engineering _ . Infrastructure departments, public utility boards With a speCific development. Figure 7.2.D contains a list of the types of costs that can be entered into FedFIT and also lists possible sources for finding that data. 7.3 Future Recommendations Future studies should expand on the tourism opportunities within the Tri—County Region by conducting public surveys and market research studies to determine local tourist expectations and desires. A survey of recent visitors to the Lansing region as well as other Michigan cities could be helpful to determine potential areas for opportunity. An example of a typical tourism spending questionnaire used by Stynes in studies is located in Appendix J. This questionnaire could be modified to also gather information about public perceptions of the community. These questionnaires could be given to hotel guests and visitors to local attractions to get an adequate sample size for a valid study. 80 “l‘l“‘i “'t“-‘t“‘;.t“.‘€‘v¢‘€.€Q‘€¢G‘.IQ‘.“II‘tl‘I-I Another aspect of this research that should be explored further is the development of a unique analysis tool or modification of the existing applications presented in Chapter 6. As pointed out, there are some downfalls to each of the estimation methods. However a combination of the FedFIT model and the MITEIM could prove to be useful for planning for tourism developments. Recommended future work should include an aggregation of different features from both models to create a unique method that analyzes site—specific tourism developments. This model should be sensitive to the spending habits of tourists, taking into account the various spending segments of tourism, and should also provide a detailed property and income tax analysis. Above all, the application should have a more user-friendly interface with detailed instructions and an explanation of the process. The calculations used by the new model should incorporate a multiplier influence to account for the trickle-down effect of tourism spending, but the multiplier must be derived in such a way that does not artificially inflate the economic impact of a development. No matter how much work goes into developing a unique application, the output data is only as good as the input data. Not only is it important to seek out the most current and accurate data available for any economic analysis, but within economic models such as these, the multiplier values are a significant factor in many calculations. Therefore efforts should continue to devise more accurate multipliers for specific local markets and specific industries such as tourism. These multipliers should be updated annually to create more accurate economic estimates. In addition, every effort should be made to develop seasonal or month by month multipliers to compensate for the seasonal fluctuations associated with tourism. 81 ""'-"""""-"v--'wvvv-vv 7.4 Closing If a new tourism-specific model can be devised, it would prove to be an invaluable tool for many planning agencies, as well as tourism professionals, economists, and even private developers around the country. As more and more American cities lose traditional manufacturing industries to foreign countries and increased automation, they are devising ways to stay afloat and attract both residents and tourists. I believe that the tourism industry has eStablished itselfwell in the US, and will continue to be a viable source of revenue around the globe, irregardless of global economy fluctuations. Tourism is not without its problems, however. Aside from the post-development impacts discussed in Chapter 3, there are also complications that arise prior to any construction. Land use planners well aware that there will always be opposition to large tourism developments, particularly amusement facilities. Whether it’s NIMBYs (Not In My Back Yard), environmentalists, or farmland preservationists, tourism is never an easy sell. If community leaders and land use planners are serious about developing or expanding a tourist economy it is extremely important to involve the public and other stakeholders (developers, business owners, neighboring jurisdictions, etc.) in the planning process. Maintaining open communication is important to successful development. However, “it is difficult to arrive at decisions which are socially and environmentally acceptable and, at the same time, economically feasible (Mathieson, 1982).” The combination of qualitative comments from the public and quantitative data from an economic impact analysis provides a more complete picture of the potential success oflocal tourism. As far as the Lansing/Tri-County Region goes, tourism should continue to be a focus for future economic growth. Although an amusement park may not be appropriate at this time for a variety of 82 4““ “‘.i ‘1‘“.1.4"“.‘t‘A't‘l.“¢€€“mf‘(“cf‘t"irltt "'UU"'-"-"""'"-"v-vvvvv reasons, there should be creative measures taken to develop a unique attraction or set of attractions that draw more out—of—town visitors to the area. Because such large-scale developments take an enormous amount of resources to become reality, it is important to have a solid understanding of the tourism industry and the many economic costs and benefits associated with various developments. This Thesis is where such an understanding begins. 83 BIBLIOGRAPHY Ill---h.-P.7PP’P-’-----_-----..-"--D--. Bibliography Bull, Adrian. Tlie Economics of Traz'el and Tourism. Melbourne: Longman, 1995. Cook, Roy, Laura Yale, and Joseph Marqua. Tourism, Tl}€ Business of Traiv'el. Upper Saddle River, NJ: Prentice Hall, 2002. Braun, Raymond. ERA Issue Paper: TlJeme Park Derelopment Case S Indy: Fiesta Texas. Economic Research Associates, 1993. D.K. 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Accessed December 12, 2004. Reed, Lawrence W. “W’here Does Economic Development Come From?” Mackinac Center for Public Poligr website. littpz//\v\\'\v.mackinacsig. Article Date: April 16, 1990. Accessed, August 11, 2004. Stynes, Daniel J. (7). illicbigan Tourism Spending by County, 2000 — Update. Available online at httpzlbvvxvprr.msu.cdu/mitcim/michtsm(l0.htm. Accessed August 21, 2004. Stynes, DanielJ. (8). “Michigan Tourism.” Found under PRR 840 Course website. http://\v\v\v.msu.edu/course/prr/841l/cconimpact/micliiganlitm. Accessed August 3, 2004. Sustainable Development, The UK Government’s Approach website. littp:/ /\v\v\v.sustainable- develgpmcntgrv.uk. Accessed August 5, 2004. ThrillNetwork website. h ttpz/ /\\'w\v.thrillnetm>rk.com. Accessed, August 14, 2004. US. Census Bureau website (Census). httpz/ /\v\v\v.census.g<)v. Accessed multiple dates 2003-2004. 87 .‘S‘x‘t‘vli‘.1‘.02€fi“..‘.€‘.‘1¢f¢€...‘.¢(€€€€‘f‘flv‘frt.£¢(writ..4..- APPENDICES CONTENTS Appendix # Title Page A Map: Michigan’s Tri-County Region 89 B Map: Regional Population Density 90 C Map: Median Household income by Census Tract 91 D Map: 1999 Land Use 92 E How Tourists and Travelers Create Jobs and Income 93 F MITEIM Data Tables 94 G MITEIM Summary of Results 99 H MITEIM Output Charts 102 I FedFIT Input-Output data 107 J Sample Questionnaire for Estimating Visitor Spending on Trips 123 88 ‘S‘w‘:‘u“l~‘.“l.‘.‘.QI.‘..‘.‘.‘.¢.(c.‘0..is‘(‘f‘€(“.“¢“.‘(“item Appendix A Michigan's Tri-County Region £325 saw 839: >35: .1 Rio .3 3038.... 732889.. o 2... chm—GE N.. o o n or 0 not}! ea... 1- ,4 83.5 Ba 8.8 H . 1 £9.83. 6.22 550 «52.9: 35 \ gtuawanE. \ peeve.— :o_mo¢ hue-30%... meanings. () v ‘t 9~.>a§u§§ Stooge i - l . .l i. - . .- m. . 1.? - l - . 144-434.. .44 3?. _. 2Q. 4 . P1 manzflmmouam mm 4.. v . (Fl. \4\.. 4 a .. -/ 14:21:44 44%.. 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M 0.8.80 020.0..-50255 088.00 .3. 03:45.22 .2 9.0:. 00 83:. :50 9:32 .252 “la““““(ttqt€gqctfl.fIv.lr.£wilva(.‘f Appendix G MITEIM Summary of Results 99 ‘t...Ii“.tn.“€!.€¢£‘.‘.€‘fi¢i‘.€fut-v5!lt‘ffffrt!“frlv.‘ff.‘l SUMMARY OF RESULTS Spending data set Lansing Spending Profile Units Year of spending data 2000 Multipliers Small Metro 98 VISITS 3,800,000 Party-night Average spending 8 128.03 per Party-night Total Visitor Spending (3 000's) 5 486,526 Capture rate 80% Effective spending multiplier 1.17 Table l. Spending and Visits by Segment _ Segment Day Motel Camp Seas VF R Total Average spending (5 per party night) 8 70.19 $ 196.67 $ 76.67 $ 0.00 $ 68.73 $ 128.03 Party nights (000's) 760,000 1,748,000 76,000 - 1,216,000 3,800,000 Total spending ($millions) $ 53,344 $ 343,779 $ 5,827 $ 0 $ 83,576 $ 486,526 Pct of party nights 20% 46% 2% 0% 32% 100% Pct of spending 1 1% 71% 1% 0% 17% 100% Table 2. Economic Impacts of Visitor Spending —————_—S-;E- Personal Value Added Sector/Spending category 5000's Jobs Income 5000's 5000's Direct Effects Motel, hotel cabin or 883 148,580 3,867 59,079 94,578 Camping fees 1,216 32 484 774 Restaurants & bars 1 1 1,167 3,443 39,402 56,587 Admissions 8. fees 33,31 1 1,626 13,265 21,762 Gambling - - - - Other vehicle expenses 3,603 41 1,226 2,035 Local transportation 14,216 353 6,476 8,168 Retail Trade 56,992 1,465 29,657 48,312 Wholesale Trade 7,767 65 2,990 5,302 Local Production of Goods 14,439 43 2,852 5,172 Total Direct Effects 391,292 10,935 155,431 242,691 Secondary Effects 179,506 2431 67,616 113,799 Total Effects 8 570,798 13,366 S 223,047 $ 356,489 Multiplier 1.46 1.22 1 .44 1.47 0000000450000..0.00000000‘0‘0‘00600000“ffé‘ff‘fl 'U'UUdUd.O‘U'UiUUUOOUUO’OUUOvavvvvvvvvvvvv‘rvv'v Table 3. Tax Impacts of Direct Sales and Income ($ 000's) Sales Income Total Federal 5,294 22,693 27,987 State 28,270 5,285 33,554 Logj 6,693 - 6,693 Total 40,257 27,978 68,234 Table 4. Mgginal Impacts _ change per $1,000 of change per visitor 1,000 party spending nights Spending $ 1,000 $ 128,030 Direct sales $ 804 $ 102,969 Direct personal income 8 319 $ 40,902 Direct value added $ 499 $ 63,864 Direct jobs 0.022 2.88 Total sales $ 1,173 8 150,206 Total personal income $ 458 $ 58,695 Total value added $ 733 $ 93,811 Total jobs 0.027 3.52 Appendix H MITEIM Output Charts 102 005.000.04.0000000‘1000000000000000000“04!."a!!!“ VDUOO'UCOOWCOUU'OOU'OOov'wo-vv-covvvvv'vvvvvvvoc 3 per party trip 3 per party trip Appendix H: MITEIM Output Charts Chart 1 Average Spending per Party Trip, by Category 45.00 — —* - - —7*—~— ~~~ . - » _-,- - 77* ~- #7 40 00 39.10 35.00 > \ 3000 29.25 25.00 20 00 15.00 > 10.00 . 5.00 0.32 0.00 L Motel. hotel Camping fees Restaurants& Groceries.take- Gas&oil Amusement and Clothing Other cabin or 88.8 bars out food/drinks Recreation Spending Category Chart 2 Average Spending per Party Trip, by Segment 250 -.___- ~— — — . —-— ~ —— _. ~ —- -—~—~—————-—————-~———w‘ 200 l 150 > 100 ~ 50 ~ 0 0 0 0 0 0 0 L Day Motel Camp Seas VFR 0 0 0 0 0 0 0 Spending Segment 103 Appendix H: MITEIM Ougput Charts Chart 3 Trip Spendlng by Spendlng Category Souvenirs and other expenses Gambling“ 10% 0% ll. ‘ Sporting goods _ l‘ 1% Clothlng _ Motel, hotel cabin or 8&8 3% Admissions & fees 7% 29% Local transportation 3% Other vehicle expenses 1 % Gas 8: oil 10% _ Camping fees 0% Groceries. take-out I food/drinks ~J' 1 Restaurants 8. bars 12% 24% Chart 4 Local Trip Spending by Segment Day VFR 11% Seas 0% '3, Camp .. 1% Motel 71 % 104 400000 Appendix H: MITEIM Output Charts Chart 5 Visits by Segment Share 46% Chart 6 Total Spendlng, by Segment 350000 ~- 300000 ~~ 250000 4 5 200000 4- 150000 4 100000 4 50000: Day g Motel Camp Seas Spending Segment 105 Appendix H: MITEIM Output Charts Chart 7 Total Trips by Segment 2.000.000 1,800,000 1 £00,000 1 .400.000 1 200,000 g 1.000.000 800.000 600.000 400.000 200.000 Day Motel Camp Seas VFR Segment 106 Appendix I FedF IT Input-Output Data 107 P .0 P 000: 22.0:00..:. 00.5.00 H0.0m. $00 .0022 08wa P H0.0m. 0.0>_0:< c2001 0:.0c0:-vo:......00n. .2000 ._ 00.02 0. 022002.: 020.:00 00.0 0050 0:... ..00. 0:. 2 000: 0:2.:2:000 .3200 0:0 ...:0 0.00 ..0 0000:020 ._ .0:2.0:..02 :0.0->:-:0.0 202 0:0 ....n. .0 30.200 :0 0220 000.00m .0050 0.003 0:. 0. 0.0. .00: .0:. 000:022000. >22: 2.. 02.2.: 2.:20 0. 000:0. .2.: .000.: 0>0: 0.00:0 E0225 0:0 80.000.090.01 0:. .0. .800. 0.00:0x.0>> 0:. .2. ..00:0 2:. 000000 0. 000: 0. 202.2: 2 .00: 0: H .0020 .0. 0.00 00.00 :00. 0:0 :2.0.::0: 020.:00 2002:: 00:00:03 80.000.09.23. 0: b 02.00: 0:0 020:0 .0.000 .0. 00:02.0. 00.0 0.0 .00:0 2:. 2 00.00. 0:. ”.0000. :00.00 .5 0.00000. 2.0. 0 2 ....n. >0 00.0080 0000228 00. 0:0 2:0. 0:. .0 ..0 0.:000.:-0. 0:0 020.:8 .0 .2. 0 020.:8 00:02.02, E0225 0:. 0:< 00.0200 020: 00.0 028080 0:. 0. 00.0.0. 0..0:0 0:0 00.0010 0000: .:0. 00030.: 00:02.03 0.003800 0: .. .0.0>.0:0 ...—0:09.000 0 08:00.: 00:02.0; 2:022 .000 0:... 80:02.03 .::.:0 0:. 2 002000.: 0.0 0..:00. 00.0.0.-0::0>0. 0..00. 0: .. 0.00:0...03 2:00.). .000 0:0 >..:m. 0.0m. 0:. 2 80020.2 .:02..0: 0.0.:0 .00: 0: .r 22.80022 2:. 020202. 0.00:0...02, :0>00 .0 0.20:00 ....n. 0.0.0200: .00..0.: 0:. .0 3030. .0800 0 20.. 0020.00 0: :00 ..0.00 0.00.0 05.0.: :08. 0 >20 020 0. 0x000 ._ 22200.: .0 .00. :0.: 0 0>0: o. ..o:.:: .0: 0000 .00. 2: ... 80:2. .0 0.02.00 0.05: 0 02000.8. .2“. >0 20>.0:0 0:. .0:. 0.02 .0282 .0 0:00 .0: 0:0 02:00 .0: 00.00 20.0. .0200 ..0.0. .0.0. .0.:02:2.:0.00 20.0. .0 002:: 0:. :0 000. .. 20.01 .0 0:080 00. 0:. 20.. 022:8 0:0 00.20 .0. :2.02.0.2 2 000:.02 02.... 0020.: 0.0 0050... 00.0. .000. 0:0 0200:. 02:00 .0: 388 0:0 00.02.00 800.80: 388 0:0 .20 .00..0.2... .0.0>00 .. :200. 0:. 2 0000.: 00.0.0282 ..0 00 :03 00 00.05 00.2... 0:. 2 000.0 .:00:0:002 0:0 022:8 0:.:-oo...m ..0 :0 8.02.0.2 020.:8 ._ .0000:.:: 0.00 202 .0. 000: 0: :00 ....n. .202000000 0:80. .0. 00.02050 :0 022.20: 0. 8.2000 :_ 00.0 :0 0. 0:.000 ....s .0:. 0200 0. 3.08.: 0:0 00.00 0:. 2000000 222:0 0:0 .00.0.: 0 .0 82.00.2080 .::2 0. .00: 0:. 02.:0:0 .0:2.:2:000 2:20 0:0 0.50.00 00030.: 0.00900; 2:2 .0.00..0.: .:02:0.0>00 0.20800 .0 0.00:2. x0. .000. 0:. 50:0 0.02 200. 008.000 0.2880 .000. :_0: 0. 00:0.000 2 .00 .. .00:2_ .002”. 020001 .0000“. 0: ... 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Include all spending for goods and services during your stay in the local area including pre-paid hotel deposits, and all other payments whether by cash, credit card, or check. Enter spending to the nearest dollar in each category below. Enter 0 (zero) if you did not spend any money in a particular category. Spending category Spending in local area by your party Lodging Hotels, motels, cabins, B&B Campground fees Food and Beverages Restaurants and bars Groceries Transportation Gas and oil (auto, RV, boat, etc) Other auto expenses (repairs, parking, tolls, etc.) Airfares, Rail, Bus, Taxi, Car rental... Other Expenses Recreation and Entertainment fees Sporting goods Clothing Other goods (film, books, ...) Other services (hair cuts, etc.) i ‘. ‘ I ' ' 1‘“Q¢I\I‘(“‘-““-‘C(‘H“""‘l {IIiiiIii.I"‘II““‘t\“(““‘-‘l\“‘.(¢"(t‘t‘l' MICHIGAN STATE UNI lmIll/Ilulu/Illllll‘llllllillil 3 1293 02656 9156