Black Hats to White Hats:
Changing the Brand Image
of Parks and Recreation
through Economics
Brand + Aid: Marketing and So...
Present Position
 Recreation and park provision is

perceived to be a relatively discretionary,
non-essential government ...
Reposition
 Position recreation and park services so

that they are perceived to be a central
contribution to alleviating...
Positioning Implications
 Positioning is a relative rather than an

absolute concept
 “We are not identified with major

problems which confront our total
American Society [which is a] deep
concern and disa...
 The “big idea” associated with

repositioning is that funds are invested
in solutions to a community’s most
pressing pro...
Positioning Implications
 Positioning is a relative rather than an

absolute concept
 Legislators’ political platforms r...
Positioning Implications
 Positioning is a relative rather than an

absolute concept
 Legislators’ political platforms r...
Politically Important Issues
 Economic development (jobs, enhanced

tax base, redevelopment)
 Health (obesity)
 Safety ...
Benefits Related to Economic
Prosperity
 Attracting tourists
 Attracting businesses
 Reducing taxes
 Attracting retire...
Benefits Related to Economic
Prosperity
 Attracting tourists
Segments of Travel and their Inter-relationship with Parks and
Recreation
Recreation and
Park Attractions in
a Jurisdictio...
POPULATION
Ability to Travel
Interest in Travel

INFORMATION AND
PROMOTION

TRANSPORTATION

ATTRACTIONS
A Taxonomy of Tourist
Attractions


Arts



Heritage Places



Parks



Recreation



Arenas



Other

Theaters, Art...
POPULATION
Ability to Travel
Interest in Travel

INFORMATION AND
PROMOTION

TRANSPORTATION

ATTRACTIONS
Tourism is a public/non-profit sector driven business.
A comparison of the Financial and Economic Returns to a
City from an Amateur Softball Association Girls 18 & Under
Class A...
A comparison of the Financial and Economic Returns to a
City from an Amateur Softball Association Girls 18 & Under
Class A...
The Conceptual Rationale For Undertaking Economic Impact
Studies
FINISH
Inflow of
Revenues

For community
residents who
pa...
State Parks as “Economic
Engines”
 Parks attract non-resident visitors to the

area
 These visitors spend money in the l...
Example of a Park as an Economic
Engine
 Mustang Island State Park (145,711 visitor days)

Salaries and operating expense...
New money into the county:
 $809,500 + $698,500

$1,508,000

 Impact on Sales (1.71):

$1,384,000 + $1,190,000
 Impact ...
So:
 Every $1 of net state funds invested in

Mustang Island State Park yields $7.83
in income for Nueces County resident...
Economic Success Depends on
What Happens Inside a Facility
 Analogous to retail stores
 Investment in services and ameni...
Economic Return to a
Community From a Festival
Cost to the council of staging the festival
Income to the Council from admi...
Benefits Related to Economic
Prosperity
 Attracting tourists
 Attracting businesses
 Conventional wisdom is that development is

the “highest and best use” of vacant land for
increasing municipal revenues....
 Conventional wisdom is that development is

the “highest and best use” of vacant land for
increasing municipal revenues....
 Fiscal impact analyses frequently

demonstrate that the public costs associated
with new residential development exceed ...
 Fiscal impact analyses frequently demonstrate

that the public costs associated with new
residential development exceed ...
1.

Allocate total municipal expenditures into
service categories and assign them to
selected land use categories (Residen...
Allocate total municipal expenditures into
service categories and assign them to
selected land use categories (Residential...
1.

2.

3.

Allocate total municipal expenditures into
service categories and assign them to
selected land use categories ...
$1.40
$1.20
$1.00
$0.80
$0.60
$0.40
$0.20

$0.27

$0.00
Commercial &
Industrial
$1.40
$1.20
$1.00
$0.80
$0.60
$0.40
$0.20

$0.27

$0.35

$0.00
Commercial &
Industrial

Farm/Forest
Open Space
$1.40
$1.20

$1.16

$1.00
$0.80
$0.60
$0.40
$0.20

$0.27

$0.35

$0.00
Commercial &
Industrial

Farm/Forest
Open Space

Re...


Write down the place you would like to live,
given your druthers (i.e., your preferred place,
ignoring practical concer...


Write down the place you would like to live,
given your druthers (i.e., your preferred place,
ignoring practical concer...


Write down the place you would like to live,
given your druthers (i.e., your preferred place,
ignoring practical concer...
Business Relocation
Context





More than 10,000 economic
development groups are competing to
attract businesses.
Foot...
Parks, Trails and Recreation:
An Indicator Species
 American Heritage Dictionary:

“The presence, absence,
or relative we...
Drivers


Beyond a threshold salary level, people are
persuaded to relocate by quality of life
factors rather than money.
Drivers




Beyond a threshold salary level, people are
persuaded to relocate by quality of life
factors rather than mon...
Drivers






Beyond a threshold salary level, people are
persuaded to relocate by quality of life
factors rather than ...
Drivers








Beyond a threshold salary level, people are
persuaded to relocate by quality of life
factors rather th...
Comparison of the Perceptions of the
Relative Importance of General
Elements in Location Decisions
Between Decision Makes ...
Comparison of Perceptions of the
Relative Importance of Quality-of-Life
Elements in Location Decisions in
Large and Small ...
Significance


“Companies that are 5 years old or
younger account for all the country’s
net job creation.”
(i.e. 2.7 mill...
Significance






Most new business growth comes
from small companies.
90% of businesses in the U.S. employ
10 or fewe...
A Business Leader’s
Lament
“What’s the greatest problem a business
has today? Workforce. If you interview
50 businesses at...
A Business Leader’s
Lament
As the incoming CEO of [a local]
company said, I’ve got 80 people
making over $100,000 in this ...
People working in high tech companies are used to there
being a high quality of life in the metropolitan areas in
which th...
Benefits Related to Economic
Prosperity
 Attracting tourists
 Attracting businesses
 Reducing taxes
$1.40
$1.20

$1.16

$1.00
$0.80
$0.60
$0.40
$0.20

$0.27

$0.35

$0.00
Commercial &
Industrial

Farm/Forest
Open Space

Re...
 Section G – last underdeveloped part of a city

available
 Section G – last underdeveloped part of a city

available
 Original master plan - 7,711 population of
which 1,820 would...
Section G – last underdeveloped part of a city
available
 Original master plan - 7,711 population of which 1,820
would be...
Fiscal Impact Analysis revealed
 If do nothing, taxes for an average
homeowner will increase $250 per year to
support gro...
 Breakeven cost for the town to purchase

development rights on farms and other open
space was $10,000 per acre, i.e., an...
Protected 2000 acres, i.e., 2/3 of remaining open
space in the town by:
Purchasing development rights on 1,200 acres
Inc...
Annual cost of purchasing development rights
was $50 per year (cf. $250 from development).
Over the life of the bonds the ...
Benefits Related to Economic
Prosperity
 Attracting tourists
 Attracting businesses
 Reducing taxes
 Attracting retire...
Retirement Relocation
The new clean growth industry in
America
Target Market
 G rowing number of R etired A ctive

M onied P eople I n E xcellent S hape
Target Market
 G rowing number of R etired A ctive

M onied P eople I n E xcellent S hape

G.R.A.M.P.I.E.
S.
Life Expectancy at Age 65 and
Age of Exit from the Labor Force
(Medians)
Age of Exit from
the Labor Force

Life Expectancy...
Economic Impact


Annual inflow of 100 retired
households with $40,000 annual
income = a new $4 million annual
“payroll”
Median Net Worth of Households,
and Homeownership and Equity in
Different Age Groups in 2011
Head of Household

Median Net...
Median Income of Households
1980-2011 in 2011 Adjusted
Dollars
Mean Size of
% Change

Age of Head of

Per Capita

Househol...
GRAMPIES Are an Appealing
Economic Target Market
Because:


Social Security and Private Retirement incomes are stable –
n...
Key Requirement


Amenity rich community especially
recreation: socialization; active
lifestyle
Key Requirement




Amenity rich community especially
recreation: socialization; active
lifestyle
Sun City and Leisure W...
Key Requirement






Amenity rich community especially
recreation: socialization; active
lifestyle
Sun City and Leisur...
Survey: 270 Recently
Relocated GRAMPIES in the
Lower Rio Grande Valley


Top 3 out of 40 reasons for moving
away from the...
Benefits Related to Economic
Prosperity
 Attracting tourists
 Attracting businesses
 Reducing taxes
 Attracting retire...
Twelve years ago there was almost no
pleasure driving in New York. There are
now at least ten thousand horses kept for
ple...


…to enjoy the use of the park, within a few
years after it became available, the dinner
hour of thousands of families w...
Economic Partners’ Support
Group
To lobby for better funding for the recreation and park
agency
Comprised of:
- Recreation...
Benefits Related to Economic
Prosperity
 Attracting tourists
 Attracting businesses
 Reducing taxes
 Attracting retire...
 1,300 acres total

150- acres for a golf course
 Cost of golf course development = $4 million
 1,300 acres total

150- acres for a golf course
 Cost of golf course development = $4 million
 College Station sub-div...
 1,300 acres total

150- acres for a golf course
 Cost of golf course development =

$4 million

 College Station sub-d...
 Pebble Creek lots = $40,000 on average

($10,000 more per lot because of golf
course)
 Pebble Creek lots = $40,000 on average

($10,000 more per lot because of golf
course)
 1,150 remaining acres X 3 lots p...
 Nash established as the central principle of

his plan: “that the attraction of open Space,
free air and scenery of Natu...
 At Regent’s Park, Nash brought to the urban

landscape the principles of picturesque
landscapes that had been developed ...
Liverpool City Council (1837):
The Council is well disposed to provide a public
park and the subject has been discussed, b...


Richard Vaughn Yates purchased 97
acres for around £50,000: 40 acres for a
park






Joseph Paxton



Richard Vaughn Yates purchased 97
acres for around £50,000: 40 acres for a
park
Hired Joseph P...
1843-1850
 Cost of land acquisition and development of the park
 Projected income from lot sales
 Surplus


₤146,619 (...
 “A perfection that I had never dreamed of. I

cannot undertake to describe the effect of so
much taste and skill as had ...
Ward
Twelfth
Nineteenth
Twenty-Second

Value of Real Estate
1856
8,149,360
8,041,183
10,239,022
$26,429,563

Increase in A...
Ward
Twelfth
Nineteenth
Twenty-Second

Value of Real Estate
1856
8,149,360
8,041,183
10,239,022
$26,429,563

1873
62,457,6...
Ward
Twelfth
Nineteenth
Twenty-Second

Value of Real Estate
1856
8,149,360
8,041,183
10,239,022
$26,429,563

1873
62,457,6...
 1868 - Writing to the developers of Riverside

Chicago: FLO cited “the vast increase in value
of eligible sites for dwel...
 1868 - Writing to the developers of Riverside

Chicago: FLO cited “the vast increase in value of
eligible sites for dwel...
Increase in property value

Decrease in property value
Distance from park
Benefits Related to Economic
Prosperity
 Attracting tourists
 Attracting businesses
 Reducing taxes
 Attracting retire...
 Critics who argue there is inadequate

evidence to support the potential
contributions of these benefits are
wrong. Ther...
Credibility of the Evidence
“we have come a long way in essentially
less than a half-century and have much
to be proud of…...
Presentation available at:
 Google “TAMU Crompton”
 Go to “Recent Presentations”
Black Hats to White Hats: Changing the Brand Image of Parks and Recreation Through Economica - Dr. John Crompton
Black Hats to White Hats: Changing the Brand Image of Parks and Recreation Through Economica - Dr. John Crompton
Black Hats to White Hats: Changing the Brand Image of Parks and Recreation Through Economica - Dr. John Crompton
Black Hats to White Hats: Changing the Brand Image of Parks and Recreation Through Economica - Dr. John Crompton
Black Hats to White Hats: Changing the Brand Image of Parks and Recreation Through Economica - Dr. John Crompton
Black Hats to White Hats: Changing the Brand Image of Parks and Recreation Through Economica - Dr. John Crompton
Black Hats to White Hats: Changing the Brand Image of Parks and Recreation Through Economica - Dr. John Crompton
Black Hats to White Hats: Changing the Brand Image of Parks and Recreation Through Economica - Dr. John Crompton
Black Hats to White Hats: Changing the Brand Image of Parks and Recreation Through Economica - Dr. John Crompton
Black Hats to White Hats: Changing the Brand Image of Parks and Recreation Through Economica - Dr. John Crompton
Black Hats to White Hats: Changing the Brand Image of Parks and Recreation Through Economica - Dr. John Crompton
Black Hats to White Hats: Changing the Brand Image of Parks and Recreation Through Economica - Dr. John Crompton
Black Hats to White Hats: Changing the Brand Image of Parks and Recreation Through Economica - Dr. John Crompton
Black Hats to White Hats: Changing the Brand Image of Parks and Recreation Through Economica - Dr. John Crompton
Black Hats to White Hats: Changing the Brand Image of Parks and Recreation Through Economica - Dr. John Crompton
Black Hats to White Hats: Changing the Brand Image of Parks and Recreation Through Economica - Dr. John Crompton
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Black Hats to White Hats: Changing the Brand Image of Parks and Recreation Through Economica - Dr. John Crompton

  1. 1. Black Hats to White Hats: Changing the Brand Image of Parks and Recreation through Economics Brand + Aid: Marketing and Social Media Conference January 2014 John L. Crompton University Distinguished Professor and Regents Professor Presidential Professor for Teaching Excellence Texas A&M University
  2. 2. Present Position  Recreation and park provision is perceived to be a relatively discretionary, non-essential government service. It is nice to have if it can be afforded.
  3. 3. Reposition  Position recreation and park services so that they are perceived to be a central contribution to alleviating the major problems in a community identified by tax payers and decision makers.
  4. 4. Positioning Implications  Positioning is a relative rather than an absolute concept
  5. 5.  “We are not identified with major problems which confront our total American Society [which is a] deep concern and disappointment…[The field should] focus park and recreation services on the great social problems of our time and develop programs designed to contribute to the amelioration of those problems.” Gray and Greben, 1974
  6. 6.  The “big idea” associated with repositioning is that funds are invested in solutions to a community’s most pressing problems. The term “investing” suggests a positive, forward-looking agenda with a return on the investments. Elected officials usually have no mandate to fund programs; their mandate is to invest resources into solutions.
  7. 7. Positioning Implications  Positioning is a relative rather than an absolute concept  Legislators’ political platforms represent residents’ concerns
  8. 8. Positioning Implications  Positioning is a relative rather than an absolute concept  Legislators’ political platforms represent residents’ concerns  The challenge is not financial, it is administrative
  9. 9. Politically Important Issues  Economic development (jobs, enhanced tax base, redevelopment)  Health (obesity)  Safety (youth crime)  Quality of life  Education (after-school programs)
  10. 10. Benefits Related to Economic Prosperity  Attracting tourists  Attracting businesses  Reducing taxes  Attracting retirees  Enhancing real estate values  Stimulation of equipment sales
  11. 11. Benefits Related to Economic Prosperity  Attracting tourists
  12. 12. Segments of Travel and their Inter-relationship with Parks and Recreation Recreation and Park Attractions in a Jurisdiction Opportunities for Local Residents Pleasure Travel – Sphere of Interest Tourism Conference and Convention Travel Business Travel Visiting Friends and Relatives – Personal Business Recreation and park attractions NOT operated by a public agency
  13. 13. POPULATION Ability to Travel Interest in Travel INFORMATION AND PROMOTION TRANSPORTATION ATTRACTIONS
  14. 14. A Taxonomy of Tourist Attractions  Arts  Heritage Places  Parks  Recreation  Arenas  Other Theaters, Art Galleries, Museums, Performing Groups, Music Concerts Ethnic Cultural Places, Shrines/Churches, Historical Sites and Structures, Educational Instructions, Industry Factory Tours National, State, Regional, Local, Beaches, Theme Parks Events and Festivals, Aquatic and Coastal Areas, Outdoor recreations (e.g. camping, fishing, hunting), golf, tennis, skiing, sailing, softball), Fitness and Wellness Centers College Sports, Professional Franchises, Concerts and Exhibitions Gambling Places, Cruise Ships
  15. 15. POPULATION Ability to Travel Interest in Travel INFORMATION AND PROMOTION TRANSPORTATION ATTRACTIONS
  16. 16. Tourism is a public/non-profit sector driven business.
  17. 17. A comparison of the Financial and Economic Returns to a City from an Amateur Softball Association Girls 18 & Under Class A National Softball Championship Tournament Context 1810 players on 133 teams participated in the tournament. All were from out-of-town. Because it was an elimination tournament, the length of time that the teams stayed in the community varied from 4 to 7 nights. 697 players’ parents were interviewed. Financial Data Income: Entry fees $300 x 133 $39,900 Tournament costs and staff time $119,617 Net loss ($79,717)
  18. 18. A comparison of the Financial and Economic Returns to a City from an Amateur Softball Association Girls 18 & Under Class A National Softball Championship Tournament Economic Data Total expenditures in the local area by the 1810 players and their family/friends $2,039,000 Economic impact on sales $3,731,000 Economic impact on income $1,162,000 Return on investment For each dollar invested, residents’ income increased by $14.58 (1,162,000/79,717). Facility cost $12 million; payback period to residents is 10 tournaments of this size.
  19. 19. The Conceptual Rationale For Undertaking Economic Impact Studies FINISH Inflow of Revenues For community residents who pay taxes START Community residents & visitors pay taxes Creating income and jobs in the community Outflow of Funds To a city council Which uses them to subsidize development of recreation programs and facilities Who spend money in the local economy That attract out-oftown visitors
  20. 20. State Parks as “Economic Engines”  Parks attract non-resident visitors to the area  These visitors spend money in the local area  This new money creates income and jobs for area residents
  21. 21. Example of a Park as an Economic Engine  Mustang Island State Park (145,711 visitor days) Salaries and operating expenses Revenue Net Loss 809,500 632,000 177,500
  22. 22. New money into the county:  $809,500 + $698,500 $1,508,000  Impact on Sales (1.71): $1,384,000 + $1,190,000  Impact on Personal Income  $753,000 + $631,000  Impact on Employment  25 jobs + 21  Average pay for each job is  $2,574,000 $1,384,000 46 jobs $30,088
  23. 23. So:  Every $1 of net state funds invested in Mustang Island State Park yields $7.83 in income for Nueces County residents. That is: $1,384,000 / $177,500  The cost of the state of each job created is $3,850 i.e. $177,500 / 46
  24. 24. Economic Success Depends on What Happens Inside a Facility  Analogous to retail stores  Investment in services and amenities More Visitors More Per Capita Expenditures More Jobs and Income to Local Residents
  25. 25. Economic Return to a Community From a Festival Cost to the council of staging the festival Income to the Council from admission fees, Vendor concessions, etc. Net loss to the city $400,000 $170,000 $230,000 $343,000 Income accruing to city residents outside the festival gates from visitor spending in the community Net gain in income to community residents: Return on investment to residents on their $400,000 investment $113,000 28%
  26. 26. Benefits Related to Economic Prosperity  Attracting tourists  Attracting businesses
  27. 27.  Conventional wisdom is that development is the “highest and best use” of vacant land for increasing municipal revenues.  Developers claim their projects “pay for themselves and then some” BUT
  28. 28.  Conventional wisdom is that development is the “highest and best use” of vacant land for increasing municipal revenues.  Developers claim their projects “pay for themselves and then some” BUT  If a private company had a business plan that looked only at revenues and ignored costs, it would be quickly out of business. Why should the public tolerate such one-sided accounting by local governments?
  29. 29.  Fiscal impact analyses frequently demonstrate that the public costs associated with new residential development exceed the public revenues that accrue from it. BECAUSE  The people who reside in developments require services. IN CONTRAST
  30. 30.  Fiscal impact analyses frequently demonstrate that the public costs associated with new residential development exceed the public revenues that accrue from it. BECAUSE  The people who reside in developments require services. IN CONTRAST  Natural parks and open space require few public services – no roads, no schools, no sewage, no solid waste disposal, no water, and minimal fire and police protection.
  31. 31. 1. Allocate total municipal expenditures into service categories and assign them to selected land use categories (Residential, Commercial/Industrial, Farm/Forestry/Open Space)
  32. 32. Allocate total municipal expenditures into service categories and assign them to selected land use categories (Residential, Commercial/Industrial, Farm/Forestry/Open Space) 2. Categorize municipal revenues by sources and allocate them to the selected land use categories 1.
  33. 33. 1. 2. 3. Allocate total municipal expenditures into service categories and assign them to selected land use categories (Residential, Commercial/Industrial, Farm/Forestry/Open Space) Categorize municipal revenues by sources and allocate them to the selected land use categories Compare revenues to expenditures for each land use category
  34. 34. $1.40 $1.20 $1.00 $0.80 $0.60 $0.40 $0.20 $0.27 $0.00 Commercial & Industrial
  35. 35. $1.40 $1.20 $1.00 $0.80 $0.60 $0.40 $0.20 $0.27 $0.35 $0.00 Commercial & Industrial Farm/Forest Open Space
  36. 36. $1.40 $1.20 $1.16 $1.00 $0.80 $0.60 $0.40 $0.20 $0.27 $0.35 $0.00 Commercial & Industrial Farm/Forest Open Space Residential
  37. 37.  Write down the place you would like to live, given your druthers (i.e., your preferred place, ignoring practical concerns such as a job, family, language, and heritage).
  38. 38.  Write down the place you would like to live, given your druthers (i.e., your preferred place, ignoring practical concerns such as a job, family, language, and heritage).  Write in one sentence, why you picked that place.
  39. 39.  Write down the place you would like to live, given your druthers (i.e., your preferred place, ignoring practical concerns such as a job, family, language, and heritage).  Write in one sentence, why you picked that place.  More than 80% of participants will cite some park, recreational, cultural, or environmental ambiance dimension in their responses.
  40. 40. Business Relocation Context    More than 10,000 economic development groups are competing to attract businesses. Footloose Industries “Information Factories” whose main asset is highly educated professional employees.
  41. 41. Parks, Trails and Recreation: An Indicator Species  American Heritage Dictionary: “The presence, absence, or relative well-being in a given environment is indicative of the health of its ecosystem as a whole.”
  42. 42. Drivers  Beyond a threshold salary level, people are persuaded to relocate by quality of life factors rather than money.
  43. 43. Drivers   Beyond a threshold salary level, people are persuaded to relocate by quality of life factors rather than money. No matter how “quality of life” is defined, parks, recreation, and open space are part of it.
  44. 44. Drivers    Beyond a threshold salary level, people are persuaded to relocate by quality of life factors rather than money. No matter how “quality of life” is defined, parks, recreation, and open space are part of it. There are no great cities in this world that do no have a great park (recreation and culture) system.
  45. 45. Drivers     Beyond a threshold salary level, people are persuaded to relocate by quality of life factors rather than money. No matter how “quality of life” is defined, parks, recreation, and open space are part of it. There are no great cities in this world that do no have a great park (recreation and culture) system. “Disamenity compensation” – companies located where there is only mediocre quality of life have to pay higher wages to attract the same quality work (and vice-versa).
  46. 46. Comparison of the Perceptions of the Relative Importance of General Elements in Location Decisions Between Decision Makes in Large and Small Companies Elements Small Company Means (n=38) Large Company Means (n=42) Government Incentives 3.9 14.2 Quality of Life 33.3 14.7 Labor 10.3 24.0 Proximity to Customers 28.4 11.6 Operating Costs 17.2 24.3 Transportation 6.7 7.7
  47. 47. Comparison of Perceptions of the Relative Importance of Quality-of-Life Elements in Location Decisions in Large and Small Companies Elements Small Company Means (n=38) Large Company Means (n=42) Primary/Secondary Education 19.4 18.0 Recreation/Open Spaces 26.4 12.1 Cost of Living/Housing 23.0 34.5 Personal Safety/Crime Rate 12.9 13.2 Cultural Opportunities 10.6 9.5 Health/Medical Services 7.1 9.2
  48. 48. Significance  “Companies that are 5 years old or younger account for all the country’s net job creation.” (i.e. 2.7 million jobs in 2012)  On average, they produce 5 jobs each
  49. 49. Significance    Most new business growth comes from small companies. 90% of businesses in the U.S. employ 10 or fewer people. Small business owners often “satisfice” rather than “optimize” their profit potential.
  50. 50. A Business Leader’s Lament “What’s the greatest problem a business has today? Workforce. If you interview 50 businesses at random, I’ll bet 49 would say that my biggest problem is getting qualified workers. To get workers, you have to get people who want to be in your community because they love the community, it’s got things to offer.
  51. 51. A Business Leader’s Lament As the incoming CEO of [a local] company said, I’ve got 80 people making over $100,000 in this operation. All of them are young, aggressive, highly compensated people. They went to the best schools in the country, they could go anywhere they wanted, they are the A players in the business world. I need things that A players want.
  52. 52. People working in high tech companies are used to there being a high quality of life in the metropolitan areas in which they live. When we at Dell go and recruit in those areas, we have to be able to demonstrate to them that the quality of life in Austin is at least comparable or they won’t come. It’s not just about salary. It’s about what’s the community like where I’m going to live. - Vice President, Dell Corp., Austin
  53. 53. Benefits Related to Economic Prosperity  Attracting tourists  Attracting businesses  Reducing taxes
  54. 54. $1.40 $1.20 $1.16 $1.00 $0.80 $0.60 $0.40 $0.20 $0.27 $0.35 $0.00 Commercial & Industrial Farm/Forest Open Space Residential
  55. 55.  Section G – last underdeveloped part of a city available
  56. 56.  Section G – last underdeveloped part of a city available  Original master plan - 7,711 population of which 1,820 would be school age. 125 acres of open space  Revised master plan – 205 acres of open space; reduction of school age population to 1,104 (716 fewer)
  57. 57. Section G – last underdeveloped part of a city available  Original master plan - 7,711 population of which 1,820 would be school age. 125 acres of open space  Revised master plan – 205 acres of open space; reduction of school age population to 1,104 (716 fewer)  Result: 1 less school to build and operate  Cost savings substantially greater than revenues from residences on the additional 80 acres available in the original plan would have generated 
  58. 58. Fiscal Impact Analysis revealed  If do nothing, taxes for an average homeowner will increase $250 per year to support growth  Break-even value of a new home was over $300,000
  59. 59.  Breakeven cost for the town to purchase development rights on farms and other open space was $10,000 per acre, i.e., annual cost of servicing bonds for this purpose equals annual costs accruing town residential use
  60. 60. Protected 2000 acres, i.e., 2/3 of remaining open space in the town by: Purchasing development rights on 1,200 acres Incentive zoning (TDRs) on 200+ acres Mandatory clustering protecting 600+ acres
  61. 61. Annual cost of purchasing development rights was $50 per year (cf. $250 from development). Over the life of the bonds the average homeowner saved $5,000
  62. 62. Benefits Related to Economic Prosperity  Attracting tourists  Attracting businesses  Reducing taxes  Attracting retirees
  63. 63. Retirement Relocation The new clean growth industry in America
  64. 64. Target Market  G rowing number of R etired A ctive M onied P eople I n E xcellent S hape
  65. 65. Target Market  G rowing number of R etired A ctive M onied P eople I n E xcellent S hape G.R.A.M.P.I.E. S.
  66. 66. Life Expectancy at Age 65 and Age of Exit from the Labor Force (Medians) Age of Exit from the Labor Force Life Expectancy at 65 Males Females Males Females Early 1950s 66.9 67.6 77.8 80.1 2011 61.6 60.5 82.8 85.4 5.3 7.1 5.0 5.3
  67. 67. Economic Impact  Annual inflow of 100 retired households with $40,000 annual income = a new $4 million annual “payroll”
  68. 68. Median Net Worth of Households, and Homeownership and Equity in Different Age Groups in 2011 Head of Household Median Net Worth Homeownership Equity in Own Age ($) 68,828 (%) 66.9 Home ($) 80,000 Under 35 6,676 39.1 20,000 35-44 35,000 65.0 40,000 45-54 84,542 73.5 70,000 55-64 143,964 79.0 97,000 Over 65 170,516 80.5 130,000 65-69 194,226 81.6 125,000 70-74 181,078 82.4 130,000 Over 75 155,714 78.9 130,000 All
  69. 69. Median Income of Households 1980-2011 in 2011 Adjusted Dollars Mean Size of % Change Age of Head of Per Capita Household in Income in Household 15-24 1980 33,033 1990 30,031 2000 36,370 2011 30,460 1980-2011 -8% 2011 2.82 2011 10,801 25-34 50,252 50,644 58,007 50,774 1% 2.85 17,815 35-44 61,400 64,327 70,216 61,916 1% 3.35 18,482 45-54 65,283 69,934 75,283 63,861 -2% 2.81 22,726 55-64 50,798 53,991 58,580 55,937 10% 2.18 25,659 65 and over 22,840 28,117 30,148 33,118 45% - - 65-74 N/A 33,851 36,767 41,598   1.91 21,779 75 and over N/A 21,997 24,572 26,277   1.60 16,423       50,854   2.55 19,943 National average
  70. 70. GRAMPIES Are an Appealing Economic Target Market Because:  Social Security and Private Retirement incomes are stable – not subject to the vicissitudes of economic business cycles  “Positive” taxpayers i.e., generate more tax revenue than the cost of serving them (e.g., schools, criminal justice)  Contribute to development of the health care industry  Volunteer pool – active in churches, service organizations, and philanthropic organizations  Stimulate housing and retail, but do not put pressure on local job markets or social services
  71. 71. Key Requirement  Amenity rich community especially recreation: socialization; active lifestyle
  72. 72. Key Requirement   Amenity rich community especially recreation: socialization; active lifestyle Sun City and Leisure World communities
  73. 73. Key Requirement    Amenity rich community especially recreation: socialization; active lifestyle Sun City and Leisure World communities Retention is as valuable as recruitment
  74. 74. Survey: 270 Recently Relocated GRAMPIES in the Lower Rio Grande Valley  Top 3 out of 40 reasons for moving away from the previous residence were: – Desire to live in a more recreationally enjoyable area – Desire to get away from cold weather – Desire to live in a place where recreation opportunities are plentiful
  75. 75. Benefits Related to Economic Prosperity  Attracting tourists  Attracting businesses  Reducing taxes  Attracting retirees  Stimulation of equipment sales
  76. 76. Twelve years ago there was almost no pleasure driving in New York. There are now at least ten thousand horses kept for pleasure driving. Frederick Law Olmsted, 1870
  77. 77.  …to enjoy the use of the park, within a few years after it became available, the dinner hour of thousands of families was permanently changed, the number of private carriages kept in the city was increased tenfold, the number of saddle horses a hundredfold, the business of livery stables more than doubled, the investment of many millions of private capital in public conveyance made profitable. Frederick Law Olmsted, 1886
  78. 78. Economic Partners’ Support Group To lobby for better funding for the recreation and park agency Comprised of: - Recreation equipment retailers - Department suppliers - Concessioners c.f. State and National Tourist Associations Recreation Coalition at the Federal level Armed forces and defense contractors
  79. 79. Benefits Related to Economic Prosperity  Attracting tourists  Attracting businesses  Reducing taxes  Attracting retirees  Stimulation of equipment sales  Enhancing real estate values
  80. 80.  1,300 acres total 150- acres for a golf course  Cost of golf course development = $4 million
  81. 81.  1,300 acres total 150- acres for a golf course  Cost of golf course development = $4 million  College Station sub-division lots = $30,000  Pebble Creek averages 3 lots per acre Golf course replaced 450 lots  450 lots at $30,000 = 13.5 million
  82. 82.  1,300 acres total 150- acres for a golf course  Cost of golf course development = $4 million  College Station sub-division lots = $30,000  Pebble Creek averages 3 lots per acre Golf course replaced 450 lots  450 lots at $30,000 = 13.5 million  Total cost of the golf course - $17.5 million
  83. 83.  Pebble Creek lots = $40,000 on average ($10,000 more per lot because of golf course)
  84. 84.  Pebble Creek lots = $40,000 on average ($10,000 more per lot because of golf course)  1,150 remaining acres X 3 lots per acre = 3,450 lots  3,450 x $10,000 premium = $34.5 million
  85. 85.  Nash established as the central principle of his plan: “that the attraction of open Space, free air and scenery of Nature, with the means and invitation of exercise on horseback, on foot and in Carriages, shall be preserved in Marylebone Park, as allurements or motives for the wealthy part of the public to establish themselves.”
  86. 86.  At Regent’s Park, Nash brought to the urban landscape the principles of picturesque landscapes that had been developed by Capability Brown in country estates half a century earlier, and his erstwhile partner Humphry Repton
  87. 87. Liverpool City Council (1837): The Council is well disposed to provide a public park and the subject has been discussed, but the value of the land is so great in the vicinity of Liverpool and the council have had so many demands upon it that they do not consider justified in incurring such an expense.
  88. 88.  Richard Vaughn Yates purchased 97 acres for around £50,000: 40 acres for a park
  89. 89.     Joseph Paxton  Richard Vaughn Yates purchased 97 acres for around £50,000: 40 acres for a park Hired Joseph Paxton, the leading botanist-garden in the country based at Chatsworth “A marketing coup” Paxton’s first venture into municipal design Assisted by James Pennethorne – a protégé of Nash – worked with him at Regent’s Park
  90. 90. 1843-1850  Cost of land acquisition and development of the park  Projected income from lot sales  Surplus  ₤146,619 ($236,057) ₤155,872 ($250,954) ₤9,253 ($14,897) ₤1 in 1850 = ₤43 in 2013 (using the retail price index)  Contemporary value using the average earnings index: ₤1 in 1850 = ₤699 in 2013  Cost of land acquisition and development of the park  Projected income from lot sales  Surplus  ₤103 million ($166m) ₤109 million ($181m) ₤6 million ($15m)
  91. 91.  “A perfection that I had never dreamed of. I cannot undertake to describe the effect of so much taste and skill as had evidently been employed…and all this magnificent pleasureground is entirely, unreservedly, and forever the people’s own…but you are inquiring who paid for it. The honest owners—the most wise and worthy people of Birkenhead—in the same way that New Yorkers pay for ‘The Tombs’, and the hospital, and the cleaning (as they amusingly say) of their streets.”
  92. 92. Ward Twelfth Nineteenth Twenty-Second Value of Real Estate 1856 8,149,360 8,041,183 10,239,022 $26,429,563 Increase in Assessed Valuation = Tax rate in 1873 was $2.50 so Tax revenue on increased AV = 1873 62,457,680 110,519,303 63,104,530 $263,081,515 $209,651,950 $5,241,200
  93. 93. Ward Twelfth Nineteenth Twenty-Second Value of Real Estate 1856 8,149,360 8,041,183 10,239,022 $26,429,563 1873 62,457,680 110,519,303 63,104,530 $263,081,515 Increase in Assessed Valuation = Tax rate in 1873 was $2.50 so Tax revenue on increased AV = $209,651,950 Total Cost of land and development for Central Park Annual debt charges $13,902,515 $5,241,200 $830,158
  94. 94. Ward Twelfth Nineteenth Twenty-Second Value of Real Estate 1856 8,149,360 8,041,183 10,239,022 $26,429,563 1873 62,457,680 110,519,303 63,104,530 $263,081,515 Increase in Assessed Valuation = Tax rate in 1873 was $2.50 so Tax revenue on increased AV = $209,651,950 Total Cost of land and development for Central Park Annual debt charges $13,902,515 Excess of tax revenues over debt charges (In 2013 dollars $4,411,140 $8,110,000,000) $5,241,200 $830,158
  95. 95.  1868 - Writing to the developers of Riverside Chicago: FLO cited “the vast increase in value of eligible sites for dwellings near public parks.”
  96. 96.  1868 - Writing to the developers of Riverside Chicago: FLO cited “the vast increase in value of eligible sites for dwelling near public parks.”  1919 – FLO Jr: “It has been established that…a local park of suitable size, location and character, and of which the proper public maintenance is reasonably assured, adds more to the value of the remaining land in the residential area which it serves than the value of the land withdrawn to create it.”
  97. 97. Increase in property value Decrease in property value Distance from park
  98. 98. Benefits Related to Economic Prosperity  Attracting tourists  Attracting businesses  Reducing taxes  Attracting retirees  Stimulation of equipment sales  Enhancing real estate values
  99. 99.  Critics who argue there is inadequate evidence to support the potential contributions of these benefits are wrong. There is strong enough empirical support for all of the benefits listed to justify their advocacy in formulating policy.
  100. 100. Credibility of the Evidence “we have come a long way in essentially less than a half-century and have much to be proud of…In fact, few areas of scientific inquiry have realized such advancements in so short a time.” Driver, 1999
  101. 101. Presentation available at:  Google “TAMU Crompton”  Go to “Recent Presentations”

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