Economic Impact of Mountain Bicycling & Trails


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A presentation by RJF's Scott Chapin, presented in Copper Harbor, Michigan, in 2011.

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Economic Impact of Mountain Bicycling & Trails

  1. 1. Scott ChapinRJF, a Marsh & McLennan Agency LLC companyECONOMIC IMPACTOF MOUNTAINBICYCLING &TRAILS
  2. 2. BACKGROUNDScott ChapinEconomics Major, UniversityWisconsin-Eau ClairePresident, Sawyer CountyDevelopment CorporationPast President, NorthlandArea Builders AssociationDirector, American BirkebeinerSki Foundation
  3. 3. BACKGROUNDScott Chapin > Avid cyclist, runner, skier > Active with local IMBA club- CAMBA > Insurance broker specializing in bicycle and ski industry risks > Work with 150+ bike clubs in U.S.
  4. 4. MOUNTAIN BIKING-TRAILDEVELOPMENTAttracts touristsTourists could becomeseasonal or permanentresidentsAttracts commerceEnhances communities
  5. 5. MOUNTAIN BIKE TRAILDEVELOPMENTLand Managers,Municipalities, Chambers ofCommerce QuestionEconomic Impact DataHaving Economic DataHelps with Financial andPolitical Support of TrailProjectsHelps With Volunteer Base
  6. 6. ECONOMIC DATAAnalysis is for SawyerCountySawyer County Located inNW WisconsinSawyer County Population =16,196 (2000)2 ½ Hours from MinneapolisMedian Per Capita Income =$24,288 (2002)
  7. 7. ECONOMIC DATATourist Area, HistoricallyFishing/HuntingService Sector EconomyKnown for Events: AmericanBirkebeiner, LumberjackWorld Championships,Chequamegon Fat TireFestival
  8. 8. ECONOMIC DATAMany second homeownersin areaChequamegon AreaMountain Bike Associationdeveloped around 1990Started signing existingdouble-track/roadsFocus on singletrack for past8 Years
  9. 9. TYPES OF ECONOMIC IMPACTDirect-Initial purchaseIndirect-Cross industryInduced-Cycled again incommunity
  10. 10. ECONOMIC STATISTICS(BICYCLING) NATIONAL$133 billion annualcontribution to the U.S.economySupports 1.1 million jobsGenerates $17.7 billion inannual federal and state taxrevenues
  11. 11. ECONOMIC STATISTICS(BICYCLING) NATIONALIn 2005- 19.8 million bicycles were sold in the UnitedStates (4.4 M more than all autos sold)NBDA-$5.6 billion in retail sales of bikes/partsannuallyAverage retail bike shop has 6 FTE’s4,200 retail shops in US (>25,000 FTE’s)
  12. 12. ECONOMIC STATISTICS(BICYCLING)-NATIONALProduces $53.1 billionannually in retail sales andservices > $6.2 billion in gear sales > $46.9 billion in bicycling-trip expenditures
  13. 13. WISCONSIN ECONOMIC IMPACT(BICYCLING)49% of Wisconsin residentsbicycleEconomic impact of bicyclerecreation/tourism is $925millionAverage daily expenditure =$60Greater impact than hunting57% of expenditures fromnon-residents
  14. 14. MINNESOTA ECONOMIC IMPACTRoad bicycling > $686M per year > 4,148 jobsMountain bicycling > $318M per year > 1,116 jobs
  15. 15. WISCONSIN ECONOMIC IMPACT(BICYCLING)Bicycling contributes $1.5billion annually and 13,200jobs (including tourism) toWisconsin’s Economy2.5 million WI residents ridebicycles for recreationOver 300 bike-related eventsin WI
  16. 16. ECONOMIC IMPACT (BICYCLING)-REGIONALLYIN, IL, MI, OH, WIContributes $17 billion toregional economySupports 191,000 jobsGenerates $2.2 billion instate and federal taxrevenues
  17. 17. ECONOMIC IMPACT (BICYCLING)-REGIONALLY$12.1 billion in retail sales > $873 million in bicycling gear sales > $11.2 billion in bicycling trip- related expenditures
  18. 18. ECONOMIC IMPACT (BICYCLING)-REGIONALLY2001: bicycle tourismbrought $66.8 million toMaine economyBicycling-related businessesbring $315M to Minnesota’seconomy annually
  19. 19. DEFINED LOCATION ECONOMICIMPACTTrails in Miami Valley of Ohio attract 1,000,000visitors who spend $16 million on related goods andservices2009 USA Cycling National CX Championshipsbrought $1 million to Bend, OregonRAGBRAI: $24 million in economic impactMoab, Utah: $8.8 million in economic impact (1996)
  20. 20. DEFINED LOCATION ECONOMICIMPACTBicycle industry in Santa Cruz, CA, generates morethan $130M in revenue, 500 jobsBicycle-related economic activity provides $90M and850-1150 jobs for the city of Portland, OR. From2006 to 2008, the value of the Portland bicycleindustry increased 38%.
  21. 21. DEFINED LOCATION ECONOMICIMPACTBicyclists in the northern OuterBanks region of North Carolinabring an estimated $60 millionannually to the areas economy,nearly nine times the one-timeexpenditure of $6.7 million ofpublic funds to construct bicyclefacilities in the region.1,400 jobs are created and/orsupported annually by thebicyclists expenditures.
  22. 22. DEFINED LOCATION ECONOMICIMPACTThe Harbin Park Cyclocross Race in Cincinnati wasestimated to bring $200,000 to the community in 2010. 70%of participants traveled in from over 100 miles to compete,and more than 80% stayed two nights or more in the region.
  23. 23. DEFINED LOCATION ECONOMICIMPACTChequamegon Area (Cable/Hayward): $1.17M in1997 (likely 3x this now)161 U.S. ski areas open trails to bikers in summer-84 run lifts for cyclists50% of Colorado tourists are engaged in cycling-$141M-$193MAmerican Birkebeiner brings in $4M toHayward/Cable area
  24. 24. Defined Location Economic ImpactColorado-Other RevenueGenerators > Bicycle Tours: $640,000 > Racing: $2,000,000 > Charity Rides: $3,400,000
  25. 25. GENERAL PUBLIC (INCORRECT)ASSUMPTIONSCyclists are cheapParticipants do not spend asmuch as other user groups(tourists)Participants have averageincome levelsParticipants (off-road) are20-somethings
  26. 26. FACTS ABOUT CYCLISTS53% of participants in Chequamegon Fat TireFestival (2,500) are between 35-4930% of cyclists have annual household incomesover $125,00049% of cyclists have annual household incomesover $100,000 (ABSF Survey)87% of cyclists are college graduates
  27. 27. Silent Sports Trends1998-2004: 16-24 Year Olds: > Snowshoeing +50% > Single Track Bicycling > Trail Running +20% for +92.5% Participants and Enthusiasts > Trail Running +50% (Future > Single Track Bicycling +183% Market) > Dirt Road Bicycling +112.5% > Snowshoeing +300% for Enthusiast Category Female Enthusiast: (Repetitive Potential Visits) > Single Track Bicycling +112.5% > Snowshoeing +100% Data from Outdoor Industry Foundation
  28. 28. GENERAL FACTS ABOUT TOURISTSMotel/Hotel tourists spend$126 per dayCampground tourists spend$75 per dayDaytripper tourists spend$40 per dayOften it is assumed thatmost cyclists visiting thearea are “tourists”
  29. 29. GENERAL FACTS ABOUTSECOND HOMEOWNERSSecond homeowners spend$17,571 per year in SawyerCounty (Sawyer Co. Dev.Cor. Study-2008)Survey sent to all non-resident homeowners withimprovements over $80,000100 User Days Per Year
  30. 30. GENERAL FACTS ABOUTSECOND HOMEOWNERSBasic consumption items= $5,700 per household(Average)Recreation equipment= $2,800 per householdNeeds for Home(Construction, Remodeling)= $14,400 per householdNote: Not all spent money inall categories
  31. 31. LAND VALUES ADJACENT TOTRAILSDevelopers in NWspecializing in recreationaluse dependent upon marketland values 3 years agowere doubleLand values today are 50%higher than non-recreationaldevelopments
  32. 32. THE BROOK-SEELEYHIGHLANDSYour home at the Brook will be locatedin the Namekagon River Valley. Thisbeautiful and diverse property is ablend of pine and aspen woodlandsand partially wooded meadows.Immediately adjacent to theBirkebeiner Ski Trail and CambaMountain Bike Trails, The Brook isbordered on the north and east bythousands of acres of Sawyer CountyForest. Homeowners enjoy 14 km ofprivate trails, professionally groomedin winter for both classic and freestyleskiers, that link directly to theAmerican Birkebeiner trail. The perfect“silent sports retreat”, The Brookbeckons to active northwoodsenthusiasts who love the feeling that“ hour at the cabin feels like 5days.”
  33. 33. LAND VALUES ADJACENT TOTRAILSStatistics on Land Values How do bicycling investments affect real estate? > According to a study of the Little Miami Scenic Trail, for every foot closer a house is to the trail, its price increases by $7.05.(Karadeniz, D., 2008, The Impact of the Little Miami Scenic Trail on Single Family Property Values, University of Cincinnati Masters Thesis) > Two-thirds of Omaha, Nebraska, residents who live near bike trails believe the trails would increase the selling price of their home.(Greer, D. L., 2000, Omaha Recreational Trails: Their Effect on Property Values and Public Safety, National Park Service, University of Nebraska at Omaha, June, 2000)
  34. 34. LAND VALUES ADJACENT TOTRAILSHouses located in areas withabove-average levels of walkability[or bikeability] are worth up to$34,000 more than similar housesin areas with average walkabilitylevels. > (Cortright, J., 2009, "Walking the Walk: How walkability raises home values in U.S. cities," CEOs for Cities)In a survey of recent transplants toPortland, OR, 62% said that thecitys bike-friendliness was a factorin their decision to move there. > (City of Portland Bureau of Transportation, 2009, Portland Bicycle)
  35. 35. LAND VALUES ADJACENT TOTRAILSIn Minneapolis-St. Paul, for every 400 meters closer amedian-priced home is to an off-street bicycle facility, itsvalue increases by $510. > (Krizek, K., 2006, Two approaches to valuing some of bicycle facilities presumed benefits, Journal of the American Planning Association, 72, 309-19)Homes within a half-mile of Indiana’s Monon Trail sell for anaverage of 11 percent more than identical homes furtheraway. > (Lindsey et al., 2004, Property values, recreation values, and urban greenways, Journal of Park and Recreation Administration, 22, 69- 90)
  36. 36. DATA ANALYSIS-IMPACTSeeley Hills RecreationalDevelopment > Adjacent to CAMBA and Birkie Trails > Sample 5.5 Miles of Road > 1994-7 Homes > 2010- 51 Homes > 33 of the 51 are Second Homeowners > 2 Retirees > 14 (Newly) Permanent Transplant > 2 Originally from Area
  37. 37. DATA ANALYSIS-IMPACT50/51 Participate in Silent Sports > Average Home Value $300,000 > Economic Impact of New Homes ($13.2 M) > Average Property Taxes $2,000 > Property Tax Revenue $88,000 > Average Expenditure in Sawyer County $17,571 > Economic Impact $589,743 (Annually)
  38. 38. DATA ANALYSIS-IMPACTSeeley Highlands Development-1997 > 67 Acres > 18 Lots > Land Values in 1997-5 Acres: $5,000-$8,500 > 14 Homes in 2010 > 3 Acre Parcels Sold for $13,000-$16,000 in 1997-2000 > 2010: $40,000-$50,000 for same lots
  41. 41. USES FOR THIS DATACommunity Support Proud Sponsors of CAMBAPublic SupportGrant OpportunitiesVolunteer SupportLand Value Increases-Private Land
  42. 42. USES FOR THIS DATAGrant Opportunities > Many Grants Available > Economic Improvement Grants > Contact Economic Development Corporation > Similar Focus on ROI
  43. 43. HOW CAN I USE THIS DATAGrant Scorers Look At: > 1st or 2nd Tier Jobs (Permanent) > Money Spent in Community (6x7 Times) > Sales and Property Tax Revenue Generated > Social Impact on Community (Need to Sell your “story”…..effects on children) > “Emotional” Scoring > Letters of Support from Legislators > Important to Involve Those on Appropriation Committees (if for Federal or State Grants) > Letters of Individual Support
  44. 44. USES FOR THIS DATAPublic Support > Politicians Understand ROI > Trailbuilding Projects=Tax Revenue > Second Homeowners do not have > children in schools, but still pay taxes.
  45. 45. CONCLUSIONSMountain Bike Trail BuildingIncreases Land ValuesMountain Bike Trail BuildingIncreases Property TaxRevenueMountain Bike Trail BuildingProduces Local EconomicImpactTrails Brings ExternalRevenue
  46. 46. CONCLUSIONSRaces/Events Promotes Repetitive Visits to Trails(Training for Events)Demographic Trends Show Younger Participation inMany Silent Sports-Singletrack Bicycling .
  47. 47. CONTACTSCOTT CHAPIN OnlineRJF, a Marsh & McLennan LLC company Rivers Edge Drive // BicycleIndustry.RJFAgencies.comSuite 203Hayward, Wisconsin 54843715-634-6513