The Economic Impact of Arizona State Parks Executive Summary Lake Havasu State Park Prepared by: The Arizona Hospitality Research & Resource Center Center for Business Outreach The W. A. Franke College of Business Northern Arizona University February 2009 ECONOMIC IMPACT OF ARIZONA STATE PARKS Executive Summary Arizona State Parks have a significant economic impact on the communities and counties in which they are located. A state park’s value is, of course, not measured by economic impact alone. Parks enhance community quality-of-life and preserve priceless historic, cultural, and recreational resources for residents and visitors from around the world. However, communities are increasingly recognizing that State Parks improve the economic well-being of rural counties and serve as an important tourism resource. This report analyzes the impact of 27 Arizona State Parks on the economies of the 13 counties in which they are located. The economic impact of a state park is a function of visitor population and direct visitor spending, combined with multipliers (that vary across counties) reflecting the extent of re-circulation of visitors’ money in the local economy. Thus, this study of the economic impact of Arizona State Parks produced the following findings: • Total visitation to the Arizona State Park system fell from 2,513,401 in FY01 to 2,298,155 in FY07, a decline of 8.6 percent. Direct spending by Arizona State Park visitors totaled $162,799,442 in FY07. • Per person spending at Arizona State Parks totaled $70.84 in 2006-07. Arizona State Parks are divided into three types – Conservation Parks (4 parks), Historic Parks (9 parks), and Recreation Parks (14 parks). • The combined total economic impact (direct spending, indirect and induced impacts) of each park type on Arizona counties was: o Recreation parks – $156.8 million o Historic parks – $35.4 million o Conservation parks – $32.2 million • As a group, recreation parks generated the largest visitation and economic impact. The three recreation parks with the largest total economic impact were: o Lake Havasu State Park (Mohave County) - $34.5 million in 2007 o Slide Rock State Park (Coconino County) - $30.1 million in 2007 o Catalina State Park (Pima County) - $19.6 million in 2007 Economic Impact of Arizona State Parks, AHRRC-NAU Page 2 • Calculated at the state level for FY07, the total economic impact of Arizona State Parks on the state was $266,436,582. Methodology Calculations of the economic impact of state parks are based on park attendance. Table 1a. Visitation by Park Park Visitation 2006-2007 County State Park Name Apache Lyman Lake 36,298 Cochise Kartchner Caverns 155,909 Cochise Tombstone Courthouse 52,989 Coconino Riordan Mansion 26,013 Coconino Slide Rock 249,409 Gila Tonto Natural Bridge 94,026 Graham Roper Lake 73,230 La Paz Alamo Lake 72,066 La Paz Buckskin Mountain 96,529 Mohave Cattail Cove 98,419 Mohave Lake Havasu 314,519 Navajo Fool Hollow 95,495 Navajo Homolovi Ruins 15,953 Pima Catalina 149,644 Pinal Boyce Thompson Arboretum 65,108 Pinal Lost Dutchman 77,683 Pinal McFarland 3,968 Pinal Picacho Peak 63,393 Pinal Oracle 9,592 Santa Cruz Patagonia Lake 178,497 Santa Cruz Tubac Presidio 14,439 Yavapai Dead Horse Ranch 120,686 Yavapai Fort Verde 16,950 Yavapai Jerome 60,307 Yavapai Red Rock 80,711 Yuma Yuma Quartermasters Depot 17,628 Yuma Yuma Territorial Prison 58,694 Total Visitation 2,298,155 Economic Impact of Arizona State Parks, AHRRC-NAU Page 3 Expenditure data used to make the calculations in this report are derived from two sources: the Arizona State Park 2006-07 Visitor Survey (for out-of-park expenditures) and Arizona State Parks FY07 Park Summary report (for in-park expenditures). Total direct expenditures on the part of visitors to each Arizona State Park were requested and collected according to the categories shown below in the Arizona State Park Visitor Survey. o o o o o o o o o o o In-Park Expenditures Admission Fees (including permits or licenses) Camping Fees Groceries Food & Beverages (restaurants, etc.) Recreational Equipment and Supplies Retail Shopping (clothing, souvenirs, gifts, etc.) Lodging Expenses (hotel, motel, condos, etc.) Private Auto Expenses (gas, oil, repairs, parking fees, etc.) Tourist Services (museums, tours, etc) Any Other Expenses The total economic impact of each park was estimated using the IMPLAN™ economic impact model1, which estimates the total income generated in the county economy, including direct, indirect and induced income, and the number of jobs in the county economy supported by this level of visitor spending. The spending of visitors with ZIP codes in the county or within 50 miles of the park was excluded since such visitors do not add new money to the local economy, a standard procedure used in economic impact studies. In the prior economic impact study of Arizona State Parks (2002), a model developed by Silvers-Pavlakovich at the University of Arizona was used.2 Differences between the Silvers-Pavlakovich model and IMPLAN™ are generally due to the initial model construction, but have other differences as well. Therefore the economic impact results from the two models (FY01 and FY07) are not presented side by side. In addition, due to the differences between the models and the fact that no direct comparisons are made between the 2001 and 2007 findings in this report, 2007 data are not adjusted for inflation. Using the IMPLAN model, the full set of economic impact calculations are produced for each of 27 Arizona State Parks and for the state of Arizona overall. Maricopa and Greenlee Counties are not included in this study because they contain no Arizona State Parks. Visitor expenditure data are organized alphabetically by county in the report that follows, combining the State Parks within each county; each county report, therefore, stands as a discrete document. Throughout the Economic Impact report, three sets of information will be provided for each park: direct, indirect, and induced effects. Direct effects are the portion of visitors’ expenditures that are spent by the tourism sector for inputs necessary to provide goods 1 2 Minnesota IMPLAN Group, Inc. University of Arizona Economic Impact of Arizona State Parks, AHRRC-NAU Page 4 and services. For example, a tourist visits a state park in County Y, and spends X dollars at a hotel. Then X dollars is the direct effect of his expenditures. The hotel in turn spends a portion of the initial expenditure on inputs necessary to run the operation (electricity, maid service, and so forth). Some of the hotel’s spending will occur outside of county Y. However, the portion that the hotel spends within the county again contributes to the economy. This impact of the initial tourist expenditures is termed the indirect effect. Finally, those individuals or firms within county Y who receive money through the indirect effect in turn spend money in the county. This final effect is termed the induced effect of the initial expenditure. The ratio of the three effects combined to the initial expenditure is labeled the output multiplier for that expenditure. Therefore an output multiplier is the sum of direct (tourist spending), indirect (hotel spending) and induced (consumption) divided by direct tourism spending. Similarly, direct jobs are jobs that are supported by direct expenditures, while indirect and induced jobs are those supported by indirect and induced expenditures. It is important to remember that direct jobs are jobs supported by visitor expenditures in the county and may include but are not limited to jobs in the parks. The following table summarizes total county income and jobs produced by the IMPLAN™ analysis for FY07. Table 2a. State Parks by County Income and Jobs County / Park Total County Income ($) Total County Jobs Apache County Lyman Lake (Rec) $2,447,506 35 Apache County Total $2,447,506 35 $7,225,150 101 $12,333,199 188 $19,558,349 289 $6,781,494 101 $30,087,905 422 $36,869,399 523 $3,621,346 38 $3,621,346 38 $5,724,685 77 $5,724,685 77 Cochise County Tombstone Courthouse (His) Kartchner Caverns (Con) Cochise County Total Coconino County Riordan Mansion (His) Slide Rock (Rec) Coconino County Total Gila County Tonto Nat. Bridge (Rec) Gila County Total Graham County Roper Lake (Rec) Graham County Total Economic Impact of Arizona State Parks, AHRRC-NAU Page 5 County / Park Total County Income ($) Total County Jobs La Paz County Alamo Lake (Rec) $5,608,937 72 $10,456,400 137 $16,065,337 209 Cattail Cove (Rec) $13,184,301 187 Lake Havasu (Rec) $34,514,609 484 Mohave County Total $47,698,910 671 Buckskin Island (Rec) La Paz County Total Mohave County Navajo County Fool Hollow Lake Recreation Area (Rec) Homolovi Ruins (His) Navajo County Total $5,824,440 73 $3,501,468 44 $9,325,908 117 $19,604,659 262 $19,604,659 262 Pima County Catalina (Rec) Pima County Total Pinal County Boyce Thompson (Con)* $2,644,753 20 Lost Dutchman (Rec) $4,190,586 46 $613,318 6 $2,453,130 26 $217,474 3 $10,119,261 101 $8,974,106 128 $256,377 4 $9,230,483 132 McFarland (His) Picacho Peak (Rec) Oracle (Con) Pinal County Total Santa Cruz County Patagonia Lake (Rec) Tubac Presidio (His) Santa Cruz County Total Yavapai County Dead Horse Ranch (Rec) $10,135,704 143 Fort Verde (His) $2,420,337 33 Jerome (His) $7,006,241 93 $17,005,170 225 Red Rock (Con) Yavapai County Total $36,567,452 Yuma County 494 Yuma Territorial Prison (His) $5,815,585 84 Yuma Quartermaster Depot (His) $1,826,521 26 $7,642,106 110 Yuma County Total NOTE: Abbreviations in Parentheses refer to Park Type. Rec = Recreation Park; His = Historic Park; Con = Conservation Park. Economic Impact of Arizona State Parks, AHRRC-NAU Page 6 Economic Impact of Arizona State Parks at the State Level For the first time, the total economic impact of Arizona State Parks on the state as a whole has been prepared in this 2007 study by using the separate state-level model provided within the IMPLAN model. To perform this analysis, visitor spending in the parks was aggregated from all parks by sector, as shown in Table 3a, and these totals were then used as inputs for the IMPLAN calculations. It should be pointed out that the model does not allow for the simple summation of all the county level impact totals to produce a state economic impact number. Thus, it was estimated that total direct expenditures in the Arizona State Park system equaled $162,799,442 in FY07, as shown in Table 3a. These total direct expenditures of $162.8 million resulted in an additional $47,218,295 of indirect income, and $56,418,845 of induced income. This resulted in a total of $103,637,140 of total indirect and induced income to the state. When direct, indirect and induced income is combined the total impact of visitors to state parks in Arizona during FY07 is $266,436,582. This total state income resulted in 2,397 direct jobs and 950 indirect jobs for a total of 3,347 total jobs. Finally, visitors’ expenditures combined with their direct and induced impacts resulted in $21,171,627 in Federal Government taxes and $22,762,326 in state and local government taxes. The total tax impact of Arizona State Park visitors in 2007 was $43,933,953. See Table 3a. Table 3a. Economic Impact of Arizona State Parks on the Arizona Economy, FY07 Direct Expenditures by Visitors ($) In-park expenditures Admission Camping Groceries Food & Beverages Recreation Equipment Supplies Retail Shopping Lodging Personal Auto Expenditures Tourist Services Other Expenses Total direct expenditures Economic Impact of Arizona State Parks, AHRRC-NAU 2007 $11,415,253 $11,319,639 $5,810,930 $27,129,959 $24,375,662 $4,708,540 $15,347,294 $18,594,618 $32,345,735 $5,012,916 $6,738,895 $162,799,442 Page 7 Indirect and Induced State Income ($) 2007 Indirect income Induced Income $47,218,295 $56,418,845 Total State Indirect and Induced Income $103,637,140 Indirect and Direct State Employment 2007 Direct Jobs Indirect Jobs 2,397 950 Total State Jobs 3,347 Total State Income $266,436,582 Tax Impacts 2007 Federal Government Non Defense State & Local Government $21,171,627 $22,762,326 Total taxes $43,933,953 Economic Impact of Arizona State Parks, AHRRC-NAU Page 8 APPENDIX Economic Impact of Arizona State Parks, AHRRC-NAU Page 9 Arizona State Park Visitation, Intervening Years Arizona State Park Visitation FY 2000/01 to 2006/07 County Park Name 2000/01 2001/02 2002/03 2003/04 2004/05 2005/06 2006/07 Apache 28,304 31,831 19,151 26,228 39,591 40,395 36,298 Cochise Lyman Lake Kartchner Cavern 199,115 193,180 187,355 203,378 198,374 160,467 155,909 Cochise Tombstone 74,105 70,328 52,350 50,814 48,247 49,121 52,989 Coconino Riordan 19,194 23,288 22,757 23,789 24,041 23,906 26,013 Coconino 275,554 233,116 199,287 243,298 238,521 238,587 249,409 Gila Slide Rock Tonto Natural Bridge 100,178 101,052 84,555 98,975 83,338 90,450 94,026 Graham Roper Lake 60,242 57,191 35,266 37,141 48,376 69,985 73,230 La Paz Alamo Lake 70,969 82,524 54,739 33,977 35,020 61,163 72,066 La Paz Buckskin 93,999 93,672 93,727 87,764 88,988 85,048 96,529 Mohave Cattail Cove 106,939 108,930 108,365 112,298 105,812 95,498 98,419 Mohave Lake Havasu 345,590 397,961 396,062 376,158 346,858 345,853 314,519 Navajo Fool Hollow 84,527 84,525 60,217 71,017 73,321 89,042 95,495 Navajo Homolovi 20,644 22,297 19,265 17,618 16,656 15,587 15,953 Pima 154,806 125,739 120,032 123,165 124,942 138,341 149,644 Pinal Catalina Boyce Thompson 87,238 86,504 71,291 70,868 81,579 63,599 65,108 Pinal Lost Dutchman 114,253 78,076 76,484 61,510 88,319 75,549 77,683 Pinal McFarland 4,162 3,725 3,175 3,289 3,442 3,454 3,968 Pinal Oracle *2,250 10,640 8,669 8,705 8,384 9,062 9,592 Pinal Picacho Peak 117,652 68,032 55,680 61,989 105,300 56,321 63,393 Santa Cruz Patagonia Lake 196,332 216,699 205,415 203,005 202,785 180,244 178,497 Santa Cruz Tubac Presidio 18,770 20,232 15,926 16,710 16,295 16,919 14,439 Yavapai Dead Horse 103,089 105,749 100,780 93,415 88,350 98,269 120,686 Yavapai Fort Verde 21,450 18,476 15,754 15,472 17,290 16,530 16,950 Yavapai Jerome 53,128 33,038 46,452 50,738 56,008 58,049 60,307 Yavapai 76,393 69,420 76,449 73,769 76,188 72,644 80,711 Yuma Red Rock Yuma Quartermaster Depot 16,959 13,813 13,995 12,584 13,297 15,641 17,628 Yuma Yuma Prison 69,698 60,345 58,622 58,233 57,002 54,868 58,694 Source: Arizona State Parks: Park Summaries, FY01 to FY07 *Oracle State Park was officially opened to the public on October 1, 2001, prior to that it was only available for environmental education programs on a reservation basis. 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