ECONOMIC IMPACT OF MOUNTAIN BICYCLING & TRAILS

Scott ChapinRJF, a Marsh & McLennan Agency LLC company

BACKGROUND

Scott Chapin

Economics Major, University Wisconsin-Eau Claire

President, Sawyer County Development Corporation

Past President, Northland Area Builders Association

Director, American Birkebeiner Ski Foundation

BACKGROUND

Scott 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.

MOUNTAIN BIKING-TRAIL DEVELOPMENTAttracts touristsTourists could become seasonal or permanent residentsAttracts commerceEnhances communities

MOUNTAIN BIKE TRAIL DEVELOPMENTLand Managers, Municipalities, Chambers of Commerce Question Economic Impact DataHaving Economic Data Helps with Financial and Political Support of Trail ProjectsHelps With Volunteer Base

ECONOMIC DATA

Analysis is for Sawyer CountySawyer County Located in NW WisconsinSawyer County Population = 16,196 (2000)2 ½ Hours from MinneapolisMedian Per Capita Income = $24,288 (2002)

ECONOMIC DATA

Tourist Area, Historically Fishing/HuntingService Sector EconomyKnown for Events: American Birkebeiner, Lumberjack World Championships,Chequamegon Fat Tire Festival

ECONOMIC DATA

Many second homeowners in areaChequamegon Area Mountain Bike Association developed around 1990Started signing existing double-track/roadsFocus on singletrack for past 8 Years

TYPES OF ECONOMIC IMPACT

Direct-Initial purchaseIndirect-Cross industryInduced-Cycled again in community

ECONOMIC STATISTICS (BICYCLING) NATIONAL$133 billion annual contribution to the U.S. economySupports 1.1 million jobsGenerates $17.7 billion in annual federal and state tax revenues

ECONOMIC STATISTICS (BICYCLING) NATIONALIn 2005- 19.8 million bicycles were sold in the United States (4.4 M more than all autos sold)NBDA-$5.6 billion in retail sales of bikes/parts annuallyAverage retail bike shop has 6 FTE’s4,200 retail shops in US (>25,000 FTE’s)

ECONOMIC STATISTICS (BICYCLING)-NATIONALProduces $53.1 billion annually in retail sales and services

> $6.2 billion in gear sales> $46.9 billion in bicycling-trip

expenditures

WISCONSIN ECONOMIC IMPACT (BICYCLING)49% of Wisconsin residents bicycleEconomic impact of bicycle recreation/tourism is $925 millionAverage daily expenditure = $60Greater impact than hunting57% of expenditures from non-residents

MINNESOTA ECONOMIC IMPACT

Road bicycling > $686M per year> 4,148 jobs

Mountain bicycling> $318M per year> 1,116 jobs

WISCONSIN ECONOMIC IMPACT (BICYCLING)Bicycling contributes $1.5 billion annually and 13,200 jobs (including tourism) to Wisconsin’s Economy2.5 million WI residents ride bicycles for recreationOver 300 bike-related events in WI

ECONOMIC IMPACT (BICYCLING)- REGIONALLYIN, IL, MI, OH, WIContributes $17 billion to regional economySupports 191,000 jobsGenerates $2.2 billion in state and federal tax revenues

ECONOMIC IMPACT (BICYCLING)- REGIONALLY$12.1 billion in retail sales

> $873 million in bicycling gear sales

> $11.2 billion in bicycling trip- related expenditures

ECONOMIC IMPACT (BICYCLING)- REGIONALLY2001: bicycle tourism brought $66.8 million to Maine economyBicycling-related businesses bring $315M to Minnesota’s economy annually

DEFINED LOCATION ECONOMIC IMPACT Trails in Miami Valley of Ohio attract 1,000,000 visitors who spend $16 million on related goods and services2009 USA Cycling National CX Championships brought $1 million to Bend, OregonRAGBRAI: $24 million in economic impactMoab, Utah: $8.8 million in economic impact (1996)

DEFINED LOCATION ECONOMIC IMPACTBicycle industry in Santa Cruz, CA, generates more than $130M in revenue, 500 jobsBicycle-related economic activity provides $90M and 850-1150 jobs for the city of Portland, OR. From 2006 to 2008, the value of the Portland bicycle industry increased 38%.

DEFINED LOCATION ECONOMIC IMPACTBicyclists in the northern Outer Banks region of North Carolina bring an estimated $60 million annually to the area's economy, nearly nine times the one-time expenditure of $6.7 million of public funds to construct bicycle facilities in the region.

1,400 jobs are created and/or supported annually by the bicyclists' expenditures.

DEFINED LOCATION ECONOMIC IMPACTThe Harbin Park Cyclocross Race in Cincinnati was estimated 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.

DEFINED LOCATION ECONOMIC IMPACTChequamegon Area (Cable/Hayward): $1.17M in 1997 (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 to Hayward/Cable area

Defined Location Economic Impact

Colorado-Other Revenue Generators

> Bicycle Tours: $640,000> Racing: $2,000,000> Charity Rides: $3,400,000

GENERAL PUBLIC (INCORRECT) ASSUMPTIONSCyclists are cheapParticipants do not spend as much as other user groups (tourists)Participants have average income levelsParticipants (off-road) are 20-somethings

FACTS ABOUT CYCLISTS

53% of participants in Chequamegon Fat Tire Festival (2,500) are between 35-49 30% of cyclists have annual household incomes over $125,00049% of cyclists have annual household incomes over $100,000 (ABSF Survey)87% of cyclists are college graduates

Silent Sports Trends

1998-2004: > Snowshoeing +50%> Trail Running +20% for

Participants and Enthusiasts> Single Track Bicycling +183%> Dirt Road Bicycling +112.5%> Snowshoeing +300% for

Enthusiast Category (Repetitive Potential Visits)

16-24 Year Olds:> Single Track Bicycling

+92.5%> Trail Running +50% (Future

Market)

Female Enthusiast: > Single Track Bicycling

+112.5%> Snowshoeing +100%

Data from Outdoor Industry Foundation

GENERAL FACTS ABOUT TOURISTS

Motel/Hotel tourists spend $126 per dayCampground tourists spend $75 per dayDaytripper tourists spend $40 per dayOften it is assumed that most cyclists visiting the area are “tourists”

GENERAL FACTS ABOUT SECOND HOMEOWNERSSecond homeowners spend $17,571 per year in Sawyer County (Sawyer Co. Dev. Cor. Study-2008)Survey sent to all non- resident homeowners with improvements over $80,000100 User Days Per Year

GENERAL FACTS ABOUT SECOND HOMEOWNERSBasic consumption items = $5,700 per household (Average)Recreation equipment = $2,800 per householdNeeds for Home (Construction, Remodeling) = $14,400 per household

Note: Not all spent money in all categories

LAND VALUES ADJACENT TO TRAILSDevelopers in NW specializing in recreational use dependent upon market land values 3 years ago were doubleLand values today are 50% higher than non-recreational developments

THE BROOK-SEELEY HIGHLANDSYour home at the Brook will be located in the Namekagon River Valley. This beautiful and diverse property is a blend of pine and aspen woodlands and partially wooded meadows. Immediately adjacent to the Birkebeiner Ski Trail and Camba Mountain Bike Trails, The Brook is bordered on the north and east by thousands of acres of Sawyer County Forest. Homeowners enjoy 14 km of private trails, professionally groomed in winter for both classic and freestyle skiers, that link directly to the American Birkebeiner trail. The perfect “silent sports retreat”, The Brook beckons to active northwoods enthusiasts who love the feeling that “...one hour at the cabin feels like 5 days.”

LAND VALUES ADJACENT TO TRAILSStatistics 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)

http://www.bikesbelong.oli.us/Resources/Real_estate.pdf

LAND VALUES ADJACENT TO TRAILSHouses located in areas with above-average levels of walkability [or bikeability] are worth up to $34,000 more than similar houses in areas with average walkability levels.

> (Cortright, J., 2009, "Walking the Walk: How walkability raises home values in U.S. cities," CEOs for Cities)

In a survey of recent transplants to Portland, OR, 62% said that the city's bike-friendliness was a factor in their decision to move there.

> (City of Portland Bureau of Transportation, 2009, Portland Bicycle)

LAND VALUES ADJACENT TO TRAILSIn Minneapolis-St. Paul, for every 400 meters closer a median-priced home is to an off-street bicycle facility, its value 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 an average of 11 percent more than identical homes further away.

> (Lindsey et al., 2004, Property values, recreation values, and urban greenways, Journal of Park and Recreation Administration, 22, 69- 90)

DATA ANALYSIS-IMPACT

Seeley Hills Recreational Development

> 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

DATA ANALYSIS-IMPACT

50/51 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)

DATA ANALYSIS-IMPACT

Seeley 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

TRAIL BUILDING – THE BEGINNING

TRAIL BUILDING TECHNIQUES

USES FOR THIS DATA

Community SupportPublic SupportGrant OpportunitiesVolunteer Support Land Value Increases- Private Land

Proud Sponsors of CAMBA

USES FOR THIS DATA

Grant Opportunities> Many Grants Available > Economic Improvement Grants> Contact Economic Development Corporation> Similar Focus on ROI

HOW CAN I USE THIS DATA

Grant 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

USES FOR THIS DATA

Public Support> Politicians Understand ROI> Trailbuilding Projects=Tax

Revenue> Second Homeowners do not

have> children in schools, but still

pay taxes.

CONCLUSIONS

Mountain Bike Trail Building Increases Land Values Mountain Bike Trail Building Increases Property Tax RevenueMountain Bike Trail Building Produces Local Economic ImpactTrails Brings External Revenue

CONCLUSIONS

Races/Events Promotes Repetitive Visits to Trails (Training for Events)Demographic Trends Show Younger Participation in Many Silent Sports-Singletrack Bicycling .

CONTACT

SCOTT CHAPINRJF, a Marsh & McLennan Agency LLC company

15954 Rivers Edge Drive // Suite 203

Hayward, Wisconsin 54843

715-634-6513

Online

Facebook.com/RJF.BikeAndSki

LinkedIn.com/in/scottschapin

BicycleIndustry.RJFAgencies.com