NRPA Measuring Impact of Park & Rec

65 Measuring the Economic Impact of Park and Recreation Services www.NRPA.org National Recreation and Park Association © 2010 All Rights Reserved Development of an Annual Economic Impact Report Exhibits 1-3 and 1-4 gave an example of an annual economic impact report for an athletics park that hosted many sports tournaments. The exhibits demonstrated both the park’s contribution to the community’s economy and the length of the payback period on the investment (13 years). Exhibit 6-5 , p. 66, shows how an annual economic impact report of multiple events at different facilities in a community can be compiled. This can be done by undertaking economic impact studies at a relatively small number of events or facilities, and then extrapolating these results to similar events or facilities in the community that were not surveyed. If resources do not permit any economic impact studies to be done in some years, then empirical data from studies used in previous years can be used. An example of such a balance sheet is shown in Exhibit 6-5, which estimates the economic impact of special events on a city. The estimate was derived by extrapolating results from 3 special events in this city that were surveyed to an additional 10 events that were sponsored by the city during the year but at which no data were collected. The ratios of visitors from inside the city, casuals/time-switchers, and visitors from outside the city were similar at all of the 3 surveyed events. This suggested that it was reasonable to ex- trapolate them to the other events. The average ratios of the 3 surveyed events were 85.5, 6.1, and 8.4 for the local residents, casuals/time-switchers, and out-of-town visitors, respectively. Attendance estimates for the 10 non-surveyed events were available. The per capita spending by out-of-town visitors at the 3 surveyed events was $10.26, $8.61, and $22.50, yielding an average of $13.79. This number was used to calculate the total expenditure at the non-surveyed events. For example, the $18,623 total expenditure at Winter Fest was derived by $13.79 × 1,350. Arraying the economic return from special events in this way also offers managers and stakeholders guidelines as to which should receive priority in promotional efforts. For example, in Exhibit 6-2, the spending of visitors to the Grand Prix was $23.00 per visitor, compared to $10.00 and $9.00 for the Annual Arts Festival and July 4 th Celebration, respectively. This suggests that the most efficient strategy for the city to increase its return on investment may be to focus on out-of-town visitors to the Grand Prix, rather than on the other two events. There are many legitimate reasons for sponsoring festivals and special events beyond their contribution to economic development. However, if economic development is the prime consideration, then these analyses offer a basis for prioritizing which events are most viable. If the agency’s cost of organizing an event is considered along with the community infrastructure, displacement, and opportunity costs discussed in Chapter 5 is compared with the relatively small impact on personal income, it suggests that the viability of some of the sponsored events shown in Exhibit 6-5 may be challengeable.