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Econ O Nomic I on the Impact Winte E Flag Ts and Er Act ECONOMIC IMPACTS AND POTENTIAL OF WINTER ACTIVITY ON THE FLAGSTAFF ECONOMY Produced for the Flagstaff Metropolitan Planninng Organization by the Arizona Hospitality Research & Resource Center Center for Business Ouutreach The W. A. Franke College of Business Northern Arizona University July 2011 EXECUTIVE SUMMARY – ECONOMIC IMPACTS AND POTENTIAL OF WINTER ACTIVITY Flagstaff is the primary winter recreation destination for Arizona residents, especially those from the Greater Phoenix area. In 2010, the combined annual economic impact of winter recreation visits to Arizona Snowbowl and Flagstaff snow play sites such as Wing Mountain, was a combined total of $48 million, producing a total tax impact of $7.3 million and more than 500 jobs. Winter recreation contributes about 10% to the estimated $500 million annual impact that tourism has on the Flagstaff economy. Tourism in Flagstaff is highly seasonal, with lodging occupancy, hospitality employment, and restaurant/bar sales tax collections all at their lowest point during the winter months. Winter recreation activity, which occurs largely from December through March, therefore comes at a welcome time boosting the otherwise lowest tourism season of the year. Flagstaff also benefits from much higher than average winter snowfall, ranking fifth in the U.S. for snowfall totals that average about 100 inches per year. Latent demand for winter recreation in the Greater Phoenix Area and in Maricopa and Pinal Counties, home to two‐thirds of the state’s population, suggests that demand for winter recreation from that area is almost double the 411,000 estimated current winter visitors; by 2020, an additional 568,000 Phoenix area residents will seek winter recreation, and by 2030 that number expands to an additional 772,000 residents. A conjoint analysis survey of Phoenix area residents who have an interest in winter recreation, determined that more than three‐fourths of them (78%) currently travel to Flagstaff for winter recreation – 85% for snowplay, 52% for downhill skiing and snowboarding, and 15% for cross country. In fact, almost two‐thirds (62%) reported that they do not go anywhere other than Flagstaff for their winter recreation. More than half of those who have been to Flagstaff for winter recreation (58%) visit once or twice a year and many are repeat visitors. These visits mostly occur on school holidays and weekends vs. weekdays. This survey also showed that more than half of respondents said they would likely ride a shuttle to winter recreation sites in the Flagstaff area. Skiers were more likely to consider using shuttle service than people participating in snowplay or sledding. In terms of the services and amenities that are most important to winter recreation visitors, especially those seeking snowplay, the conjoint survey found the following: 1. Easy and direct access is far preferable to visitors than driving through city traffic in Flagstaff. It also appears that getting “to the mountain” is not necessarily their preference, but that visitors would rather avoid traffic to access snow play areas more directly. 2. Full services, such as plowed parking lots, restrooms, trash receptacles, and refreshments, are preferable to minimal or no services. Thus, all things being equal people prefer to have services available at their winter recreation sites. Northern Arizona University, Center for Business Outreach, AHRRC‐July 2011 1 | Page 3. Cost is, above all others, a very important factor, perhaps more given the recent recession and the rising cost of gasoline to get to Flagstaff. Visitors generally prefer the cost for winter recreation, especially snow play on public lands, to be free or as nearly free as possible. 4. Development of the lands on which winter recreation is offered is the attribute with the least variability, or the area about which visitors felt least strongly. The highest preference in this area is for minimal development, more than no development at all, while least preferable were highly developed areas or areas with manmade snow. Thus, visitors want their snow play and winter recreation experiences to be natural and authentic. Northern Arizona University, Center for Business Outreach, AHRRC‐July 2011 2 | Page Table of Contents EXECUTIVE SUMMARY – ECONOMIC IMPACTS AND POTENTIAL OF WINTER ACTIVITY .............................. 1 Introduction .................................................................................................................................................. 7 I. Analysis of Lodging Capacity ..................................................................................................................... 9 II. Analysis of Winter Employment in Flagstaff .......................................................................................... 13 III. Analysis of Hospitality Taxes ................................................................................................................. 17 IV. Analysis of Snowfall .............................................................................................................................. 18 V. Combined Analysis of Holiday/Weekend Daily Activity ......................................................................... 23 VI. Total Annual Economic Impact of Winter Recreation .......................................................................... 28 VII. Latent Demand for Winter Activities in the FMPO ............................................................................... 30 VIII. U.S. 180 Winter Congestion Mitigation Study: Findings of Conjoint Analysis Survey ........................ 36 Conjoint Analysis ......................................................................................................................................... 43 APPENDIX A ................................................................................................................................................. 52 FMPO Segment Cross‐Tabulation Analysis ................................................................................................. 53 APPENDIX B ................................................................................................................................................. 61 Complete List of Responses ........................................................................................................................ 61 Northern Arizona University, Center for Business Outreach, AHRRC‐July 2011 3 | Page List of Tables Table 1. Winter Occupancy Rates in Flagstaff, 2007‐2011 ........................................................................ 10 Table 2. Holiday /Daily Occupancy Data .................................................................................................... 11 Table 3. Flagstaff Hospitality employment, winter months 2007‐2011 .................................................... 15 Table 4. City of Flagstaff‐BBB Lodging Tax Collections (2%) ...................................................................... 17 Table 5. City of Flagstaff, BBB Tax Collections Winter months, 2007‐2011 ............................................... 18 Table 6. Total Snowfall – November through March, 2000‐2011 ............................................................. 20 Table 7. Flagstaff Snowfall/Precipitation & Sea Surface Temperatures ..................................................... 21 Table 8. Grand Canyon National Park‐Recreational Visitors by Month ...................................................... 22 Table 9. Grand Canyon National Park, Vehicle Counts‐Tusayan Entrance ................................................. 22 Table 10. Comparison‐ Lodging Occupancy, BBB, Snowfall, Employment & Attendance Data, 2008‐2011 .................................................................................................................................................................... 24 Table 11. Combined direct expenditures for Wing Mountain, dispersed snowplay and AZ Snowbowl. ... 28 Table 12. Economic impact of winter visitors ............................................................................................. 29 Table 13. Overall Population Growth in Arizona between 2000 and 2010 ................................................ 30 Table 14. Growth in the Phoenix MSA, between 2000 and 2010 ............................................................... 31 Table 15. Maricopa and Pinal counties 2010 population, with forecasts to 2030 ..................................... 31 Table 16. Children under 18 years of age in Maricopa County, 2010 ......................................................... 32 Table 17. Current Demand .......................................................................................................................... 33 Table 18. Winter activity participation rates from Conjoint Analysis Survey ............................................. 34 Table 19. Latent Winter activity participation rates from Conjoint Analysis Survey .................................. 34 Table 20. Projected winter activity 2020 and 2030 .................................................................................... 35 Table 21. What types of winter recreation do you participate in? ............................................................. 37 Table 22. How many years have you lived in Arizona – mean years. ......................................................... 37 Table 23. Age coded into ranges ................................................................................................................
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