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The Kentucky Golf Economy Summary Report

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The Kentucky Golf Economy Summary Report THE KENTUCKY GOLF ECONOMY SUMMARY REPORT This report was commissioned by GOLF 20/20 for the Kentucky Alliance for Golf, and prepared by SRI International. Kentucky Golf’s Economic Impact With 280 golf facilities, including the State Golf brings visitors to the state, spurs new Park Golf Trail, and host to The 2008 Ryder residential construction, generates retail Impact Cup, golf in the Bluegrass State is a key sales, and creates demand for a myriad of Kentucky’s golf industry contributing to Kentucky’s goods and services. In 2009, Kentucky’s industry generated a economy. golf industry generated a total economic total economic impact impact of $710.4 million, supporting of $710.4 million in In 2009, the size of Kentucky’s direct golf 11,000 jobs with $218.7 million of wage 2009, supporting nearly economy was approximately $379.1 income. 11,000 jobs with wage million. This is comparable to revenues income of $218.7 generated by other key industries in the The continued health and growth of the million. state, such as medical equipment and golf industry has a direct bearing on future supplies ($308.7 million), horse breeding jobs, commerce, economic development, ($780.0 million), and distilleries ($2.5 and tax revenues for a large number of billion). Kentucky’s communities and industries. Golf’s Impact on Kentucky’s Economy (2009) Industry Direct Indirect Induced Total Total Total ($ M) Output Jobs Wage ($ M) Income ($ M) Golf Facility $201.8 $401.6 6,853 $127.6 Operations Golf Course Capital $18.9 $9.3 87 $2.7 Investments* Golfer Supplies $22.1 $45.3 506 $12.8 Tournaments $3.1 $5.4 70 $1.7 & Associations Real Estate ** $40.3 $51.7 482 $15.1 Hospitality / $92.9 $196.7 3,010 $58.8 Tourism TOTAL $379.1 $710.1 11,008 $218.7 Note: To calculate golf’s total economic impact, SRI subtracted from the direct golf economy impact of $379.1 million the portion of capital investment that is investment in existing facilities ($14.9 million of $18.9 million) and the portion of real estate that is the realized golf premium associated with the sale of real estate in existing developments ($18.2 million of $40.3 million). This is because: *Golf course capital investments—Only new course construction has an indirect and induced economic impact. Other types of facility capital investment are typically financed through facility revenues and, therefore, are omitted to avoid double-counting. **Real Estate—Only golf residential construction has an indirect and induced impact. The golf premium associated with golf real estate is considered a transfer of assets rather than new economic activity. Core Industries Golf Facility Operations: Kentucky’s 280 Middleground Golf, Stryker Golf, etc.) were golf facilities, 15 stand-alone ranges, and approximately $2.52 million in 2009. In 10 miniature golf facilities generated addition, the margin made on state retail Industries $201.8 million of revenues in 2009. This sales of golf equipment, apparel, and The golf economy amount is comparable to the revenue media totaled $19.6 million. begins with the golf generated by all other spectator sports Major Tournaments and Associations: In facilities, themselves, combined—horse racing, auto racing, and recent years, Kentucky has hosted two PGA and with other core other popular spectator sports, etc. Championships and a Senior PGA industries that produce Golf Course Capital Investments: Championship. However, it is the Ryder goods and services Kentucky’s golf facilities made $18.9 million Cup of 2008 for which Kentucky is best used to operate of capital investments in 2009: $14.9 known. The Ryder Cup drew 240,000 facilities and to play the million in existing facilities and $4 million in spectators with an impact of over $50 game (e.g., equipment the construction of new courses. million. In 2009, no major golf and apparel, turf Golfer Supplies: Out-of-state shipments by championships were played in Kentucky in maintenance, course Kentucky golf equipment manufacturers 2009. State golf associations generated construction, club (Louisville Golf Club Company, $3.1 million in revenues. management). The game of golf further enables other industries, including golf tourism and golf real estate development. Enabled Industries Golf Real Estate: Golf-related residential construction averaged $22.1 million in 2009. The “golf premium” generated by sales of existing golf community homes was $18.2 million. Hospitality/Tourism: SRI estimates that Kentucky’s State Parks Golf Trail, golf resorts and golf events spurred $92.9 million of golf-related tourism spending in 2009. Size of Kentucky’s Golf Economy in Comparison to Other Industries, 2009 ($ millions) Medical Equipment and Supplies Manufacturing $308.7 Golf $379.1 Future Horse Breeding $780.0 The continued health Distilleries $2,535.9 and growth of the golf industry has a direct Source for non-golf data: U.S. Department of Agriculture, Economic Research Service (2010), Kentucky: bearing on future Leading Commodities for Cash Receipts, 2009. U.S. Census Bureau (2010), 2007 Economic Census, Geographic Series: Manufacturing, Medical Equipment and Supplies (NAICS 33911) and Distilleries (NAICS jobs, commerce, 31214). 2007 revenues adjusted to 2009 dollars using the GDP deflator. economic development, and tax · The importance of golf in Kentucky extends beyond the golf facilities themselves. With revenues for a large $379.1 million of direct economic activity in 2009, the sheer size of the game of golf number of Kentucky’s makes it a major industry in its own right and a significant contributor to Kentucky’s communities and economy. industries. · Kentucky’s golf industry is comparable in size to other important industries in the state, including medical equipment and supplies manufacturing, horse breeding, and distilleries. · In 2009, golf facilities represented the largest golf industry segment in terms of revenue, followed by golf-related tourism and golf real estate. Kentucky Golf Gives Back · Kentucky golf course owners, club managers, and golf professionals are happy to serve as access points for fundraising by local service organizations. · Numerous charitable events are hosted on Kentucky’s golf courses each year benefiting organizations, such as the Folds of Honor Foundation, which supports scholarships for families of veterans who either perished or were wounded while serving in Iraq or Afghanistan, the Ronald McDonald House Charities of Kentuckiana, Kosair Children’s Hospital, and several other children’s charities. · Many not-for-profit organizations, such as the First Tee chapters of Lexington, Louisville, Owensboro, and Pine Mountain, the Youth Golf Coalition, and the Kentucky Golf Foundation introduce Kentucky’s youth to the game and values of golf. · The total amount of charitable giving attributed to the game of golf in Kentucky approached $27.4 million in 2009. The full version of The Kentucky Golf Economy report is available at: http://www.golf2020.com Photo credits from the cover: (top) Griffin Gate Golf Club, Griffin Gate Marriott Resort & Spa, Lexington, KY (Marriott International, Inc.); (bottom) Valhalla Golf Club, Louisville, KY – Host of The 2008 Ryder Cup (The PGA of America) .
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