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Application Under the Australian Government's Building Better Regions Fund Brisbane Valley Rail Trail Business Case

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Application Under the Australian Government's Building Better Regions Fund Brisbane Valley Rail Trail Business Case Application under the Australian Government’s Building Better Regions Fund Brisbane Valley Rail Trail Business Case Brisbane Valley Rail Trail – Business Case Page 1 Table of contents 1 Executive summary ......................................................................................... 4 2 Project objective .............................................................................................. 6 2.1 Community need ............................................................................................................... 6 3 Background...................................................................................................... 7 3.1 Market analysis ................................................................................................................. 7 3.1.1 Trends in cycling and walking ........................................................................................... 8 3.1.2 Cycle tourism .................................................................................................................... 8 3.1.3 Cycle tourism is a growth market in Australia ................................................................... 8 3.1.4 Recreational cycling markets ............................................................................................ 9 3.1.5 Overnight travel cycling market ......................................................................................... 9 3.1.6 Cycling visitors expenditure ............................................................................................ 10 3.2 Overview of Cycling Tourism and Rail Trails .................................................................. 11 3.2.1 Cycling is becoming a tourism product and travel motivator .......................................... 11 3.2.2 Growth in rail trails and other multi use trails .................................................................. 11 3.2.3 Rail trails as a visitor attractant ....................................................................................... 11 3.2.4 Rail trails appeal to a broad range of markets ................................................................ 12 3.2.5 The economic impact of rail trail tourism is strong .......................................................... 12 3.2.6 Rail trails provide opportunities for business diversification ........................................... 14 3.2.7 Social and health benefits of cycling ............................................................................... 14 3.2.8 Cycling industry ............................................................................................................... 15 4 Competitor review and SWOT analysis ......................................................... 16 4.1 Overview ......................................................................................................................... 16 4.2 Competitor review ........................................................................................................... 16 4.2.1 Rail trails versus other recreational trails and roads ............................................. 16 4.2.2 Competitor rail trails in Queensland to a completed Brisbane Valley Rail Trail .... 16 4.2.3 Competitor rail trails elsewhere in Australia and New Zealand to a completed Brisbane Valley Rail Trail ...................................................................................... 17 4.3 Strengths ......................................................................................................................... 17 4.4 Weaknesses ................................................................................................................... 19 4.5 Opportunities ................................................................................................................... 19 4.6 Threats ............................................................................................................................ 20 5 Options considered ........................................................................................ 21 6 Impact on Somerset Regional Council as proponent ..................................... 22 7 Cost benefit analysis and approach ............................................................... 24 7.1 Forecast demand ............................................................................................................ 24 7.2 Visitor days per visit ........................................................................................................ 25 7.3 Per visitor expenditure per day ....................................................................................... 25 7.4 Increased value added to the regional economy ............................................................ 26 7.5 Brisbane Valley Rail Trail operating and maintenance costs ......................................... 26 7.6 Queensland Government maintenance contributions .................................................... 27 Brisbane Valley Rail Trail – Business Case Page 2 7.7 Cost benefit assessment................................................................................................. 27 7.8 Socio-economic outcomes .............................................................................................. 28 8 Conclusion ..................................................................................................... 31 Brisbane Valley Rail Trail – Business Case Page 3 1 Executive summary Council seeks funding for the completion of the Brisbane Valley Rail Trail. This involves the re-development of 27.25 km of disused rail corridor from Toogoolawah to Moore in the Brisbane Valley of Queensland into a recreational trail to connect the existing Wulkuraka to Toogoolawah and Moore to Yarraman Rail Trails. By 31 March 2018, this will create a shared use rail trail spanning a total length of 160 km for non-motorised recreational users including walkers and mountain bikers that will be the longest in Australia. Brisbane Valley Rail Trail will travel through Somerset, South Burnett, Toowoomba Regional and Ipswich City local government areas linking towns and communities and benefitting associated businesses in Wulkuraka, Fernvale, Lowood, Coominya, Esk, Toogoolawah, Harlin, Moore, Linville, Benarkin, Blackbutt and Yarraman. Investment of $3.354 million in the construction of the rail trail is likely to bring socio economic benefit to the region that is quantifiable by reference to other rail trails in Australia and New Zealand. The Queensland Government has made $1.8 million available for constructing this project until 30 June 2018 provided the trail is owned (via a 50 year sublease) and maintained by local government following completion. Unemployment and median household income indicators for the Somerset and South Burnett target areas are significantly worse than those for Queensland as a whole. The project aims to improve these indicators. The business case concludes that at five years post construction it is estimated the Brisbane Valley Rail Trail would increase direct tourism expenditure in the region by $1.5 million per annum. In addition, the Queensland Government has pledged to contribute $2.0 million towards maintenance of the rail trail over the first 15 years following construction. The flow-on impacts of this expenditure in the region are expected to be significant. This increase in economic activity is estimated to support 49 jobs in the region at the median income level for Queensland. The impact of the Brisbane Valley Rail Trail is expected to become progressively greater at ten and fifteen years post construction due to greater usage rates. At fifteen years post construction the Brisbane Valley Rail Trail is estimated to increase economic output in the region by $2.2 million per annum and support 58 jobs. Brisbane Valley Rail Trail – Business Case Page 4 The employment impact of the rail trail will be significant for the communities of Somerset and South Burnett given that a large proportion of the jobs created would be within the local region. Employment opportunities in regional areas can be limited and the rail trail will provide a well-needed boost to these communities. Participation in rail trail activities offers many social, health-related and cultural benefits to residents of Somerset, South Burnett and other areas. It is envisaged that the participation rate in cycling in south east Queensland will increase with the development of the rail trail. The trail has the capacity to increase social morale as well as providing health benefits for the local population. This investment will provide a significant enhancement to the existing 130 km Wulkuraka to Toogoolawah and Moore to Yarraman Rail Trails making the region a competitive tourism and cycling destination. Brisbane Valley Rail Trail – Business Case Page 5 2 Project objective 2.1 Community need The project will address economic disadvantage in the Somerset and South Burnett local government areas. This economic disadvantage is evidenced by poor economic indicators for unemployment and income in these areas. Table 1 Selected indicators, Queensland, Somerset (R) and South Burnett (R) LGA / State September 2016 Median total Median total unemployment household income personal income rate 2011 2011 % $/week $/week Queensland 6.1 1,235 587 Somerset (R) 9.3 928 445 South Burnett (R) 8.6 789 397 The project will also have social and health benefits. The specific benefits from the Brisbane Valley Rail Trail that
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