As the public has called for increased accountability from public officials, there has been an increased need for economists to conduct economic impact analyses to justify the feasibility of renovating or building new parks and recreation facilities. Three types of studies are listed below:
• The most common type of study would measure the “sales” or gross output of a recreation facility. These studies always produce positive numbers. The gross impact simply measures the general magnitude of the impact. For example, the study will determine if the impact is in the range of $10 million, $50 million, or $100 million a year.
• If facilities are intended to attract tourists or visitors, the study may measure only the amount of “new” money brought into the community as a result of the facility and its programs. The impact of visitors would be measured by their spending at hotels, restaurants, gasoline stations, and retail stores. And the spending of locals is not counted – it is not an infusion of money from outside the area, rather it is money just re-circulating within the local economy.
• In some cases economic impact studies measure the net benefit of the facilities, or the gross impact less costs associated with the facility. Frequently, analyses for public facilities are negative. This is to be expected because public facilities have an obligation to provide lower cost/no cost services to their citizens because they are funded by tax dollars. In other words, it is not possible for them to “show a profit.”
In all three cases, it will be useful to complete the study then look at benefits of the parks and recreation facilities that extend beyond the impact analyses.
Quite often recreation centers are the hub of a larger complex that may include sports fields, parks, or open space. The following factors are ways a recreation center/complex can benefit a community. A portion of this list was taken from the reports, The Economic Benefits of Denver’s Park and Recreation System by the Trust for Public Land and Measuring the Economic Impact of Park and Recreation Services, by John L. Crompton.
Parks and recreation facilities can impact a community in the following way:
• They can be a tool for economic development that draws individual talent to the area. Centers may be a draw that helps with the retention and attraction of businesses.
• Recreation facilities can serve as a gathering spot for locals of all ages. This in turn will increase pride in the town and make the community more cohesive.
• Many park and recreation employees work on a part-time basis for a variety of reasons. For example, a facility may only employ 15 FTE workers, but it may have a payroll of 50 part-time workers.
• A stronger recreation facility may benefit local retailers who sell sporting goods equipment. It may also result in the formation of spinoff recreation businesses that complement programs at the facility.
• Parks and facilities may serve as a tourism attraction. In the case of many facilities, the parks and facilities are not the primary draw, but tourists may have a better experience in the area by having access to quality recreation facility.
• Tournaments, special activities, or ongoing programs may attract out of town visitors.
• Special events or activities may draw media coverage for the facility and the community.
• Recreation facilities with active programs increase the health of the local community.
• Some recreation facilities have staff members who publish periodic health and fitness press releases in the local media to promote a healthy and active community.
• Studies have shown that quality recreation facilities increase the value of neighboring property.
• Strong recreation facilities and programs keep residents in town who might otherwise travel outside the community. In turn this reduces sales leakage to neighboring communities.
• Direct facility use, which includes providing activities for adolescents, will keep them active and may reduce the chances of them getting in trouble.
• Facilities that are part of a complex that includes parks and/or open space may mitigate air pollution. Some complexes are designed to assist with storm water retention or to address other environmental issues.
• Public recreation facilities often provide reasonably priced access to recreation facilities because they are supported by tax dollars.
The bottom line is that the value of a facility extends beyond the economic activity associated with its construction, operation, and maintenance. To understand the full benefits of a park or recreation facility, it is imperative to look at the numbers and beyond them as well.