This article appeared in the California Parks & Recreation magazine and best describes the role of parks and recreation in economic development.
Parks and Recreation Supports Economic Development
What easier way is there to convince policy makers to approve funding for a project, facility or service than to show what the economic benefit it will have to your city, county or special district? Economic impact studies are vital to show the value of parks and recreation to the economic vitality of a community. Although most economic impact studies usually test just the increase/decrease of enrollment fees in relation to the expenses of that program/event, studies should be made to the amount of secondary spending that happens in the immediate community: restaurants, gas stations, hotels/motels, sporting equipment, arts/craft materials or job creation. Not to mention the value parks and recreation may add to the community through lower health costs, increased tax revenues, corporate relocations and increased property values.
The East Bay Regional Park District (EBRPD) commissioned a study of economic benefits the district confers on the East Bay region. The goal of the district was to show that open space, parks, trails and other recreation facilities are an essential part of a community, and that the vital economy of the region is linked directly to “quality of life” benefits. The study was also intended to assure its continued vitality and responsiveness to the needs of its constituents.
EBRPD serves two counties which includes about 2.4 million people. It is responsible for over 91,000 acres of parks, open space and trails, including 59 regional parklands and 1,000 miles of trials. The study found that 90% of East Bay residents visit local parks at least once each year while the average resident visited local parks five times a year.
The report showed that EBRPD has a positive economic impact in the areas of:
- Quality of life
- Property values
- User utility
Quality of Life
The probability of a family or business moving to a particular community increases as the perceived quality of life increases. Parks and recreation is a key component when discussing quality of life, others include public safety, traffic, environmental concerns and educational resources. Yet when discussing the other quality of life components, parks and recreation impacts those areas as well. EBRPD found that the presence of its public safety officers in and around parks had an effect on the neighborhoods adjacent to those parks. Traffic congestion is eased by the use of trails and greenways when traveling between neighborhoods and to local retail areas. Estimated use of regional trails in EBRPD was about 750,000 visits annually. And parks help environmental concerns by providing open space, fresher air, and cleaner water.
Regression analyses conducted during the 1970s concluded that properties adjacent to large parks and open spaces, with minimum noise, traffic, and user conflicts, derive as much as 30% of their value from these amenities, with a general range of 10% to 30%.(1) The direct benefit of this to the city is the increased property taxes paid by the homes near a community park or greenway.
Another way to view the economic value of parks and recreation is to view the “user utility.” Although most park, open space and trail users pay nothing when using these resources, there is an intrinsic value that can be placed on them. User utility is defined as an individual’s perceived value of the experience of a park visit. A conservative estimate of total user utility associated with visits to EBRPD facilities in dollar terms approaches $74 million each year.(2) The user utility associated with park usage was estimated at $6.52 per visit and for regional trails $1.84 per visit.
Studies in the area of user utility are currently being done on California beaches. Economist know that beaches have some intrinsic value. “Beaches must be very valuable, yet we know very little about the magnitude of those values,” states David Layton, an economist at the University of California, Davis. Layton plans on looking at such beach amenities as fine sand, shells, lifeguards, surfing, and parking. The goal is to put a monetary value on the average visit to the beach. This value will help policy makers when discussing environmental issues that may result in beach closures.
Impact on Retail Centers
Another economic impact on the local community of parks and recreation is the money spent by participants of programming, sports leagues and park users in retail stores. Participants in soccer leagues must buy uniforms, soccer balls and knee pads. A participant in an art class will have to buy paints, canvasses, and brushes.
The study by EBRPD found that expenditures in East Bay sporting good stores of park-related durable goods approached the $236 million range and that $64 million in net new direct expenditures on durable goods occurred due to the presence of the park district.(3)
For some communities, tourism is the major source of income. Parks and recreation can play an important role in attracting tourist to a community. One of park and recreation’s roles is in providing attractive parks, campgrounds and beaches. The second is by sponsoring events, festivals and sports tournaments. Factor in the money spent by tourist at local restaurants, hotels and gas stations and it is easy to see how tourism is vital to the economic climate of some communities.
The $64 million estimated by EBRPD doesn’t include the trickle down value of parks and recreation. Those employees of the sporting good stores now have discretionary income to spend in the community. The sporting good stores also buy products and services from other local businesses. Employees of the park and recreation agency also spend money in the community. Economic experts have multipliers that can estimate what that value may be.
The economic value of parks and recreation is far more reaching than just the amount of money spent by participants in fee-based programming. When considering such factors as quality of life, economic vitality, tourism and user utility, it becomes easy to see just how important parks and recreation is to truly creating a community.
- “Quantifying Our Quality of Life,” East Bay Regional Park District, Economic & Planning Systems and Strategy Research Institute