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The views expressed are those of the author and do not necessarily reflect the views of ASPA as an organization.
By Stephen Kleinschmit
Ecotourism is an increasingly important means by which to facilitate local economic development. While efforts for its promotion are often primarily associated with the private sector, it is important to consider the health of the entities that maintain many of the public spaces on which businesses depend. State parks have suffered considerably during the recession, with severe fiscal problems emerging with primarily many smaller, underutilized sites. As declining appropriations have facilitated a greater dependence on user fees to fund their operations, parks must adopt a more aggressive approach to tourism development if they are to survive. Park closures will undermine ecotourism as an engine of economic growth in rural communities.
Aggregate spending on U.S. tourism amounted to $181 billion in 2013, constituting 2.8 percent of U.S. gross domestic product. Of this total, $42 billion was spent by visitors to our state and national parks. Despite these substantial sums, states spend little to promote their park systems and have failed to return to their relatively modest funding to pre-recession levels. Nearly all suffered severe cuts to their marketing budgets, while some programs were eliminated completely. Agency staffs have little to celebrate amid news of improving state revenue projections. Appropriations have often been diverted toward more politically sensitive issues, such as the need to offset revenues lost by tax cuts.
Paradoxically, such measures often prove to be counterproductive to legislative and executive goals of maintaining a state fiscal discipline. Such is the case in Colorado, where the passage of the 1993 Taxpayer’s Bill of Rights led to the elimination of the state tourism-marketing fund. Consequently, the state’s tourism market share declined by 30%, resulting in an estimated annual loss of $2 billion in economic development and hundreds of millions in forgone tax revenues. Current state estimates on the utility of tourism marketing reveal that each dollar spent on marketing yields substantial returns (anywhere from $10 to $200 in additional economic development). So what then is undermining efforts to restore or even expand this funding? To answer that question, we have to examine a number of recent trends.
Ecotourism is in part a response by policymakers to improve the economic potential of distressed regions. It has become an important mechanism in rural areas that lack the skilled workforce and access to infrastructure that would allow them to attract substantial commercial or industrial development. An example of this is Appalachia, where parts are seeking to expand the economic base beyond resource extraction, as mechanization, regulatory policy and competition from natural gas have adversely affected employment in the coal industry. Aside from the service jobs created to assist tourists directly, there is a secondary employment effect, fueled by market demand for retail, food service and lodging. These enterprises are highly dependent on availability of public facilities to attract customers. Closures often have an immediate and often severely detrimental effect on local economies. Thus, there is a considerable economic positive spillover effect that results from the operations of public parks.
Reductions in marketing budgets are often coupled with service reductions and staff layoffs. One particularly significant trend has been a shift from state appropriations to a greater reliance to deriving revenue through user fees. This raises questions about maintaining access for low-income populations, as the financial burden creates a strong disincentive to utilize these resources. Parks have moved toward the privatization of their services and are increasingly directed to secure corporate sponsorships. Some have even considered allowing energy exploration as a means to generate revenue, such as recent efforts in Pennsylvania to remove restrictions precluding natural gas production through hydraulic fracturing (fracking), though the public strongly opposes such measures. The possibility of environmental contamination and habitat destruction would be devastating to any park’s promotion efforts.
State parks are often vastly under-marketed, especially when compared to the promotional efforts of the private sector. Reasons for this include resource constraints, political considerations and institutional culture. An example is that California park system, one of the largest in the United States (currently 280 sites), which only established its Business Development and Marketing Office in late 2013. Additionally, local tourism development organizations and chambers of commerce focus on private enterprise, which displaces demand for state facilities, depriving them of the increasingly critical user revenue they need to maintain their facilities. It may exacerbate disparities in tourism development, with certain areas saturated by multiple promotional efforts (state, regional, local, private) with less resourced areas unable to adequately compete. It also creates the potential for conflicts in state and local tourism development, with entities locked in an expensive battle to attract visitors.
Parks are hampered by a combination of underinvestment and lack of coordination with state tourism campaigns, reduced budgetary appropriations for operation and maintenance, a shift to a user fee based revenue structure and a dependence on marketing development strategies that emphasize private enterprise. If ecotourism is going to play an important part of state economic development, policymakers should give greater consideration to the role of state parks in facilitating this vision. Additionally, it will become increasingly necessary for park administrators to adopt a more market-centric and entrepreneurial approach to competing for tourism dollars, as user revenues will be an important part of their funding for the foreseeable future.
Author: Stephen Kleinschmit is an assistant professor in the Department of Public Policy at Indiana University-Purdue University Fort Wayne, where he teaches in the Master of Public Affairs program. His research covers the areas of environmental planning, spatial analysis/GIS and public sector technology. He currently serves as president of the Midwest Public Affairs Conference, an APSA-affiliated organization currently planning its 2nd Annual Conference at the University of Wisconsin-Milwaukee in July 2015. Please direct your inquiries to [email protected].