Spearhead Trails Economic and Fiscal Impacts

Year:
Benefits studied:
Uses studied:
Region:
States:
Place: Buchanan County, Dickenson County, Lee County, Russell County, Scott County, and Tazewel County

Overview

An extensive motorized trail system in rural southwest Virginia has brought substantial new spending to the community, helping to diversify the area’s traditionally coal-based economy. The estimated economic impact is less than the predicted impacts before the system was built, but the impacts nonetheless exceed state and local investments.

Relevance

This study is relevant to communities interested in developing trail systems to promote rural economic development, particularly for motorized use.

Location

The Spearhead Trail system covers seven counties in southwest Virginia: Buchanan County, Dickenson County, Lee County, Russell County, Scott County, and Tazewel County.

Trail Type

The Spearhead Trail is a system connecting 400 miles of off-highway vehicle (OHV) trails.

Purpose

The purpose of the study is to justify ongoing state and local investment in the trail system, to measure how the economic benefit compares to local investments. The study also weighs the potential benefits from developing nonmotorized trails and building connections to tourist amenities.

This study was produced for the Southwest Regional Recreation Area (SRRA), which manages and promotes the Spearhead Trails.

Findings

  • Day visitors spent an average of $49 per day in the Spearhead area; overnight visitors spent $60 per day (and trips averaged 3.6 days).
  • In FY2016-17 visitors added approximately $4.3 million in economic impact to the seven-county region. This translates to 83 jobs and $3.2 million in labor income annually.
  • Visitor spending resulted in $528,000 in state and local taxes for FY2016-17. This is compared to the $405,000 in state and local funding that SRRA receives annually.
  • A user satisfaction survey found that 88% of respondents would use a trail system outside of Virginia if the Spearhead Trails did not exist. This finding highlights the trail system’s value in generating new economic activity in the region.
  • Eighty-five percent of visitors said they would visit more often and stay longer (71% of respondents) if the trails were connected to visitor amenities like restaurants and hotels.
  • Non-motorized trail uses like equestrian, biking, and hiking are growing in popularity in Virginia. Adding non-motorized trail options could increase trail system use, but nonmotorized visitors tend to spend less than current Spearhead users, so investments in nonmotorized trails may not be the most cost-effective priority for now.
  • Permit sales have increased 66% per year.
  • In 2011, SRRA completed a study predicting the potential impact of the trail system. The economic impacts reported in this 2017 study are substantially lower than predicted in the 2011 study. It is unclear whether this is due to lower visitation, lower spending per visitor, smaller scope for the trail system, or other factors.

Methods

The authors relied on a list of individuals who purchased trail permits in 2017, for a total of 319 respondents. The survey asked respondents about their trips during the previous year including number of people in their party, duration of trip, and how much they spent. In addition to consumer spending, the authors included SRRA’s operational spending and capital spending in the estimates of local economic contributions. They used the regional economic impact model, IMPLAN, to estimate impacts.

Citation

Institute for Service Research. 2017. Economic and Fiscal Impacts. Coeburn, VA: Spearhead Trails.