The Economic Impact
of the
2002 Saskatchewan Winter Games
Humboldt and Region
February 17 - 23, 2002
prepared for:
Saskatchewan Games Council
4th Floor, 1919 Saskatchewan Drive
Regina, Saskatchewan
S4P 3V7
prepared by:
Ross Milnthorp
Director of Leisure Services
City of Humboldt
Box 1137, Humboldt
Sask. S0K 2A0
306.682.2597
[email protected]
Introduction
The City of Humboldt hosted the 2002 Saskatchewan Winter Games from February 17-23, 2002.
The event attracted 1562 athletes and approximately 2569 visitor spectators.
The following is a report on the economic impact of the Games on the local and regional
economy. The research was conducted by the City of Humboldt Leisure Services Department for
the Saskatchewan Games Council.
The City of Humboldt Leisure Services Department has considerable experience in economic
impact research having conducted a study into the economic impact of leisure services in the City
of Humboldt over the 1999 calendar year. The study was developed in the form of a template
that could be used by other communities and has received wide recognition and a high level of
acceptance in the industry as an economic impact modelling and research tool. This study is
based on that model.
Economic Impact - A Definition
It is critical that a definition of economic impact as it pertains to this study is established at the
beginning of this report.
This research was based on the belief that the net gain of visitor expenditures versus leakage is
the economic impact felt by the community (refer to page 2 for a definition of leakage).
Study Scope
Expenditures
Only new money spent in Humboldt by out-of-town visitors, private businesses, and other levels
of government, attracted specifically by the Games and retained by its citizens, is included in this
study. Spending by local residents and residents of the immediate trading area (within 50km) is
not included. Local spending merely represents a redistribution of existing money in the
community and as such is not considered new money.
New money is defined as money that would not have entered the local economy without the
existence of the Games.
Geographical Area
Only the visitor expenditures of regional and destination visitors is included in the study.
Regional visitors travel between 51-80km one way to their destination. Destination visitors
travel 81+km one way to their destination.
Sales Coefficient
Money spent in Humboldt by visitors has a ripple effect on the local economy because businesses
are interdependent. Businesses and employees purchase goods and services from each other,
which keeps the money in the local economy. Previous research has shown us that a new dollar
spent in Humboldt is re-spent 1.3 times before it leaves the local economy. Therefore, the
Humboldt sales coefficient is 1.3.
The Economic impact of the Saskatchewan Winter Games on the City of Humboldt and Region
City of Humboldt Leisure Services Department - May 2002
Page 1 of 5
Leakage
When visitor expenditures are re-spent outside of Humboldt by the community’s residents and
businesses the money is lost from the local economy. This is known as leakage. Previous
research has determined that 60% of each new dollar spent in Humboldt is lost to leakage.
Conversely, 40% of each new dollar is retained by the local economy making the Humboldt
leakage coefficient 0.4.
Two Economic Impact Approaches
Sales Impact
The Sales Impact approach to economic impact analysis includes all direct and indirect effects on
the local economy. Direct effects are the initial visitor expenditures. Indirect effects are the
initial visitor expenditures multiplied by the sales coefficient.
Community Income Impact
The Community Income Impact approach to economic impact analysis measures visitor
spending that remains in the community permanently. It is much lower than the sales impact
because the leakage factor has been removed. However, it is a much more accurate analysis of
the economic impact of the event and is considered to be the best approach by economists.
This study includes the data generated by both approaches in an effort to facilitate comparisons to
other economic impact studies.
Study Methodology
A Survey Supervisor and 3 Interviewers were recruited from the local student population. These
4 students conducted 227 interviews with Games spectators at all of the venues, at various times
of the day over the 6 day period of the Games.
The survey questionnaire (attachedp) was developed using a model designed by Distinguished
Professor John Crompton of Texas A&M University. Mr. Crompton is the recognized authority
on event economic impact research in North America.
The questionnaire was divided into 4 basic areas of research:
1.
Visitor Profile - this section of the questionnaire enabled us to take a snapshot of the
visitor profile including: location of origin
number of visit days (length of stay)
whether they had a family member participating in the Games
number of people in their immediate travelling group
2.
Spending Profile - this section of the questionnaire enabled us to determine the
primary areas where visitor’s spent their money while in Humboldt and included:
admission fees
food and beverage
entertainment
retail shopping
lodging
auto expenses
other
The Economic impact of the Saskatchewan Winter Games on the City of Humboldt and Region
City of Humboldt Leisure Services Department - May 2002
Page 2 of 5
3.
Visit Determinants - this section of the questionnaire contained two main questions
and two sub-questions that enabled us to determine the reason for the respondents visit
to Humboldt.
4.
Areas Visited - this section of the questionnaire enabled us to determine the areas and
facilities of Humboldt visited by the respondent and included:
Humboldt Mall
Downtown Business Core
Willkommen Centre
Humboldt Museum
Waldsea Lake
Study Conclusions
Visitor Profile
Only spectators who were not residents of Humboldt were interviewed and are included in this
research. A total of 227 spectators were interviewed over the 6 day period of the Games:
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95.6% were either regional or destination visitors
the average length of stay was 2.8 days
84% had a relative participating in the Games
the average number of people in their immediate travelling group was 2.99
Spending Profile
Spectators were surveyed regarding their spending in typical areas of visitor expenditure
including admission fees, food and beverage, entertainment, retail shopping, lodging and auto
expenses as well as miscellaneous items:
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the average person stayed in Humboldt and region 2.8 days and spent $126.57 or an
average of $45.20 per day
The following table illustrates the visitor spending pattern in terms of percentages of total
expenditure on the typical areas of visitor expenditure:
The Economic impact of the Saskatchewan Winter Games on the City of Humboldt and Region
City of Humboldt Leisure Services Department - May 2002
Page 3 of 5
Visit Determinants
This section of the survey enabled us to determine the reason for the respondents visit. More
importantly, this section enabled us to ensure that only new money specifically attracted to
Humboldt and region by the Games was included in the economic impact analysis. We found
that:
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92% of the respondents came to Humboldt and region specifically because of the Games
of the 8% who did not come specifically because of the Games, 11% stayed longer
because of the Games
76% of the respondents would not have come to Humboldt and region over the next three
months if they had not come for the Games
Facilities Visited
This section of the survey enabled us to determine which areas of Humboldt and which facilities
the respondents visited and therefore where they were likely to have spent their money. We
found that:
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81% or 2071 of the respondents visited the Humboldt Mall
69% or 1766 of the respondents visited the Downtown Business Core
17% or 452 respondents visited the Willkommen Centre and Humboldt Museum
Economic Impact of the Games
Definition of Terms
C
Total Initial Visitor Expenditure:
this number equals the amount of money spent by
visitors to Humboldt and region on typical tourist
expenditures such as admission fees, food and
beverage, entertainment, retail shopping, lodging,
auto expenses, miscellaneous.
C
Games Non-Local Revenues:
this number equals the amount of revenue the
Games received from non-local sources. An
example of this revenue would be the Saskatchewan
Games Council operating grant of $220,000. Also
included in this number are items such as non-local
cash sponsorship and non-local advertising sales.
This number does not include admissions or local
contributions of any kind.
C
Total Expenditure:
this number equals the total amount of new money
injected into the Humboldt and region economy as
a result of the Games. This amount is identified by
adding the total initial visitor expenditure to the
Games non-local revenues.
The Economic impact of the Saskatchewan Winter Games on the City of Humboldt and Region
City of Humboldt Leisure Services Department - May 2002
Page 4 of 5
C
Community income Impact:
this number equals the total expenditure multiplied
by the Humboldt leakage coefficient (0.4). The
community income impact represents the amount of
money retained permanently by the Humboldt and
region economy. This measure indicates the income
that accrues to residents directly as a result of visitor
spending.
C
Sales Impact:
this number equals the total expenditure multiplied
by the sales coefficient (1.3). This amount
represents all of the spending generated locally by
the provision of the Games. This measure indicates
the increase in sales in Humboldt and region as a
result of visitor spending related to the Games.
The Economic Impact of the 2002 Saskatchewan Winter Games
on Humboldt and Region
The Economic impact of the Saskatchewan Winter Games on the City of Humboldt and Region
City of Humboldt Leisure Services Department - May 2002
Page 5 of 5
2002 HUMBOLDT SASKATCHEWAN WINTER GAMES
ECONOMIC IMPACT INTERCEPT SURVEY
Venue
Sport
Date
Time
1.
W hat is the postal code at your hom e address?
2.
W hich of the following days will you be at this event? (Please circle all that apply)
Sunday
Monday
Tuesday
Wednesday
Thursday
Friday
Saturday
3.
Do you have a family member on a participating team? Yes _____
4.
How many people (includ ing y ourself) are in your immediate traveling group? (This is the number of people for whom you
typically pay the bills. e.g., your fam ily or close friend s) _____ ___ __ p eop le
5.
To better understand the economic impact of the Winter Games, we are interested in finding out the approximate amount of
mon ey you and other visitors in your immediate group (immediate group is usually the mem bers o f your ho useho ld) will
spend, includ ing travel to and from your hom e. W e understand that this is a difficult question, but please d o your be st
because yo ur resp onses are very impo rtant to o ur efforts. DURING THE COURSE OF YOUR VISIT, WHAT IS THE
APPROX IMATE AM OUNT YOUR IMMEDIATE GROUP WILL SPEND IN EACH OF THE FOLLOWING
CATEG ORIES:
TYPE OF EXPENDITURE
No _____
Amount spent in the
Humboldt area
Amount spent Outside the
Humboldt area
A.
Admission/Entry Fees
B.
Food & Beverage (restaurants, concessions, grocery stores, etc.)__________________
_____________________
C.
Entertainment, Lounges & Bars (cover charges, drinks, etc.)
__________________
_____________________
D.
Retail Shopping (clothing, souvenirs, gifts, etc.)
__________________
_____________________
E.
Lodging Expenses (hotel, bed & breakfast, Motel, etc.)
__________________
_____________________
F.
Private Auto Expenses (gas, oil, repairs, parking fees, etc.)
__________________
_____________________
G.
Any other Expenses
Please identify:_____________________________
__________________
_____________________
6.
__________________
Would you have come to the Humboldt area at this time even if this event had not been held?
Yes _____
No_____
6a. If “Yes”, did you stay longer in the Humboldt area than you would have done if this event had not been held?
Yes ____
No ____
6b. If “Yes” (in 6a), how much longer? __________Days
7.
Would you have co me to Hum bold t in the next three months if you had not co me at this time for this event?
Yes ____
8.
__________Nights
No_____
Have you o r do you plan to visit any of the fo llowing:
Humboldt Museum _____ Willkommen Centre _____
Humboldt Mall
_____ Downtown Business Core _____
Waldsea Lake _____