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ARCHIVED  November 1, 1995

Tourism’s changing face

For years, community leaders here have debated how much of the town’s economy is driven by tourism.

Conservatives say that about 50 percent of the town’s economy derives from tourism, while others estimate it at closer to 90 percent. The debate finally drove a group of business people known as the Forward Estes Park Foundation to commission Jeffrey S. Zax and Nellie M. Hester from the University of Colorado College of Business to conduct a study of tourism in Estes Park. The study, “Economic Growth and its Sources in Estes Park,” was published in August 1996, but it left unanswered the question of how many dollars from tourism go into the Estes Park economy.

“We tried to get there with numbers,´ said Eric Blackhurst, a real estate agent and member of Forward Estes Park, “but we just couldn’t get a figure on what percentage tourism is of the local economy. The study looked at what were the economic engines driving the local economy, and clearly it was tourism. There was a clear correlation between traffic going into Rocky Mountain National Park and sales-tax revenues. Then we tried to look at new growth in town and sales-tax revenues, but there was very little correlation, which is no surprise to anyone.”

Blackhurst said they also tried to look at sales-tax revenues in the off season and subtract that from the peak season, but that didn’t work, either.

Two things remain clear, however: Tourism drives the economy, and both tourism and permanent residents are growing in Estes Park.

“In the last 12 months, we sold 130 to 150 homes,” Blackhurst said. “And over the last four years, the value of existing homes has increased about 10 to 12 percent per year. There has been a large market in buying condos.”

A large segment of the population commutes long distances to work in Boulder, Longmont and even Denver, he said.

Gary Klaphake, Estes Park town administrator, said that because the town has grown with many new residents, it is difficult to study the role of tourism in the local economy.

“We now have many new people in town,” he said, “and it is really hard to get your arms around a figure that shows how much sales-tax revenue tourism brings in to Estes. We have talked to the experts, and they shrug their shoulders.”

In one unscientific study, town officials tried to watch the difference between summer and winter sales tax.

“A good conservative estimate that we don’t get into a fight over is (that tourism is) 50 percent of the economy, but it may actually be closer to 60 percent,” Klaphake said. “The flattest part of the season is in the winter, so we bench mark off that.”

The town of Estes Park has 5,077 residents, but when Estes Valley is added to the equation, the population jumps to 9,886.

“We think we might be growing at a 3 percent (a year) clip,” Klaphake said, “but that is a reckless answer based on trend lines from an economic-development report. We also think tourism here is growing at a 3.2 percent (per year) rate. Last year, sales tax figures cooled a little bit.

“Generally the loss of the state tourism board three years ago has weakened our economy,” he added. “Our ability to advertise has been hurt (by the loss of the board).”

Estes Park is a small town with a limited budget for advertising. Denver has not been hurt by the loss of the tourism board, Klaphake claims, but small towns such as Durango and Estes Park feel the pinch.

Colorado voters refused to renew a tax to fund tourism promotions, but the Colorado General Assembly recently voted to allocate some funding from the state general fund.

Even though tourism is up in Estes, the demographics of the tourist market has changed. After conducting an intercept study, town officials were surprised to learn that almost 50 percent of the tourists lived in Colorado and were visiting Estes on a day trip. The study was done in July, August and September last year, and 469 people on the street were interviewed as they milled about on the streets.

“We wanted to know who is on the streets, and we were very surprised to learn how many Colorado people were here,´ said Peter Marsh, advertising manager for Estes Park. “We found that 49.4 percent of those interviewed were here on a day trip. Of those who stayed overnight, 15.8 percent were from Colorado. This was also a surprise.”

The intercept study found that an average of $610 was spent per group during their stay. This figure is up from the last study in 1993, which found that $495 was spent per party, which is typically three people.

People who stay overnight spend much more money than people who leave on the same day they arrive. The 1996 intercept study found that $132 was spent per group by day trippers, and $822 was spent per group by overnighters.

“We have more cars now, more traffic, but not more spending because the mix has changed,” Klaphake said. “We used to get many more people from out of state, especially Kansas, Illinois, Texas, Nebraska, Iowa and Minnesota.”

Klaphake said that the loss of the state tourism board has meant that fewer people are coming to Estes Park from out of state.

“We have replaced the people from out of state with the day trippers,” he said. “We have changed our marketing to rekindle some of that traffic, but our dollars don’t go far. It can cost $7,000 to $10,000 for one magazine ad. Montana, Wyoming and Utah have made hay in our absence.”

The change in the mix of tourists has also changed the business community. Colorado tourists are not likely to buy Estes Park souvenirs, but will try the local restaurants and shop for clothing.

“Some businesses are doing well, and some are not,” Klaphake said. “The day trippers do not want the souvenirs that the Texans want. The businesses are adapting. I have not seen any more failures than before. Some things are thriving. Everyone wants to eat. We have enough population in Estes to keep things open in the winter, and many restaurants and clothing stores stay open year-round. We are not shrinking, and we are not exploding. The park stabilizes that.”

Marsh said Estes Park does not need more tourists during the peak periods but does need more tourists during the flat periods. The town has worked hard to plan festivals and events throughout the year.

The Christmas festival has been expanded, and the Scottish Festival brings in as many as 28,000 people. September is now as popular as July for tourists.

“We can accommodate 25,000 to 30,000 people in town, and then everything just chokes up. It’s crowded,”Marsh said. “So our goal is to spread things out over the year. We encourage wildlife watching in the fall, and our fall is bigger than July.”

The advertising budget for Estes Park increased 11 percent in 1997.

“Our total ad budget is $593,880 for 1997,” Marsh said. “The intercept study gave us information that led us to do more regional coverage. We consider the regional market from Cheyenne, Wyo., to Castle Rock. But we are not cutting back on national coverage; 44 percent of our ad budget is spent out of state.”

Marsh said that the number of tourists in Estes Park is based on the volume of tourists entering Rocky Mountain National Park, which had 3,115,785 visitors in 1996.

“Some people just come to Estes and not to the park,” he said. “We think we have more visitors than the park. We actually only have one industry here. That is tourism.”

For years, community leaders here have debated how much of the town’s economy is driven by tourism.

Conservatives say that about 50 percent of the town’s economy derives from tourism, while others estimate it at closer to 90 percent. The debate finally drove a group of business people known as the Forward Estes Park Foundation to commission Jeffrey S. Zax and Nellie M. Hester from the University of Colorado College of Business to conduct a study of tourism in Estes Park. The study, “Economic Growth and its Sources in Estes Park,” was published in August 1996, but it left unanswered the…

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