Thursday, January 15, 2015

Canal Fee Could Cost Local Economy $12 Million Per Year

HAGERSTOWN, MD - A local resident recently requested the WashCo Chronicle investigate the budget and proposed entrance fee of the C&O canal, in response to the recent announcement that the National Park Service may charge an entrance fee beginning in May. While a line-item budget for the C&O Canal is not currently available, the National Park Service "Green Book" budget is available online: http://www.nps.gov/aboutus/budget.htm

 Currently for local sections of the C&O Canal, there is no entrance fee, and no camping fee for hiker/biker camp sites on the canal.

The proposed entrance fee for 2015 is $3 per person or $5 per vehicle, which would then increase to $7 per person or $15 per vehicle in 2017. A hiker/biker camping fee would also be implemented at $20 per night.

According to the National Park Service, 5,062,079 people used the C&O Canal in 2013. C&O canal use contributes approximately $80,000,000 per year to the local economy near the canal.

In 2014, the C&O Canal requested $9,539,000. The enacted budget was $9,389,000, $150,000 less than what was requested.

For 2015, the C&O Canal has requested $9,467,000.

Assuming that on average a vehicle contains two people, if the full 5,062,079 people were to use the C&O canal, disregarding camping, this would provide the C&O canal an additional $12,655,197.5 in 2015.

5,062,079 / 2 people = 2,531,039.5 vehicles
2,531,039.5 vehicles X $5 = $12,655,197.5

It is unclear why the canal would need that large an increase in income, especially when upcoming improvements to the canal walls at lock 17 through 20, scheduled for 2017, are only estimated to cost an additional $3,967,000.

However, it's important to realize that if people do pay an access fee for the C&O canal, they may be less likely to keep spending money in the local economy. Assuming that most people are on a budget for recreational expenses, that $12,655,197.5 would be subtracted from local economy contributions. That's a 15% reduction in income for local businesses. What's worse, if some people refuse to go to the C&O Canal due to the fee increase, neither local businesses nor the C&O Canal receive the funds.

With many small businesses still struggling since 2008, one should question if they really could afford a 15% reduction in tourism income. This 15% could really make or break businesses which rely on C&O Canal tourism, such as local restaurants or stores.

Below are excerpts from the 2015 National Park Service budget as they relate to the C&O Canal. The full budget can be downloaded from http://www.nps.gov/aboutus/budget.htm






NOTE: This article was updated to correct a calculation error.

Ken Buckler is the editor of the WashCo Chronicle

3 comments:

  1. Ken I am not even sure where to start on this. At best I an call it uninformed, at worst at hatchet job.

    First you assume everyone will pay every time they go into the park. They won't. Some will skip paying, some will come back multiple time in on their entrance fee and others will have national parks passes. The number of uniques visitors is certainly less than 5 million. Also the 5 million number is gathered from things like traffic counters for one. So that number can't be used to accurately predict number of paying visitors. Since it does not take into those who would be repeat visitors or have passes.

    2. You list one and say that it only costs 3 something million making it seem that is the only project the park has or the only thing that the money will fix. Have you taken into account the money that will be needed for the work at Williamsport to dewater the canal and rebuild the aqueduct? Have you researched or included the backlog if delayed maintenance items or the other projects the park was not funded for or that they didn't put in for because they knew with a limited supply of money they wouldn't be funded. To make it appear that they are going to have 9 million they don't need is just plain wrong.

    Third have you taken into account that the money might be used to bolster employment that has been steadily declining at all the parks? I didn't see that and how that would impact the local economy. After all those who get jobs would most likely be from the local area an spending money on housing, food, fuel and yes entertainment.

    Fourth you article makes it appear as if the fees would directly take money from the local economy for entertainment items. How can this correlation be made? Just because someone spends money there doesn't mean they will stop spending somewhere else and how about the tourist who come to the park? Tourist will spend money that they may not spend going to a movie in Hagerstown.

    Sixth nowhere in your article have you stated that this is happening at all National Parks or that is was ordered by the Director of NPS. It is unfair to slant an article to make it seem that this is unique or out of the ordinary.

    I don't agree with everything the C&O Canal does even when I worked there. However they are taking flak for something that has to happen. There is now way they can keep going at the level they are being funded and staffed. None of the national parks can keep going at this level. Have you or anyone else taken into account how hard it is to staff, run and maintain a park? It cost money to mow or the towpath would be overgrown quickly. It cost money maintain campgrounds and paint picnic tables. It cost money to maintain visitor centers and education programs for the kids. It cost money for law enforcement rangers to be out protecting people on the Canal. Tell me something how would you feel if HPD had one officer patrolling somewhere that backup could be 30 minutes or more away? You and everyone else would be screaming bloody murder that more funding was needed. Yet that is the case for places on the Canal. I won't go into the actual numbers if how many LE Rangers work the Canal for their safety but I an tell you it sure isn't enough.

    No I don't like fees for anything either with the National Parks. However because they are not getting the funds they need from the government they need to get it somewhere else. You all want to blame someone blame the people in Washington. It isn't just republicans or democrats doing it, all of them neglect the parks. Direct the moral indignation and outrage to those in DC who love high off the taxpayer dollar giving perks to their friends while our greatest treasures suffer and whither away.

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    Replies
    1. Anthony,

      Thank you for the great feedback!

      1) This was an attempt to estimate the maximum possible influence upon the local economy of charging the entrance fee. Unfortunately, I have to agree with you that I'm very uninformed on this issue - we all are. The National Park Service has not made available, to my knowledge, any estimates regarding how much income will be generated by the entrance fees, or what their estimated impact on the local economy will be. If the National Park Service would publish any such data, I would be happy to revise this article.

      2) My intention was to show that the National Park Service budget shows an ADDITIONAL $3.9 million for improvements is shown in the budget document as being scheduled for 2017. I absolutely understand this would be on top of normal yearly operating expenses.

      3) At this time, it's currently unknown what purpose the National Park Service has in mind for the additional funds. Once again, very little information regarding planned usage for the fees is mentioned, other than the following which comes directly from the National Park Service: "100% of the fees collected at the C&O Canal are invested in projects that improve facilities and experiences for park visitors." Unfortunately that's an extremely vague statement, and it's hard to determine what their planned usage is for those fees.

      4) Many families are on a budget. If a family must spend money on an entrance fee to the canal, that won't necessarily increase the amount of money a family can spend on a trip to the canal. Once again, this is a "worst case" estimate. I revised this article to only reflect the $5 fee, and not the 2017 proposed fee of $15 per vehicle. Using the 2017 fee, the potential impact is even higher.

      6) What happened to 5? ;-) According to the document released by the National Park Service, Director Jon Jarvis authorized, not mandated, that park superintendents begin a civic engagement process associated with increasing entrance fees within units of the National Park system. If the National Park Service has released additional documentation stating that the fees were mandated, please do share! I was unable to find any documentation stating this in my research.

      I don't disagree with your statements regarding costs to maintain the park. Unfortunately, I'm working with the publicly available information, which is extremely lacking. If the National Park Service were to publish additional information and justification for the fee increases, I would be more than happy to include this information.

      Personally, I am not against charging a fee. However, I am concerned that the proposed fees may be too steep for some families to afford, especially when the fees increase in 2017.

      You bring up an excellent point, that park funding could be increased with a budget shift in Washington. I would highly recommend you contact your elected representatives and ask them to cut funding to some of their "pet projects" and allocate more funding for the National Park Service. If you need help doing so, please let me know, and I'd be happy to help you find who to contact.

      The most important take-away from all this is that this article did have its intended effect - it motivated a dialog regarding the potential economic impact to the local economy by implementing a fee for the canal. Please, by all means, disagree with my estimates! I would encourage you to come up with your own estimates, and share them. The fact of the matter is, no matter how you look at it, there will be an economic impact to the local economy. The question is - how much will that impact be, and will it cause local businesses to close?

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    2. Here is an excellent research report on funding state parks - much of the information in this can directly relate to national parks as well. An interesting quote from the study:
      "User fees are here to stay and appropriate for many services offered in state parks, but state
      park agencies need to beware of an overreliance on fees. Public goods that are nonrival in
      consumption should have a zero price, and many aspects of parks, such as hiking and biking
      trails, scenic views, and the like, are nonrival."

      Paying for State Parks - Evaluating Alternative Approaches for the 21st Century
      http://www.rff.org/RFF/Documents/RFF-Rpt-Walls-FinancingStateParks.pdf

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