An Economic Impact Study of the Nantahala Outdoor Center

on the Economy of Western North Carolina

Submitted by:

Inhyuck “Steve” Ha, Ph.D. Hillary M. Sherman, LL.M.

Jessica Hollars, B.S.

Western Carolina University

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An Economic Impact Study  

of the Nantahala Outdoor Center  

on the Economy of Western North Carolina 

 

Submitted to: 

Smoky Mountain Host of North Carolina 4437 Georgia Road Franklin, NC 28734

Prepared by: Inhyuck “Steve” Ha, Ph.D. Western Carolina University Hillary M. Sherman, LL.M Western Carolina University Jessica L. Hollars, B.S. Western Carolina University

April 2009

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TABLE OF CONTENTS 

EXECUTIVE SUMMARY ·· · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · 3

I. INTRODUCTION ·· · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · 6

II. VISITOR PROFILE ·· · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · 9

Demographic Information · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · 9

Marketing and Satisfaction Results · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · 11

Visitor Spending Patterns · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · 20

III. EMPLOYEE PROFILE ·· · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · 21

Demographic Information · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · 21

Employee Spending Patterns · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · 27

IV. ECONOMIC AND FISCAL IMPACT ·· · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · 29

V. CONCLUSION ·· · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · 34

REFERENCES ·· · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · 35 APPENDIX A. VISITOR SURVEY ·· · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · 36

APPENDIX B. EMPLOYEE SURVEY ·· · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · 40 ABOUT THE AUTHORS ·· · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · 44

ACKNOWLEDGEMENTS ·· · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · 45

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EXECUTIVE SUMMARY 

This study was conducted to provide estimates of the economic impact of the Nantahala Outdoor Center on the surrounding Carolina Smokies region. This study also reveals important information and insights about the Nantahala River Gorge. For the purposes of this study, the Carolina Smokies were defined as the eight westernmost North Carolina counties of Buncombe, Cherokee, Clay, Graham, Haywood, Jackson, Macon and Swain. The project had two objectives: (1) to examine the economic effect that both visitors and employees of the Nantahala Outdoor Center have on the surrounding economy and (2) to provide insightful information to Smoky Mountain Host that can guide future planning, development and marketing strategies for the Nantahala Outdoor Center and regional tourism efforts in the Carolina Smokies overall. In order to quantify the economic impact of the Nantahala Outdoor Center, surveys were administered to both visitors and employees of the NOC. Data collected included demographic, marketing and spending, in addition to the basic economic information needed to measure the Nantahala Outdoor Center’s impact. In addition to visitor and employee survey data, financial and administrative data was collected from the Nantahala Outdoor Center. Data collected includes both payroll data and operating expenditures. The Nantahala Outdoor Center has a substantial and valuable effect on the surrounding Carolina Smokies region. The direct impact of the Nantahala Outdoor Center in terms of payroll expenditures, other operating expenditures, capital expenditures and attendee spending was determined to be $35,084,352. The indirect and induced effects of payroll expenditures, other operating expenditures, capital expenditures and attendee spending were determined to be $6,352,270 and $6,637,069, respectively. As a result, the Nantahala Outdoor Center contributed a total of $48,073,691 to the local economy (figure represents 2008 constant dollars). In terms of employment, the Nantahala Outdoor Center created and maintained 579.2 jobs to the regional economy. Visitor surveys were collected from the Nantahala Outdoor Center. Results from the visitor survey revealed that the Nantahala Outdoor Center is successful in attracting visitors from outside the local area. The results of the visitor survey revealed the following major findings:

! More than 60 percent of visitor respondents (64.5%) came to the Carolina Smokies primarily to visit the Nantahala River Gorge.

! The most influential advertising medium for attracting visitors to the Nantahala River Gorge was word-of-mouth. Other effective marketing tools include the Internet and brochures.

! A third of survey respondents indicated that they planned to visit the Great Smoky Mountains National Park during their visit. Other popular regional attractions visited include the Blue Ridge Parkway, the Great Smoky Mountain Railroad, and the Cherokee attractions.

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! Nearly 40 percent of respondents (39.5%) indicated that this was their first time visiting the Nantahala River Gorge. In contrast, 40.6 percent of visitors reported that they come at least every year to the Gorge.

! A third of visitors (33.8%) reported they made travel plans one to two weeks in advance of visiting the area.

! Nearly 70 percent of visitors (69.4%) who completed the survey indicated that the addition of a River Park would increase the likelihood of their return.

! It is estimated that the addition of a River Park would generate an additional 47,490 visitors to the Nantahala River Gorge.

! Seventy percent of respondents (71.8%) indicated that the addition of new streambed enhancements would increase the likelihood of their return.

! Over three-fourths of visitors (76.4%) who completed the survey indicated they would more likely return within the next year based on their experience with the Nantahala Outdoor Center.

In addition to the data received from visitors about the Nantahala Outdoor Center, this economic impact study also revealed information on the impact that outfitter employees have on the region. The results from the employee surveys revealed the following major findings: ! The average total household monthly expenditure for Nantahala Outdoor Center

employees is $1,795.64. ! Nearly 70 percent of employees who completed the survey (68.09%) indicated

that they have a 2-year college degree or higher. ! Almost half of employee respondents (48.4%) reported that they are full-time,

year-round employees. ! Over one-third of Nantahala Outdoor Center employees (35.4%) have worked for

the outfitter one year or less. In contrast, slightly more than nine percent of employees (9.38%) have worked at the Nantahala Outdoor Center for more than 20 years.

! Nearly 80 percent of respondents (79.7%) indicated that they moved to the Carolina Smokies to work for the Nantahala Outdoor Center.

! Nantahala Outdoor Center employees each bring an average of eleven visitors per year to the Nantahala River Gorge from outside the region.

! These visitors from outside the Carolina Smokies stayed in commercial lodging an average of 3.25 nights.

! Nantahala Outdoor Center employees each bring an average of 7.86 visitors per year to the Nantahala River Gorge from within the Carolina Smokies region.

! These visitors stayed in commercial lodging an average of 3.33 nights.

This study is specifically designed to quantify the tangible impact of the Nantahala Outdoor Center on the region in terms of dollars and cents. However, this industry also provides intangible benefits to the community that are essential to regional community development, but are not addressed in this report. For example, the Nantahala Outdoor

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Center contributes to the cultural life and reputation of the region as a tourism destination. These contributions reinforce the attractiveness of the region as a family-friendly tourism locale. Therefore, both economic and non-economic factors are important to the quality of life in the Carolina Smokies and should be considered in future decision making.

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I. INTRODUCTION 

ABOUT THE NANTAHALA OUTDOOR CENTER As adventure tourism grows in popularity, tourists are in search of an all inclusive outdoor recreation spot. In the Great Smoky Mountains, outdoor recreation awaits at every turn. There is hiking, mountain biking, trout fishing, horseback riding and whitewater rafting on the great Nantahala River. Miles of rugged mountain beauty surround the Nantahala River, which is located in western North Carolina’s scenic mountains. The Nantahala River Gorge is a leader of family fun and outdoor adventure. The Nantahala Outdoor Center, based near Bryson City, is a leading commercial outdoor guide and retail store in western North Carolina. “Since 1972, the Nantahala Outdoor Center has shared the outdoors with millions of guests on white water river rafting trips, with all varieties of kayak and canoe instruction, on mountain bikes and around the world with their adventure travel trips (NOC)1

1 Material from this section of the report was drawn from the Nantahala Outdoor Center website at http://www.noc.com

.” The Nantahala Outdoor Center offers a thrilling adventure for everyone, from skilled rafters to leisure seeking tourists. Friends and families gather at the River for a lifetime adventure, filled with rafting, kayaking, mountain biking, meals and lodging. Although the Nantahala Outdoor Center has long played a role in the region, particularly in terms of attracting tourists to the area, this role has been steadily declining for the past decade. The Nantahala River Gorge witnessed a 13 percent decline in business between 1997 and 2007. This trend has piqued the interest of the Nantahala Outdoor Center, other outfitters and regional tourism entities tied to the Gorge and driven to growing focus on how to redefine the product of whitewater rafting on the Nantahala Gorge. This study provides insight into the interests of the customers that outfitters and tourism entities can use to inform future economic development planning and marketing efforts. This study was designed to examine the economic impact the Nantahala Outdoor Center has on the Carolina Smokies region. A number of quantitative data collection methods were used to collect visitor, employee and administrative/financial data. This data, in turn, was used to conduct statistical analyses in order to develop an accurate portrait of the Nantahala Outdoor Center’s role in the local economy.

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This research project was undertaken at the request of David Huskins, Smoky Mountain Host Managing Director. This economic impact study was conceived as part of a larger Highway 19 Corridor Study. The first phase of this study includes economic impact studies for the Great Smoky Mountains Railroad and the Nantahala Revitalization Project. The Nantahala Revitalization Project includes the survey and analysis of a small, medium and large outfitter to determine the gorge’s economic impact on the region. The findings of these impact studies are designed to provide Smoky Mountain Host with useful information about the impact of Highway 19 Corridor tourist attractions on the region. Upon completion of the first phase, further analysis will be undertaken to determine the economic impact that remaining Highway 19 Corridor tourist attractions have on the region.

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METHODOLOGY

Two separate questionnaires were distributed at the Nantahala Outdoor Center. The questionnaires were developed to gather economic, marketing and demographic information for the Nantahala River Gorge. The questionnaires include the following: (1) visitor survey and (2) employee survey.

Each visitor questionnaire comprised of twenty questions and incorporated demographic, economic, marketing and tourism-related questions. The Nantahala Outdoor Center and Smoky Mountain Host reviewed the questionnaires. Modifications were made based on their recommendations.

In the questionnaire design, data was collected in 2007. Questionnaires and pencils were provided to all visitors as they waited their turn to raft the Nantahala River. The research team at Western Carolina University administered surveys. Visitors completed a total of 882 questionnaires (see Appendix A for a copy of the visitor questionnaire).

The employee questionnaire comprised of fifteen questions and incorporated demographic and economic questions. Nantahala Outdoor Center employees completed a total of 96 questionnaires (see Appendix B for a copy of the employee questionnaire). Similarly to the visitor questionnaire, the employee questionnaire was reviewed and critiqued by the Nantahala Outdoor Center and Smoky Mountain Host, and modifications were made based on their recommendations. Questionnaires were distributed to all employees of the Nantahala Outdoor Center. They were collected through a series of locked drop boxes so employee information would remain confidential.

In addition to collecting visitor and employee data via survey, financial and administrative data was collected. The data collected included both payroll data and data relating to revenue and operating expenditures. Financial and administrative data from the past four years was collected from the Nantahala Outdoor Center to provide a more detailed look at the firm’s financial trends and its implications on the region. Information regarding the Nantahala Outdoor Center financial and administrative data was obtained directly from either the finance office or the business owners.

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II. VISITOR PROFILE 

DEMOGRAPHIC INFORMATION Visitor surveys were collected from the Nantahala Outdoor Center. Surveys were collected from 882 individuals. Individuals visiting the Nantahala Outdoor Center have a higher rate of post-secondary educational attainment compared to the American public at large. Based on survey results, approximately 80 percent of visitors (79.3%) who raft the Nantahala River hold a 2-year college degree or higher, compared with just 34 percent of the general public who hold such a degree2. Table 2.1 illustrates the educational attainment of visitors to the Nantahala Outdoor Center.

Table 2.1 Level of educational attainment

Frequency Percent Valid Percent

Less than high school 11 1.2% 1.3% High school grad/GED 169 19.2% 19.4% 2-year college/technical/associates degree 182 20.6% 20.9% 4-year college degree 300 34.0% 34.4% Masters degree 151 17.1% 17.3% Doctoral degree 58 6.6% 6.7% Subtotal 871 98.8% 100.0% Missing 11 1.2% Total 882 100.0% Source: Nantahala Outdoor Center Visitor Survey 2007

As shown in Figure 2.1, over 50 percent of Nantahala Outdoor Center visitors (50.3%) have an annual household income of more than $80,000. Another 33 percent of visitors (33.4%) have an annual household income less than $60,000. These findings are above the national median annual household income of $50,0073

2 National figure based on 2005 U.S. Census data. 3 National figure based on 2005 U.S. Census data.

. Based on survey results, the mean annual household income of Nantahala Outdoor Center visitors is $85,511.71. Figure 2.1 illustrates the annual household income of visitors to the Nantahala Outdoor Center.

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Figure 2.1 Annual household income of visitors to the Nantahala Outdoor Center

17.5%

15.9%

16.3%

17.3%

16.8%

16.3%

15.0%

15.5%

16.0%

16.5%

17.0%

17.5%

less than $40,000 $40,000 -$59,999

$60,000 -$79,999

$80,000 -$99,999

$100,000 -$149,999

$150,000 ormore

Source: Nantahala Outdoor Center Visitor Survey 2007 Out of the total number of respondents, more than half of the visitors (61.4%) to the Nantahala Outdoor Center that completed the survey were male. While survey instruments were distributed to all rafters at the NOC, the findings do not necessarily suggest that men dominate the Nantahala Outdoor Center. Table 2.2 highlights the gender of Nantahala Outdoor Center visitors who completed the survey.

Table 2.2 Gender of respondents

Frequency Percent Valid Percent

Female 333 37.8% 38.6% Male 530 60.1% 61.4% Subtotal 863 97.8% 100.0% Missing 19 2.2% Total 882 100.0%

Source: Nantahala Outdoor Center Visitor Survey 2007

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MARKETING AND SATISFACTION RESULTS As shown in Table 2.3, over 60 percent (64.5%) of visitors came to the Carolina Smokies primarily to visit the Nantahala River Gorge. “Other” and “visiting family and friends” were also popular reasons respondents indicated they came to the area.

Table 2.3 Primary purpose for being in the Carolina Smokies

Frequency Percent Valid Percent

Visiting the Nantahala River Gorge 565 64.1% 64.5% Visiting family/friends 111 12.6% 12.7% Business 11 1.2% 1.3% Other 189 21.4% 21.6% Subtotal 876 99.3% 100.0% Missing 6 0.7% Total 882 100.0% Source: Nantahala Outdoor Center Visitor Survey 2007

As shown in Table 2.4, nearly half of the respondents who completed the visitor survey came to the Nantahala River Gorge to raft. One-fourth of respondents reported that they came to the Nantahala River Gorge to canoe or kayak, while 21.1 percent of respondents indicated that they came to the Gorge primarily to ride the Great Smoky Mountain Railroad.

Table 2.4 Primary purpose for visiting the Nantahala River Gorge

Frequency Percent Valid Percent

Rafting on the Nantahala River 379 43.0% 43.3% Canoeing or kayaking on the Nantahala River 210 23.8% 24.0% Spectator or sightseeing 102 11.6% 11.6% Riding the train 185 21.0% 21.1% Subtotal 876 99.3% 100.0% Missing 6 0.7% Total 882 100.0%

Source: Nantahala Outdoor Center Visitor Survey 2007 Visitors to the Nantahala Outdoor Center were asked to report the number of nights they stayed in a variety of lodging situations in the following western North Carolina locales: Bryson City, Cherokee, Maggie Valley/Waynesville, Nantahala Gorge, Robbinsville, Sylva/Dillsboro and Other. Table 2.5 illustrates the average number of nights spent in each area. As evident by this table, most Nantahala Outdoor Center visitors stayed in Robbinsville with family or friends or in a condo or rental.

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Table 2.5 Average number of nights spent in area by Nantahala Outdoor Center visitors

Bryson City Cherokee

Maggie Valley/

Waynes-ville

Nantahala Gorge

Robbins-ville

Sylva/ Dillsboro Other

Family/Friends 1.4 2.2 4.6 5.6 7.7 4.9 4.9 Hotel or Motel 1.9 1.8 1.9 2.4 2.4 1.8 2.9 Inn or B&B 4.5 3.0 3.0 2.6 1.0 1.5 3.3 Condo/Rental 3.2 2.8 4.4 3.9 7.5 4.0 4.8 Timeshare 5.0 2.0 5.0 5.7 Campground 2.9 2.8 2.4 3.3 5.0 7.0 4.3 Other 6.3 13.3 5.0 17.9 12.6 Overall 2.3 2.5 3.6 4.9 5.3 3.4 4.8

Source: Nantahala Outdoor Center Visitor Survey 2007 As shown in Table 2.6, Nantahala Outdoor Center visitors indicated that they typically stay with family and friends (35.9%) when visiting the Carolina Smokies. Alternatives to staying with family and friends included staying at a campground (16.4%), “Other” lodging facility (14.8%), and hotel or motel (13.9%). The majority of visitors, approximately 35.1%, spent the night in the Nantahala Gorge. Nearly 25 percent (25.4%) of respondents indicated they stayed in “Other,” and nearly 20 percent (20.3%) stayed in the Bryson City area. The high percentage of visitors who stayed in the Nantahala Gorge should be expected given the central role the Nantahala River has in the community.

Table 2.6 Percent of nights spent in area by Nantahala Outdoor Center visitors

Bryson City

Chero-kee

Maggie Valley/

Waynes-ville

Nanta-hala

Gorge

Robbins-ville

Sylva/ Dillsboro Other Overall

Family/Friends 5.2% 1.4% 2.3% 14.4% 1.4% 2.6% 8.6% 35.9% Hotel or Motel 3.9% 2.7% 0.8% 1.8% 0.4% 0.7% 3.7% 13.9% Inn or B&B 2.8% 0.1% 0.2% 0.4% 0.0% 0.4% 0.6% 4.5% Condo/Rental 3.2% 0.3% 1.5% 2.9% 0.5% 0.1% 3.5% 12.1% Timeshare 0.0% 0.0% 0.3% 0.1% 0.0% 0.2% 1.8% 2.3% Campground 3.4% 0.8% 0.4% 8.2% 0.3% 0.4% 2.8% 16.4% Other 1.8% 1.3% 0.2% 7.3% 0.0% 0.0% 4.4% 14.8% Overall 20.3% 6.6% 5.6% 35.1% 2.6% 4.4% 25.4% 100.0%

Source: Nantahala Outdoor Center Visitor Survey 2007 Visitors were asked to indicate the total number of people that travel in their group. Based on survey results, an average travel group to the Nantahala Outdoor Center consisted of 4.12 adults, 2.33 children (age 0-11 years) and 3.45 youth (age 12-18 years). Table 2.7 illustrates the number, average and variation of travel groups.

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Table 2.7 Adults, children and youth by group visiting the Nantahala Outdoor Center

N Mean Minimum Maximum Std. Dev.

Number of adults 863 4.12 1 33 4.354 Number of children 247 2.33 1 60 4.179 Number of youth 172 3.45 1 30 4.896

Source: Nantahala Outdoor Center Visitor Survey 2007 Businesses and companies have adopted many different advertising tools to get them noticed. As depicted in Figure 2.2, the most influential advertising medium for Nantahala Outdoor Center visitors was word-of-mouth. While, word-of-mouth advertising accounted for nearly 50 percent, the Internet and brochures accounted for 22.6 percent and 13.9 percent, respectively. Figure 2.2 Advertising mediums that most influenced visitors to the Nantahala River Gorge

22.6%

13.9%

1.5%

1.5%

48.3%

12.2%

0.0% 5.0% 10.0% 15.0% 20.0% 25.0% 30.0% 35.0% 40.0% 45.0% 50.0%

Internet

Brochure

Magazine / Newspaper

Articles

Word-of-Mouth

Other

Source: Nantahala Outdoor Center Visitor Survey 2007 Visitors to the Nantahala Outdoor Center were asked what additional regional attractions they planned to visit during their trip to the area. Nearly half of the respondents (45.9%) indicated that they visited or plan to visit the Nantahala River Gorge as part of their trip to the Carolina Smokies. A third of the survey respondents indicated that they planned to visit the Great Smoky Mountains National Park during their stay. An additional 28 percent (28.2%), 21 percent (21.3%) and 19 percent (19.4%) indicated that they planned

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on visiting the Blue Ridge Parkway, the Great Smoky Mountain railroad and the Cherokee attractions, respectively. The results are depicted in Figure 2.3.

Figure 2.3 Other regional attractions visitors plan to visit while in the area

15.4%

28.2%

19.4%

6.8%

32.9%

21.3%

7.9%

12.0%

45.9%

4.2%

15.1%

7.3%

11.6%

0.0% 5.0% 10.0% 15.0% 20.0% 25.0% 30.0% 35.0% 40.0% 45.0% 50.0%

Biltmore

Blue Ridge Pkwy

Cherokee Attractions

Ghost Town in the Sky

Great Smoky Mountains National Park

Great Smoky Mountains Railroad

Harrah's Cherokee Casino

Joyce Kilmer Memorial Forest

Nantahala River Gorge

NC Arboretum

Pigeon Forge / Gatlingurg

Trail of the Dragon

Other

Source: Nantahala Outdoor Center Visitor Survey 2007 Visitors were asked how they arrived in the Carolina Smokies. Over 90 percent of the visitors to the Nantahala Outdoor Center (94.5%) indicated that they arrived in the area by car. Other modes of transportation used by respondents include: RV (1.6%), Other (1.6%), airplane (1.0%), motorcoach/bus (0.8%) and motorcycle (0.5%). The results are displayed in Table 2.8.

Table 2.8 Mode of transportation used by visitors to arrive in the area

Frequency Percent Valid Percent

Car 824 93.4% 94.5% Motorcoach/Bus 7 0.8% 0.8% Airplane 9 1.0% 1.0% RV 14 1.6% 1.6% Motorcycle 4 0.5% 0.5% Other 14 1.6% 1.6% Subtotal 872 98.9% 100.0% Missing 10 1.1% Total 882 100.0% Source: Nantahala Outdoor Center Visitor Survey 2007

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As depicted in Figure 2.4, approximately 50 percent of the respondents (53.7%) reported that they were the primary person who influenced their decision to come to the Nantahala River Gorge. Nearly one-fourths of Nantahala Outdoor Center visitors (22.7%) indicated that their friends and other relatives influenced their decision to come. Other influential people include: spouse (10.5%), “other” (8.1%) and children (5.0%). Figure 2.4 Person who influenced decision to visit the Nantahala River Gorge

53.7%

10.5%

5.0%

22.7%

8.1%

0.0% 10.0% 20.0% 30.0% 40.0% 50.0% 60.0%

You

Spouse

Children

Friends or Other Relatives

Other

Source: Nantahala Outdoor Center Visitor Survey 2007 Visitors were asked the frequency of which they visit the Nantahala River Gorge. Almost 40 percent of respondents (39.5%) indicated that this was their first time visiting the Nantahala River Gorge. In contrast, 40.6 percent of Nantahala Outdoor Center visitors reported that they come at least every year to the Gorge. Results are shown in Table 2.9. This finding highlights a unique opportunity and very real challenge for the Nantahala Outdoor Center: namely, how to provide a captivating experience to repeat customers while also attracting newcomers to support its base.

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Table 2.9 Frequency visitors come to the Nantahala River Gorge

Frequency Percent Valid Percent

This is my first time 342 38.8% 39.5% Every few years 121 13.7% 14.0% Every other year 51 5.8% 5.9% Every year 135 15.3% 15.6% Several times a year 123 13.9% 14.2% More than 5 times a year 94 10.7% 10.9% Subtotal 866 98.2% 100.0% Missing 16 1.8% Total 882 100.0% Source: Nantahala Outdoor Center Visitor Survey 2007

As depicted in Table 2.10, a third of the Nantahala Outdoor Center visitors (33.8%) reported they made travel plans one to two weeks in advance of visiting the Gorge. Although 11 percent of respondents (11.0%) reported that they made travel plans at least six months in advance, over 15 percent of respondents (15.2%) indicated that they did not make advance plans to visit the Gorge.

Table 2.10 Number of weeks in advance visitors made plans to come to the Nantahala Gorge

Frequency Percent Valid Percent

Today 94 10.7% 15.2% 1-2 weeks 209 23.7% 33.8% 2-4 weeks 99 11.2% 16.0% 1-2 months 100 11.3% 16.2% 3-6 months 49 5.6% 7.9% 6 months or more 68 7.7% 11.0% Subtotal 619 70.2% 100.0% Missing 263 29.8% Total 882 100.0% Source: Nantahala Outdoor Center Visitor Survey 2007

Visitors were asked whether the addition of a River Park would increase the likelihood of their return to the Nantahala River Gorge within the next year. Nearly 70 percent of visitor respondents (69.4%) indicated that the addition of a River Park would increase the likelihood of their return. Approximately 17 percent of respondents indicated that they had no preference. Figure 2.5 illustrates these findings. It is estimated that there were approximately 220,000 visitors to the Nantahala River Gorge. Based on survey results, it is estimated that an additional 47,490 visitors would come to the Nantahala River Gorge with the addition of a River Park.

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Figure 2.5 Likelihood of return for the addition of a river park

13.6%

17.0%

69.4%

0.0% 10.0% 20.0% 30.0% 40.0% 50.0% 60.0% 70.0%

Will not increase likelihood ofreturn

Uncertain

Will increase likelihood ofreturn

Source: Nantahala Outdoor Center Visitor Survey 2007 Nantahala Outdoor Center visitors were asked whether the addition of new streambed enhancements would increase the likelihood of their return within the next year. As seen in Figure 2.6, over 70 percent of respondents (71.8%) indicated that the addition of new streambed enhancements would increase the likelihood their return.

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Figure 2.6 Likelihood of return for the addition of new streambed enhancements

12.4%

15.8%

71.8%

0.0% 10.0% 20.0% 30.0% 40.0% 50.0% 60.0% 70.0% 80.0%

Will not increase likelihood ofreturn

Uncertain

Will increase likelihood ofreturn

Source: Nantahala Outdoor Center Visitor Survey 2007 Nantahala Outdoor Center visitors were asked to predict, based on their experience at the Nantahala River Gorge on the day they were surveyed, the likelihood that they would return in the next year. Nearly 80 percent of visitors (76.4%) indicated that they would return to the Nantahala River Gorge within the next twelve months. Only 8 percent of respondents (8.4%) indicated that they were less likely to return within a year. Figure 2.7 illustrates the findings.

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Figure 2.7 Likelihood of returning to the Nantahala River Gorge in the next twelve months

8.4%

15.2%

76.4%

0.0% 10.0% 20.0% 30.0% 40.0% 50.0% 60.0% 70.0% 80.0%

Less likely to return

Uncertain

More likely to return

Source: Nantahala Outdoor Center Visitor Survey 2007

20

VISITOR SPENDING PATTERNS Visitors to the Nantahala Outdoor Center contribute to the economy of the Carolina Smokies. The Nantahala Outdoor Center visitor survey asked visitors to report their spending as a result of their entire visit to the Nantahala River Gorge area. Spending was broken down into several categories, including lodging, transportation, food and beverage, shopping, spending on river excursions, spending at other local attractions, spending on “other,” and total spending. Analysis of the 882 surveys revealed that, on average, adults to the Nantahala Outdoor Center spend $797.85 each in the Carolina Smokies Region. Table 2.11 shows the results of the analysis.

Table 2.11 Spending in region per group

N Mean Minimum Maximum Std. Dev.

Lodging 654 $261.05 $0 $3,000 417.24 Transportation 657 $113.03 $0 $2,500 180.44 Food and Beverage 694 $169.01 $0 $2,000 215.77 Shopping 626 $134.47 $0 $5,000 310.66 River Excursions 543 $125.75 $0 $3,000 214.16 Attraction Admissions 627 $60.61 $0 $1,000 114.45 Other 401 $44.20 $0 $2,100 214.10 Total spending per adult 715 $797.85 $6 $9,600 946.13

Source: Nantahala Outdoor Center Visitor Survey 2007 Visitors were asked how they would have spent their time had they not visited the Nantahala River Gorge. Of the 882 respondents, nearly 40 percent of respondents (38.2%) indicated that they would have attended another event in the area. Another 30 percent (29.4%) indicated that they would have stayed home. Table 2.12 illustrates these findings.

Table 2.12 How visitors would have spent their time had they not come to the Nantahala River Gorge

Frequency Percent Valid Percent

Attended another event in the area 330 37.4% 38.2% Attended an event or attraction outside of the Carolina Smokies

180 20.4% 20.8%

Stayed home 254 28.8% 29.4% Other 101 11.5% 11.7% Subtotal 865 98.1% 100.0% Missing 17 1.9% Total 882 100.0% Source: Nantahala Outdoor Center Visitor Survey 2007

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III. EMPLOYEE PROFILE 

DEMOGRAPHIC INFORMATION To determine the economic impact that the Nantahala Outdoor Center has on the surrounding region, employees in the Gorge area were surveyed. Surveys were collected from 96 full-time and part-time employees. Employees of the Nantahala Outdoor Center have a higher rate of overall post-secondary educational attainment as compared to the American public at large. Based on the 2007 survey results, approximately 70 percent of employees in the Gorge area (68.09%) hold a 2-year college degree or higher, compared with just 34 percent of the general public who hold such a degree4. Although many employees have completed higher education, over one-forth of employees (27.7%) have only attained a high school diploma. Table 3.1 illustrates the educational attainment of Nantahala Outdoor Center employees.

Table 3.1 Level of Educational Attainment

Frequency Percent Valid Percent

Less than high school 4 4.2% 4.3% High school graduate 26 27.1% 27.7% 2-year college/technical/associates degree

15 15.6% 16.0%

4-year college degree 37 38.5% 39.4% Masters degree 8 8.3% 8.5% Doctoral degree 4 4.2% 4.3% Subtotal 94 97.9% 100.0% Missing 2 2.1% Total 96 100.0% Source: Nantahala Outdoor Center Employee Survey 2007

The survey results also show that more than 60 percent of Nantahala Outdoor Center employees (64.5%) have an annual household income of less than $40,000. This value is slightly lower than the average median household income in North Carolina of $43,867 and $50,007 for the entire United States5

4 National figure based on 2005 U.S. Census data. 5 Figures are based on the 2005-2007 American Community Survey Data.

. As expected for this region, only 3 percent of employees have an annual household income over $100,000, as seen in Figure 3.1.

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Figure 3.1 Annual household income of Nantahala Outdoor Center employees

64.5%

20.4%

7.5%4.3% 2.2% 1.1%

0.0%

10.0%

20.0%

30.0%

40.0%

50.0%

60.0%

70.0%

less than 40,000 40,000 - 59,999 60,000 - 79,999 80,000 - 99,999 100,000 -149,000

150,000 or more

Source: Nantahala Outdoor Center Employee Survey 2007

More than half of the employees (53.7%) who completed the survey were female. While survey instruments were distributed to all employees, the findings do not necessarily suggest that the Nantahala Outdoor Center employs more women. Instead, it may simply be a result of the well-documented fact that women are more likely to complete surveys than men. Table 3.2 highlights the gender of Nantahala Outdoor Center employees who completed the survey.

Table 3.2 Gender of respondents

Frequency Percent Valid Percent

Female 51 53.1% 53.7% Male 44 45.8% 46.3% Subtotal 95 99.0% 100.0% Missing 1 1.0% Total 96 100.0% Source: Nantahala Outdoor Center Employee Survey 2007

As depicted in Table 3.3, it is apparent that many responding employees are young professionals. Over 30 percent of Nantahala Outdoor Center employees (31.3%) are under the age of 30. Furthermore, only 2 percent of employees (2.1%) are older than 70 years. Table 3.4 highlights the age of Nantahala Outdoor Center employees who completed the survey.

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Table 3.3 Age of Nantahala Outdoor Center employees

Frequency Percent

18 – 29 years 30 31.3% 30 – 39 years 19 19.8% 40 – 49 years 18 18.8% 50 – 59 years 17 17.7% 60 – 70 years 10 10.4% Older than 70 years 2 2.1% Total 96 100.0%

Source: Nantahala Outdoor Center Employee Survey 2007 As survey results indicate, almost half of responding employees (46.3%) have never married. In contrast, nearly 35 percent of employees (34.7%) are married. Other survey respondents indicated they were either divorced (13.7%), living in a marriage-type relationship (3.2%), separated (1.1%) or widowed (1.1%). Figure 3.2 illustrates this finding. Figure 3.2 Marital status of Nantahala Outdoor Center employees

46.3%

3.2%

34.7%

1.1%

13.7%

1.1%0%

5%

10%

15%

20%

25%

30%

35%

40%

45%

50%

Never Married Living in amarriage-

typerelationship

Married Separated Divorced Widowed

Source: Nantahala Outdoor Center Employee Survey 2007

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Almost half of employee respondents (48.4%) reported that they are full-time, year-round employees. Other survey respondents indicated that they were either full-time seasonal (21.5%), part-time year around (26.9%) or part-time seasonal (3.2%). Table 3.4 illustrates the employment status of Nantahala Outdoor Center employees who completed the survey.

Table 3.4 Employment status of employees surveyed

Frequency Percent Valid Percent

Full-time (250 days) 45 46.9% 48.4% Full-time (125 days) 20 20.8% 21.5% Part-time (less than 125 days) 25 26.0% 26.9% Part-time (less than 60 days) 3 3.1% 3.2% Subtotal 93 96.9% 100.0% Missing 3 3.1% Total 96 100.0% Source: Nantahala Outdoor Center Employee Survey 2007

Employees of the Nantahala Outdoor Center were asked how many children under the age of 18 reside in their residence. Almost 90 percent of employee respondents indicated that no children under the age of 18 currently live with them. Table 3.5 illustrates this finding.

Table 3.5 Number of Nantahala Outdoor Center employee children living at home

Frequency Percent

Zero 86 89.6% One 4 4.2% Two 6 6.3% Total 96 100.0%

Source: Nantahala Outdoor Center Employee Survey 2007 As depicted in Table 3.6, over one-third of employee respondents (35.4%) have worked at the Nantahala Outdoor Center one year or less. In contrast, 9 percent of employees (9.38%) have worked at the Nantahala Outdoor Center for more than 20 years.

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Table 3.6 Number of years employees have worked at the Nantahala Outdoor Center

Frequency Percent

0 – 1 years 34 35.4% 2 – 3 years 17 17.7% 4 – 5 years 18 18.8% 6 – 8 years 6 6.3% 9 – 13 years 6 6.3% 14 – 19 years 6 6.3% 20 – 25 years 7 7.3% More than 25 years 2 2.1% Total 96 100.0% Source: Nantahala Outdoor Center Employee Survey 2007

Employees of the Nantahala Outdoor Center were asked if they had lived in one of the surrounding eight North Carolina counties before working at the NOC. The surrounding eight North Carolina counties include Swain, Jackson, Macon, Clay, Graham, Cherokee, Haywood and Buncombe. As illustrated in Table 3.7, almost three-fourths of respondents reported that they had not lived in one of the eight surrounding North Carolina counties prior to working in the Gorge.

Table 3.7 Employee respondents who lived in one of the surrounding eight NC counties

Frequency Percent Valid Percent

Yes 27 28.1% 28.4% No 68 70.8% 71.6% Subtotal 95 99.0% 100.0% Missing 1 1.0% Total 96 100.0% Source: Nantahala Outdoor Center Employee Survey 2007

Employees who did not live in one of the eight surrounding North Carolina counties prior to working in the Gorge were asked if they moved to the Nantahala River Gorge specifically to work at the Nantahala Outdoor Center. Almost 80 percent of respondents (79.7%) indicated that they moved to the area to work for at the Nantahala Outdoor Center. The results are depicted in Table 3.8.

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Table 3.8 Employee respondents who moved to the area to work at the Nantahala Outdoor Center

Frequency Percent Valid Percent

Yes 63 65.6% 79.7% No 16 16.7% 20.3% Subtotal 79 82.3% 100.0% Missing 17 17.7% Total 96 100.0% Source: Nantahala Outdoor Center Employee Survey 2007

Predictably, the vast majority of employees reported that their permanent home address is located in North Carolina (68.8%). Another 5 percent of employee respondents (5.4%) indicated that their permanent residence is located in Florida. Table 3.9 illustrates these findings.

Table 3.9 States of Nantahala Outdoor Center employees’ permanent residence

Frequency Percent Valid Percent

Alabama 1 1.0% 1.1% Connecticut 1 1.0% 1.1% Florida 5 5.2% 5.4% Georgia 2 2.1% 2.2% Iowa 1 1.0% 1.1% Louisiana 1 1.0% 1.1% Massachusetts 1 1.0% 1.1% Missouri 1 1.0% 1.1% Mississippi 1 1.0% 1.1% North Carolina 66 68.8% 71.7% Ohio 1 1.0% 1.1% Pennsylvania 3 3.1% 3.3% South Carolina 1 1.0% 1.1% Tennessee 3 3.1% 3.3% Texas 1 1.0% 1.1% Vermont 1 1.0% 1.1% Wisconsin 2 2.1% 2.2% Subtotal 92 95.8% 100.0% Missing 4 4.2% Total 96 100.0% Source: Nantahala Outdoor Center Employee Survey 2007

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EMPLOYEE SPENDING PATTERNS To calculate the economic impact of the Nantahala Outdoor Center on the surrounding area, employees were asked to report their monthly expenditures on various items. Monthly expenditures for the following items were recorded: housing, home/renters insurance, utilities, car payments, car insurance, car maintenance and repair, gasoline and local transportation, clothing and retail shopping, groceries, restaurants, fast food and drinking establishments, entertainment and recreation, medical care, health insurance, other insurance, education and other. The findings are reported in Table 3.10. On average, employees spend $409.32 on housing per month. While the mean expenditure for housing per month is relatively low, employees have a wide range of housing expenditures that they pay each month – ranging from $30 to $2,000. This wide range contributes to the wide margin exhibited in the standard deviation ($392.71). The average monthly payment for home or renters insurance is $107.08. While some employees have a relatively low monthly payment of $10, others pay up to $560 a month for home or renters insurance. Employees also reported a wide range of monthly expenditures for utilities, which were identified as including electric, gas, phone, trash, cable, satellite, Internet and other related expenses. The average monthly utility payment rate for employees of the Nantahala Outdoor Center is $202.07. While some employees bear high monthly payments for utility use, others have payments as low as $20 a month. As shown in Table 3.10, employees reported that they spend an average of $387.13 per month on car payments and $120.17 per month on car insurance. In addition, employees also reported a wide range of monthly expenditures for car insurance, varying from $10 to $1,200 per month. The average monthly payment for car maintenance and repair is $68.78. In addition, an average of $186.06 a month is spent on gasoline and local transportation. The average monthly cost for clothing, other retail shopping, groceries and restaurants, fast food and drinking establishments is $137.93, $321.34 and $136.14, respectively. Employees also spend an average of $122.36 per month on entertainment expenses. On average, employees spend $207.51 each month on medical care, $222.75 each month on health insurance, and an additional $123.25 per month on other insurance. Employee respondents indicated that they spend an average of $175.53 a month on education and $523.10 on educational loans. Employees also reported they spend approximately $194.40 a month in other expenses.

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After considering all types of monthly expenditures, employees of the Nantahala Outdoor Center spend, on average, a total of $1,795.64 a month. Employees reported a minimum monthly payment of $180 and a maximum monthly payment of $16,162.

Table 3.10 Descriptive Statistics of Employee Monthly Spending

N Mean Minimum Maximum Std. Dev.

Monthly Expenditures Housing 72 $409.32 $30.00 $2,000.00 392.71 Home/Renters Insurance 39 $107.08 $10.00 $560.00 138.91 Utilities 60 $202.07 $20.00 $1,992.00 258.98 Car Payments 30 $387.13 $35.00 $3,000.00 523.73 Car Insurance 70 $120.17 $10.00 $1,200.00 194.30 Car Maintenance and Repair 55 $68.78 $8.00 $500.00 88.60 Gasoline and Local Transportation

80 $186.06 $10.00 $2,100.00 251.55

Clothing and Retail Shopping 69 $137.93 $10.00 $1,000.00 185.32 Groceries 87 $321.34 $25.00 $6,760.00 727.67 Restaurants, Fast Food and Drinking Establishments

83 $136.14 $5.00 $1,000.00 183.60

Entertainment and Recreation 58 $122.36 $8.00 $1,000.00 176.27 Medical Care 35 $207.51 $5.00 $3,000.00 516.83 Health Insurance 28 $222.75 $16.00 $660.00 184.50 Other Insurance 12 $123.25 $21.00 $467.00 151.65 Education 15 $175.53 $10.00 $600.00 168.13 Other 10 $194.40 $50.00 $400.00 124.30 Educational Loans 10 $523.10 $25.00 $3,000.00 883.72 Estimated Total 91 $1,795.64 $180.00 $16,162.00 1978.60

Source: Nantahala Outdoor Center Employee Survey 2007 Note: Missing values are not included in these calculations

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IV. ECONOMIC AND FISCAL IMPACT 

This section discusses the economic and fiscal impact of the Nantahala Outdoor Center. Impacts are reported in terms of income and jobs created. Income includes wages and salaries and indirect business taxes. As mentioned in previous sections, for the purposes of this analysis, the Carolina Smokies region was defined as the following eight westernmost North Carolina counties: Buncombe, Cherokee, Clay, Graham, Haywood, Jackson, Macon and Swain. The counties included in the geographic area were determined based on the range of economic data from the visitor and employee surveys described in the previous sections and analyzed by the researchers. To develop a detailed profile of the Nantahala Outdoor Center and conduct the economic impact analysis, an input-output model of the Nantahala Outdoor Center was constructed. The researchers utilized the IMPLAN (IMpact Analysis for PLANing, Minnesota IMPLAN Group 2000) software input-output model and database to construct a basic input-output model for the Nantahala Outdoor Center. The input-output model is useful for estimating the economic impact and understanding how the impacts ripple throughout an economy. The basic framework used for this study is built around the eight county region of the Carolina Smokies. This region was selected because it represents the permanent residences of the majority of Nantahala Outdoor Center employees. It also represents the area of focus of the Smoky Mountain Host Tourism Agency. Dollar figures for goods and services purchased within the Carolina Smokies region were entered into an IMPLAN-generated model constructed of the eight county region. IMPLAN then analyzes these dollars to understand the direct and secondary impacts of the railroad on the region. The first level of analysis measures the direct impact. Direct effects are those dollars spent on goods and services that are available within the regional or local economy. Direct dollars are those clearly and obviously traceable to the Nantahala Outdoor Center. Examples of direct effects include taxes paid, wages paid and supplies purchased by the Nantahala Outdoor Center. Direct effects trigger the secondary level of analysis, both indirect and induced effects. Direct dollars are traced by an input-output analysis to detect secondary impact dollar spending. Secondary impact dollars accumulate as a result of both indirect and induced effects. Indirect secondary effects are the dollars generated by expenditures necessary to replenish goods or improve services that have been purchased by direct (initial) impact expenditures. In other words, the indirect effect refers to the secondary impact caused by input needs of directly affected industries. Induced secondary effects are the result of an increase in household spending by employees who are hired, or current employees paid to work longer hours, to provide goods and services being purchased. In other words,

30

induced effects refer to the secondary impacts caused by changes in household spending due to the additional employment generated by direct and indirect effects. The indirect and induced effects are commonly known as the multiplier. The multiplier effect shows how the direct expenditures get multiplied through the economy; it calculates spending that takes place as a result of the “ripple effect.” Multipliers are calculated based on supplier relationships and employee consumption patterns. It essentially means that every dollar received by business owners and employees is re-spent within the region, which, therefore, multiplies the initial sales and generates revenues in other sectors of the local economy. IMPLAN estimates the magnitude of both primary and secondary impacts for each industry, which forms the so-called “multipliers.” It should be noted that a portion of direct and secondary dollar spending goes for goods and services that are not purchased in the local community, as well as to pay state and federal taxes. Money used to purchase items that are not available in the local community and money used to pay state and federal taxes leaves the local economy, and so does not continue to circulate within the local economy. The data used to estimate the total economic impact of the Nantahala Outdoor Center includes payroll expenditures (wages and salaries), other operating expenditures and Nantahala Outdoor Center visitor spending. The analyses of payroll and other operating expenditures are based both the 2007 and 2008 fiscal years. Dollars are converted into 2008 constant dollars prior to analysis to ensure accurate estimation of the economic impact the Nantahala Outdoor Center has on the surrounding region. Refer to Table 4.1. Over the last eight years, the number of visitors that floated down the Nantahala River in a canoe, kayak, raft or inner tube has remained relatively stable. In 2000, approximately 198,000 visitors floated down the River. In 2007, approximately 180,000 visitors went down the Nantahala River Gorge in some form or fashion.

Figure 4.1 Total number of rafters to the Nantahala River Gorge area

-20,00040,00060,00080,000

100,000120,000140,000160,000180,000200,000

2000 2001 2002 2003 2004 2005 2006 2007

Source: U.S. Forest Services (USFS).

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The data used to estimate the total economic impact of the Nantahala Outdoor Center includes payroll expenditures (wages and salaries), other operating expenditures and Nantahala Outdoor Center visitor spending. The analyses of payroll and other operating expenditures are based both 2007 and 2008 fiscal years. Refer to Table 4.1. Table 4.1 Economic Impacts of the Nantahala Outdoor Center

Direct Impact

Indirect Impact

Induced Impact

Total Impact

Output Impact

1 Wages and Salaries $5,147,809 $631,143 $584,997 $6,363,949

2 Operating Expenditures $7,139,196 $1,344,703 $1,326,629 $9,810,528

3 Capital Expenditures $636,461 $173,896 $144,066 $954,423

4 Visitor Spending $22,160,886 $4,202,528 $4,581,377 $30,944,791 Total $35,084,352 $6,352,270 $6,637,069 $48,073,691

1 Wages and Salaries 28.7 5.7 6.1 40.5

2 Operating Expenditures 88.7 11.6 13.8 114.1

3 Capital Expenditures 6.1 1.5 1.5 9.1

4 Visitor Spending 328.5 39.4 47.6 415.5 Total 452.0 58.2 69.0 579.2

Source: IMPLAN analysis * Employment impact is the estimated number of jobs associated with the output impact. The Nantahala Outdoor Center paid $5,147,809 in wages and salaries to its full-time and part-time workers. The indirect impact is $631,143. The induced impact, which captures the multiplier effect associated with employees spending in the local economy, is $584,997. Thus, in 2007, the Nantahala Outdoor Center contributed nearly $6.5 million in wages and salaries to the western North Carolina region. In terms of jobs associated with the payroll expenditures, the Nantahala Outdoor Center generated 40.5 jobs in total. In addition to payroll expenditures, the Nantahala Outdoor Center is responsible for a number of other expenditures such as contracted services, supplies and maintenance and miscellaneous payments. In 2007, the Nantahala Outdoor Center had total operating expenditures of approximately $9,810,528. Nearly $7.2 million of the operating expenditures were generated through the direct effects, while $2,671,332 was generated through the secondary effects. In terms of jobs associated with non-payroll operating expenditures, the Nantahala Outdoor Center generated 114.1 jobs in total.

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In addition to both payroll and operating expenditures, the Nantahala Outdoor Center is responsible for a number of capital expenditures. Capital expenditures include investments in property, plant and equipment. The Nantahala Outdoor Center had total capital expenditures of $954,423. Nearly $650,000 of the capital expenditures was generated through direct effects, while $317,962 was generated through the secondary effects – indirect and induced effects. In terms of jobs associated with capital expenditures, the Nantahala Outdoor Center generated 9.1 jobs in total. As described in the previous section, visitor spending accounted for the majority of the economic impact. The direct impact of visitor spending on lodging, transportation, food and beverage, shopping, entertainment and other expenses is $22,160,886. The total impact of visitor spending on the local economy is $30,944,791. Visitor spending supports local employment and other services. When combined, the direct impact of the Nantahala Outdoor Center in terms of payroll expenditures, other operating expenditures, capital expenditures and visitor spending is $35,084,352. The indirect and induced effects of these same categories are $6,352,270 and $6,637,069, respectively. Thus, in terms of dollars, the Nantahala Outdoor Center contributes $48,073,691 to the local economy. In terms of employment, the Nantahala Outdoor Center created and maintained 579.2 additional jobs to the local economy. Related to the economic impact analysis, one can estimate the fiscal impact of the Nantahala Outdoor Center in terms of federal, state and local taxes. The results of this analysis were broken out into two categories: federal non-defense related taxes and state and local non-education related taxes as shown in Table 4.2. Four tax categories constitute the federal taxes generated by the Nantahala Outdoor Center. They are: corporate profits tax; indirect business taxes; personal taxes, fees and fines; and other taxes. Together these categories comprise the majority of federal taxes attributed to the Nantahala Outdoor Center. A total of $3,518,204 was contributed in 2007 to federal taxes. In terms of taxes that remain locally, the Nantahala Outdoor Center can be credited with $3,289,148 in tax payments. In this case, sales taxes of $1,372,928 are the greatest tax source followed by $943,635 in property taxes. Thus, in addition to its economic impact, the Nantahala Outdoor Center provided $6,807,352 tax dollars in 2007 to support federal, state and local initiatives.

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Table 4.2 Fiscal Impact of the Nantahala Outdoor Center on the Smoky Mountain Host Region Type of Tax Tax Impact Federal Government Non-Defense

$3,518,204

Corporate Profits Tax $478,928

Indirect Business Taxes $347,475 Personal Taxes, Fees, and Fines $1,005,177

Other Federal Taxes $1,686,624 State/Local Government Non-Education

$3,289,148

Corporate Profits Tax $71,119

Dividends $111,110 Indirect Business Taxes: Property Taxes $943,635

Indirect Business Taxes: Sales Taxes $1,372,928

Indirect Business Taxes: Other Taxes $283,177

Personal Taxes, Fees, and Fines $477,649

Other State/Local Taxes $29,530

Total $6,807,352 Source: IMPLAN analysis

34

V. CONCLUSION  

The results of this study reveal that the Nantahala Outdoor Center is a significant generator of economic activity for the Carolina Smokies region. The Nantahala Outdoor Center generated an estimated total economic impact of nearly $48.1 million. Additionally, this economic activity of the Nantahala Outdoor Center produced 579.2 jobs in addition to the direct employment. The total number of jobs is supported through direct and secondary impacts of the Nantahala Outdoor Center. Results from the visitor survey suggest that the Nantahala Outdoor Center is successful in attracting visitors from outside to the local area. The most influential advertising medium for the Nantahala Outdoor Center visitors was word-of-mouth and the Internet. Individuals visiting the gorge have a higher rate of overall post-secondary educational attainment and significantly higher median household incomes as compared to the national average. In addition, many individuals were first time visitors to the Nantahala River Gorge. These findings have important implications for the Nantahala Outdoor Center. It can be a real challenge for the Nantahala Outdoor Center to develop effective marketing tools that provide a captivating experience to repeat customers while also attracting newcomers. Over 40 percent (40.6%) of Nantahala Outdoor Center visitors are repeat customers. These repeat customers come to the Nantahala Outdoor Center at least once a year. Given the large percent, the Center can essentially spend less on advertising for this focus group. Word-of-mouth is the primary way to bring in new customers. In order to generate positive word-of-mouth, the Nantahala Outdoor Center needs to promise visitors a certain quality experience and exceed that promise.

35

REFERENCES 

About the “Nanny:” Appalachian Rivers. Apprivers.com. 2006. 31 December 2008 <http://www.apprivers.com/about.html>.

Minnesota IMPLAN Group, Inc. 2000. IMPLAN Professional Software 2.0; User Guide,

Analysis Guide, and Data Guide, 2nd Edition. Stillwater, Minnesota: MIG, Inc. Nantahala Gorge Area History. Nantahalariver.net. 31 December 2008

<http://www.nantahala-river.net/history.html>. Nantahala River Gorge. National Forests in North Carolina. 2008. 31 December 2008

<http://www.cs.unca.edu/nfsnc/recreation/nantahala.htm>.

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APPENDIX A: VISITOR SURVEY 

37

Dear Visitor: Western Carolina University is currently conducting a project to determine the impact of the Nantahala River area on the surrounding region and we need your help. Please take a few minutes to answer the following questions. The information you provide will be used to shape the future of the eight southwestern North Carolina Counties known as The Carolina Smokies. All answers are anonymous. Your feedback is greatly appreciated.

1. What is the primary purpose of your visit to the Nantahala River Gorge? (Circle the

appropriate number) 1. Rafting on the Nantahala River 2. Spectator/Sightseeing 3. Canoeing or kayaking on the Nantahala River 4. Riding the train

2. What is your primary purpose for being in the Carolina Smokies? (Circle the appropriate number) 1. Visiting the Nantahala River Gorge 2. Business 3. Visiting Family/Friends 4. Other, Please Specify: _______________

3. Who was the primary person in your group that impacted your decision to come to the

Nantahala River Gorge? (Circle the appropriate number) 1. You 2. Spouse 3. Children 4. Friends or other relatives 5. Others, Please Specify: __________________

4. How far in advance did you make plans to come to the Nantahala River Gorge?

1. ____ Today 2.____ 1-2 WKS 3.____ 2-4 WKS 4. ____ 1-2 MOS 5.____ 3-6 MOS 6.____ 6 MOS or more

5. What is the total number of people in your group? (If you are with tour group include only

those traveling with you, not entire tour group). 1. _______ # of adults 2. ______ # of children (0-11 YRS) 3. _____ # of youth (12-18 YRS)

6. What advertising medium most influenced your visit to the Nantahala River Gorge: (Circle

the appropriate number) 1. Internet 2. Brochure 3. Magazine/Newspaper Advertisment 4. Newspaper/Magazine articles or news broadcast

5. Word-of-Mouth 6. Other, Please specify: _________

7. How often do you come to the Nantahala River Gorge? (Circle the appropriate number) 1. This is my first time 2. Very few years 3. Every other year 4. Every year 5. Several times a year 6. More than 5 times a year or local resident

8. Had you not come to the Nantahala River Gorge, how would you most likely have spent your

time? (Circle the appropriate number) 1. Attended another event or attraction in the area 2. Attended an event or attraction outside the Carolina Smokies 3. Stayed home 4. Other, Please Specify: _____________________

9. How did you arrive in The Carolina Smokies? (Circle the appropriate number)

1. Car 2. Motorcoach/Bus 3. Airplane 4. RV 5. Motorcycle 6. Other, Please Specify: ________

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10. Check all other attractions/destinations you are planning to visit while you are in the area? 1. Biltmore Estate 2. Blue Ridge Parkway 3. Cherokee Attractions (drama, museum, village) 4. Ghost Town in the Sky 5. Great Smoky Mountains National Park 6. Great Smoky Mountains Railroad 7. Harrah’s Cherokee Casino 8. Joyce Kilmer Memorial Forest /

Cherohala Skyway / Fontana Village 9. Nantahala River Gorge 10. North Carolina Arboretum 11. Pigeon Forge / Gatlinburg 12. Tail of the Dragon 13. Other, please Specify: _______________________

11. What is the zip code of your permanent residence? ________________________________ If you are from a country other than the U.S., what is your country? _____________________

12. How much do you anticipate spending for your group in The Carolina Smokies as a result of

your entire visit to the Nantahala River Gorge (includes eight western most counties in North Carolina: Buncombe, Cherokee, Clay, Graham, Haywood, Jackson, Macon, Swain; these counties include Asheville west)?

A. $________LODGING

B. $________TRANSPORTATION

C. $________FOOD AND BEVERAGE

D. $________SHOPPING

E. $________RIVER EXCURSIONS / RIVER OUTFITTERS

F. $________ATTRACTIONS ADMISSIONS

G. $________OTHER, PLEASE SPECIFY: ________________________________

13. Please specify how many nights you plan to stay in each of the following categories in the following Western North Carolina communities:

Bryson City

(Number of Nights)

Cherokee (Number

of Nights)

Maggie Valley Waynesville

(Number of Nights)

Nantahala Gorge (Number of Nights)

Robbinsville (Number of Nights)

Sylva Dillsboro (Number of Nights)

Other location PLEASE SPECIFY (Number of Nights)

With family or friends

Hotel/Motel

Inn or B&B Condo or

house rental

Timeshare

Campground Other: please

specify:

14. What is the highest level of education you completed? (Circle the appropriate number)

1. Less than High School 2. High School Graduate / GED 3. 2-Year College/ Technical/Associates Degree 4. 4-Year College Degree 5. Masters Degree 6. Doctoral Degree

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15. What range best represents your annual household income? (Circle the appropriate

number) 1. Less than $40,000 2. $40,000 - $59,999 3. $60,000 - $79,999 4. $80,000 - $99,999 5. $100,000 - $149,000 6. $150,000 or more

16. What is your profession? (Fill in the blank)______________________________________

17. What is your gender? _____ FEMALE _____ MALE 18. Based on your experience at the Nantahala River Gorge today, what is the likelihood that

you will return within the next year? (Circle the appropriate number)

1= will not return 5= will return 1 2 3 4 5

19. Would the addition of a River Park increase the likelihood of your return to the Nantahala

River Gorge within the next year? (Circle the appropriate number.) A river park could include the following characteristics: ! More rapids like Nantahala Falls ! Family friendly and handicapped accessible hiking trails ! Children’s play area with splash pools for wading ! Additional festivals, special events, competitions, and daily entertainment ! River walks and additional scenic viewing areas

1= will definitely not increase likelihood 5= will definitely increase likelihood 1 2 3 4 5

20. Would the addition of new streambed enhancements increase the likelihood of your return

within the next Year? River enhancements could include the following characteristics: (Circle the appropriate number.)

! A surfing wave capable of hosting international events ! Beginner and intermediate play spots ! Additional rapids like Nantahala Falls ! Improved river access

1= will definitely not increase likelihood 5= will definitely increase likelihood 1 2 3 4 5

21. Any Additional Comments:

__________________________________________________________________

__________________________________________________________________

__________________________________________________________________

__________________________________________________________________

__________________________________________________________________

THANK YOU SO MUCH!!!

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APPENDIX B. EMPLOYEE SURVEY 

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Dear Employee: Western Carolina University is currently conducting a project to determine the impact of the Nantahala River area on the surrounding region and we need your help. Please take a few minutes to answer the following questions. The information you provide will be used to shape the future of the Nantahala River area. All answers will remain strictly confidential. Your feedback is greatly appreciated.

YOUR MONTHLY SPENDING PATTERNS 1. Please record your estimated household monthly expenditures in Swain, Jackson, Macon,

Graham, Cherokee, Clay, Haywood, and Buncombe Counties from this past year. If this is your first year working at the Gorge, please estimate your monthly expenditures for the current year.

Housing (mortgage / rent) $_____________________ Home/Renters Insurance $_____________________ Utilities (e.g., electricity, gas, phone, cable, satellite, internet, etc.) $_____________________ Car Payments $_____________________ Car Insurance $_____________________ Car Maintenance and Repair $_____________________ Gasoline and Local Transportation $_____________________ Clothing and Retail Shopping $_____________________ Groceries $_____________________ Restaurants, Fast Food, and Drinking Establishments $_____________________ Entertainment and Recreation $_____________________ Medical Care $_____________________ Health Insurance $_____________________ Other Insurance (Please Specify: ________________________) $_____________________ Education (for you or members of your family) $_____________________ Other (Please Specify: _________________________________) $_____________________ Educational Loans (combined for all members of your family) $_____________________ TOTAL $___________________

YOUR VISITORS 2. How many visitors from the following eight counties (Buncombe, Cherokee, Clay, Graham,

Haywood, Jackson, Macon and Swain) did you bring to the Gorge last year? (If this is your first year at the Gorge, please estimate how many visitors you expect to have visit you over this year)

Total Number of Visitors __________________ Number of Nights Spent in Your Home __________________ Number of Nights Spent in Commercial Lodging Establishment __________________

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3. How many visitors did you bring to the Gorge last year from places other than the eight counties named above? (If this is your first year at the Gorge, please estimate how many visitors you expect to have visit you over this year)

Total Number of Visitors __________________ Number of Nights Spent in Your Home __________________ Number of Nights Spent in Commercial Lodging Establishment __________________ DEMOGRAPHIC INFORMATION 4. What is the Zip code, county, and state of your permanent residence?

Zip Code: _______________________ County: ___________________________________ State: _____________________________________

5. Approximately how many years have you worked in the Gorge? (Please express years in whole numbers. If you have worked in the Gorge less than a year, please put a zero on the line). ____________ YEARS

6. Before you began work in the Gorge, did you live in one of the following eight North Carolina

counties? (Buncombe, Cherokee, Clay, Graham, Haywood, Jackson, Macon and Swain) 1. YES 2. NO 7. If you did not live in one of these eight counties before you began work in the Gorge,

did you move here specifically to work at the Nantahala River Gorge? 1. YES 2. NO 8. Do you work at the Gorge full or part time?

_____Full-time (40 hrs/wk) _____Part-time (less than 40 hrs/wk)

9. What is your gender? _____ Female _____ Male 10. What year were you born? 19 ______ 11. What is your marital status? 1. Never Married 2. Living in a Marriage-Type Relationship 3. Married 4. Separated 5. Divorced 6. Widowed 12. How many children under the age of 18 are currently living with you? (Fill in blank)

_______

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13. What is the highest level of education you completed? (Circle the appropriate number)

1. Less than High School 2. High School Graduate 3. 2-Year College/Technical/Associates Degree 4. 4-Year College Degree 5. Masters Degree 6. Doctoral Degree 14. What range best represents your annual household income? (Circle the appropriate

number) 1. Less than $20,000 2. $20,001 - $30,000 3. $30,001 - $40,000 4. $40,001 - $50,000 5. $50,001 - $60,000 6. $60,001 - $70,000 7. More than $70,000

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About the Authors 

Inhyuck “Steve” Ha (Ph.D., University of Minnesota-Twin Cities) is an assistant professor of Economics at Western Carolina University. His concentrations are regional economics, community economic development, economic impact analysis, tourism, and econometric modeling. Dr. Ha has worked at the Humphrey Institute of Public Affairs at University of Minnesota and in the Haas Center for Business Research and Economic Development at the University of West Florida as Forecasting Program Director. Hillary Sherman (M.S., Elon University; LL.M., National University of Ireland) is the Director of the U.S. Economic Development Administration funded “Know Your Region” Project. In this role, Ms. Sherman studies regional economies, identifies regional best practices in the areas of regionalism and industrial clustering, and manages the project and project website. Hillary studied IMPLAN at the Minnesota IMPLAN Group and has served as a consultant to communities and small businesses in the areas of identifying regional assets, conducting effective regional strategic planning, CEDS, and regional marketing. Jessica Hollars is a Research Associate with the Institute for the Economy and the Future at Western Carolina University. Ms. Hollars joined the IEF in March of 2008. Currently, she is in the process of executing an economic impact analysis of the equine industry in North Carolina. Before joining the IEF, Ms. Hollars began working for the Department of Economics at WCU as an undergraduate research assistant. She gained valuable tools on how to manipulate data and analyze key variables. Ms. Hollars graduated cum laude from Western Carolina University in the fall of 2007. She holds a Bachelor’s Degree in Accounting and Corporate Finance and a minor in Economics.

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Acknowledgements 

The authors would like to acknowledge the following individuals and groups for their assistance with the Economic Impact Study of the Nantahala Outdoor Center: David Huskins, Managing Director of the Smoky Mountain Host, who provided overall project support and vision. Dan Ostergaard, Jeff Zelenka, and Ken Place for their work overseeing the overall project. Andy Ireland for his excellent analysis of the surveys. The Institute for the Economy and the Future for access to IMPLAN software and data. I especially acknowledge the assistance of Julia Blount. Her contribution can be seen throughout the manuscript.