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Study determines economic impact, ripple effect of hunting on CRP-funded land

Date:
April 1, 2016
Source:
South Dakota State University
Summary:
An economic analysis of data gathered from survey respondents who bought South Dakota hunting licenses showed that more than $37.5 million was generated through those who hunted on land set aside through Conservation Reserve Program funding. The U.S. Department of Agriculture Farm Service Agency research shows the economic contribution, impacts and benefits from hunting that occurs on CRP lands and calculates the effect of a 50 percent reduction in CRP acres.
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A 50 percent loss in CRP-funded acres would result in more than a 60 percent reduction in revenue from upland game hunting alone in South Dakota.
Credit: Photo courtesy of Tom Koerner, U.S. Fish and Wildlife Service

Land set aside under through Conservation Reserve Program funding plays a key role in drawing out-of-state hunters to South Dakota. That's the take-home message from a U.S. Department of Agriculture Farm Service Agency hunter survey.

Surveys were sent to 2,863 hunters who bought upland game, waterfowl and deer licenses for the 2014 season to assess the economic contribution, impacts and benefits of hunting in South Dakota. More than 39 percent of deer hunters, 35 percent of upland game hunters and 33 percent of waterfowl hunters returned their surveys.

Nonresident hunters spent more than $122 million in the 2014 season with 89 percent of that coming from upland game or pheasant hunting. More than $37.5 million was generated through nonresidents who hunted on CRP land, with upland game hunting accounting for nearly 95 percent, or $35.45 million, of those monies, which researchers refer to as economic impact.

Economic impact looks at the money nonresident hunters spend on everything from gas to food and lodging as well as licenses and shells, explained South Dakota State University assistant economics professor Michael Miller, who helped analyze the South Dakota data. The influx of "new money" would not have occurred if those hunters had not come to the state.

"We wanted to find out how much upland game, waterfowl and deer hunting depended on CRP land for two reasons. First, there is concern that CRP land is not being re-enrolled. Second, the perception exists that putting land into CRP and, thus, taking it out of agricultural production adversely affects the local economy," said project manager John Loomis, a professor in Department of Agricultural and Resource Economics at Colorado State University. Data was also collected on North Dakota hunters through the $250,000 research project.

Calculating economic ripple effect

Resident and nonresident hunters reported slightly more than $282 million in direct expenditures. About 62 percent of those dollars -- $175.7 million -- came from upland game or pheasant hunting. In South Dakota, pheasant hunting is the most impactful, Miller said.

However, those direct expenditures don't paint a complete picture of how those dollars reverberate within the state's economy, Miller pointed out. To do that, the researchers analyzed the data using IMPLAN software, which considers indirect effects and induced effects.

Loomis describes it as throwing a rock into a pond, "there's always that ripple effect." The envelope of money that the hunter throws into the pond then ripples throughout other sectors of the economy.

The restaurants at which the hunters dine use those dollars to purchase supplies and to pay their employees. Those would be indirect effects, Miller explained. When those employees spend the money they earn for the things they need, those are induced effects.

"Eating at a restaurant, for instance, creates more ripples than buying sandwich meat and bread at a grocery store," Loomis explained. The model also accounts for whether a baker in South Dakota makes the bread.

The analysis showed that the economic contribution from nonresident upland game bird hunting alone brings more than $63 million in economic benefits, with $32.4 million in wages associated with approximately 1,300 jobs. When resident upland game hunters are included, those figures increase to $87 million in economic benefits, $49 million in wages and 1,938 jobs.

Estimating impact of CRP losses

About 56 percent of upland game bird hunters, 23 percent of deer hunters and 21 percent of waterfowl hunters surveyed hunted on CRP land. CRP, which began in 1985 and is administered by the Farm Service Agency, allows producers to remove marginal, environmentally sensitive land from production in return for a yearly payment. The goal is to return the land to perennial grassland to improve water quality, prevent erosion and provide wildlife habitat.

In 2014, more than 900,000 acres of land in South Dakota was enrolled in CRP. The 2015 farm bill set stricter guidelines for CRP and Conservation Reserve Enhancement Program and a program cap of 24 million acres nationwide by 2017. That cap is 1.4 million acres less than the acres enrolled in the nation's CRP last year, the lowest since 1988.

If the state had a 50 percent reduction in CRP acres, the survey showed that resident and nonresident upland game bird hunters would make 20 percent fewer hunting trips, The economic impacts from just the reduction in nonresident upland game bird hunters, results in a $12.6 million reduction in economic impacts from those nonresidents, a $6.5 million reduction in total wages and loss of 260 jobs in South Dakota.

"This research shows the beneficial effects on the local economy from hunting that occurs on CRP lands," Loomis said.

Miller hopes this information will be useful to legislators and policymakers. "We're a small state and this is a big impact."

See the report at: http://webdoc.agsci.colostate.edu/DARE/PubLinks/SDNDHUNT.pdf


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Materials provided by South Dakota State University. Note: Content may be edited for style and length.


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South Dakota State University. "Study determines economic impact, ripple effect of hunting on CRP-funded land." ScienceDaily. ScienceDaily, 1 April 2016. <www.sciencedaily.com/releases/2016/04/160401131102.htm>.
South Dakota State University. (2016, April 1). Study determines economic impact, ripple effect of hunting on CRP-funded land. ScienceDaily. Retrieved May 8, 2017 from www.sciencedaily.com/releases/2016/04/160401131102.htm
South Dakota State University. "Study determines economic impact, ripple effect of hunting on CRP-funded land." ScienceDaily. www.sciencedaily.com/releases/2016/04/160401131102.htm (accessed May 8, 2017).