Tourism decline from floods may affect state

Estes Park, one of Colorado’s most popular destinations, may see a significant decline in tourism due to flood-damaged roads, ultimately impacting Colorado’s economy.

A drop in tourist visits to Estes Park as a result of flood-damaged roads could have a ripple effect through the rest of Colorado’s economy, according to preliminary analysis conducted by the Regional Economics Institute at Colorado State University.

With major roads leading into Estes Park damaged or destroyed, it is clear there will be a drop in tourist activity, according to the report. The true extent will depend on how quickly the state’s highway infrastructure in the northern foothills can be repaired. The report examined a variety of scenarios, including the possibility that tourist visits to the western gateway to Rocky Mountain National Park could drop between 30 and 100 percent.

If tourism activity in Estes Park were to decline 70 percent, it could translate into a loss of 1,111 jobs, a $90 million decrease in state economic activity, and a $46.1 million drop in real household income. In addition, state tax revenue could dip by $5.8 million and local tax revenue by $4.4 million.

Visits create traffic for other areasMartin Shields, Economics Department

“We know that tourism is a major driver of Colorado’s economy and the damaging floods will certainly have an impact on access to Estes Park, one of Northern Colorado’s strongest tourist draws, though only time will tell how significant that impact will be,” said Martin Shields, director of the Regional Economics Institute at CSU. “Our preliminary research, however, indicates that any reduction in tourist visits to Estes Park will have an impact on the state’s broader economy and it could be significant. We’ve provided some very rough numbers in our report, and more study would  be warranted to understand the complete picture.”

Shields, co-author of the report with professor of economics Harvey Cutler, believes that if reduced accessibility to Estes Park persists into 2014, many potential visitors will reconsider their vacation plans. This reduces not only visitation to Estes Park and Rocky Mountain National Park, but complementary destinations in Colorado as well, from Fort Collins to Colorado Springs along the Front Range and from Steamboat Springs to Aspen in the mountain areas.

Estes Park saw an estimated $187 million in tourism expenditures in 2011, with approximately 56 percent of visitors from out of state. The report also projects the impact of 100-percent and 30-percent losses of tourism activity in Estes Park and demonstrates the economic urgency of repairing tourism-critical roadways.

If there is a 100 percent loss in out-of-state sourced tourism expenditures, an estimated 1,588 jobs could be lost, state economic activity could fall by $129.1 million and real household income drop by $66.1 million. State tax revenue and local tax revenue could drop by $8.3 million and $6.3 million, respectively.

A tourism reduction of as little as 30 percent in Estes Park could amount to a decline in state economic activity of $27.2 million, a loss of 335 jobs, and a $13.9 million decrease in real household income. State tax revenue could fall by $1.8 million and local tax revenue by $1.3 million.

“If, over the next few months, vacation planners expect Rocky Mountain National Park to be inaccessible next summer, then they will choose an alternative destination, such as Grand Tetons, Yellowstone or Glacier National Parks,” Shields said. “Of course Estes Park will be adversely impacted, but so, too, will be the side trip communities and the entire state of Colorado.”


October 3, 2013         –        TODAY@ColoradoState       –       Tiana Nelson