Snowmobiles Have Big Impact On Economy

News By David Erickson, Ravalli Republic
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A recent report by the Bureau of Business and Economic Research at the University of Montana indicates that about 8 percent of the state’s households include snowmobile recreationists. With an average household size of about 2.5, perhaps as many as 100,000 Montanans participate in the sport each winter. Nonresident snowmobilers are also important contributors to the Montana economy, as they spend about $147 per activity day, which accounts for nearly $14.3 million per year in Montana. That spending supports about 200 winter jobs in the state.

The study, called “Montana Recreational Snowmobiles Fuel-Use and Spending Patterns 2013,” was prepared by BBER senior economist Jim Sylvester.

"Resident and nonresident snowmobilers buy about 4.3 million gallons of gasoline per season,” he wrote. “With a base tax of $0.27 per gallon, we estimate that snowmobilers in Montana generate more than $1.2 million in revenue for the state highway trust fund.”

Sylvester said that according to surveys that were sent out, access to snowmobiling areas is a concern of Montana snowmobilers, but they are also concerned about a lack of personal responsibility affecting access to some areas.

“In short, snowmobiling is a popular, revenue-generating winter recreation for Montana,” Sylvester wrote. “It is popular with a solid share of households in the state and popular with nonresident tourists.”

Sylvester’s study was sponsored by Montana State Parks, which administers the Snowmobile Trails Program. That program is funded by fuel taxes and vehicle decal fees related to snowmobile use. The primary purpose of Sylvester’s research was to estimate the amount of gasoline used by snowmobiles.

All snowmobile users in the state who use their machines on public lands are required to register with the state, which keeps track of the data. The number of registered snowmobile users in Montana has increased every year since 1991. As of 2013, Montanans owned 56,844 registered snowmobiles, an 81 percent increase since 2006. Between 3,000-5,000 snowmobiles are registered every year.

In 2006, the BBER conducted surveys of nonresident snowmobile users and found they travel about 85 miles per activity day, much more than residents because they tended to be in Montana for one purpose and wanted their money’s worth. Residents travel about 36 miles per activity day and spend about $24 on fuel. The average length of a nonresident snowmobile vacation is six days.

Snowmobile ownership is concentrated in southwestern Montana, with the highest concentration found in Meagher and Granite counties with 0.302 and 0.226 snowmobiles per person, respectively.

According to the BBER’s calculations, about 100,000 individuals snowmobiled an average of 12 days during the 2013-14 season, resulting in about 1.2 million activity days, up from 1 million activity days during the 2005-06 season.

Sylvester said that a National Park Service plan to limit snowmobiles to 720 commercially-guided trips per day in Yellowstone National Park caused a precipitous decline in snowmobile visitation from 2004-2007.

The impact of nonresident snowmobile-related spending can also be understood in terms of jobs and income, Sylvester said. Approximately 25 percent of the nonresident spending becomes direct labor income for people who work in lodging places, restaurants, taverns and other businesses that serve tourists. The remaining percentage is spent on items that must be imported into Montana for sale such as groceries and clothing.

“Overall, we estimate that nonresident snowmobilers generate more than $3.6 million per year in labor income for Montanans,” Sylvester wrote.

Reporter David Erickson can be reached at david.erickson@ravallirepublic.com.

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