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Study puffs up economic impact of Pima County Fair

Several University of Arizona experts are questioning claims that the Pima County Fair boosted the local economy by almost $35 million. They say it was probably less.

The Southwestern Fair Commission, a nonprofit organization that operates the 105-year-old fair, issued a press release last week that claimed a study by a Tucson company, FMR Associates, showed that the 11-day fair held in April pumped $34.7 million into the local economy.

It is apparently the first study in at least 15 years showing how much money the fair contributes.

However, an executive summary of the study, provided to TucsonSentinel.com by a source before the group put out the press release, said $14.9 million of that came from local residents and that about $20 million came from out-of-county residents, vendors and other fair participants. But it is unclear how the $20 million was calculated. Vendors from out of town are unlikely to repeatedly lose money as they ply their trades at the fair.

Last week's press release said nothing about how much of the $34.7 million was local spending or spending by visitors from out of town.

Alan Hoogasian, a research economist at the University of Arizona's Eller College of Management, said he has done a similar studies and never includes spending by local residents because that doesn't represent a local impact. That is just money that residents are spending on the fair that they otherwise would have spent on other local events or businesses.

"For local impact,  we would only include money that is spent (by people) from the outside," he said. 

Alberta Charney, an Eller senior research economist, agreed and said "If somebody spends $45 there, then they don't spend it somewhere else. They would have gone to a movie or something or done something else to spend that $48.95 (a figure mentioned in the executive summary). So that probably should not be calculated."

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Tom Moulton, director of the county’s Office of Attractions and Tourism, said the most important finding of the survey is that $20 million of the fair's impact was “new money "brought in by visitors and vendors from outside the county and state.

“Clearly $20 million for 10 days is a pretty significant number. We have three-day festivals that only bring in one or two million dollars,” he said.

But after looking at the executive summary, Hoogasian and Charney said that while the fair undoubtedly brings in new money, they couldn't figure out how that $20 million was calculated. 

"I have no clue. It looks to me like they are trying hard very hard not to tell you," Charney said.

Andy Wellik, research manager for FMR Associates Inc.,  said he couldn't elaborate and referred questions to the Southwestern Fair Commission, the group that operates the 105-year-old fair under contract with the county. And officials with the Fair Commission didn't respond to repeated requests for comment, but instead then put out the release touting their figures — giving even fewer details than in the summary document.

 Moulton said this is first time in a long time that the economic impact of the 11-day fair has even been calculated.  

“They have done some informal research. I have been involved with them since 2001 and this is the first economic impact report that I have seen from the Southwestern Fair Commission,” he said.

More studies will be done to look at the impact of other events held at the fairgrounds near Houghton Road and Interstate 10.

Measuring economic impact can be very complicated, is often overdone and often doesn't begin to measure the real value of an event, Charney said. The most complicated study she has done looked at the impacts of Mexican visitors and took up to three years and  involved about 3,000 interviews.

"The words 'economic impact' is used so often. I mean, come on, the county fair," she said. "I took my kids there every year. We had a wonderful time. It's a valuable fun thing for the community. Why in the world does it have to justify itself with economic impact. That's my complaint, that they feel the need to ... Just say, 'did you have fun? Did you get to pet any cool animals? Did you get to see any animals you don't get to see on a regular basis? Did you eat until you were sick?' I mean, those are my memories of the county fair."

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How numbers were calculated

FMR Associates came up with the numbers by interviewing 709 people who attended the April 14-24 fair as well as vendors and participants. Hoogasian said that is the standard way to measure economic impact.

The executive summary said fair attendance came primarily from Tucson area visitors and that they accounted for an estimated $21.6 million impact. About 53 percent of the vendors and other participants came from out of town and their impact was estimated at $9.9 million. The fair commission itself spent another $3 million for salaries, promotions and other operating expenses.

So it is not clear how the $20 million in out-of-town impact was computed. Sometimes economic studies include multipliers that attempt to  measure broader economic impacts. Vendors, for example, might have bought  food from local suppliers and those suppliers would buy from other suppliers and so on.  

The press release said that "Fair impact goes beyond the 11 days of the fair, as many fair vendors arrived to Tucson in March and don't depart until May."

Guests were asked how much they spent on parking, admission, carnival rides, food, retail purchases and concerts. The typical attendee spent almost $49 on all that.

The average group included 3.5 people who visited for 1.6 days. Sixty percent had attended the fair for at least five years.

Most vendors (53 percent) traveled from out of town and stayed an average 13.8 days, traveling in groups that averaged 4.8 people. 

Vendors and participants spent an average of $3,005 on locally purchased items such as equipment rentals, food, carnival supplies and animal care. Ninety percent of them plan to return for the 2017 fair.

The study was commissioned because the fair commission may be seeking partners, including private companies, or selling bonds to help finance improvements and needs to show how much they might get for their investments, according to Moulton.

The Pima County Board of Supervisors in early August approved a plan to renovate Old Pueblo Hall and Pima RV Park at the fairgrounds for $960,000. Even though the commission pays for its own renovations, it still needed approval from the board because the work exceeded $100,000 and the fairgrounds are on county land, Moulton said.

Moulton said no public funds are being used to finance the studies or improvements. The commission pays for that out of its profits.

The 2017 fair will be held April 20-30 at the fairgrounds near Interstate 10 and Houghton Road.

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