Feeling the Effects of Nature Based-Tourism ... in Cash Registers

By Leah Thibault

There’s a popular anecdote repeated in rural Piscataquis County, Maine, where a general store owner has said, “I feel the AMC (Appalachian Mountain Club) in my cash register.”

This tangible economic impact around the region is the result of the creative, decade-long effort known as the Maine Woods Initiative, AMC’s strategy for land conservation in Maine’s 100-Mile Wilderness region that also folds in very real economic stability through job creation and traditional uses of Maine working forest.

Theirs is an innovative approach to conservation that combines outdoor recreation, resource protection, sustainable forestry and community partnerships. It seeks to address the ecological and economic needs of the Maine Woods region by supporting local forest products jobs and traditional recreation, creating new multi-day recreational experiences for visitors, and attracting new nature-based tourism. In “shallow economies,” where all of these needs are so closely interdependent, this forward-looking effort is paying off in a big way.

The AMC has been able to grow overnight lodge stays from 3,900 bed nights in 2009 to more than 7,300 by 2014, and those numbers continue to grow. Per a 2013 survey, 70 percent of visitors came from out of state. One in five stayed at other properties during their trip. One-quarter visited a historic or cultural site; 67 percent ate at a local restaurant; and 77 percent shopped at a local store.

In 2014, AMC’s operations employed 45 full- and part-time employees in a mix of year-round and seasonal positions -- amounting to 26 full-time equivalent (FTE) jobs in Piscataquis County. But the economic benefits don’t end there.

As that general store quote shows, the economic benefit extends beyond the direct employment at the AMC. It ripples through to a variety of enterprises, from the provisioners of the hikers, campers, skiers and other tourists that flock to the region that you’d expect, to the less obvious but equally important businesses that support investments in local infrastructure that keep the access open.

The impact moves down the supply chain as AMC purchases about $100,000 in food annually, approximately 60 percent of which is obtained from local purveyors and the remaining 40 percent from other Maine vendors. In 2012, they paid nearly $750,000 to loggers, truckers and others involved in traditional timber harvesting on its land. These local loggers and vendors with their families, then turn around and use the funds they’ve earned for goods and services in their community.

By demonstrating that conservation can also produce local economic benefit, the AMC was able to tap a federal financing tool to help acquire its founding parcels for this initiative, the New Markets Tax Credit. The federal New Markets program was designed to increase the flow of capital to businesses within economically distressed communities by providing a modest tax incentive to private investors.

The AMC is far from alone. Other enterprises are using the credit as a way to finance growth capital that’s creating jobs throughout their supply chains, like the packaging company with new contracts to support a global wound care product manufacturer and the truckers transporting Greek yogurt from a dairy in Vermont to public schools in Connecticut.

According to a study by the New Markets Tax Credit Coalition, between 2003 and 2012 the program created some 750,000 jobs – all of which was from capital invested in communities with high poverty and unemployment rates.

However, the New Markets Tax Credit program expired at the end of 2014. The good news is that it can still be extended. The New Markets Tax Credit Extension Act of 2015 (HR 855), introduced by Reps. Pat Tiberi (R-Ohio), Richard Neal (D-Mass.), and Tom Reed (R-N.Y.), would extend the program indefinitely. Sens. Roy Blunt (R-Mis.), Chuck Schumer (D-N.Y.), Steve Daines (R-Mont.), and Ben Cardin (D-Md.) introduced S. 591, which is nearly identical to its House counterpart.

By extending the New Markets Tax Credit program, Congress can continue to deliver a financing solution that supports more than any single project, but which radiates new opportunity throughout supply chains to ultimately revitalize and diversify struggling economies.

Image credit: Flickr/Trailsource.com

Leah B. Thibault is Director of Operations at CEI Capital Management LLC.