Introduction

The present report has two purposes. The first is to update the data and conclusions contained in the 1996 report entitled The Economic Impact of Steelhead Fishing and the Return of Salmon Fishing in Idaho. Since completion of the 1996 study, data obtained from a 1997 economic survey on chinook fishing have added substantially to an understanding of local fishing conditions. The second purpose of this report is to respond to criticisms of the earlier study and of the conclusions we drew from it. This study confirms – using actual data – the results of the first study showing significant economic benefit for a recovered recreational salmon fishery in Idaho. The results of this study show a restored salmon fishery when combine with steelhead recreational fishing would support $170 million in economic expenditures and support 5,000 jobs in the state.

Objectives. The September 1996 study had two objectives: (1) to determine the continuing economic impact on Idaho’s economy of recreational steelhead fishing (assuming steelhead fishing can be maintained at the level found for the 1992/1993 season); and (2) to extrapolate from the steelhead data estimates of the contribution to Idaho’s economy of restored recreational salmon fishing and of the combined impact of steelhead and salmon fishing. The study was subsequently reviewed by Dr. Anthony Scott, University of British Columbia, for the Independent Economic Analysis Board (IEAB).

Focus on River Communities. Although the study took in the entire state, its focus was on Idaho’s river communities and the economic stimulus they would experience from the restoration of recreational salmon fishing. Accordingly, it could be objected (and has been) that the economic impact of such a circumscribed event cannot automatically be equated with a net benefit, when you put it in the context of a statewide or region wide cost/benefit analysis. In other words, from a broader perspective than river communities, the net benefit from salmon restoration could well be minimal or even nonexistent. According to an article by Hamilton, Whittlesey, Robison, and Ellis,

From a Northwest or even broader region perspective, economic impacts determined in this study may not net large benefits after adjustments are made for labor mobility and for alternative uses of productive factors, including land, labor, and capital. In other words, a job gained in the salmon fishing-related industry in Riggins may be offset by a job in Seattle or Portland. However this "zero-sum" result assumes full employment and complete labor mobility. Neither applies to the river communities studied, which are more akin to the communities described by Hughes and Holland:

Many river communities in Idaho fit this description. It is thus our contention that a significant portion of the gains in income and employment from reestablishing salmon runs would not be offset by opportunity costs, but could be considered real benefits to the subject communities. The thrust of this analysis is on the river communities first and the state of Idaho second. Restoration of full salmon runs would bring to those communities income and jobs that are just as important and beneficial to them as are any other dollars or any other kind of employment.

1996 Study Procedures. In the 1996 study, the economic impact of steelhead fishing was determined for 12 individual communities in Central Idaho and for the state as a whole. In the absence of reliable salmon fishing expenditure data for specific river sections, an estimate of the economic impact of restored salmon fishing was derived for all river communities combined, as well as for the state as a whole.

To find the steelhead fishing impacts, two sets of community level input-output models were used that were developed by M. Henry Robison, Charles McKetta, and Steven Peterson of the University of Idaho. The first set of models included eight communities in the North-central Region; the second set included four communities in the Upper Salmon Region.

The principal data source for the models was a survey administered by the Idaho Department of Fish and Game (IDFG) that asked economic questions regarding the 1992/1993 Idaho steelhead season. These survey data were supplemented from two other sources: (1) the National Survey of Fishing, Hunting, and Wildlife-Associated Recreation, and (2) a forest survey of the Payette National Forest.

When processed, the IDFG’s survey allowed the calculation of steelhead-fishing-related expenditures over 20 different river reaches and allocation of spending to the affected communities near a particular river section. However, this survey lacked questions on expenditures for durable equipment such as boats and travel trailers; therefore, estimates were made using the national survey data, given the angler activity along each river section as revealed by the Idaho survey.

After calculating expenditures for each river section, assessed spending patterns were assessed in local communities in order to incorporate them into the input-output models and determine the economic impact of steelhead fishing on each community. As expected, not all fishing-related spending occurs in the river communities. Much of it, especially on boats and travel trailers, occurs in larger cities and the anglers’ home towns. The forest survey aided us in estimating the proportion of such expenditures in the river communities.

Steelhead Results. The September 1996 study of Idaho’s 1992/1993 recreational steelhead fishing season, in which nearly 44,000 steelhead were harvested, found an economic impact of $90 million in expenditures and supported nearly 2,700 jobs -- the latter consisting of 1,000+ jobs directly and another 1,600+ indirect jobs (see Table 1 below). For some of the state’s smallest communities, the economic importance of steelhead fishing had been approaching that of traditional resource-based industries. For example, in Riggins, steelhead fishing expenditures directly supported 25 jobs and indirectly supported 19 jobs, a total of 44, which is about 7.7% of local employment (see Table 4 of that study).

Salmon Extrapolation. Idaho has not had a general salmon fishing season since the 1970s. Therefore, in the 1996 study the estimate of a chinook fishery’s economic contribution to Idaho was based on the steelhead expenditure data and on the salmon angling levels in the 1960s. Based on the limited data available at the time, restored salmon fishing was estimated to produce over $62 million in economic activity, with approximately 1,000 jobs supported directly and another 800 supported indirectly (see Table 1 below). The results of this study indicate, the original estimate of economic impact was conservative.

The 1997 Chinook Season. In the limited 1997 season, chinook fishing was opened along the North Fork and Main Clearwater, South Fork Clearwater, Little Salmon, South Fork Salmon, Lochsa, and Boise/Payette River sections. Although neither a full nor a general chinook fishing season, the 1997 season enabled us to acquire recent and more reliable expenditure data on chinook salmon anglers and to test assumptions in the original 1996 study.

Overall, the sample of 637 anglers spent an average of 1.76 days on a trip on which they spent an average of $189 per day, $78 of which was expended during the trip (see Attachment 3). In the 1996 study that based salmon fishing expenditures on the steelhead data, the average daily cost was $169, of which $46 was spent locally. Because per day expenditures were found to be higher for salmon anglers than those assumed in the original the economic impacts are also greater. This is especially true for river communities were survey respondents indicate they spend 70% more per day than was assumed in the 1996 analysis. The 1997 survey data thus reveal increases over the comparable figures of the earlier study, especially for the local communities.

The 1997 Survey Procedure. Exactly 20,132 salmon permits were issued in 1997, of which approximately 15,000 were to sports pack holders. From this list, the IDFG selected 4,000 salmon permit holders – weighted for salmon-only permit holders – and mailed each a survey form. IDFG provided a database of coded questions contains 2,234 records, of which 218 are designated "not returned"; hence, 2,016 survey recipients provide usable data for this study.

The first of the survey’s fifty-four questions asks whether the survey recipient ever fished for chinook salmon in 1997. Of the 2,016 answers, 817 were affirmative. Of these 817 anglers, 680 fished in one of the four main river sections of interest in this study. The expenditure patterns of this sample of 680 anglers provide a basis for determining the economic impact on Idaho’s economy of restored recreational salmon fishing.

These 680 anglers’ responses were analyzed to obtain average daily expenditures for various costs incurred on a chinook fishing trip. The survey’s 54 questions included separate inquiries concerning the angler’s first chinook fishing trip of 1997 and the angler’s last trip–the latter set to be answered only by anglers who fished for Chinook more than once. These trip-related questions asked for the following information:

• the river section fished;
• the number of days spent fishing;
• the amount of money spent on the following:
• groceries (before and during the trip)
• restaurant meals
• transportation
• lodging
• fishing supplies (before and during the trip)
• guides
• other equipment and supplies (before and during the trip).

Survey Responses. The makeup of responses among the four main river sections and the average costs per day for first and last trips are shown in Attachment 1. The data reveal some dramatic differences between first trip and last trip expenditures. For example, lodging costs averaged $36.71 for the first trip but only $11.15 for the last trip, and grocery costs averaged $26.75 for the first trip but just $9.38 for the last trip. In fact, total average costs for the first trip were more than double those of the last trip – $276.23 for the first trip versus $129.58 for the last trip. Yet these great differences in reported trip expenditures cannot be adequately explained by differences in the length of first and last fishing trips: first trips averaged 1.9 days, last trips 1.5 days.

The first trip/last trip expenditure disparity is doubtlessly a reflection of the restrictions placed on the short 1997 chinook season. First, anglers were unable to plan well in advance. There were only 9 days between the announcement of the season on the Little Salmon and the Clearwater and the opening on May 17^th (the Lochsa, Boise, and Payette were announced and opened in July). This opened a very narrow planning window for prospective anglers, especially for out-of-staters. Second, when announced, the season had no closing date -- it was to last until a predetermined number of chinook had been caught. The Clearwater was originally closed on June 15^th but then reopened again for 11 days in July. Each opened river section had not only its unique opening and closing dates but also its unique restrictions on open days of the week and open river reaches. This tangle of uncertainties undoubtedly limited planning for many anglers and reduced second (or last) trip opportunities to essentially spur-of-the-moment decision-making.

Third, expenditures for fishing equipment and supplies will generally be higher on an angler’s first trip of the season than on subsequent trips, when some purchases made during the first trip are reused. Therefore, expenditure analysis usually entails some type of averaging of first and last trip expenditures. Because we are studying the impact of a restored salmon fishery, and because the economic data reflect such a short and uncertain season, it could be argued that first trip expenditures would be more representative for a fully restored season. In fact respondents indicated their equipment expenditures would be higher if there was fully restored season. In response to the question, "If salmon fisheries were permanently restored in Idaho, would you be more likely to spend additional money on equipment, such as boats and trailers?" 76.4% of the anglers responded yes.

Accordingly, our analytical approach uses a combination of first and last trip expenditures. For fishing equipment and supplies, we calculated an average of first and last trip expenditures Even though salmon angling equipment and supplies purchases reported would be lower for the short and uncertain 1997 chinook season than for a fully restored season, we wanted to recognize decreased spending for equipment for multiple fishing trips. For other categories of expenditures, we considered first trip expenditures to be more representative of a fully restored season, one with ample time for planning multiple trips, and with definite opening and closing dates; we therefore discarded the last trip data for these categories. Accordingly, per-day expenditures for the analysis were found by dividing the combination of first and last trip equipment costs and first trip other costs by the average length of a trip.

The 1997 chinook survey also breaks down the various costs that anglers incurred before and during their first fishing trip of the season. The 1996 steelhead study allocated various fishing-related expenditures to local and nonlocal communities based on a forest survey of the Payette National Forest that was modified to fit the fishery study. Table 2 below displays a comparison of the local and nonlocal expenditure allocations from the 1996 study and the allocations evidenced by the 1997 chinook survey data.

The new survey confirms the previous allocations for fishing supplies. In the original study, 25% of fishing supply expenditures were assumed to be local, and 75% were assumed to occur elsewhere in Idaho. However, the new survey shows that some other 1996 allocations understated local economic impact. For example, the original study assumed a 15% to 85% ratio of local to nonlocal spending on durable equipment such as boats and travel trailers., but the 1997 survey indicates that local spending in this category is greater than 29% -- nearly double the 1996 allocation. Similar results were found for the spending mix for food. The 1996 study assumed a 25% local to 75% nonlocal split; the 1997 survey found a 41.7% local to 58.3% nonlocal mix Overall, results from the 1997 survey indicate that the 1996 assumptions concerning local/nonlocal spending patterns were overly conservative. Hence, benefits to local communities will be greater (see next section) than those found in the original study.

This verification and refinement of the 1996 estimates is important because those estimates were subject to considerable second-guessing. According to the IEAB,

The reviewer’s doubts are understandable. Judgments of economic impacts increase in reliability with their geographic scale, because the broader the area measured, the less significant the economic leakages to nearby areas. When estimating the economic impact from recreational fishing in a limited area, there is no way to obtain high reliability without an extended and expensive analysis of the economy of each river community. However, as explained in the September 1996 study, we took care to match the fishing days on each river reach to the nearest riverside communities. Table 2 of that study shows that while some river reaches were assigned to a single community, most were allocated among the closest two or three. Of course, it is quite likely that some angler expenditures occurred on the way to and from different river reaches -- to what extent and magnitude only an extended analysis could reveal.

We also severely limited the percentage of total direct angler expenditures assigned as local spending in river communities (see Table 3 of the 1996 chinook study), and the results of the 1997 chinook survey bear us out on that. Given this confirmation, the allocation to communities closest to the river reach fished should serve as a reasonable approximation of direct spending for a given community. While the fit is not perfect, we believe the careful approach taken offers the best available estimate of economic impact from angling activity to river communities.

The abbreviated 1997 chinook fishing season alone produced roughly $5.7 million in direct expenditures and a total impact of $14.5 million -- that is 20% of a full season’s estimated impact of $72 million. Of that $14.5 million, $4.7 million impacted the local riverside communities presented in this study, and $9.9 million impacted the rest of Idaho (see Table 3 below). Other long-run trends in anglers’ fishing activities, as discussed later in this report, could further increase the impact.

Because the 1997 season was a short and uncertain, the 1997 angling level cannot be considered indicative of the potential economic impact of a fully restored salmon fishery. As explained in the 1996 report, it is reasonable to expect that a restored salmon fishery will, in the long run, reach the angling levels typical of the 1950s and 1960s, when Idaho had full salmon fishing seasons. The IDFG reports an annual average harvest of 23,000 chinook annually in that era, and Gordon reports an average of 6.5 days spent fishing per catch, totaling 149,500 fishing days in a full season. If an average of $189 is spent per angler per day over 149,500 fishing days, restored recreational salmon fishing would produce a total of $72 million in economic activity and would support more than 2,100 jobs (see Table 4 below). This dollar impact is 15.7% higher than the $62.4 million impact produced in the original 1996 chinook study that applied a $169-per-person-day expenditure from the 1992/1993 steelhead survey data.

One comment on the 1996 study noted that restoring salmon and steelhead to the levels in the

1960s is less than full restoration of accessible habitat in Idaho. If full restoration were achieved, the economic impacts would be greater than the $90 million for steelhead fishing or the $83 million for salmon fishing as identified in this study. While the topic of economic impacts of salmon and steelhead fishing under a full restoration scenario is outside the scope of this study, it is an issue worthy of future investigation because actions taken to restore salmon runs would likewise have a positive impact on steelhead runs. At a minimum, it would render the existing $90 million estimate of steelhead fishing as low compared to restored levels.

As mentioned earlier, $78 per chinook fishing day can logically be associated with local riverside communities. As Table 4 below shows, applying this $78 to the full angling levels of the 1960s projects an economic impact on local communities of $23 million, compared to $6.2 million in the original study. The results further show an economic impact of $72 million on the rest of Idaho, compared to $56.2 million in the original study.

In both studies, the focus was on those local communities in economic stress. Expenditures in the rural communities increase considerably between the two studies, by nearly 274% from the original study, while those in the entire state of Idaho decrease only 12%. Part of this change was anticipated from the local and nonlocal spending pattern found by the recent chinook survey. The original study assumption for grocery spending in local communities was 25%, and the survey indicates 42%. These results are suggestive of the importance of these communities’ economic revival, to which a restored salmon fishery can meaningfully contribute. Of that contribution, nearly 680 jobs could be supported by this industry, and, as explained at the outset of this analysis, these jobs may be considered a benefit to the river communities.

The 1996 study was criticized for assuming that boats and major equipment expenditures are totally associated with anglers’ Idaho fishing activities. It is true that people make such expenditures in order to go camping, hunting, and boating, and/or to fish out of state. We tried to correct this in the 1997 chinook survey. Question 10 asked, "If salmon fisheries were permanently restored in Idaho, would you be less likely to go out-of-state to fish for salmon?" Of the 808 responses to this question, 702 (87%) were affirmative. Question 11asked, "If salmon fisheries were permanently restored in Idaho, would you be more likely to spend additional money on equipment, such as boats and trailers?" To this question, 620 (76%) of the 811 responses are affirmative. It is therefore fair to infer that a restored recreational salmon fishery would result in substantially increased boat and major equipment expenditures.

The survey analysis shows that anglers spent an average of $23 per day on major equipment for salmon fishing in 1997. Assuming full season angling levels equal to those of the 1960s, this $23 translates into total direct expenditures of $3.5 million ($23.31 * 149,500). We consider this figure to be highly conservative, because the figure of $23 per day correlates with an atypically low level of boat usage. Responses to question 19 indicate that 84% of anglers went bank angling during their first 1997 fishing trip (see Table 5 below). This is unsurprising, because the salmon available for harvest were primarily in smaller streams where bank angling is the only available method. However, fully restored salmon populations should enhance opportunities for boat angling in larger rivers, and the per-day expenditures in getting to those salmon should be above $23. As described above the 1997 salmon fishing season was short, limited, and uncertain, with 76% of anglers declaring plans to up their spending on major equipment in the event of permanently restored Idaho salmon fisheries. It is therefore reasonable to assume that total spending on equipment will increase above this $3.5 million level should a fully restored salmon fishery, with full seasons, is settled into the economy.

According to the IEAB’s review of the original study, "To the extent [the anglers] were from Idaho, the study’s estimate of the total dollar or job impact could be a serious exaggeration. To see why, imagine that the steelhead fishery was closed." According to the IEAB, this conclusion holds water only if, (1) spending and re-spending from anglers benefits former loggers and farmers, and (2) if the anglers are from out of state. The latter claim has been dealt with in the previous section of this study. The former claim does not accurately represent the 1996 study.

The economies of small Northwest communities are in transition. In order to remain viable, many of these small communities need to find replacement economic activities. Steelhead and salmon fishing can be one of those activities. Should the fisheries be lost, then one important economic option for these communities will be lost. What the 1996 study report asserts is that a job supported by angler spending is just as real as a job in any other sector. While some former loggers and farmers may take jobs supported by fishing activities, the 1996 study report made no claim, and had no intent to imply, that former loggers and farmers would be shifting to support steelhead and salmon fishing activities.

In its review, the IEAB comments, "Nothing is said about the changes in the downstream fishery, hatcheries, dams, habitat or flows that would give the greatest restored-salmon fishery economic impact, or even whether these would be compatible with a continued steelhead fishery." The answers to these implicit questions lie within the first few sentences of this same review: "The [Idaho Fish & Wildlife] Association is chiefly interested in showing that the fishery is economically worth maintaining at its present level." This study has a different goal: to provide policymakers with an estimate of the economic worth of fully restored recreational salmon fishing. This estimate should be put together with information from various other resources in determining what to do about restoring and protecting a salmon fishery. As demonstrated, anglers and salmon would generate over $72 million in spending and re-spending and support 2,100 jobs in Idaho; $23 million of that total would impact the riverside communities in Central Idaho.

The IEAB in Section 3.3.2 (c) of its report states as follows,

As explained above, the 1997 chinook survey, while not dealing with out-of-state anglers, did shed light on the number of Idaho residents who fished in other states and the millions of dollars Idaho lost to out-of-state expenditures related to salmon fishing – a clear indication that the negative impact in the state is more than trivial. However, the primary focus of the 1996 steelhead study was to investigate angler impact on river communities. As we said there:

The analysis underlying this report has exposed the economic importance of a steelhead fishery and a fully restored salmon fishery, especially for Idaho’s riverside communities. The potential benefits to these economically unsettled communities include an estimated $23 million dollar impact from anglers’ recreational salmon fishing and an estimated $9 million dollar impact from steelhead fishing. Although the salmon impact is contingent on a return of the runs to their historic levels (a multifaceted problem), these industry impacts are generally conservative, given the various qualifying factors presented throughout this study.

• Survey participants plan to increase spending on boats and travel trailers if they can count on the recreational salmon industry being fully restored;
• The turnout of out-of-state anglers during Idaho’s 1997 season was held down by the last minute announcement and the brevity of the season.
• We can assume that a goodly portion of Alaska’s quarter- million out-of-state sport fishermen would be attracted to Idaho’s new fishery, and Idaho’s new money would increase in the long run.
• A healthy steelhead fishery and the return of bountiful salmon fishing would make Idaho a better place to live, encouraging new residents to move here.

In the meantime, even though the survey data do not distinguish resident from nonresident expenditures, we have determined that without a fully restored salmon fishery Idaho loses a significant amount of expenditures to other states – between $5 million and $8 million.

These long-run trends in salmon anglers’ fishing activities can not be holistically interpreted from the short 1997 chinook season, but they surely provide some food for thought on the fishery’s future impact on Idaho beyond that assessed in this study. Most importantly, this and the original study uncover the hearty economic prospects, from both sustained steelhead fishing and restored salmon fishing, for Idaho’s river communities from Riggins to Salmon.