HomeMy WebLinkAboutEconomic Impacts of the PT Land Development Bozeman MT 05262016
Economic Impacts of the
PT Land Development
Bozeman Montana
For:
Conducted By:
May 2016
Economic Impacts of the PT Land Development, Bozeman Montana 2
Contents
Page
Economic Impact Highlights 3
Approach & Methodology 4
Key Terms & Assumptions 4
Impact Summary Findings 5
Construction Impacts 7
Operations Impacts 9
Firm Description 11
Economic Impacts of the PT Land Development, Bozeman Montana 3
PT Land Development
Economic Impact Highlights
Summary
• The economic activity generated by the PT Land Development will support from 290 to
1,477 jobs in the Bozeman economy each year.
• In dollar terms, the PT Land Development will add from $13.4 million to $50.2 million in
income to the local economy each year.
• Total economic output generated by the PT Land Development, will range from $38.5
million to $127.4 million each year.
• Tax revenues will total from $4 million to $15.7 million annually.
Construction
• Construction activity will support from 139 to 290 jobs each year, generate between
$6.4 and $13.4 million in income, raise economic output $18.5 to $38.4 million and
generate annual tax revenues of $1.9 to $4 million.
Operations
• Early operations will support 544 jobs annually in the Bozeman economy, generate
$17.6 million in income dollars each year and raise total annual economic output by
$47.3 million. Total tax revenues will increase by $6.3 million annually; $2.4 million state
& local and $3.9 million Federal.
• On-going operations will annually support 1,337 jobs in the Bozeman economy,
generate $43.8 million in income dollars each year and raise total annual economic
output by $108.9 million. On-going operations will generate tax revenues of $13.7
million annually; $4.4 million state & local and $9.3 million Federal.
Economic Impacts of the PT Land Development, Bozeman Montana 4
Approach & Methodology
This analysis focuses on the likely economic impacts to occur in the Bozeman MT economy as a
result of the construction and operation of the PT Land Development. The analysis examines the
two developmental phases and post construction on-going operations.
The study conservatively examines the impacts that are realistic under the current economic
environment in Bozeman MT economy. The economic modeling and subsequent industry and
household linkages are established from the structure of the area’s existing economy.
To measure economic impacts as they flow through the local economy, the IMPLAN® system was
employed. IMPLAN® is an input-output model that is comprised of software and regional data sets.
The overriding objective of the model is to measure the full economic impact to a location as a
result of a specific economic activity. The model is built upon a matrix detailing the input-output
relationships among industries and consumers and tracks new spending though the local economy.
The primary matrix structure is derived from the National Bureau of Economic Analysis’s National
Benchmark Input-Output Model.
Impacts (defined below) help describe how the additional activity generated by the PT Land
Development will move its way through the Bozeman economy. Key Terms & Assumptions
Term Definition
Direct impact The impact caused by the initial change or new purchases.
Indirect impact
The cycle of local business-to-business spending as it works its way backward through the
local supply chain due to the direct impact, plus forward spending by local households of
the income earned from the initial activity.
Total impact Sum of direct and indirect impacts.
Employment The annual average of monthly jobs in that industry.
Income All forms of employment income, including wages, benefits and proprietor Income.
Output The gross value of industry production (total sales or gross margins).
Hotel Activity 200 rooms, ADR of $150 at 75 percent occupancy. Estimated visitor spending derived from
Institute for Tourism and Recreation Research, University of Montana - Missoula 1
Retail & Office
Activity
Activity proportioned across retail categories (restaurants, clothing & clothing accessories,
sporting goods and health/personal care) and office categories (legal, accounting,
marketing, office administration, business support, architectural, consulting and financial
activities). Estimated sales based on Triple Net Lease comprising 12 percent of total sales.
Local Economy Gallatin County, Montana2
1 Grau, Kara, "2015 Nonresident Visitation, Expenditures & Economic Impact Estimates." (2016). Institute for
Tourism and Recreation Research. http://scholarworks.umt.edu/itrr_pubs/333 2 Modeling utilized most current, 2014, economic structure of Gallatin County MT, IMPLAN Group, LLC,
Huntersville, NC
Economic Impacts of the PT Land Development, Bozeman Montana 5
PT Land Development
Impact Summary Findings
The planned PT Land Development in Bozeman Montana will impact the local economy over two
development phases and via continued on-going operations when built-out. Phase 1 (Years 1 and 2)
includes initial design, infrastructure and construction activity in both years; with hotel operations and
63,500 gross square feet (GSF) of retail and office activity in Year 2. Phase 2 (years 3, 4 and 5) includes
continuing construction activity, on-going hotel, retail and office activity from Year 2, plus 223,000 GSF
of additional retail and office activity (presented fully in Year 5). On-going operations include total hotel,
retail and office economic activities.
Annually, economic activity generated by the PT Land Development will support from 290 to 1,477 jobs
in the Bozeman economy (Figure 1 and Table 1). Post-construction on-going operations will support
1,337 jobs each year. In dollar terms, the PT Land Development will add from $13.5 million to $50.2
million in income to the local economy each year. Post-construction on-going operations will add $43.8
million in labor income annually. Total economic output, or the gross value of industry production
generated by the PT Land Development, will range from $38.4 million to $127.4 million each year. Post-
construction on-going operations will generate $108.9 million in additional economic output annually.
Tax revenues will rise from $4 million to $15.7 million annually through the development phases; with
on-going operations contributing $13.7 million each year.
Figure 1
PT Land Development
Annual Jobs Supported (Construction & Operations)
190
588 490 490
1,063 971
100
256
203 203
414
367
0
200
400
600
800
1,000
1,200
1,400
1,600
Year-One Year-Two Year-Three Year-Four Year-Five On-GoingOperations
Indirect Jobs
Direct Jobs
Phase 1 Phase 2
Economic Impacts of the PT Land Development, Bozeman Montana 6
Table 1
PT Land Development
Economic Impact Summary (Construction & Operations)
Phase 1 Phase 2 On-Going
Operations Year-One Year-Two Year-Three Year-Four Year-Five
Jobs Supported
Direct 190 588 490 490 1,063 971
Indirect 100 256 203 203 414 367
Total Jobs 290 844 693 693 1,477 1,337
Income Generated
Direct $9,214,759 $21,002,018 $16,223,158 $16,223,158 $34,293,383 $29,857,484
Indirect $4,238,842 $10,108,976 $7,880,655 $7,880,655 $15,959,652 $13,949,131
Total Income $13,453,601 $31,110,994 $24,103,814 $24,103,814 $50,253,036 $43,806,615
Economic Output
Direct $25,537,501 $53,993,269 $40,839,101 $40,839,101 $76,580,944 $64,197,611
Indirect $12,921,499 $31,858,528 $25,091,571 $25,091,571 $50,885,382 $44,730,840
Total Output $38,459,000 $85,851,797 $65,930,672 $65,930,672 $127,466,326 $108,928,451
Tax Revenues
State & Local $1,187,789 $3,582,780 $2,968,938 $2,968,938 $5,000,518 $4,426,571
Federal $2,884,120 $6,805,675 $5,306,140 $5,306,140 $10,731,820 $9,347,236
Total Tax Revenues $4,071,909 $10,388,455 $8,275,078 $8,275,078 $15,732,338 $13,773,807
Economic Impacts of the PT Land Development, Bozeman Montana 7
PT Land Development
Construction Impacts
Phase 1 (Years 1 and 2) construction activity includes initial design, infrastructure work, hotel
construction and development of 42,500 GSF of Retail space and 21,000 GSF of Office Space. Phase 1
construction activity will annually support 290 jobs in the Bozeman economy; 190 directly and another
100 indirectly (Figure 2 and Table 2). The construction activity will generate $13.4 million in income
dollars each year and raise total annual economic output by $38.4 million. Total tax revenues will
increase by $4 million annually; $1.2 million state & local and $2.8 million Federal.
Phase 2 (Years 3, 4 and 5) construction activity includes an additional 149,000 GSF of retail space and
74,000 GSF of Office Space. Phase 2 construction activity will annually support 139 jobs in the Bozeman
economy; 92 directly and another 47 indirectly. The construction activity will generate $6.4 million in
income dollars each year and raise total annual economic output by $18.5 million. Total tax revenues
will increase by $1.9 million annually; nearly $600 thousand state & local and $1.3 million Federal.
Figure 2
PT Land Development
Construction- Annual Jobs Supported
190 190
92 92 92
100 100
47 47 47
0
50
100
150
200
250
300
Year-One Year-Two Year-Three Year-Four Year-Five
Indirect Jobs
Direct Jobs
Phase 1 Phase 2
Economic Impacts of the PT Land Development, Bozeman Montana 8
Table 2
PT Land Development
Construction Economic Impacts
Phase 1 Phase 2
Year-One Year-Two Year-Three Year-Four Year-Five
Jobs Supported
Direct 190 190 92 92 92
Indirect 100 100 47 47 47
Total Jobs 290 290 139 139 139
Income Generated
Direct $9,214,759 $9,214,759 $4,435,899 $4,435,899 $4,435,899
Indirect $4,238,842 $4,238,842 $2,010,521 $2,010,521 $2,010,521
Total Income $13,453,601 $13,453,601 $6,446,421 $6,446,421 $6,446,421
Economic Output
Direct $25,537,501 $25,537,501 $12,383,333 $12,383,333 $12,383,333
Indirect $12,921,499 $12,921,499 $6,154,542 $6,154,542 $6,154,542
Total Output $38,459,000 $38,459,000 $18,537,875 $18,537,875 $18,537,875
Tax Revenues Generated
State & Local $1,187,789 $1,187,789 $573,947 $573,947 $573,947
Federal $2,884,120 $2,884,120 $1,384,585 $1,384,585 $1,384,585
Total Tax Revenues $4,071,909 $4,071,909 $1,958,532 $1,958,532 $1,958,532
Economic Impacts of the PT Land Development, Bozeman Montana 9
PT Land Development
Operations Impacts
Phase 1 (Years 1 and 2) operations includes the economic activity generated from a 200 room hotel and
businesses occupying 42,500 GSF of Retail space and 21,000 GSF of Office Space. No operations are
expected in Year 1. Year 2 operations will annually support 544 jobs in the Bozeman economy; 398
directly and another 156 indirectly (Figure 3 and Table 3). Operations will generate $17.6 million in
income dollars each year and raise total annual economic output by $47.3 million. Total tax revenues
will increase by $6.3 million annually; $2.4 million state & local and $3.9 million Federal.
Phase 2 (Years 3, 4 and 5) impacts conservatively estimate continuing operations from Year 2 into Years
3 and 4. Occupancy of the additional 149,000 GSF of retail space and 74,000 GSF of Office Space is
estimated to occur by Year 5. Although earlier occupancies may occur in Years 3 or 4, for reporting
simplicity full occupancy is condensed into Year 5; which then reflects PL Development’s complete on-
going economic impacts in the Bozeman economy.
Year 5 (on-going) operations will annually support 1,337 jobs in the Bozeman economy; 971 directly and
another 367 indirectly. Operations will generate $43.8 million in income dollars each year and raise total
annual economic output by $108.9 million. Total tax revenues will increase by $13.7 million annually;
$4.4 million state & local and $9.3 million Federal.
Figure 3
PT Land Development
Operations- Annual Jobs Supported
398 398 398
971156156156
367
0
200
400
600
800
1,000
1,200
1,400
Year-Two Year-Three Year-Four Year-Five
On-Going
Indirect Jobs
Direct Jobs
Phase 1 Phase 2
Economic Impacts of the PT Land Development, Bozeman Montana 10
Table 3
PT Land Development
Operations Economic Impacts
Phase 1 Phase 2
Year-Two Year-Three Year-Four
On-Going
Year-Five
Jobs Supported
Direct 398 398 398 971
Indirect 156 156 156 367
Total Jobs 554 554 554 1,337
Income Generated
Direct $11,787,259 $11,787,259 $11,787,259 $29,857,484
Indirect $5,870,134 $5,870,134 $5,870,134 $13,949,131
Total Income $17,657,393 $17,657,393 $17,657,393 $43,806,615
Economic Output
Direct $28,455,768 $28,455,768 $28,455,768 $64,197,611
Indirect $18,937,029 $18,937,029 $18,937,029 $44,730,840
Total Output $47,392,797 $47,392,797 $47,392,797 $108,928,451
Tax Revenues Generated
State & Local $2,394,991 $2,394,991 $2,394,991 $4,426,571
Federal $3,921,555 $3,921,555 $3,921,555 $9,347,236
Total Tax Revenues $6,316,546 $6,316,546 $6,316,546 $13,773,807
Economic Impacts of the PT Land Development, Bozeman Montana 11
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