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Philip Morris

the Economic Impact of Nhra Races on Topeka, Kansas

Date: Sep 1995
Length: 45 pages
2060488444-2060488488
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Author
Defranco, L.J.
Lilley, W. III
Area
LEGAL DEPT
Type
REPT, REPORT, OTHER
CHAR, CHART, GRAPH, TABLE, MAPS
DRAW, DRAWING
FOOT, FOOTNOTES
Site
N28
Master ID
2060488186/8635

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Named Person
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Kentling, W.
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Author (Organization)
Incontext
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ILLE, ILLEGIBLE
MISS, MISSING PAGES
Litigation
Bcnj/Produced
Date Loaded
16 May 2000
Brand
Winston
UCSF Legacy ID
ejd42d00

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Page 11: ejd42d00
<;~ 114ki 1989 63,430 - 1990 74,053 - 1991 89.548 - 1992 88.440 - 1993 83.984 62,435 1994 (FLOOD YEAR) (FIRST NHRA JC"QFIJVT,Y RACE) 96.800 59.322 1995 Notrertm.D 71,000 Where Do They Come From: Surveys show that 55 percent of the fans come from Kansas City (and most of them from Kansas City. Missouri); 18 percent come from Wichita, Kansas: 12 percent come from the local Topeka atea; the residual 15 percent come from Omaha-Lincoln; Nebraska (5 percent); Des Moines, Iowa (5 percent); and Springfield, Missouri (5 percent). How Much Do They Spend: The average fan spends per day about $91 on tickets, parking. lodging, food, drink, entertainment, and tourist rerail 6 This means that the two race week events combined put $19 million into the local economy. This number reflects the ability of this study to Itack price and volume changes by type of business, both through direct phone surveying and computer manipulation of the Dun & Bradstreet On-Lfne Business Database. What Do They Spend It On: These numbers vary significantly between two groups of spectators. For the spectators who stay overnight in local hotels/motels, the approximate spend- ing split is: 39 percent for food and drink, 16 percent for lodging, 25 percent for souvenirs and shopping, 19 percent for tickets, and 1 percent for gas. For the spectators who do not stay at local hotels/motels, the spending split is: 34 percent for food and drink, 33 percent for dckets, 27 percent for souvenirs and shopping, 2 percent for gas, and 4 percent for lodging.7 It is one thing to say that the Heartland Park race events ate big, and that they are particularly big in comparison to tht population size of the local Topeka community, but it is another thing to see how "outsize" they are. The map on the following page visualizes this feature depicting the major feeder roads to Heartland Park "swollen in size" to reflect the increase in traffic volume for the Topeka race events spread across all of race week. The map does not indicate that the feeder roads are inadequate to the traffic volume of race week. 6 See Chapter 4, p.16, for more details. 7 Ibid. tnCmren? loc. Poiitlol Eroaamc Analysis 9aptmba 1995 1615 L 5rteet. N.W., suia 650, Wshfugwe D.C 20036 'A7/659-1023 2060488454
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10 It is important that the reader realize the importance of the location of the feeder roads and the huge increase in volume on those roads. Subsequent maps in the text. using copyrighted computer software, wiil link effected local businesses to the traffic flow pattems. NHRA Related Traffic Flow Heartland Park Topeka InCautea? Inc.. Po11uW Emuanic Anzi1'Ms Sap1®ber 1995 . 1615 L Scee. v.W.. Svim 650. Wa{biygioa D.C. 20036 202J659-1023 2o60a88455
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Chapter 3: Heartland Park/NHRA/Winston Drag Racing Series Races Impacted Local Businesses This chapter describes the types of local businesses directly impacted by spectator spending during the Winston Drag Racing Series races: the chapter inventories how many of each of those types are in the Heartland Park race area: the chapter describes how many people work at those types of businesses in this local area. The chapter also provides. in Appendix A to the Report. a listing of each business. its name and type of business. its address and how many people work there. This chapter also uses copyrighted computer software to map the precise latitudinal and longi- tudinal location of each of these businesses in relation to the race track and to the major feeder roads for the races. Table 2 below. which was assembled through computer manipulation of the Dun & Bradstreet On-Line Business Data Base. shows the precise types of businesses impacted by spectator spending. how many of each type, and their typical levels of employment. The reader should know that this is local data for the Topeka area, not a national average. The reader should also know that the authors canvassed a number of experts in the auto racing field to ascertain the types of local businesses effected by spectator spending during a race event. Table 2 shows that there are 15 types of effected businesses; there ate 1,282 total effected business enterprises: those 1,282 businesses employ 18,653 workers. Appendix B of the study lists each of these businesses individually. rs~.z ~ . " .. .. . . . . , . r,ecaf e3rs~tict~es c~enel![~tg Fro® Ifeattiand ParkNHNA Racec: ,_ . ~~~- Eating and Drinking places 563 9,557 Grocery stores 178 4,457 Media & Advertising 95 1.824 Hotels and motels 59 1,336 Gasoline service stations 139 755 Drug stores and proprietary stores 42 349 Liquor stores 89 389 Employment agencies 33 210 Local transportation (taxi, bus, etc.) 11 171 Photocopying and duplicating services 13 111 Sep~b¢ t9% InCmtae inc.. Pdiual Eeonomk M+lym 1615 L sua4 N.W.. Suim 650, Wahiugrun D.C.2W36 2(?1659-I023 2Q6a488456
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I i Commercial art and graphic design 20 58 Commercial photography 16 39 RV & Passenger car rental 7 38 Racing, incl. separate track operations 3 22 Trailer parks and campsites 6 20 1 TOTAL 1.282 18,653 The maps on the following pages are extremely important in showing the importance of the Topeka races to the local economy. The maps are a series of ever-tighter zooms of the Heartland Park racetrack area. The maps depict with rigorous precision the precise latitudinal and longi- tudinal position of each effected business-as that business relates in geographic proximity either to the racetrack or to the highways feeding the racetrack. tocmlas'ta., Paita soovom. An,lyH 1615 L s¢ea. N.W., Suite 650, Wadiingmv. D.C. 20076 201I659-1023 sapkmbc 1995 2060488457
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I Businesses Benefitang from NHRA Races at Heartland Park Topeka NCamata Inc.. Paif¢®l Ecommic Maly.ds 1615 L SK«t N.W., Suke 650. Wuhingma D.C.2UUS6 20?/659-I023 Sepf®ber 1995 2060488458
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InCaaratm Inc.. Pd'aid Ecocamic Analysis Sept®ber 1995 1615 L Scm6 N.W„ Suim 650, Wasbingwa D.C.20036 202ISi9-1023 2060488459
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:6 Chapter 4: Heartland Park/NHRA/Winston Drag Racing Series Races Revenue Impact of Non-local Race Attendance on the Local Economy The Heartland Park NHRA races are the biggest economic events annually in the Topeka metro- politan area. The twice-yearly, several-days-long events inject $19 million into the metropolitan economy, more than 80 percent of it entirely new money from outside the metro area. This added $19 million constitutes an enormous gain for the area's businesses and their workers. The $19 million number reflects a model built by the authors after discussions with Heartland Park officials, local restaurant and lodging proprietors and local store merchants. The model also reflects an analysis by the authors of spectator spending data provided by the NHRA organ- ization, by other local NHRA tracks and by regional travel-tourism-development organizations which have monitored the economic impact of NHRA events at the behest of local NHRA tracks in their areag These discussions and reviews were used to calibrate the reasonableness of original research done by the authors on approximate spending amounts, both for total spending and, importantly, spending on major items such as food and drinks, tickets, lodging, souvenirs, gasoline, and general tourist shopping. The authors estimated the amount of an individual's average per day "no-frills" spending for each of those unavoidable or typical categories. The authors then segregated total per day spending amounts into four spectator cohorts: the largest spectator block: spectators who come to the races, eat and drink at or in the race area, but return home for the night; =A the second largest spectator block: spectators who attend the races, eat, drink and shop in the area, and who stay overnight in local area hotels and motels;9 * the third largest spectator block: spectators who attend the races; eat, drink and shop in the area but have overnight lodging outside the 35-mile Heartland Park radius area; * the fourth largest spectator block: race participants and their crew who attend the taces, eat, drink and shop in the area, and who stay overnight in the track paddock atea From all of this analysis, the authors built their conclusion that each Heartland Park NHRA event pumps $19 million directly into the local economy, mote than 80 percent of it from outside the local area. The authors did not attempt to quantify the indirect effects of the new $19 million pumped into the local economy courtesy of the NHRA events. It is inevitable that the "new" $19 million in g See Appendix A for Spending impact Methodology, p. 16. 9 Appendix A, "Spending Impact Methodology," prints the "impact spending spreadsheet" by detailed spending category per each of the spectator cohorts. luCmlext'tnc. Pditid Ecwamie Md5*l• Septsi.e 1945 1615 L Scac N.W., Suwm 650. Washiugtoa D.C 20036 201/6544023 2060488461
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spending has second-order, third-order and fourth-order effects on the local economy-such as how many more times a dollar is spent in the local economy. The authors realize that NHRA uses a multiplier of three10: we believe that number is reasonable, even conservative. and if used in this instance would lift total annual retail sales to $57 million (or 3 x $19 million). The authors analyzed every metropolitan statistical area (MSA) in the United States where the MSA's population was within 5 percent of the Topeka MSA population. There are 13 such MSA's in the nation. Table 3 below lists those MSA's and their total retail sales; the MSA's are ranked according to Annual Total Retail Sales volume.l l The average Total Retail Sales volume for an area approximately the size of Topeka is $1.48 billion. As the reader can see. Topeka exceeds the average by 13 percent. While it is impossible to estimate how much the $190 million overage is triggered by Winston Drag Racing Series attendance spending. two critical factors stand out: of the 13 MSA's equal in populafion to Topeka, only Topeka is on the Winston Drag Racing Series NHRA calendar, after numerous phone interviews with local merchants, it was indisputably clear that the local merchants believe that the Winston Drag Racing Series NHRA twice-a-year presence is the single biggest revenue-generating event in the year. These calls covered interviews with all the hotels and motels, numerous restaurants and drinking establishments, and random retail outlets which target tourist-type spending. Each of the interviews revealed a common pattern: all types of local outlets that do business with travel-tourists ran their businesses at 100 per- cent or greater volume levels (many of the establishments extend their regular hours); virtually all of rlte business outlets substantially increased their prices. z Also, if one used the NHRA multiplier of three times, then 31 percent of Topeka's total $190 million overage would be accounted for by these two NHRA events. - -~ ,~ A!1 MeooVotitan Arext SV-diun 5 Perceni of Topeka s Pupulaiion m...~, ..n .~. ~ ~r.~ Nashua, NH 173,500 $1,849,181,000 Medford-Ashland, OR 159,500 $1,795,205,000 Fargo-Moorhead,ND-MN 160,300 $1,752,491,000 TOPEKA, KS 165,700 $1,674,651,000 Tyler, TX 159.300 $1,546,247,000 Burlington, VT 157,500 $1,493,259,000 10 NHRA spokesman Chris Woolwine (Topeka Capital-Joumal, October 2, 1992). 11 Rand MaVally 1995 Commercial Atlas and Marketing Guide, pp. 56-58. lnCmcros Iuc.. Politioi Ecaoauic AudYa, S.p,mber 1995 1615 L Srteet. N.W., Suine 650. wahivg,oa D.C 20036 =639-1023 , 2060488462
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I f-= IAVERAGE IElkhart-Goshen.IN Lafayette, IN Benton Harbor, MI Richiand-Kennewick, WA Lake Charles. LA Redding, CA Tuscaloosa, AL 163.608 163.100 167.900 162,100 163.300 172.200 164.600 157.900 $1,484,852,460 $1,424,456.000 $1,380.861,000 $1,376,011,000 $1,349,718,000 $1,276,676,000 $1,212,935,000 $1,171,391,000 The Winston Drag Racing Series Presence and The Hotel/Motel Experience The authors selected one of the most critical revenue-generating and job-generating business nponents in order to analyze the exact impact of the races on revenues and jobs. For obvious -easons. the authors chose the 59 hotels and motels within the 35-mile radius of the Heartland tark track It is the authors' belief that the hotel/motel experience could be extrapolated to restaurants, drinking establishments and other outlets which deal directlywith the 167.800 individual spectators who arrive annually for the two race weeks. Table 4 below shows in dramatic detail the impact of race week on the local economy. Volume goes to 100 percent and ptices are, on average, raised 31 percent It also is important for the reader to see how the hotellmotel managers look at the two race weeks as future guarantees of total volume and high prices. ;avremom. .~.. AIRPORT MO7EL BEST WESTERN nWY24 3181WHWY50 LAWRENCE E4.iPORIA w,.o. t~.,~....ci. . 12 528 $29 Fl3tl. 90 S39 $39 Fm-[.-2MOS.IN 83 338 $65 ADVAN/E FULL-1YRIN 97 $53 S80 ADVANCE FV[J.-1 YR IN ADVSALTOKC BESTWF%IEBN 2950SWTOPEKAAVE TOFEKA BEST WESTERN 284t SW FAIRLAWN RD TOPEKA IW-mteria luc. Palitinl &maqoic Awillvis 1615 L Suea N.W., Sui(e 650. Waahinewt D-C 2C036 207/659-1023 Septmbs 1993 I 2060488463
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19 4 I f [pFpsct of 1\fuu'i R7ce Week Olt L.oeBI HeI,tELsimdtels ~ ~ _. .. . ... . . . - _ A~ . ~O CF lbOlMAt. RltE . [WMAWM . ' AmMd6 ' CS{Y .. . 90DM8 1ATC.... YA'7C tKR6 B]SMARCKINN 1100N3RDST LAWRENCE 50 S32 $52 FULL CHRISTOPHERS HOUSE 643 TENTv"ESSEEST LAWRENCE 9 S75 $75 FULL CLLBHOL'SE INN 924 SW HENDERSON DR TOPEKA 121 565 565 WOA7 GIVE RACERATE CO.YBbRT INN 15I8 SW WAVAMAKER RD TOPEKA 67 555 S61 FL7-L- I YR IN COUN 7RY CLLB MOTII. 3732 S W TOPEKA AVE TOPEKA COUNTRY INN MOTEL 601 NW US HWY 24 TOPEKA DAYS INN 3032 W HWY 50 EMPORIA DAYS INN 230910WAST LAWRENCE DAYS INN TOPEKA 1510SW WANAMAICERRD TOPEKA DODDS HOUSE ECONO LODGE ECONO LODGE TOPEKA ELDRIDGE HOTEL FAQIF9E],D INN HALCYON HOUSE HALLMARK INN MOTE[. HAMPTON INN HERIYAGEHOUSE HOLIDAY INN HOLIDAY INN HOLIDAY INN HOLIDAYINN HOTEL JOSEFEIVE HOWARDJOHNSON JAYHAWK MOTEL LAMONT HILL MO-IE- LPICOLN INN MO7II, 6 SfOTEL 61195 MOTII.6159 MOTEL 6307 NOD-A-WAY MOTEL ADVANCE 32 S22 $26 FL11-WASFULL IN IU!v`c TOO 80 S33 $42 FLR.L. I MO.IN ADVANCE 39 535 535 NOTFUI.L-BUT EXPECCTO BE 112 S34 540 FL'LL-3 MOS IN ADVANCE 62 563 568 FLLL-t YR LN ADVANCE HWY 75 HOLTON 20 538 $38 FULL 2331 S CEDARST OTTAWA 38 S38 $38 FULL 1240WANAMAKER TOPEKA 47 S45 553 FULL 701MASSACHUSET[SST LAWRENCE 48 574 $100 FULL 1530SW WESTPDRTDR TOPEKA 62 S59 $59 FULL 10CJOHIOS7 LAWRENCE 9 f43 545 FUC.L 730 IOWA ST LAWRENCE 60 S43 548 FULL 1401 SW ASHWORTH PL TOPEKA 62 S50 S75 FL7]. 3535SW67HAVE TOPEKA II S90 390 FULL 605SWFABiLAWNRD TOPEKA 197 559 5100 FU[1- 200MCDONALDDR LAWRENCE 192 569 $89 FULL 914SEMADLSONST TOPEKA 202 SSS S90 NOTYETFOLL 2700WISIHAVE EMPORIA 269 S49 549 NOTYETFULL 501OHIOAVE HOLTON 19 $35 535 NOTSUREIF FULL 3839SWTOPEBAAVE TOPEKA 132 $39 567 FULL 1004N3RDST LAWRENCE 19 532 532 NOTYETFULL RTIHWY368VASSER TOPEKA 10 530 530 FULL 904SWLINCOLN TOPEKA 35 S35 $35 FULL 2630 W IBTH AVE EMPORIA 59 527 S27 NOT YET FULL 1224SW WANAMAIQ:RRD TOPEKA 91 $32 532 FULL 3846SWTOPEKAAVE TOPEKA 87 529 54D FULL 709SWFA@LAWNRD TOPEKA 102 330 S30 FUIS.-IYRIN ADVANCE 107NWHWY24 TOPEKA 16 S3 $25 FULI- fef-mta? Ia.. Politial Erooami<An.lyaia 1615 L Srtmq N.W.. Suis 650, Wu61v8mq D.C 20D36 202/659-1023 Sepl®ber 1995 2060488464

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