Statewide Economic Contributions from

Diving and Recreational Fishing Activities on Mississippi’s Artificial Reefs

 

April 9th, 1998

Prepared under contract for the:

Mississippi Department of Marine Resources

and the

Mississippi Gulf Fishing Banks, Inc.

 

by:

Southwick Associates

Fernandina Beach, FL Alexandria, VA

(904) 277-9765 (703) 684-5856

 

 

 

 

 

Table of Contents

 

 

Forward/Acknowledgments....................................................................................... iii

List of Tables.............................................................................................................. iv

Executive Summary.................................................................................................... vi

Introduction and Purpose............................................................................................ 1

The Importance of Economic Information.................................................................. 2

Section I: Diving and Fishing Trips to Coastal Mississippi........................................ 3

Characteristics of Diving Trips and Trip Related Expenditures...................... 3

Characteristics of Saltwater Fishing Trips and Trip Related Expenditures..... 12

characteristics of Charter Boat Firms............................................................... 21

Section II: Economic Impacts of Expenditures Associated with Diving and Fishing

Trips to Artificial Reefs

Descriptions of Economic Impacts.................................................................. 24

Data Sources and Methodologies.................................................................... 25

Results............................................................................................................. 29

Appendix A: Survey Forms........................................................................................ 32

Appendix B: Dive Survey Standard Deviations…………………………………….. 42

 

 

 

 

FORWARD/ACKNOWLEDGMENTS

 

This project was conducted under contract to the Mississippi Gulf Fishing Banks and the Mississippi Department of Marine Resources by Southwick Associates, a fish and wildlife economics research firm based in Fernandina Beach, Florida and Alexandria, Virginia (904-277-9765). The authors and primary researchers were Rob Southwick, John Bergstrom, Ph.D., and Jeff Teasley.

Until this project, very little scientific data were available on the characteristics of fishing and diving trips to artificial reefs in Mississippi marine waters and the statewide economic impacts of these trips. To generate quantified information, surveys were conducted of Mississippi coast divers, anglers, and charter boat operations. In any survey, there is a trade-off between survey length and response rates. In addition, any survey which asks respondents to provide financial information such as personal expenditures is likely to generate some resistance on the part of survey participants. Therefore, this project began with a certain level of caution. Despite the beginning uncertainties, this project was successfully completed after many hours of research, surveying, discussions and economic examinations. This success came only as a result of the cooperation and support of key industry members and marine management officials. With their tremendous assistance, the first scientific economic examination of fishing and diving trips to artificial reefs in coastal Mississippi has been completed.

Southwick Associates extends its sincere gratitude to Mike Buchanan of the Mississippi Department of Marine Resources for his assistance, the Mississippi Gulf Fishing Banks, and to every dive shop along the Mississippi coast. Every coastal dive shop participated in this project by distributing surveys and helping us to obtain the information required to quantify the total number of divers. Without their help, results on coastal scuba diving would not have been possible. We also thank every charter boat operation, angler and diver who took the time to complete and return a survey, and Ben Posadas of the Mississippi State University Cooperative Extension Service for his constructive reviews and inputs. Despite the countless people who participated in this project, the authors remain solely responsible for all contents herein.

 

 

 

 

 

 

 

List of Tables

 

 

Page #

Table 1: Characteristics of Trips to Coastal Mississippi for Scuba Diving 5

Table 2: Expenses Incurred on Most Recent Trip to Coastal Mississippi

During Which Scuba Diving Took Place 6

Table 3: Proportion of Scuba Dives Taken to Artificial Reefs in

Coastal Mississippi 7

Table 4: Proportion of Coastal Mississippi Diving Trip in Past 12 Months

Taken Aboard a Charter Boat 7

Table 5: Expenditures on Scuba Diving Equipment During the Past 12

Months by Coastal Mississippi Divers 8

Table 6: Expenditures on Auxiliary Scuba Diving Equipment During the

Past 12 Months by Coastal Mississippi Divers 9

Table 7: Demographic Characteristics of Coastal Mississippi Divers 10

Table 8: Rankings of Preferred Gamefish for Spearfishing by Coastal

Mississippi Divers 11

Table 9: Characteristics of Trips to Coastal Mississippi for Saltwater Fishing 13

Table 10: Expenses Incurred on Most Recent Trip to Coastal Mississippi

During Which Saltwater Fishing Took Place 14

Table 11: Proportion of Saltwater Fishing Trips to Coastal Mississippi in

Past 12 Months Taken Aboard a Charter or Private Boat 14

Table 12: Proportion of Saltwater Fishing Trips to Coastal Mississippi

During Past 12 Months Taken to Artificial Reefs 15

 

 

Table 13: Expenditures on Fishing Equipment During the Past 12 Months

by Coastal Mississippi Saltwater Anglers 16

Table 14: Demographic Characteristics of Coastal Mississippi Saltwater Anglers 18

Table 15: Rankings of Preferred Gamefish by Coastal Mississippi

Saltwater Anglers 19

Table 16: Frequency of Charter Boat Firms in Different Categories by Percentage

Split of Charters Between Fishing and Diving 21

Table 17: Charter Boat Fees for Whole and Half Day Trips Charged by Coastal

Mississippi Charter Boat Firms 22

Table 18: Rankings of Preferred Gamefish by Coastal Mississippi

Charter Boat Firms 23

Table 19: Retail Sales Generated by Scuba diving on MS Artificial Reefs 29

Table 20: Retail Sales Generated by Recreational Fishing on MS Artificial Reefs 30

Table 21: The Economic Impacts of Mississippi Artificial Reefs 31

 

 

 

 

 

 

Executive Summary

 

 

Recreational fishing and diving trips to artificial reefs in coastal Mississippi produce valuable benefits to the state economy. In 1997, it is estimated that the expenditures made by recreational anglers and divers during the course of their reef-related activities generated the following economic benefits for the Mississippi economy:

Scuba: Fishing: Total:

Retail sales = $886,500 $37.4 million $38.3 million

Jobs = 28 1,122 1,150

Salaries and Wages = $515,200 $20.1 million $20.6 million

State Sales Tax Revenues = $54,000 $2.7 million $2.7 million

State Income Tax Revenues = $9,200 $364,000 $374,000

Federal Income Tax Revenues = $47,500 $1.9 million $1.9 million

Total Multiplier Effect = $1.7 million $76.6 million $78.4 million

(the multiple rounds of spending created by sportsmen’s expenditures)

According to a recent study by the American Sportfishing Association, all saltwater fishing in Mississippi generates $155 million in annual retail sales and supports 3,988 jobs. This study indicates that about 25 percent of all expenditures and jobs supported by marine fishing in Mississippi could be associated with artificial reefs. Previous studies on scuba diving could not be identified. Therefore comparisons cannot be provided. Detailed information on trip expenditures and total trips to artificial reefs, as well as demographic data on Mississippi’s divers and anglers who use artificial reefs, are provided in this report. Please review the text for greater details.

 

 

 

 

INTRODUCTION AND PURPOSE

 

 

The study was initiated and funded by the Mississippi Gulf Fishing Banks and the Mississippi Department of Marine Resources. The primary purpose was to estimate total expenditures associated with recreational fishing and diving trips to artificial reefs in coastal Mississippi and the economic contributions of these expenditures to the Mississippi economy. The results will help resource officials understand and communicate the importance of artificial reef fishing and diving to the state economy, and help the public appreciate one of the many important benefits of artificial reefs. Economic benefits measured include: jobs supported, salaries and wages produced, tax revenues generated and total economic activity resulting from trip related expenditures.

This study had two basic components. One component was estimation of total expenditures associated with fishing and diving trips to artificial reefs in coastal Mississippi. This component required the design and conduct of three surveys: saltwater angler survey, scuba diver survey, and charter boat survey. These surveys were designed to collect information necessary for estimating total trip related expenditures and the proportion of total expenditures that can be attributed to artificial reef fishing and diving. The second major component of the study was estimating the economic impacts of expenditures attributable to artificial reef fishing or diving on the Mississippi economy. This component required combining the trip expenditure information with an economic model of the Mississippi economy to estimate the impacts of trip related expenditures on specific business sectors and the state economy as a whole. All components of this project and their results are presented within this text.

 

 

 

 

 

 

THE IMPORTANCE OF ECONOMIC INFORMATION

 

 

Many of the driving influences in resource management and utilization originate within state and federal legislatures, government agencies, courtrooms, corporate boardrooms, and media offices. These factors collectively decide not only the financial resources available to manage resources, but also help shape public attitudes that ultimately decide the course and fate of all resource actions and programs. Efforts to initiate positive change and build constructive relationships can be greatly enhanced with sound economic data. Specifically, economics can assist in six general areas:

Legislative Actions: economic information can help gain political support for conservation programs by demonstrating the importance of resource-related activities to constituents and commerce.

Funding Initiatives: greater legislative and/or private funding can be secured by demonstrating the importance of resource related-activities to state residents and commerce.

Establish Management Priorities: used with biological and other sources of data, economics can help government resource managers develop conservation and management priorities and understand the impacts of their actions on local, state and national economies.

Public Communication: economics can help win greater public support for resource-related activities by demonstrating the dependence of many people and communities on local resources such as artificial reefs. Also, economics can help gain the attention of people and organizations who may otherwise not be interested in resources, but who are motivated by commerce and economic issues.

User Management: economics provide insights into people’s actions and motivations thereby helping resource officials effectively manage human use of resources such as artificial reefs.

Habitat Conservation: by demonstrating the values and benefits produced by resource-based harvests and recreation, pressure to develop and alter habitat will be minimized.

 

 

 

 

 

SECTION I

 

Diving and Fishing Trips to Artificial Reefs

 

 

Characteristics of Diving Trips and Trip Related Expenditures

This section must begin with a brief note on characteristics of scuba diving in Mississippi coastal waters. Mississippi waters are typically shallow and have low visibility due to wind, current, or river outflow related turbulence. This tends to discourage diving activities. Coastal dive shops reported that the vast majority of locals travel to Florida to dive where water clarity is more favorable. The few who do dive in state waters tend to be more avid, and often must travel a relatively long distance offshore to find clear water, or must wait for periods when currents may shift and bring clearer water near shore. These factors are noticeable in the results of this report where the number of participants and the economic impacts of diving are significantly lower than recreational fishing.

A survey questionnaire was designed to collect basic information from divers describing their trips to coastal Mississippi for scuba diving, focusing on trip expenditures and dives to artificial reefs. A copy of the questionnaire is provided in Appendix A. Questionnaires were distributed to divers via Mississippi coast dive shops. Without a source of Mississippi divers’ names and addresses available, dive shops were used to contact divers. Recognizing that all divers must fill their scuba tanks, and that no other air compressors could be located on the coast independent of dive shops, these shops presented a natural bottleneck for all divers to proceed through at some point before a dive trip. All seven Mississippi coastal dive shops participated.

A cover letter from the Mississippi Department of Marine Resources was included with the questionnaire asking divers to complete and return it to the department by mail in an attached postage-paid return envelope. Dive shops distributed the questionnaires to divers during the summer of 1997. Dive shops were requested to hand a survey to each diver who visited for air fills. A total of 31 questionnaires were returned. Without knowing how many surveys were handed out by dive shops (the project’s limitations prevented detail tracking of all dive surveys and we could not realistically expect volunteer shops to track individual surveys), the response rate is unknown. However, recognizing the very limited number of divers in Mississippi, this sample size was considered adequate.

 

To determine the total number of coastal Mississippi divers, each questionnaire asked how many airfills that diver purchased in the last 12 months. The dive shops provided estimates on the total airfills sold annually. Some shops had exact records, while others could only provide monthly estimates for off-season and in-season months which were then extrapolated to provide annual estimates of airfills sold. One shop could not provide an estimate. To account for this shop’s sales, we simply substituted the average airfills sold by all other shops annually. The total number of divers was then estimated by dividing the total airfills sold annually by all dive shops by the average numbers of airfills annually purchased per diver.

One adjustment was made to the total number of divers. Many divers rent air tanks from dive shops. When a tank is rented, it comes already filled with air. Therefore, each tank rental represents one air fill. Dive shops reported that most tank rentals are for trips out of state and that 10 percent would be a good estimate of the percentage of rented tanks actually used in state waters. To account for divers who rent tanks, one-tenth of all tanks rented by dive shops was added to the total number of airfills sold by dive shops in Mississippi before being divided by the average number of airfills annually purchased per diver.

Total divers using MS waters were estimated at 113. This does not include divers who used charter boats, which will be presented later in the Charter Boat part of this section. Therefore, 27 percent of all divers were estimated to have participated in this project’s survey.

Total expenditures, days and trips estimates were tabulated by multiplying the number of divers by the average per diver as determined by the surveys.

The results of the scuba diver survey are summarized in Tables 1-8. Table 1 shows: 1) mean number of trips per respondent for the main purpose of scuba diving in coastal Mississippi; 2) mean number of trips per respondent which were not for the main purpose of diving in coastal Mississippi but during which a respondent spent some of the trip diving in coastal Mississippi; and 3) mean number of trips to coastal Mississippi during which diving took place, whether or not the trip was for the main purpose of diving in coastal Mississippi. For these three types of trips, Table 1 also provides the mean length of the most recent trip and the total number of dives taken on the most recent trip. The average number of airfills purchased for dives in coastal Mississippi over the past 12 months is also reported in Table 1. Recognizing the small universe and small sample size associated with this effort, standard deviations for specific variables collected by the survey are presented in Appendix B.

 

 

Table 1. - Characteristics of Trips to Coastal Mississippi for Scuba Diving, 1997.

Type of Trip and Characteristics

Mean

Number of Observations

1. Trips to MS Coast for the Main

Purpose of Diving

a. Total Annual Trips per

Respondent

b. Length of Most Recent Trip in

Days

c. Number of Dives on Most Recent

Trip

 

 

 

14.7

2.0

3.8

 

 

 

31

27

27

2. Trips to MS Coast Not for Main

Purpose of Diving

a. Total Annual Trips per Respondent

b. Length of Most Recent Trip in

Days

c. Number of Different Days

Respondent went Diving on Most

Recent Trip

d. Number of Dives on Most Recent

Trip

 

 

7.4

2.4

 

2.2

3.9

 

 

31

20

 

20

20

3. Trips to MS Coast during which Diving

took Place Whether or Not the Main

Purpose of the Trip Was for Diving

a. Total Annual Trips per

Respondent

b. Length of Most Recent Trip in

Days

c. Number of Dives on Most Recent

Trip

 

 

 

22.1

2.0

3.8

 

 

 

31

31

31

Average Number of Airfill Purchases for Dives along MS Coast in Past 12 Months

36

31

Expenditures per respondent on the most recent trip taken to coastal Mississippi during which at least a portion of the trip was spent diving are reported in Table 2. Average total reported trip expenditures were about $353 per respondent spread over such items as lodging, food, commercial transportation, package trips, air tank fills, boat fuel, boat ramp and marina fees, boat rental, dive equipment rental, charter fees, ice, and film.

 

 

 

 

Table 2. - Expenses Incurred on Most Recent Trip to Mississippi Coast During which Diving Took Place (whether the main purpose of the trip was to dive or not), 1997.

Category

Mean

Number of Observations

Average total trip expense

$352.86

31

Lodging

80.00

31

Food (including beverages)

62.42

31

Commercial transportation

0

31

Package trips

0

31

Air tank fills

18.12

31

Boat fuel

73.00

31

Boat ramp and marina/dockage fees

42.58

31

Boat rental

15.65

31

Dive equipment rental

28.13

31

Charter fees

12.58

31

Ice

7.53

31

Film and processing

12.85

31

Number of people respondent paid for on most recent trip

1.6

31

 

Table 3 summarizes the proportion of total dives taken by respondents in coastal Mississippi during the past 12 months that occurred at artificial reefs. On average, respondents reported that about 50% of their total dives in coastal Mississippi during the past 12 months were to an artificial reef. Table 4 summarizes the proportion of dives taken in coastal Mississippi using a charter boat during the past 12 months. Respondents reported that about 19% of their total diving trips during the past 12 months were taken by charter boat.

 

 

Table 3. - Proportion of Scuba Dives Taken to Artificial Reefs in Coastal Mississippi, 1997.

Categories of Proportion of Dives in Past 12 Months that were at Artificial Reefs

Percentage of Respondents in Each Category (n = 31)

1. 0%

2. 1% - 29 %

3. 30 % - 59 %

4. 60 % - 89 %

5. 90 % - 100 %

16.1%

22.6

19.4

12.9

29.0

Average Number of Dives that were to MS Artificial

Reef in Past 12 Months

50.7%

Percentage of Respondents who Dove at an MS Artificial Reef in Past 12 Months

83.9%

 

 

Table 4. - Proportion of Coastal Mississippi Scuba Diving Trips in Past 12 Months Taken Aboard a Charter Boat, 1997.

Categories of Proportion of Dives in Past 12 Months that were Taken by Charter Boat

Percentage of Respondents in Each Category (n = 31)

1. 0%

2. 1 % - 29 %

3. 30 % - 59 %

4. 60 % - 89 %

5. 90 % - 100 %

73.3%

6.7

3.3

6.7

10.0

Average Proportion of Total Diving Trips that were by

Charter Boat in Past 12 Months

18.8%

Percentage of respondents who traveled by Charter to dive on the MS Coast in Past 12 Months

26.7%

 

Expenditures on diving equipment made by Mississippi coast scuba divers during the past 12 months are shown in Table 5. Mean expenditures in 1997 were about $1,672 per respondent spread over common diving equipment including air tanks, regulators, masks, fins, weights, watches, wet suits, knives and other tools. Expenditures made on auxiliary equipment and housing during the past 12 months used primarily to support diving in coastal Mississippi are reported in Table 6. Mean auxiliary equipment and housing expenditures were estimated at about $4,900 per respondent spread over such items as boats, cars, coolers, cameras, boat gear, clothes, and maintenance of boat and dive equipment.

Vehicles, boats and maintenance were the three single largest expenses per diver. It is recognized that probably a minority of divers actually purchased a boat and a vehicle. These expenditures, often ranging from $12,000 to $40,000 each, are large enough to significantly affect the average expenditure for all divers. Also considering that 1996 was an outstanding year in economic terms, expenditures for big ticket items such as boats and vehicles were up considerably. For example, the U.S. Fish and Wildlife Service’s 1996 National Survey of Fishing, Hunting and Wildlife-Associated Recreation reports that 1996 fishing-related expenditures in Mississippi (for fresh and saltwater) were 159 percent higher than in 1991, which was a poor economic year. Also, the same survey shows that anglers’ expenditures in Mississippi for big-ticket items such as vehicles, boats, and trailers increased approximately nine times from 1991 to 1996. This is not unexpected as people tend to forego big-ticket and luxury item purchases in periods of economic uncertainty (1991) and make up for those years they went without those items during periods of extended economic prosperity (1996).

 

Table 5. - Expenditures on Scuba Diving Equipment During the Past 12 Months by Coastal Mississippi Divers, 1997.

Category

Mean

Number of Observations

Average total 12 month equipment expense

$1,672.64

31

Air tanks

155.29

31

Regulators

164.23

31

Masks, fins, snorkels, weight belts, and weights

80.06

31

Buoyancy compensators

131.55

31

Dive watches

88.55

31

Dive computers

127.26

31

Wet suits, dive skins, and underwater apparel

95.24

31

Electronic depth finders and navigation (GPS, LORAN, etc)

407.19

31

Dive knives and tools

39.61

31

Spearfishing tackle and gear

154.03

31

Bags and carrying cases for dive gear

21.77

31

Misc. dive items

44.08

31

Dive lessons

109.68

31

Other dive related expenses-1

48.97

31

Other dive related expenses-2

5.13

31

 

Table 6. - Expenditures on Auxiliary Scuba Diving Equipment During the Past 12 Months by Coastal Mississippi Divers, 1997.

Category

Mean

Number of Observations

Average total 12 month auxiliary diving expense

$4,900.62

31

Boats

3,159.48

31

Coolers

125.97

31

Scuba diving magazines

14.51

31

Cars

648.59

31

Cameras

48.03

31

Fishing/boating licenses and permits

19.52

31

Boat gear (ropes, binoculars, radios, etc.)

298.71

31

Clothes (foul weather, dive apparel, etc.)

67.58

31

Membership dues

19.03

31

Maintenance of boat and dive equipment

499.19

31

Several expenditures were adjusted. Recognizing that most boats and nearly all vehicles (cars, trucks, etc.) that were purchased to aid individuals’ diving activities are logically used for other non-diving activities, these expenditures were adjusted downward so as not to over estimate the true economic contributions of artificial reef diving. Without better data to deflate these expenditures, the authors deflated boat and vehicle purchases by two-thirds. This estimate was based on the author’s 16 years of experience as a certified diver and that of close diving associates. The survey item for houses and condos purchased near the coast to bring the diver closer to their dive sites was eliminated completely due to the difficulty in estimating a proper deflation factor.

Demographic characteristics of Mississippi coast scuba divers are reported in Table 7. Respondent rankings of preferred gamefish for spearfishing are shown in Table 8. Over 75% of respondents ranked snapper as their first choice for a spearfishing gamefish. Grouper was ranked as the second choice for a spearfishing gamefish by over 45% of respondents, and cobia was ranked as the third choice by 60% of respondents.

Table 7. - Demographic Characteristics of Coastal Mississippi Divers, 1997.

Demographic Category

Sample Mean or Frequency (n = 31)

Mean age

32 years

Gender
Male

77.4%

Female

22.6%

Education
Grades 1 - 11

13.3%

High school graduate

13.3%

Some college

26.7%

College graduate (2 or 4 year degree)

30.0%

Completed a graduate degree

16.7%

Location of primary residence
Urban

32.3%

Rural

41.9%

Suburban

25.8%

State of residence
Mississippi

100%

Other

0%

Average miles of residence from MS coast

4.2 miles

Does respondent spearfish?
Yes

71.0%

No

29.0%

Table 8. - Rankings of Preferred Gamefish for Spearfishing by Coastal Mississippi Divers, 1997.

 

Gamefish Species

Percentage of Anglers Ranking as:

# 1 Rank

(n = 22)

#2 Rank

(n = 22)

# 3 rank

(n = 20)

# 4 Rank

(n = 22)

# 5 Rank

(n = 19)

# 6 rank

(n = 12)

# 7 Rank

(n = 8)

# 8 Rank

(n = 7)

# 9 Rank

(n = 7)

# 10 Rank

(n = 6)

1. Snapper 77.3 13.6 5.0    

 

 

 

 

 

 

 

 

 

 

 

 

2. Grouper

18.2 45.5 15.0 4.5 15.8 8.3    

 

 

 

 

 

 

3. King

Mackerel

   

13.6

   

 

 

 

 

16.7

   

 

 

14.3

16.7
4. Spanish

Mackerel

   

 

 

 

 

 

 

 

 

16.7

12.5    

28.6

16.7
5. Cobia 4.5 9.1 60.0 22.7 5.3 8.3    

 

 

 

 

 

 

6. Amberjack

   

9.1

5.0 31.8 10.5 16.7    

 

 

28.6

16.7
7. Wahoo    

4.5

   

 

 

 

 

 

 

 

 

 

 

 

 

 

 

8. Dolphin

   

 

 

 

 

 

 

15.8

   

 

 

14.3

   

 

 

9. Tuna

   

 

 

 

 

4.5

5.3    

 

 

 

 

28.6

16.7
10. Shark    

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

33.3

11. Flounder    

4.5

5.0 18.2 26.3 25.0 25.0 42.9    

 

 

12. Redfish

   

 

 

10.0

13.6 15.8 8.3 37.5 14.3    

 

 

13. Trout

   

 

 

 

 

 

 

 

 

 

 

25.0

28.6    

 

 

14. Sheephead

   

 

 

 

 

4.5

5.3    

 

 

 

 

 

 

 

- Numbers in bold represent the most often listed gamefish species, within rank, by Mississippi coastal divers.

 

 

 

Characteristics of Saltwater Fishing Trips and Trip Related Expenditures

A survey questionnaire was designed to collect basic information from saltwater anglers describing their trips to coastal Mississippi for fishing, focusing on trip expenditures and fishing at artificial reefs. A copy of the questionnaire is provided in Appendix A. Questionnaires were mailed to a sample of anglers holding Mississippi saltwater fishing licenses in 1996. A cover letter from the Mississippi Department of Marine Resources was included with the questionnaire asking anglers to fill out and return the questionnaire to the department by mail in an enclosed postage-paid return envelope. Approximately 1,500 non-residents were mailed surveys (representing nearly every non-resident license holder – 1,876 were sold, but nearly 350 had incomplete addresses) and a sample of 2,000 residents (out of a license buyer population of 52,000) during the summer and fall of 1997. A second round was mailed after 3 weeks to non-respondents. From both mailings, 653 addresses were undeliverable and 643 were returned by the cut-off date for a response rate of 22 percent. A trade-off existed regarding the length of the questionnaire and the return rate. However, recognizing the large number of returned surveys, the overall effect is considered minimized.

This survey typically only reached people who fished by means other than charter boats. Customers of charter boats do not need a license and therefore may not have purchased one. To account for the expenditures of this group, a separate charter boat survey was conducted. A discussion on the methods and results of the charter survey are presented later in the section.

The results of the saltwater angler survey are summarized in Tables 9-15. Table 9 shows:

1) mean number of trips per respondent for the main purpose of saltwater fishing in coastal Mississippi; 2) mean number of trips per respondent which were not for the main purpose of fishing in coastal Mississippi but during which a respondent spent some of the trip saltwater fishing in coastal Mississippi; and 3) mean number of trips per respondents to coastal Mississippi during which saltwater fishing took place whether or not the trip was for the main purpose of saltwater fishing (totals and averages for the first two trip types). For these three types of trips, Table 9 also provides the mean length of the most recent trip, the total number of different days on the most recent trip on which the respondent went fishing, and the total number of different times on the most recent trip the respondent went fishing (for example, a respondent may fished twice on the same day, once in the morning and once in the afternoon).

 

 

Table 9. - Characteristics of Trips to Coastal Mississippi for Saltwater Fishing, 1997.

Type of Trip and Characteristics

Mean

Number of Observations

1. Trips to MS Coast for the Main

Purpose of Fishing

a. Total Annual Trips per Respondent

b. Length of Most Recent Trip in Days

c. Number of Different Days on Most

Recent Trip when Respondent went

Fishing

d. Number of Different Times on

Most Recent Trip when Respondent

went Fishing

 

 

14.9

2.4

2.2

 

2.5

 

 

552

506

506

 

506

2. Trips to MS Coast not for Main

Purpose of Fishing

a. Total Annual Trips per Respondent

b. Length of Most Recent Trips in Days

c. Number of Different Days on Most

Recent Trip when Respondent went

Fishing

d. Number of Different Times on

Most Recent Trip when Respondent

went Fishing

 

 

4.3

3.0

1.7

 

2.2

 

 

552

254

254

 

254

3. Trips to MS Coast during which Fishing

Took Place Whether or Not the Main

Purpose of the Trip was for Fishing

a. Total Annual Trips per Respondent

b. Length of Most Recent Trip in Days

c. Number of Different Days on Most

Recent Trip when Respondent went

Fishing

d. Number of Different Times on

Most Recent Trip when Respondent

went Fishing

 

 

 

19.2

2.6

 

2.1

 

2.5

 

 

 

552

552

 

552

 

552

Expenditures per respondent on the most recent trip taken to coastal Mississippi during which at least a portion of the trip was spent saltwater fishing are reported in Table 10. Average total reported trip expenditures were about $180.91 per respondent spread over such items as lodging, food, commercial transportation, package trips, bait, boat fuel, boat ramp and marina fees, boat rental, ice, and film.

 

Table 10. - Expenses Incurred on Most Recent Trip to Mississippi Coast During Which Saltwater Fishing Took Place (whether the main purpose of the trip was to fish or not), 1997

Category

Mean

Number of Observations

Average total trip expense

$180.91

552

Lodging

30.68

552

Food (including beverages)

48.45

552

Commercial transportation

.97

552

Package trips

5.24

552

Boat fuel

39.95

552

Bait

20.19

552

Boat ramp & marina/dockage fees

5.08

552

Boat rental

4.68

552

Fishing equipment rental

1.67

552

Charter fees

11.75

552

Ice

7.79

552

Film and processing

4.46

552

Number of people respondent paid for on most recent trip

2 people

552

Percentage of respondents who reported that expenses above were incurred on a trip for the main purpose of fishing

88.2 %

536

 

Table 11 shows the proportion of saltwater fishing trips in coastal Mississippi in the past 12 months taken by license holders aboard a charter or private boat . The figures in Table 11 indicate that for saltwater fishing license holders, most saltwater fishing trips in coastal Mississippi in the past 12 months were taken aboard a private boat. This information should be used cautiously as the sample was drawn from a list of saltwater fishing license holders. People who only fished via charters do not need a license and may not have received a license. This issue probably reduces the reported percentage of charter boat anglers below the actual percentage. Better charter-specific data is provided in Tables 16-18. Table 12 summarizes the proportion of total saltwater fishing trips taken in coastal Mississippi by anglers during the past 12 months to artificial reefs. Respondents reported that about 28% of their total saltwater fishing trips in the past 12 months to coastal Mississippi were to an artificial reef.

Table 11. - Proportion of Saltwater Fishing Trips to Coastal Mississippi in Past 12 Months Taken Aboard a Charter or Private Boat by Licensed Anglers, 1997.

Charter and Private Boat

Proportion Categories

Percentage of Respondents in Each Category

1. Categories of Proportion of Total Fishing

Trips in Last 12 Months that were by

Charter Boat (n = 549)

a. 0 %

b. 1 - 19 %

c. 20 – 49 %

d. 50 - 79 %

e. 80 - 100 %

 

 

 

83.6%

8.4

3.0

1.5

3.4

2. Categories of Proportion of Total Fishing

Trips in Last 12 Months that were by

Private Boat (n = 547)

a. 0 %

b. 1 - 19 %

c. 20 - 49 %

d. 50 - 79 %

e. 80 - 100 %

 

 

 

12.5%

4.7

3.1

5.8

73.9

Average Proportion of Fishing Trips that were by Private Boat in Past 12 Months

78.1%

 

Table 12. - Proportion of Saltwater Fishing Trips to Coastal Mississippi During Past 12 Months Taken to Artificial Reefs, 1997.

Categories of Proportion of Total Fishing Trips in last 12 Months that were to Artificial Reefs

Percentage of Respondents in Each Category (n=542)

1. 0% of Fishing Trips to Art. Reefs

2. 1 - 19 % of Fishing Trips to Art. Reefs

3. 20 – 49 % of Fishing Trips to Art. Reefs

4. 50 – 79 % of Fishing Trips to Art. Reefs

5. 80 – 100% of Fishing Trips to Art. Reefs

44.3%

13.3

13.3

17.9

11.2

Average Proportion of Total Fishing Trips that

Were to an Artificial Reef in Past 12 Months

27.6%

Total Percentage of Respondents who Fished at an Artificial Reef during the Past 12 Months

55.7%

 

 

 

Expenditures on fishing and fishing-related equipment made by Mississippi coast saltwater anglers during the past 12 months are shown in Table 13. Mean expenditures in 1997 were about $2,735.32 per respondent. Fishing equipment included rods, reels, line, tackle, nets, electronic fish finders, knives and other tackle and tools. Fishing-related equipment included boats, boat trailers, boat gear, vehicles, and clothes purchased to support fishing activities. Vehicles, boats and maintenance were the three single largest expenses per angler. It is recognized that probably a minority of anglers actually purchased a boat and a vehicle. These expenditures, often ranging up to $40,000 each, are large enough to significantly affect the average expenditure for all anglers. Also considering that 1996 was an outstanding year in economic terms, expenditures for big ticket items such as boats and vehicles were up considerably. For example, the U.S. Fish and Wildlife Service’s 1996 National Survey of Fishing, Hunting and Wildlife-Associated Recreation reports that 1996 fishing-related expenditures in Mississippi (for fresh and saltwater) were 159 percent higher than in 1991, which was a poor economic year. Also, the same survey shows that anglers’ expenditures in Mississippi for big-ticket items such as vehicles, boats, and trailers increased approximately nine times from 1991 to 1996. This is not unexpected as people tend to forego big-ticket and luxury item purchases in periods of economic uncertainty (1991) and make up for those years they went without during periods of extended economic prosperity (1996).

 

Table 13. - Expenditures on Fishing Equipment During the Past 12 Months by Mississippi Coast Saltwater Anglers, 1997.

Category

Mean

Number of Observations

Average total 12 month equipment expense

$2,735.32

552

Fishing rods

107.98

552

Reels

104.29

552

Fishing line

21.30

552

Terminal tackle (hooks, sinkers, etc)

56.44

552

Landing nets and gaff hooks

11.83

552

Knives and hand tools

12.21

552

Coolers, fish boxes, live wells, and buckets

31.71

552

Electronic fish finders and navigation devices (GPS, LORAN, etc)

202.41

552

Boats and trailers (incl. Trailer accessories

1,227.64

552

Fishing and boat licenses and permits

36.09

552

Taxidermy

5.49

552

Magazines related to saltwater fishing

8.72

552

Maintenance of boat and equipment (includes fees and parts)

261.93

552

Cars, trucks, and campers

371.26

552

Cameras

20.18

552

Other tackle (incl. bait nets and bait catching rigs, down riggers, outriggers, rod belts and holders, etc.)

43.03

552

Clothes, foul weather gear, and other apparel purchased primarily for marine fishing

40.88

552

Boat gear (ropes, binoculars, radios, bumpers, life vests, cushions, etc.) and tools

79.70

552

Membership dues and contributions to fishing-related clubs and organizations

17.67

552

Other miscellaneous expenses

74.61

552

 

Several expenditures were adjusted. Recognizing that most boats and nearly all vehicles (cars, trucks, etc.) that were purchased to aid individuals’ fishing activities are logically used for other non-fishing activities, these expenditures were adjusted downward so as not to over estimate the true economic value of artificial reef angling. Without better data to deflate these expenditures, the authors deflated boat and vehicle purchases conservatively by two-thirds. This estimate was based on the author’s lifetime experience as an avid saltwater angler and that of close fishing associates. The survey item for houses and condos purchased near the coast to bring the angler closer to their fishing locations was eliminated completely due to the difficulty in estimating a proper deflation factor.

Demographic characteristics of coastal Mississippi saltwater anglers are reported in Table 14. Respondent rankings of preferred gamefish are shown in Table 15. Twenty-nine percent of the respondents ranked snapper as their first choice for a saltwater gamefish. Trout was ranked first by 26% of respondents. About 29 percent of respondents ranked redfish as their second choice for a saltwater gamefish. About 28 percent of respondents ranked flounder as their third choice for a saltwater gamefish.

 

 

Table 14. - Demographic Characteristics of Coastal Mississippi Saltwater Anglers, 1997.

Demographic Category

Sample Mean or Frequency

Mean age (n=547)

44 years

Sex (n = 549)
Male

82.8%

Female

17.2%

Education (n = 546)
Grades 1 – 11

4.2%

High school graduate

20.7%

Some college

27.2%

College graduate (2 or 4 year degree)

28.7%

Completed a graduate degree

16.4%

Other

2.7%

Location of primary residence (n = 542)
Urban

26.2%

Rural

40.7%

Suburban

33.1%

State of residence (n = 550)
Mississippi

96.5%

Louisiana

1.3%

Alabama

1.0%

Texas

0.1%

Other states (25 states included)

1.1%

Average miles of residence from MS coast

(n = 539)

48.6 miles

Has respondent fished at an artificial reef in last 2 years? (n = 543)
Yes

64.0%

No

36.0%

 

 

Table 15. - Rankings of Preferred Gamefish by Coastal Mississippi Saltwater Anglers, 1997.

 

Gamefish Species

   

# 1 Rank

(n = 495)

#2 Rank

(n = 485)

# 3 rank

(n = 451)

# 4 Rank

(n = 325)

# 5 Rank

(n = 260)

# 6 rank

(n = 207)

# 7 Rank

(n = 165)

# 8 Rank

(n = 120)

# 9 Rank

(n = 91)

# 10 Rank

(n = 80)

1. Snapper 29.1 6.1 8.2 16.0 8.5 4.9 5.9 5.1    

 

 

2. Grouper

 

1.3

10.3 4.6 3.8 15.1 11.6 7.2 6.8 6.2 4.7
3. King

Mackerel

1.8 3.9 8.2 6.8 4.8 10.5 11.6 6.7 6.4 2.4
4. Spanish

Mackerel

0.9 1.3 2.0 9.3 15.9 11.4 11.7 13.2 4.4 11.6
5. Cobia 4.6 6.6 6.0 8.0 8.4 12.5 9.2 8.2 4.4 0.1
6. Amberjack 0.4 0.9 0.9 6.0 3.8 7.0 7.1 13.1 14.8 2.6
7. Wahoo    

0.8

   

0.1

0.0 1.1 3.6 6.5 8.7 11.7
8. Dolphin 0.4 0.8 0.9 3.1 3.1 2.9 6.0 11.8 6.5 13.9
9. Tuna 0.4 0.0 0.9 1.8 3.0 2.0 2.5 1.9 19.1 9.3
10. Shark 1.3 3.8 4.1 6.2 6.8 3.8 9.4 6.7 14.6 16.3
11. Flounder 12.1 15.6 28.2 9.1 4.7 12.4 5.9 8.4 6.5 9.1
12. Redfish 19.5 29.1 17.1 13.3 9.8 6.7 8.2 1.7 6.2 0.1
13. Trout 26.1 18.8 17.6 12.2 12.9 7.6 7.0 6.6 0.1 11.4
14. Blackfish    

 

 

 

 

0.6

   

 

 

1.1

   

1.1

 
 

15. Black

drum

   

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

16. Specks and Bream

   

 

 

 

 

 

 

0.7

0.9    

 

 

 

 

 

 

17. Bass

   

 

 

0.4

   

 

 

0.9

1.1    

 

 

 

 

18. White

Perch

   

 

 

 

 

0.6

   

 

 

1.1

   

 

 

 

 

19. Gafftop Sail Catfish

   

0.4

   

 

 

 

 

1.9

1.1    

 

 

 

 

20. Croaker

   

 

 

0.4

1.2 0.7 0.0    

 

 

 

 

 

 

21. Black

drum and

Drum

   

 

 

 

 

0.6

0.8 0.0    

 

 

 

 

 

 

22. Sheephead

   

 

 

 

 

 

 

 

 

0.9

   

 

 

2.1

 
 

23. Spadefish

   

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2.3

24. Mullet 0.8 0.4 0.4 1.2 0.8 0.9    

 

 

 

 

2.3

25. White

Trout

0.4 0.8    

 

 

 

 

 

 

 

 

 

 

 

 

2.3

26. Marlin    

 

 

 

 

 

 

 

 

 

 

 

 

1.6

   

 

 

27. Crabs,

Shrimp,

Oysters

   

 

 

 

 

 

 

 

 

 

 

 

 

1.6

   

 

- Numbers in bold represent the most often listed gamefish species, within rank, by Mississippi coastal anglers.

- Shaded cells represent the five most often listed species by MS anglers within rank, including ties.

- Blank cells represent species not ranked by MS anglers.

 

 

Characteristics of Charter Boat Trips

A questionnaire was designed to collect information from charter boat firms including use of artificial reefs in coastal Mississippi (Appendix A). Questionnaires were sent to a total of 88 licensed operators (duplicate names were excluded) along with a cover letter from the Mississippi Department of Marine Resources and a postage-paid return envelope. Two rounds were sent. Every charter license holder was sent a survey regardless if they engaged in charter operations in the last year or not. A total of 23 questionnaires were returned for a response rate of 26 percent.

Results of the charter boat survey are summarized in Tables 16-18. Table 16 presents the proportion of charter boat trips that are for fishing or diving across various categories. About two-thirds of the firms in the sample reported that 100% of their charters in 1997 were for fishing. Only about 5% of firms in the sample reported more of their charters in 1997 were for diving than fishing (the reported split was 80% diving charters and 20% fishing charters). The average split between fishing and diving charters in the sample was 95% fishing trips and 5% diving trips. Table 16 reports that the mean number of charter trips operated by charter boat firms during the past 12 months was approximately 60 trips. It was reported that almost 40% of these trips were taken to artificial reefs in coastal Mississippi.

 

Table 16. - Frequency of Charter Boat Firms in Different Categories by Percentage Split of Charters Between Fishing and Diving, 1997.

Percentage Split Between Trips for Fishing and Diving Reported in Sample

 

Number of Firms

in this Category

 

Percentage of Firms

in this Category

Percentage of Fishing Trips Percentage of Diving Trips

100%

0%

15

71.4%

98%

2%

1

4.8%

95%

5%

3

14.3%

90%

10%

1

4.8%

20%

80%

1

4.8%

Average Split Between Fishing and Diving Charters (n=21)

Fishing - 95%

Diving - 5%

Mean number of Charter trips operated in past year (n = 23)

59 trips

Mean percent of Charter trips over artificial reefs (n = 22)

39.5%

 

Table 17 reports mean charter boat fees per person and per boat for whole day and half day trips. Table 17 shows that about 72% of charter boat trips in 1997 were for the whole day. As also shown in Table 17, 86% of charter boat firms in the sample stated that artificial reefs have been a benefit to their business.

 

Table 17. Charter Boat Fees for Whole and Half Day Trips Charged by Coastal Mississippi Charter Boat Firms, 1997.

Item

Mean Charter Boat Charges

Whole Day

Half Day

Fee per person

$500 (n=3)

$385 (n=3)

Fee per boat

$446 (n=14)

$346 (n=11)

Average Number of Customers

6 (n=22)

6 (n=17)

Mean Percentage of Charter Boat Trips per Firm which are for the Whole day

72.5 % (n=21)

Percentage of Charter Boat Firms Answering "Yes" to the Question: Have artificial reefs benefitted your business?

86.4 % (n=22)

 

Table 18 shows rankings of preferred gamefish by charter boat firms. Over 50% of charter boat firms ranked snapper as their first choice for gamefish. About 26% of respondents ranked king mackerel as their second choice for gamefish. Cobia was ranked as the third choice by approximately 35% of charter boat firms.

 

 

 

 

 

 

 

 

 

Table 18. - Rankings of Preferred Gamefish by Coastal Mississippi Charter Boat Firms, 1997.

 

Gamefish Species

Percentage of Charter Boat Firms Ranking as:

# 1 Rank

(n = 20)

#2 Rank

(n = 19)

# 3 rank

(n = 17)

# 4 Rank

(n = 15)

# 5 Rank

(n = 10)

# 6 rank

(n = 7)

# 7 Rank

(n = 6)

# 8 Rank

(n = 5)

# 9 Rank

(n = 3)

# 10 Rank

(n = 1)

1. Snapper 55.0 5.3 5.9 6.7 10.0 14.3 33.3    

 

 

 

 

2. Grouper

   

15.8

5.9 6.7    

14.3

16.7    

 

 

 

 

3. King

Mackerel

   

26.3

11.8 13.3 30.0    

 

 

20.0

   

 

 

4. Sp Mackerel

10.0 10.5 5.9    

10.0

   

 

 

 

 

33.3

 
 

5. Cobia

   

5.3

35.3 33.3 10.0 28.6    

20.0

   

 

 

6. Amberjack

   

 

 

 

 

 

 

 

 

 

 

 

 

 

 

33.3

 
 

7. Wahoo

   

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

100.0

8. Dolphin  

 

 

 

 

 

 

10.0

 

 

 

20.0

 

 

 

9. Tuna

   

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

10. Shark

5.0 5.3 5.9 26.7 10.0 14.3 16.7    

 

 

 

 

11. Flounder

   

 

 

5.9

   

 

 

 

 

 

 

 

 

33.3

 
 

12. Redfish

10.0 21.1 11.8 6.7    

 

 

33.3

   

 

 

 

 

13. Trout

20.0 10.5 11.8 6.7 10.0 14.3    

40.0

   

 

 

14. Sheephead

   

 

 

 

 

 

 

 

 

14.3

   

 

 

 

 

 

 

15. White

Trout

   

 

 

 

 

 

 

10.0

   

 

 

 

 

 

 

 

- Numbers in bold represent the most often listed gamefish species, within rank, by Mississippi coastal Charter firms.

 

 

 

 

Section II

Economic Impacts of Expenditures Associated with

Diving and Fishing Trips to Artificial Reefs

This section explains and illustrates various economic concepts and terms used within this report. The explanations are relatively standard and it is suggested that individuals comfortable with basic economic concepts skip to the next section.

Description of Economic Impacts

Economic impacts measure the business and financial activity resulting from transactions in a particular industry. Economic impacts can be separated into three components: direct, indirect and induced:

Direct Impacts

A direct impact is defined as the initial purchase made by the user group or industry under study. For example, when a consumer buys a rod and reel combo from a retailer for $100, there is a direct impact for the retailer, and the economy, of $100.

Indirect Impacts

Indirect impacts imply that sales in one industry affect not only the directly impacted industry, but also the industries that provide supplies and services. For example, the retailer must purchase additional inventory plus pay other costs such as wages, electricity, rent, etc.; the wholesaler must purchase additional goods; the manufacturer must produce rods and reels; the graphite, cork and accessories suppliers must arrange for additional product, and so on. Therefore, the original purchase of a $100 rod and reel, in turn, may benefit a range of other industries and their suppliers.

Induced Impacts

An induced impact results from the wages and salaries paid by the directly and indirectly impacted industries. The employees of these industries, in turn, spend their income on various goods and services such as groceries or a night at the movies. These expenditures are induced impacts. They, in turn, create a continual cycle of indirect and induced effects.

The sum of the direct, indirect and induced impact effects is the total economic impact of the industry or activity under study. As the original retail purchase (direct impact) goes through round after round of indirect and induced effects, the economic impact of the original purchase is multiplied, benefiting many industries and individuals. Likewise, the reverse is true. If a particular item or industry is removed from the economy, the economic loss is greater than the lost retail sales. Once the original purchase is made, each successive round of spending is smaller than the previous round down to the point where the economic benefits are no longer measurable. This is the point where the economic examination ends.

Data Sources and Methodologies:

The methods used to generate the economic impact estimates of recreational fishing and diving associated with Mississippi’s artificial reefs are separated into four stages: 1) Compile the expenditure data for divers and anglers,

2) disaggregate the expenditures into retail, wholesale, and manufacturer portions,

    1. generate the economic impact estimates by applying the multipliers from the RIMS model to the adjusted expenditures (develop the economic model), and

4) calculate state sales tax, state income tax, and federal income tax revenues.

Compile the Expenditures:

The data for the economic analyses were obtained from the diver, angler and charter boat surveys described in the previous section. Besides participation information, these surveys collected data on detailed travel, equipment and ancillary purchases made for the primary purpose of either diving or fishing. Travel expenditures were collected for the most recent trip as studies have shown people have a hard time recalling the total value of numerous small purchases over the course of a year (Fish and Wildlife Service, 1989). Travel related items include:

Food Lodging Public Transportation Private Transportation

Bait Film and Processing Guides and Charters Boat and Equip Rental

Boat Fuel Boat Launching Ice Airfills (diving only)

As this study needed to quantify the total expenditures made for artificial reef-related activities over the course of a year, the per-trip expenditures were multiplied by the total number of trips taken over the last 12 months – also collected as part of the angling and dive surveys. All costs were adjusted to reflect the proportion of trips made to artificial reefs. Example, if an angler spent $100 on rods and reels, and reported 20 percent of his trips were to artificial reefs, then only $20 of his annual rod and reel purchases would be applied to this study. Survey respondents were provided a map presenting the locations of all Mississippi artificial reefs. They were asked to report the percentage of all fishing trips made to any of these locations over the past year.

One adjustment was made. Since all artificial reef trips and expenditures made by charter boats are addressed separately, total private boat expenditures were adjusted downward by 18.8 percent for divers and 21 percent for anglers. These percentages reflected the proportion of all trips made by survey respondents via charter boats. Since all charter boat related expenditures are calculated separately from private boat trips, these expenditures had to be eliminated to prevent double counting.

Once the per-trip expenditures for travel-related goods were tabulated, they were multiplied by the total number of trips estimated to have occurred on the coast. The result was the total annual expenditures for travel related items in Mississippi. The number of trips were 2,497 for diving and 850,419 for fishing. The trip estimates for diving were calculated by multiplying the estimated number of divers (113) by the average number of annual trips per diver as estimated by the dive survey. Angler trips were estimated by multiplying the total number of resident and non-resident angler licenses sold (53,824) by the average annual number of trips reported by the returned surveys. After the total travel-related expenses were calculated, they were added to the total annual equipment expenditures for anglers and divers respectively to determine the total reef-related expenditures. Total equipment expenditures were calculated by multiplying the number of divers and anglers by the respective annual expenditures per equipment category as reported by the surveys.

Two alternatives existed to calculate total angler expenditures. The first method, which we used, was to multiply the per-angler expenditures reported in the survey by the number of angler licenses sold. The second method was to multiply the per-angler expenditures by the total number of anglers reported in the U.S. Fish and Wildlife Service’s 1996 National Survey of Fishing, Hunting and Wildlife-Associated Recreation (Survey). The Survey reports approximately 121,000 saltwater anglers fished in Mississippi in 1996. This is slightly more than twice the number of licenses sold. We elected to use the lower number (licenses sold) for several reasons:

  1. the survey we conducted asked respondents to report the total amount spent, and then asked how many people did their expenditures pay for. The average survey respondent paid for two people. The Fish and Wildlife Service’s Survey only reported the amount that was spent for that individual’s share of the expenses. Therefore, both surveys balance out.
  2. The sample size of the U.S. Fish and Wildlife Service’s Survey is fairly small. The sample size is determined by the responses needed to collect big game hunting data, not fishing data. Big game hunting is typically the toughest data to collect in most states, so it drives the sample sizes. However, in Mississippi where deer hunting is very popular and the coast line for fishing limited, the fact may or may not affect the reliability of the saltwater angler sample. Without knowing for sure, we preferred to use the actual number of licenses sold as this is a certain number.
  3. The U.S. Fish and Wildlife Service’s Survey present a slightly larger estimate of the number of Mississippi saltwater anglers. To remain on the conservative side, we selected the lower of the two options.

Expenditures made for charter boat trips were quantified using a different method. To avoid the significant time and cost of surveying charter boat customers, we determined the total number of dive and fishing charter customers through the charter operator survey. Then, the total number of dive and fishing charter trips were each multiplied by the per-trip travel expenses from the angler and diver surveys described in the paragraph above to derive the annual travel-related expenditures spent by charter customers to artificial reefs. Expenses for equipment and other non-travel related items were not included in this analysis as charter boats cover all other costs for each trip such as tackle, boat, etc., as part of their fee. An exception was made for masks, fins, snorkels, weight belts, watches, computers and regulators which are typically personal gear and would be provided by the customer. Boat fuel was also eliminated as this cost is built into the charter fee. Total charter/guide fees were estimated by multiplying the weighted average of full and half day charter fees (as reported by the survey) by the total number of trips (also derived from the survey).

 

Dissaggregate the Expenditures:

Retail sales were separated into manufacturer, wholesale and retail sub-categories because economic impact analyses treats each segment as separate industries. The amount of each retail sale attributed to each segment is known as a margin.

A margin is the percentage, or mark-up, of a sale attributable to either the retail, wholesale or manufacturing sector. For example, 70 percent of the final retail dollar value of a binoculars sale may be attributed to the manufacturer, 5 percent to the wholesaler and 25 percent to the retailer. This means that the manufacturing industry has earned 70 percent of the final retail price, the wholesaler accrued 5 percent of the sale, and the retailer received 25 percent. Since there are no wholesale or manufacturing activities in the service sector, services are not subjected to the above process.

Data used to calculate trade margins are from the Census of Retail Trade: Measures of Values Produced (1987) and the Census of Wholesale Trade: Measures of Values Produced (1987). These two Department of Commerce documents contain national sales figures for most retail and wholesale industry sectors as well as gross margins. A gross margin is the revenue remaining after the cost of the goods sold is subtracted. To derive margins, each wholesale and retail industry's gross margin was divided by its total sales. This produces the typical price mark-up for that industry. Next, two formulas are applied to estimate the value added (price mark-up) for each sector:

R/(1+R) = retail margin, where R = retail mark-up, and

W/{(1+W)(1+R)} = wholesale margin, where W = wholesale mark-up.

These formulas estimate the percentage of a product's final selling price that accrues to each sector. The manufacturing margin is derived by summing the retail and wholesale margins and subtracting the total from 100 percent.

Develop the Economic Model:

To estimate the economic impacts of diving and fishing on the state economy, the data were analyzed with the Regional Input-Output model (RIMS-II). RIMS-II was developed by the U.S. Dept. of Commerce, Bureau of Economic Analysis for primary use by the Federal government.

Input-output models, such as RIMS-II, describe how sales in one industry impacts other industries. For example, once an angler makes a purchase, the retailer buys more merchandise from wholesalers, who buy more from manufacturers, who, in turn, purchase new inputs and supplies. In addition, the wages and salaries paid by these businesses stimulate more benefits. Simply, the first purchase creates numerous rounds of purchasing. Input-output analysis tracks how these rounds of purchasing benefits other industries and generates economic benefits.

The relationships between industries are explained through multipliers. For example, an income multiplier of .09 for industry X would indicate that for every dollar received by the industry under study, nine cents would be paid to industry X for its products or services. The RIMS-II model provides multipliers for all major industries in the U.S. The multipliers include direct, indirect and induced effects.

The RIMS-II model includes output, earnings and employment multipliers. The output multiplier measures the total economic effect from economic activity created by the original retail sale. The earnings multiplier measures the total salaries and wages generated from the economic activity created by the original retail sale. The employment multiplier estimates the number of jobs supported by the economic activity resulting from the original retail sale.

To apply the RIMS-II model, diver and angler expenditures are each matched to the appropriate output, earnings and employment multipliers. For example, dollars attributed to gasoline refining are multiplied separately by the earnings, output and employment multipliers specific to gasoline refinement. The resulting estimates describe the salaries and wages, total economic effects, and jobs supported by the refining industry as a result of fuel purchases made during recreational activities. This same process is repeated for all reported expenditures. After all expenditures and multipliers have been applied together, the retail, wholesale and manufacturing results for each category are summed together.

This scope of this study was to estimate the economic impacts of artificial reef-related diving and fishing on the state economy versus the economy of the coast or specific counties. Therefore, statewide RIMS-II multipliers were used instead of county or regional multipliers.

Calculation of Tax Revenues

State sales tax estimates are based on state general and fuel sales tax rates. Sales tax revenues are calculated by multiplying all retail purchases, except fuel and categories such as food and many services, by the 1996 state tax rate (excluding local and city taxes). This was added to fuel tax revenue which was determined by multiplying total fuel purchases first by the manufacturing margin (described above) to determine the total percentage of gasoline sales attributed to the manufacturing/distribution sector (where most fuel taxes are charged), then divided by the average manufacturer price per gallon to determine the total gallons sold, and then multiplied by the 1996 state fuel tax rate per gallon.

 

State income tax revenues were calculated by dividing the total income generated by recreationists’ expenditures by the total number of jobs supported by recreationists’ expenditures. The result was the average income per job. Next, the state standard deduction was subtracted and the remaining amount was multiplied by the appropriate 1996 state income tax rate. The results were then multiplied by the total jobs to derive the final income tax estimate.

Federal income tax revenues were calculated by dividing the total income generated by sportsmens’ expenditures by the total number of jobs supported by sportsmen. The result was the average income per job. From this, a standard deduction of $3,980 was subtracted. The applicable tax rate was then applied according to the 1996 IRS tax schedule for single filers to determine the average tax paid per job. Finally, the average tax paid per job was multiplied by the total number of jobs to determine the total Federal income tax revenue generated by recreationists during 1996.

Results

The economic impacts of diving and recreational fishing activities on artificial reefs is substantial. Table 19 presents the total retail sales for all reef-related diving activities. Table 20 presents the total retail sales resulting from recreational fishing activities over Mississippi artificial reefs. Table 21 presents the economic impacts these retail sales create for the state of Mississippi, both for diving and fishing.

Table 19: Retail Sales Generated by Scuba diving on MS Artificial Reefs:

Average Spent

Total Spent Annually

Total Spent Annually

Total Spent Annually

Per Diver

for Private Boat

for Charter Boat

for ALL Boat

Category:

Per Trip

Trips to Art. Reefs:

Trips to Art. Reefs:

Trips to Art. Reefs:

Food

$62.42

$40,109

$24,003

$64,111

Lodging

$80.00

$51,405

$30,763

$82,168

Public transportation

$0.00

$0

$0

$0

Private transportation

$0.84

$540

$323

$863

Airfills

$18.12

$11,643

$6,968

$18,611

Guides/Charter fees

$0.00

$0

$50,527

$50,528

Film/Processing

$12.85

$8,257

$4,941

$13,198

Dive equipment rental

$28.13

$18,075

$10,817

$28,892

Boat fuel

$73.00

$46,907

$46,907

Boat launching/Docking

$42.58

$27,360

$16,373

$43,734

Boat rentals

$15.65

$10,056

$6,018

$16,074

Ice

$7.53

$4,838

$2,896

$7,734

TOTAL:

$341.12

$219,191

$153,629

$372,819

Avg. Spent Per

Total Spent Annually

Total Spent Annually

Total Spent Annually

Diver Annually,

for Private Boat

for Charter Boat

for ALL Boat

reef & non-reef trips:

Trips to Art. Reefs:

Trips to Art. Reefs:

Trips to Art. Reefs:

Air tanks

$155.29

$4,515

$59,714

$64,229

Regulators

$164.23

$4,775

$63,152

$67,927

Masks, fins, snorkels, wgt belts

$80.06

$2,328

$30,786

$33,113

B.C.'s

$131.55

$3,825

$50,585

$54,410

Dive watches

$88.55

$2,575

$34,050

$36,625

Dive computers

$127.26

$3,700

$48,936

$52,636

Wet suits, skins

$95.24

$2,769

$36,623

$39,392

Elec. Depth finders, GPS, loran

$407.19

$11,839

$11,839

Dive knives & tools

$39.61

$1,152

$1,152

Spearfishing gear

$154.03

$4,478

$4,478

Bags and carrying cases

$21.77

$633

$633

Other dive-related gear

$44.08

$1,282

$1,282

Dive lessons

$163.78

$4,762

$4,762

Clothing

$67.58

$1,965

$1,965

Cameras

$5.13

$149

$149

Books/Magazines

$14.51

$422

$422

Dues

$19.03

$553

$553

Coolers

$125.97

$3,663

$3,663

Vehicles

$648.59

$18,858

$18,858

Boats

$3,159.48

$91,862

$91,862

Boat Gear/Accessories

$298.71

$8,685

$8,685

Maintenance and Repair Costs

$499.19

$14,514

$14,514

Licenses and Fees

$19.52

$568

$568

TOTAL:

$6,530

$189,871

$323,846

$513,717

TOTAL ANNUAL SPENT:
(Trip & Equipment Combined)

$409,062

$477,474

$886,536

 

Table 20: Retail Sales Generated by Recreational Fishing on MS Artificial Reefs:

Average Spent

Total Spent Annually

Total Spent Annually

Total Spent Annually

Per Licensed Angler

for Private Boat

for Charter Boat

for ALL Boat

Category:

Per Trip

Trips to Art. Reefs:

Trips to Art. Reefs:

Trips to Art. Reefs:

Food

$48.45

$4,491,930

$566,370

$5,058,301

Lodging

$30.68

$2,844,426

$358,643

$3,203,068

Public Transportation

$0.97

$89,931

$11,339

$101,270

Private Transportation

$35.37

$3,279,434

$413,491

$3,692,925

Guides/Charters

$0.00

$0

$747,952

$747,952

Bait

$20.19

$1,871,869

$236,017

$2,107,886

Film/Processing

$4.46

$413,499

$52,136

$465,635

Boat Rental

$4.68

$433,895

$54,708

$488,604

Boat Fuel

$39.95

$3,703,872

0

$4,170,879

Boat Launching

$5.08

$470,981

$59,384

$530,365

Fishing Equipment Rental

$1.67

$154,830

$19,522

$174,352

Ice

$7.79

$722,232

$91,063

$813,295

TOTAL:

$199.29

$18,476,900

$2,610,626

$21,554,532

Average Spent

Total Spent Annually

Total Spent Annually

Total Spent Annually

Per Angler Annually,

for Private Boat

for Charter Boat

For ALL Boat

reef & non-reef trips:

Trips to Art. Reefs:

Trips to Art. Reefs:

Trips to Art. Reefs:

Fishing Line

$21.30

$124,986

$124,986

Cameras

$20.18

$118,414

$235,900

$354,314

Fishing Rods

$107.98

$633,615

$633,615

Reels

$104.29

$611,963

$611,963

Terminal tackle

$56.44

$331,184

$331,184

Nets, Landing nets, gaff hooks

$11.83

$69,417

$69,417

Knives and Hand tools

$12.21

$71,647

$71,647

Coolers

$31.71

$186,071

$186,071

Elec. Fish finders/GPS/Loran

$202.41

$1,187,720

$1,187,720

Maintenance/repair

$261.93

$1,536,977

$1,536,977

Clothing

$40.88

$239,879

$239,879

Taxidermy

$5.49

$32,215

$32,215

Books/Magazines

$8.72

$51,168

$51,168

Dues

$17.67

$103,686

$103,686

Other Fishing Expenditures

$117.64

$690,299

$690,299

Boats

$1,227.64

$7,203,660

$7,203,660

Boat Gear and Accessories

$79.70

$467,671

$467,671

Vehicles

$371.26

$2,178,514

$2,178,514

Licenses and Fees

$36.09

$211,772

$211,772

TOTAL:

$2,735

$16,050,857

$235,900

$16,286,757

TOTAL ANNUAL SPENT:
(Trip & Equipment Combined)

$34,527,757

$2,846,526

$37,3784,283

 

Table 21: The Economic Impacts of Mississippi Artificial Reefs

Economic Impacts: Scuba Diving:

Recreational Fishing:

TOTAL:
Retail Sales: $886,500 $37.4 million $38.3 million
Salaries & Wages: $515,200 $20.1 million $20.6 million
Jobs 28 1,122 1,150
State Sales Tax Revenues: $54,100 $2.7 million $2.7 million
State Income Tax Revenues: $9,200 $364,000 $374,000
Federal Income Tax Revenues: $47,500 $1.9 million $1.9 million
Total "Ripple" effect, or

Multiplier Effect:

$1.7 million $76.7 million $78.4 million

The overwhelming portion of economic impacts generated from users of Mississippi’s artificial reefs is derived from recreational fishing. The average job supported from artificial reef related activities pays $18,000 annually. Please note that these jobs, and the pay for each job, is an average of all full time and part time positions. The job and pay estimates reported here are not full time equivalent. The state tax revenues are those earned by the state only and do not include any local sales tax levies or other special taxes that may be earned by local coastal communities. These impacts could be compared to the annual government investment in state artificial reefs to determine the net return to the state economy.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Appendix A: Survey Forms

 

 

 

 

 

 

Appendix B: Standard Deviations for Dive Survey

 

 

N Mean Std. Dev. Min Max

Trips (question #1, Table 1) 31 14.677 15.572 0 65

Days (question #1, Table 1) 27 1.962 3.252 0 15

Dives (question #1, Table 1) 27 3.815 3.981 1 20

Trips (question #2a, Table 1) 31 7.387 9.531 0 30

Days (question #2b, Table 1) 20 2.350 3.345 0 15

Number of days 20 2.225 3.262 0 15

(question #2c, Table 1)

Number of dives 20 3.90 4.494 0 20

(question #2d, Table 1)

All trips 31 22.065 19.696 1 65

(question #3a, Table 1)

Total Days 31 2.040 2.940 0 15

(question #3b, Table 1)

Total Dives 31 3.757 3.766 1 20

(question #3c, Table 1)

Age 31 31.613 10.763 14 59

Miles from Coast 31 4.171 3.617 0 12.5

Expenses:

Trip Cost 31 352.863 502.293 12 2350

Equip. Cost 31 1672.64 1737.4 0 6370

Auxiliary Cost 31 4900.62 7790.67 0 33725

Annual Cost 31 6573.26 8971.33 0 37509