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Economic Impact of Snowmobiling

Every time snowmobile issues are discussed or written about in Vermont, you can count on someone claiming that "the sport brings in $500 million dollars to Vermont's economy annually". Although this is pure hogwash, VAST lobbyists have spread this bit of misinformation so widely and so effectively that it has now attained the status of common knowledge.

The original source of the $500 million figure is a 2001 VAST-commissioned "economic impact study" that tallied up every expenditure associated with snowmobiling; from the purchase of snowmobiles and tow vehicles to gas, oil, beer, and chips; then doubled the total to account for the so-called "multiplier effect" (the spending by those at the receiving end of a monetary transaction). The study is suspect in many regards, but even the Johnson State economics professor who conducted it never claimed that the total amount was "brought into" the state: the study made no distinction between spending by Vermonters and spending by tourists.

In fact, a lot of the money spent on snowmobiling in Vermont should be seen as money leaving the state, rather than coming in. When a Vermonter buys a new $8,000 snowmobile or a $20,000 truck to tow it, the bulk of that money, everything but the dealer's markup and the sales tax, is immediately headed for Detroit, Canada, Japan, or wherever the vehicle was manufactured. Nonetheless, the VAST study doubles the entire amount and adds it to the bottom line. The same goes for all the gasoline and oil purchased here to run snowmobiles, tow vehicles, trail-grooming equipment, and so on. Most of that money winds up in Texas or Saudi Arabia, and only a small fraction remains in Vermont. If the economic benefit of tourist dollars flowing into Vermont is obvious, it should be equally clear that money drained out of Vermont hurts our economy. But the VAST study makes no attempt to correct for this.

The fact is, the entire study is littered with flaws; from arithmetic mistakes to poor methodology; all of which tend to inflate snowmobiling's economic impact. As just one example, the surveys on which the study was based were sent to VAST members along with a cover letter pointing out that "issues such as maintaining open lands and trails for snowmobile use [and] influencing state legislation to support snowmobiling are all affected by the results of this survey." Now there's a good way to get accurate, unbiased information out of snowmobile enthusiasts! Maybe that's why survey respondents claimed to have bought almost 20 percent more new snowmobiles in Vermont than dealers actually sold.

Despite the fact that the $500 million figure is continually trotted out by VAST as a typical year's economic impact, the study itself was conducted over a very unusual winter, as VAST Executive Director Bryant Watson admitted when he announced the survey: "Wasn't this past winter just fantastic for snowmobiling! For the first time in years, there was snow, statewide, for an average of 14 weeks. Wow! If there was ever a time to do [an economic impact study] it is now". What better time, that is, if you want to inflate the economic importance of your sport.

A useful economic impact study would not only need to deduct snowmobile-related spending that quickly leaves the state, it would need to measure the sport's costs as well; for example the added burden on law enforcement bodies and rescue services. And with global warming clearly underway, a sport that consumes nearly 4 million gallons of gasoline a year in Vermont alone clearly has environmental costs.

Does snowmobiling bring $500 million into the state's economy annually? Nope.