UM Study Shows Effect of Increased National Park Fees on Local Communities

November 29, 2017

MISSOULA – A proposed national park fee increase from $30 to $70 for a seven-day pass likely will negatively affect the gateway communities near the parks, according to a new study by the Institute for Tourism and Recreation Research at the University of Montana.

The U.S. Department of the Interior recently announced its plan to increase fees in 17 of the most-visited national parks in response to a nearly $12 billion backlog due to deferred maintenance. For many of the parks, the fee increase means a seven-day vehicle pass will more than double in cost during the park’s five-month peak season. The National Park Service expects to generate an estimated 34.3 percent increase, or $69 million, over its 2016 revenues.

“As with most goods or services in our economy, a price increase leads to a decrease in demand,” said Jeremy Sage, the ITRR study’s lead author. “In the case of a national park, this means a reduction in the number of visits.”

The ITRR report estimates what the change in demand might mean for Yellowstone National Park. Sage and his colleagues find that for every 10 percent increase in travel costs, including entrance fees and fuel costs, the number of monthly visits to the park declines by 2.7 percent when all other factors are constant.

This decline in number of visits may negatively impact the gateway communities surrounding the parks. According to a 2016 report from the NPS, visitors to parks across the country spent $18.4 billion annually in gateway communities, including nearly $525 million around Yellowstone alone. According to the ITRR analysis, an annual loss of $3.4 million in spending in Yellowstone’s gateway communities would result from just the change in the price of seven-day vehicle passes.

 “The effect of the price change is disproportionately felt by local visitors from Idaho, Montana and Wyoming,” Sage said. “Visitors from these local states currently have an average travel cost of about $106, including fuel and the entrance fee. They would see an increase of nearly 38 percent with the new fees. This obviously has a potential to create a significant hardship for many families in the local area.”

The price changes mostly will affect the local communities, with U.S. citizens outside the area and Canadians seeing an average change of 14 percent and international visitors facing an average increase of only one percent.

 “The effects shown in our assessment of Yellowstone likely carry over to the other parks and gateway communities as well,” Sage said. “We only assess the seven-day vehicle pass, but changes are proposed to the motorcycle pass, the per-person pass and the park-specific pass. All should be expected to reduce visits and thus have a negative impact on local communities.”

The full report, “Thinking Outside the Park – National Park Fee Increase Effects on Gateway Communities,” is available on the ITRR website at https://scholarworks.umt.edu/itrr_pubs/362. To read more reports published by the ITRR, visit http://www.itrr.umt.edu.

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Contact: Jeremy Sage, economist and associate director, UM Institute for Tourism and Recreation Research, 406-243-5552, jeremy.sage@umontana.edu.