Hatteras Island economic impact study presented to Dare County Board of Commissioners

Published 8:19 am Sunday, April 10, 2022

Last September, the Dare County Board of Commissioners commissioned an economic impact study for Hatteras Island. E. Brent Lane was assigned the task. He produced a similar report in 2013 for the Outer Banks Visitors Bureau.

Lane, an economic strategist, is a fellow at the UNC Global Research Institute at the University of North Carolina at Chapel Hill. Lane also completed economic study for the Dare County Regional Airport in 2019.

He said he was paid $27,500 for the current work, which was completed in February 2022.

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For the 2022 report, he stated this conclusion: “Hatteras Island plays a disproportionately large role in the county’s economy.”

He based this assessment on “examination and calculation of economic impacts of four primary sectors of Hatteras Island economic activity…” Those sectors are real estate, tourism, recreational fishing and commercial fishing.

Real Estate

In the real estate sector, Hatteras Island has 8,572 parcels with an assessed value of $2.657 billion. Dare’s total assessed value is $16.915 billion. Hatteras Island represents 17% of the total value, reports Lane.

That assessed value produced an estimated $10.6 million in 2020 property tax revenues. Occupancy tax receipts generated in 2021 from Hatteras Island totaled $189.4 million. That is 24.6% of the Dare County total in 2021.

Tourism

Tourism in Dare held its own during the pandemic. In 2020, North Carolina’s tourism industry suffered a 32 percent decline in visitor spending, reports Lane. Not so in Dare County. In 2020, Dare’s visitor spending was $1.41 billion, a decline of only 2.2% in that year.

To calculate the impact of Hatteras Island tourism, Lane put together an industry cluster, defined as “classifications of businesses that directly serve tourists.”

Lane writes “a healthy, dynamic industry cluster can be thought of as a wide-ranging fabric of firms that serve a target market.”

North Carolina has 34,967 firms in its tourism cluster; Dare County, 561 firms; Hatteras Island, 136 firms, which represent 24% of Dare County’s tourism cluster firms.

Those 136 firms produced $104.57 million in revenues, 23% of Dare’s $455.44 million.

Lane’s summary of the Hatteras Island tourism economic impact is: economic output, $324 million; employment, 2,715 jobs; labor income, payroll $61 million; property income, investment income $35 million; total income, $96,413,700; state and local taxes, $28,382,000.

Recreational Fishing

This sector was divided into three parts: private fishing, for-hire fishing and tournament fishing.

Lane used various sources to construct a model to estimate the economic impacts of the three sections of recreational fishing.

For example, an analysis of data from 2011 to 2020 found that 38.4% “of Dare County for-hire industry revenues were achieved by Hatteras Island activity.” That percentage was applied to the updated recreational fishing model to produce the impacts of for-hire fishing.

As of 2020, the combined Hatteras Island economic impact of the recreational fishing sector is reported as: economic output, $35.7 million; employment, 443 jobs; labor income, payroll $18.1 million; property income, investment income $14.4 million; total income, $32,543,754; state and local taxes, $2,174,815.

Commercial Fishing

Dare County commissioners objected to this part of the report. Lane offered to do a supplement.

Lane sent this additional paragraph to Section 5.3 which is titled “Hatteras Island Commercial Fishing Economic Impacts:

“This study’s geographic focus limited assessments of the impacts of commercial fishing solely to those resulting from seafood landings within Hatteras Island. As a consequence, the impacts – jobs, income, etc. – of commercial fishermen operating out of Hatteras Island, but selling catch elsewhere, were not included. For similar reasons, the impacts reported also exclude those generated by seafood processing or wholesale/retail markets.”

The report’s original paragraph continues: “The NCDMF [North Carolina Division of Marine Fisheries] reported that the 2020 value of commercial seafood landings in Hatteras Island was $3,582,611. Incorporating this value in the Hatteras Island economic model estimated the 2020 economic impacts (Table 8) of Hatteras Island’s commercial fishing as follows:

Economic Output $6.3 million

Employment: 83 jobs added (excludes non-Hatteras Island landings and processing), phrase added after the presentation.

Labor Income: Payroll of $2.7 million

Property income: Investment returns of $2.1 million

Total income: Aggregate income growth of $4.8 million

Taxes: $379k in state and local taxes”

Table 8, referenced in the original paragraph, gives the specific amounts associated with each impact: economic output, $6,254,583; employment, 83 jobs; labor income, $2,698,084; property income: $2,082,084; total income, $4,780,494; state and local taxes, $378,672.

Dare commissioner Steve House concentrated on the number of jobs indicated in the report. House pointed out the figures did not include seafood processing.

A North Carolina Sea Grant report does accumulate seafood processing information. The report divides the coast into three sections: north, central, south and offers figures on four different categories: commercial fishing, seafood preparation and processing, fish markets and retailers and seafood restaurants to assess the economic impact of the state’s wild-caught commercial seafood industry.

Overall, in 2019, the Sea Grant report said that the commercial fishery produced an economic impact of $297.3 million and generated 5,528 jobs.

The north coast, of which Dare County is part, has a total impact of $78.6 million, with commercial fishing listed as $65.8 million, seafood preparation and processing at $5.4 million, fish markets and retailers at $5.3 million and seafood restaurants at $2.1 million.

The Coastland Times has reached out to Sea Grant asking for a breakout of Dare County information.

Hatteras Inlet

Dare’s commissioners asked for the economic impact of Hatteras Inlet, a major difference between the 2013 and 2022 studies.

To create an economic impact for Hatteras Inlet, Lane added the economic impacts of recreational and commercial fishing together. He reports for Hatteras Inlet: economic output, $42.0 million; employment, 526 jobs; income, $37.5 million; state and local taxes, $2.6 million.

The full report was published in the agenda packet of the March 21, 2022 Board of Commissioners meeting. To find the report, go to darenc.com and under Departments look for the Board of Commissioners listing and select Agenda, Minutes & Videos.

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