Kennesaw State College
Office of College Relations
1000 Chastaln Rd.
Kennesaw, GA  30144-5591

                                                                            NEWS

January 29, 1996                                                                                                Contact: Betsy R. Jordan
                                                                                                                            (770) 423-6711

                                Weiss Lake generates $201 million for local economy

    Users of northeast Alabama's Weiss Lake spent $147 million on lake related goods and services in 1994, according to a
new study by researchers at Kennesaw State College and Florida State University.

    Researchers estimate Weiss lake's economic impact at $291 million for surrounding Cherokee County.  To reach that figure,
researchers factor in the number of times Weiss Lake users' dollars turn over between various merchants and the public.

    The study represents the first time that economists have conducted a comprehensive assessment of Weiss Lake, which sports
447 miles of shoreline near the Alabama/Georgia border, according to co-author Harry McGinnis, director of the A.L. Burruss
Institute of Public Service at Kennesaw State. the same study also reported on public perceptions of the lake's water quality.

    "Weiss Lake generates more than $36 million in wages and 4,132 jobs in the region," McGinnis said. "In general, perceptions
of existing water quality are favorable, despite biological and chemical evidence that might put the lake at a lower level of water quality."

    Researchers surveyed 1,001 residents in the 78 Alabama, Georgia and Tennessee counties closest to the lake, as well as more
than 1,200 tourists.  Among the findings:

    - About 450,000 people visit Weiss Lake annually.
    - About 64 percent of the lake's users are Cherokee County residents.  Those local users spent $1.25 million on lake related
       goods and services last year, or about $57.55 per party.
    - Tourists -- those who visit the lake from outside Cherokee County -- spent $102.56 per party on lake related goods and
       services, or $145.8 million, in 1994.
    - Most users -- about 77 percent of those surveyed -- felt that Weiss Lake's water quality ranges between "swimmable" and "drinkable."
    - Users said they'd be willing to pay for water-quality improvements. Most users surveyed indicated they'd buy an annual pass
       to use the lake, with the revenue going toward maintenance of the lake and its facilities.
    - The main reasons non-users gave for not visiting the lake were unfamiliarity with the lake and lack of time.
    - About 7.2 percent of people who fish at Weiss Lake depend on the lake for their regular food supply, the data showed.
    - The economic impact study was funded by a $25,000 grant from the U.S. Environmental Protection Agency.

                                Executive Summary

Weiss Lake, Alabama is a natural resource that has both an economic impact on Cherokee County by attracting visitors and
provides value from outdoor recreation to all users.  Although related, the economic impact of a lake is separate from the
recreational value provided by common property resources such as a fish stock as explained in this report.

Five concentric zones were drawn around Weiss Lake.  Zone 5, the most distant zone from the lake, had a radius of a little over
100 miles from the lake.  Each zone was defined as a geographical market area served by Weiss Lake with Zone 1 being Cherokee
County.  There are 78 counties in Zones 1 - 5.  Within these five market areas, 1,001 phone contacts were made using a random
sample of non-business telephone numbers.  Of the total contacts, only 12.5% or 125 adults (18 years or older) used the natural
resources of Weiss Lake over the last 12 months (1994).  Over 4.9 million people live in he market area served by Weiss Lake.
This area covers the tri-state region of Alabama, Georgia and Tennessee.  An on-site survey of 1,276 individuals was made to
ascertain the percent of Weiss Lake users coming to the lake from beyond 100 miles (tourists).  Only 7.8% of all individuals visiting
the lake came from beyond Zone 5.  Both in the phone and on-site surveys, individuals were extensively interviewed on primarily
economic factors (e.g., expenditures while at the lake, willingness to pay for improved water quality, etc.) related to Weiss Lake.
 This was the first comprehensive economic study of users and non-users of Weiss Lake on record.

The data yielded by the telephone survey enabled the researchers to establish the percentage of the population, within each of the
five zones, that visited Weiss Lake in the last 12 months.

When the multiplier is considered, it is estimated that spending or sales related to Weiss Lake amounted to a little over $201 million
in Cherokee County in 1994.  This generated over $36 million in wages and almost 4,132 jobs.  This is called the economic impact
of Weiss Lake.

Separate from the economic impact of the lake is its recreational value.  The recreational services of Weiss Lake are by and large free
to the public (e.g., picnicking, boating, etc.) except for a selective license fee (e.g., fishing license).  Economists call these "recreational
services" non-market or extra market goods that are not bought and sold in an organized market yet may have substantial value.  The
value can be estimated using what is called the "Travel Cost Method" which is widely used by federal agencies to evaluate water
resources projects (e.g., navigation and beach nourishment).

The travel cost method uses the inverse relationship between the participation rate (see above) and the cost of travel to a site
(e.g., Weiss Lake) plus the opportunity cost of time while in transit to generate an empirical demand curve for the resource (lake)
showing the relation between an entrance fee and the number of visitors.  Since there is no fee for the use of the lake, users obtain
what is called "consumer surplus" or difference between what users might pay (entrance fee) and the present free access to the lake's resources.

All users of Weiss Lake derive a little over $20.9 million (1994) in consumer surplus or just recreational value.  The daily value
of a visit per person is $3.72 for all kinds of recreational services using the travel cost method with the opportunity cost of time.
Diminished water quality at Weiss Lake would reduce this recreational value -- consumer surplus -- which is a perpetual flow over time.

Perceptions of water quality at Weiss Lake were also examined using a scale from 1 (bad) to 10 (excellent) and the concept of a
"water quality ladder."  The mean and median rating of water quality by users was 6.5 and 7 respectively indicating an above average
rating for Weiss Lake.  The distribution of ratings was approximately normal.  The water quality rating can be related to use by the
means of a "ladder."  Most users (76.7%) felt that Weiss Lake was on rung 4 (i.e. swimmable) or above.  In general, perceptions
of existing water quality are favorable despite biological and chemical evidence that might put the lake at a lower level of water quality.
Perceptions are often inconsistent with biological and chemical "objective" measures of water quality.

                    Water Quality Rating                          Rung of Ladder                    Use of Water
                        9-10                                                        5                                Drinkable
                        7-8                                                          4                                Swimmable
                        4-6                                                          3                                Fishable
                        3-4                                                          2                                Boatable
                        0-2                                                          1                                Not Usable
 

Users are willing to pay (WTP) for improvements in water quality.  This amounts to moving up the water quality ladder.  The average
rating of water quality would place it on the fishable rung of the water quality ladder.  But, only 18.3% of users (82,631) agree that the
lake is on this rung (i.e., .183 X 451,537).  To move from fishable to swimmable, these individuals would be willing to pay $733 per
year or a total of about $6.6 million.  Although such numbers cannot be precise, it does show a willingness on the part of the users of
Weiss Lake to pay for improved water quality.

Of all users of Weiss Lake, 52.8% preferred access fees and licenses for specific recreation as a means of funding to maintain (i.e., stay on
the same rung of the water quality ladder) water quality.

Over 43% of the Weiss Lake users preferred local government to be responsible for maintaining water quality.

We posed the suggestion to Weiss Lake users that they purchase an annual pass to use the lake with revenue going to maintain the lake
and its facilities.  The response was that users would pay $35.20 (mean) and $25.00 (median) respectively for such a pass raising from
$6.8 to $15.9 million in revenue.  Few (10.4%) users refused to pay for an annual pass, citing no trust in government or inability to pay
or unwillingness to pay more taxes.

Non-users were interviewed by the telephone survey as discussed above.  These non-users were important to analyze since they may
have an interest in using the resource in the future (i.e., they have option value) or just want natural resources preserved (i.e., they have
existence value).

Of the 12.6% of the non-users having option value, it was found they would be willing to contribute to advancing up the water quality
ladder for Weiss Lake from 455 to $410 per year per family.  The researchers feel such values may be inflated since respondents could
not be easily held to such payments since they do not visit the lake.

Of the 75.5% of the non-users having existence value, their willingness to pay to move up the water quality ladder ranged from $185 to
$360 per year per family, about the same as those with option value.  The same reservation for option value (point 16 above) applies to
existence value.

Non-users agreed with users that access fees are a better means of raising revenue to maintain water quality, but the former preferred the
state while the later felt local government should handle the problem.

The two main reasons by non-users for not visiting Weiss Lake are their unfamiliarity with the lake and their lack of time for this kind of
recreation.

There were statistically significant socioeconomic differences between users and non-users of Weiss Lake.  The lake's users had a higher
percent of younger white males than non-users.

Based on days of use during 1994 at Weiss Lake, users had more activity fishing, swimming/sunbathing and picknicking, which seems
consistent with the perception of Weiss Lake as predominately a fishing lake.

About 7.2% of the recreational fishermen at Weiss Lake depend on the lake for their regular food supply.