Skip to main content

Full text of "ERIC ED075705: Private Outdoor Recreation Enterprises in Rural Appalachia."

See other formats


DOCOMENT RESUME 



ED 075 705 



AC 014 344 



AUTHOR 
TITLE 

INSTITUTION 
REPORT NO 
PUB DATE 
NOTE 



Johnson, Hugh A.; And Others 

Private Outdoor Recreation Enterprises in Rural 
Appalachia. 

Economic Research Service (DOA) , Washington, D.C, 

ERS-^429 

Nov 69 

21p. 



EDRS PRICE 
DESCRIPTORS 



IDENTIFIERS 



MF-$0^65 HC^$3.29 

Recreation; ♦Recreational Activities; ♦Recreational 
Facilities; ♦Rural Areas; ♦Surveys; Technical 
Reports 

Alabama; ♦Appalachia; New York; North Carolina; Ohio; 
Pennsylvania ; Tennessee 



ABSTRACT 

A study was undertaken to determine to what extent 
recreation enterprises in rural Appalachia can help meet the growing 
urban demands for outdoor recreation and provide profitable use of 
rural resources and employment for rural people. The analysi-s, drawn 
from a 1966 nationwide survey , included 35 campgrounds, 18 fishing 
areas, 14 vacation faanns^ 10 hunting areas, and 9 riding stables. In 
general, the kinds and qualities of facilities found in this survey 
have limited potential for expansion to meet increasing urban needs 
for outdoor recreation. Most of these recreation enterprises! were 
small, family-operated, and supplemented other major income sources. 
Capital investment specifically for recreation usually was small and 
often was undistinguishable from that of the overall farm. A minimum 
of facilities and services usually was provided. Relatively isolated 
locations and managerial disinterest in expansion helped keep these 
enterprises small. Occasional exceptions demonstrated that 
supplemental enterprises providing larger incomes can be established 
when favorable conditions exist. But managerial interest and ^ 
capabilities often are major limitations, (Author /KM) 



FILMED FROM BEST AVAILABLE COPY 

— — 



PRIVATE OUTDOOR 
RECREATION 
ENTERPRISES IN 

RURAL 
APPALACHIA 

U.S. DEPARTMENT OF AGRICULTURE • ECONOMIC RESEARCH SERVICE • ERS-429 



... U S OePARTMENT OF HCALTH. 

CD EDUCATION & WELFARE 

OFFICE OF EDUCATION 
THIS DOCUMENT HAS BtEN REPRO 
I^S. DUCf^O EXACTLY AS RECEIVED FROM 

^ * THE PERSON OR ORGANIZATION ORIG- 

JS.^ INATING II POINTS OF VIEW OR OPIN- 

OIONS STATED DO NOT NECESSARILY 
REPRESENT OFFICIAL OFFICE OF EDU- 
CATION POSITION OR POLICY 



i 



ERIC 



CONTENTS 

Page 

Summary : li 

Introduction 1 

Survey Sampling Procedures 1 

Description of Facilities 3 

Location 5 

Land and Water Area 5 

Operating Seasons 6 

Ownership, Management, and Labor 8 

Capital Values 11 

Returns From Recreation : 13 

Aavertising 15 

Plans for Capital Investment " 17 

Interpretation of Study Results 17 



j Washington, 13. C. 20250 November 1969 



SUMMARY 



Most of the recreation enterprises that were surveyed were small, family- 
operated, and supplemented other major income sources. Capital investment 
specifically for recreation activities usually was small and often was undis- 
tinguishable from that of the overall farm enterprise. A minimum of facilities 
and services usually was provided. 

Relatively isolated locations and managerial disinterest in expansion 
helped keep these enterprises small. Occasional exceptions demonstrated that 
supplemental enterprises providing larger incomes can be established when 
favorable conditions exist. Managerial interest and capabilities often are 
major limitation^*. 

The analysis, drawn from a 1966 nationwide survey, included 35 campgrounds, 
18 fishing areas, 14 vacation farms, 10 hunting areas, and 9 riding stables in 
rural Appalachia. Half of the operators providing financial data reported less 
than $500 of net returns from recreation sources in 1966. Only about one oper- 
ation in six provided a net return of $3,000 or more annually. These tended 
to be larger, better managed, better financed, and closer to metropolitan areas 
than the less profitable ones. They also offered more variety in related 
facilities and services and frequently were located in areas where clusters of 
other types of recreation facilities helped attract visitors. 

In general, the kinds and qualities of facilities found in this survey 
have limited potential for expansion to meet increasing urban needs for out- 
door recreation. 

For the purposes intended^ these marginal recreation operations can 
provide supplemental sources of income and to an extent will help meet the 
growing recreation needs of the public. Most, however, will operate on the 
periphery of the vast recreation market. 

Development of recreation opportunities on farms and other rural lands 
has been encouraged by the Federal Government as national policy since 1962. 
This study was undertaken to determine to what extent recreation enterprises 
operating in rural Appalachia can help meet the growing urban demainds for 
outdoor recreation and provide profitable use of rural resources and employ- 
ment for rural people. The 86 recreation operations studied were drawn from a 
nationwide survey conducted by the National Association of Conservation 
Districts cooperating with the Soil Conservation Service. 



ii 



PRIVATE OUTDOOR RECREATION ENTERPRISES IN 
RURAL APPALACHIA 



by 

Hugh A. Johnson, Judith M. Huff, and J.J. Csorba y 

INTRODUCTION 

Since 1962, the Federal Government has encouraged development of recreation 
enterprises on farms and other rural lands as (1) a way to provide additional 
income to rural families, (2) a use for unused or underutilized rural resources, 
and (3) a source of increasingly needed recreation opportunities for nonfarm 
people. 

Both public officials and private investors expressed interest in oppor- 
tunities for developing outdoor recreation facilities and services on farms 
and in rural areas of Appalachia. The contrasting ridges and valleys of 
Appalachia make it one of the most potentially interesting and scenically 
attractive areas in America. Some people assumed that improved transportation, 
lacing the Region with new highways, would provide needed access from urban 
areas bulging with people wanting recreation outlets. Improved access was 
assumed to help get potential recreation users and potential suppliers to- 
gether in rural mountain areas. 



SURVEY SAMPLING PROCEDURES 



Five popular types of privately owned recreation enterprises <vacation 
farm, riding stable, hunting area, fishing area, and campground) were studied ' 
to provide insight into the situation in Appalachia. 

Appalachia, as defined by P.L. 89-4, as amended, includes 373 counties in 
12 btates (map, p. 2). The sample was drawn from the 1965 inventory of private 
and public rural outdoor recreation operations conducted by the National 
Association of Soil and Water Conservation Districts, in cooperation with 
the Soil Conservation Service and various State agencies. No inventorv was 
made in Virginia. Kentucky was eliminated, for sampling purposes, because the 
enterprises inventoried by NACD were too widely scattered for economical con- 
tact by enumerators. 



1/ Mr. Johnson is presently Agricultural Economist and Leader in outdoor 
recreation research. Natural Resource Economics Division, Economic Research 
Service, U.S. Dept. Agr. Miss Huff was formerly an Economist and Mr. Csorba 
was formerly an Agricultural Economist in r.he Division. This study was 
partially supported by funds from the Appalachian Regional Commission, under 
authority of Public Law 89-4. 




U.S. DEPARTMENT OF AGRICULTURE NEG. ERS 7068-69 ( 10) ECONOMIC RESEARCH SERVICE ] 



ERIC 



2 



I 

i 



To derive a sampling universe of privately owned and operated rural recre- 
ation enterprises, the public, quasi-public, and closed-membership facilities 
were screened from the NACD universe as much as possible before the sample 
was drawn. Inadequacies in available information, however, still resulted in 
selection of several operations in the sample which did not qualify as privately 
owned recreation enterprises. Loss of possible respondents within the sample 
also occurred because enumerators could not locate the enterprises, the oper- 
ators no longer provided recreation services, or for other reasons (table 1). 
This experience was one indication of the problems facing potential recreation 
enterprises in Appalachia: namely, that apparently few entrepreneurs who 
start recreation enterprises retain them over an extended period. 

The limited amounts and poor detail of information that could be developed 
through the survey made it impossible to meet some original study objectives 
involving detailed analyses of the effects of location, management, and other 
institutional restraints on opportunities for developing viable recreation 
enterprises in the private sector. However, since even valid descriptive 
information about such operations is sparce, analysis was developed as far as- 
the data seemed to warrant. 

Campgrounds, fishing enterprises, hunting areas, riding stables, and 
vacation farms are the most common types of recreation facilities found 
associated with farms and farming areas. More than 2,500 of these types of 
firms were located in Appalachia by the NACD inventory. A sample of 460 
enterprises was drawn. Analysis was possible for 35 campgrounds, 18 fishing 
areas, 14 vacation farms, 10 hunting areas, and 9 riding stables* Definitions 2/ 
for these types of enterprises are: Campgrounds — areas for tent, trailer, or 
pack camping, including transient camping; fishing areas — water areas having 
good fishing either owned by the operator or readily accessible to the users; 
vacation farms — a privately owned facility. in which sleeping and eating 
accommodations are provided for paying guests. Guests may eat with the farm 
family or in separate quarters if they are housed in cabins or cottages and 
responsible for preparing their own meals. Guests may participate in some of 
the farm work and activities; hunting areas — an area of land or land and water 
for hunting wild game, including small game, big game, and waterfowl; riding 
stables — an area of using horses or other riding animals for recreation, in- 
cluding their housing. 



DESCRIPTION OF FACILITIES 

Small, family-operated enterprises are common among recreation businesses. 
Most of the management and labor are provided by owners and family members. 
The seasonal nature of the business, small size, and other conditions often 
make it possible for recreation to supplement or complement other family 



Ij From instructions for conducting the inventory of existing outdoor 
recreation businesses by enterprises and activities, NACD. 



3 







ON 


ON 


n 


n 


^0 


xO 


CP"' 




00 














n 


CM 


00 








Ov 


n 






1 
















rH 
















^1 










in 




00 




rH 


x£> 


fH 


rH 




CM 


m 


ON 




















CM| 






1 


CM 




in 


CO 


rH 


1 


CM 


eg 


m 




o> 


















in] 








«^ 


in 


00 


00 


CM 




rH 


rH 




rH 


rH 


vO 




























ON 


o 


30 


in 


vO 






rH 


rH 


m 


00 


in 


o 


ON 


r** 


00 


CN 


r** 




ON 


ON 


tH. 


in 










rH 




in 


rH 


ON 




00 


o 


r** 


r** 


ON 


ON 


rH 












rH 




oo 


vO 


o 


rH 




ON 


o 


in 


in 


CM 


ON 


CM 


rH 


rH 


CM 


O 


m 


in 



(3 
O 

•rl 

u 



00 



as 



I 
I 
I 
I 

(Q 
Q) 

CO 

•rl 

I 



I 
I 

I 
I 
I 
I 
I 

C9 
0) 

CO 

60 
(3 

•rl 

CO 



o 
u 

00 



o 
u 
< 

4J 

(3 
0) 



3 

OC 

c 

•rl 

CO 



CO 

o 
p. 

u 

0) 
3 

>^ 

0) 



o 
c 

iJ 

CO 
0) 

0) 

c 
o 



(0 
0) 
3 
00 

0) 

(0 



4S 



CO 

J3 



T3 
0) 
iJ 

O 

a 

0) 



0) 



u 

0) 

p. 



T3 
0) 



u 
CO 



0) 
(0 

o 



c 

CO 

tJ 

0) 
iJ 
CO 
u 
o 



0) 



3 

o 
u 

u 

•H 



01 

M 
O 

•§ 

0) 
(0 
■H 

u 
c 

M 
0) 
iJ 

c 

0) 
03 

c 



CO 

u 

0) 

c. 
o 

0) 

c 
o 

t> 
c 

CO 



(0 
iJ 

c 
o 
B 

3 

0) 



• (0 

>^ 

rH 

C rH 
O C 
O 

0) 

(0 C 
3 0) 
O. 
0) O 
iJ 

CO CO 

> o 

•H CO 
M "H 
P. U 
P. 

O 0) 

3 S 
o 

c * 

CO 
0) AJ 

CO o 

CO 



0) 



C u 
CO 

•k 

•O CO 

rH M 

O 0) 

(0 (3 

C CO 

0) u 

0) 4-* 

0) (0 



0) 



C 

CO 
B 



OC 
M 
O 
0) 

o 

tJ 
c 

CO 

CO 
B 
(0 

•§ 

rH 
• .< 

(0 

M C 
0) -rl 
iJ 

C >N 
3 rH 

e rH 
O 3 
M U 
4H -rl 

(0 M 
0) CO 



3 • 

U CO 

CO 0) 

U (0 

00 o 

p. 



rH 4J 



(0 (3 

0) > 

(0 M 

f3 0) 

U CO 
(3 

>^ O 

c u 

CO 

E U 
o 

C MH 



CO • 0) 

M C CO 

O 0) o 

iJ ^ JS 

CO CO iJ 

M iJ 

0) CO 

a CO 0) 

O CO t) 
rH 

(3 



U 0) 
•rl CA 

J 

(0 

0) * 

rH J2 
J3 U 
CO tS 

u CO 

(0 U 

OO 0) 
• C 

>^T^ 3 

4J tJ TJ 

rH M CO 
•rl 

U CO CO 

CO 0) 0) 

UH TJ 'O 

3 :) 

fi rH rH 
O U U 
t4 C (3 



p. * rH 
iJ •H 
iJ 3 3 
3 ^ ^ 

* CO 
00 t) 

' c 
- .. o 
U u Cl 

0) d 

a 3 C/3 

o ^ o 

U C/3 

o •a 

(3 «H 0) 
O tJ 
0) 3 



01 3 

u o 

0) u. 

o « 

JZ (0 

3 c 
o 

<0 -rl 

0) CO 

g s 

O V 

CO it 

M (0 

o e 

CO «s 
0) 

u o 



CO D 
iJ 0) 
(0 

3 3 
O 

U 0) 
M • 

U CO 
0) M M 
rH O 0) 
M P. 

CO >^ e 

M rH (8 
iJ rH U 

ce 

u c o 
c o ^ 

0) 

g 

B u 
o 
o 



CC 0) 
(3 U 



0) 

c. 



>^T3 
«k iJ 0) 
M M iJ 
0) (3 
0) C. 0) 
O M 
M 

CO C >^ 
rH 

C M rH 
CO -rl (0 



(0 0) 
0) (0 



CO 
0) 

O CO 
0) 

u 



Cr 0) OOrH 

rH M U 

M ^ C3 (3 

0) CO J3 

3 rH U 
(0 

SCO <U W 

> O O 

CO C «J 

O (3 

iJ 0) O 0) 

§•3 > 
c 

0) 00 CO 

CO U ^ 

3 73 0) O 



(3 
O 
•H 

CO 
CO 

o 
u 
o 

o 

iJ 13 

(0 CO 

c 

3 (0 
O C 
M -H 
00^ 
CO 

u U 



0) UH M 

CO O O 

O M MH 

JS P. 

«i C (0 
O 

<k c o 

to rH 

U rH •H 

ce rH 
(0 rH 
rH O 0) 
M U5 CO 

00 «H 

M O 
M O 

O CO 

(0 (0 

« CO 3 0) 

00 >^ 0) C 

C O -H 

CO 0) 0) ^ 

*r4 U 

«H CO C 0) 
> 

0) -rl 

Q) U U 

M a O (3 



3 tJ 01 
rH C 

2Sl 



CO 

U O Q) >\ 

O tJ rH rH 

UH 3 J3 rH 

rH (d CO 

0) O I . " 
rH C3 

^ M CO 

CO > 

rH CO 



3 

u 
CO 



0 



CO ooIaj 
> 2 

CO (3 



occupations and sources of income* The Chilton Study reported a nationwide 
median capital investment of $64,000 for enterprises that provided full or 
primary income. 3J Capital investment ' for 26 percent of these enterprises was 
$10,000 or less."^ 

Recreation enterprises that supplement other businesses or other income 
sources are the most .prevalent. For those enterprises that provided supple- 
mental income, the Chilton Study reported median capital investment of $8,000 
and 44 percent of these operations valued at $10,000 or more. 

Operating costs" per unit of use often are high because the number of 
visitors attracted to the enterprise is low. Volume of visitors depends upon 
such factors as type of facilities offered (single or complex, day use, or 
overnight), quality of facilities (rustic to ultramodern), advertising, 
location, access, and personality of operators. 



Location 

Two factors usually considered important -to the success of recreation 
enterprises are location relative to population centers and the comparative 
ease of access* 

Access to many parts of Appalachia has been poor* This may be one reason 
why recreation has remained a minor enterprise in the region. It may also 
help explain why most of the facilities surveyed were found relatively close 
to population centers. People simply do not travel the available mountain 
roads into the hinterland for common kinds of recreation. 

Of the 35 campgrounds, 28 were located within 100 miles of cities with 
populations of more than 250,000 people. Most of these campgrounds offered a 
variety of facilities complementary to the camping experience, including picnic 
areas, fishing, beaches or pools, and refreshment stands. The remaining seven 
campgrounds were at least 150 miles from cities of this size and tended to 
provide only rental spaces for tents and trailers. 

All of the 18 pay fishing lakes were within 80 miles of cities of at 
least 100,000 population* Eight were within 70 miles of cities of more than a 
half million people. Most of these lakes were stocked regularly with a variety 
of fish* Operators located close to population centers often gave prizes for 
the largest fish caught, and provided other complementary facilities such as 
for picnicking or boating. Those in more remote areas tended to offer only 
facilities for fishing. 

All of the 14 vacation farms were within 150 miles, and 12 were within 100 
miles, of cities of more than 250,000 population. A variety of facilities was 
available at most of them. Included were boating, swimming, and nature trails. 



3./ Private Sector Study of Outdoor Recreation Enterprises ^ prepared by 
Chilton Research Services, Philadelphia, Pa., for the Bureau of Outdoor 
Recreation, U.S. Department of the Interior. 1966. Highlights, p. 3. 



All of the 10 hunting areas were within 80 miles of cities of 100,000 to 
250,000 population. 

All of the nine riding stables were within 80 miles, and seven were within 
30 miles, of cities with more than 250,000 persons. Five provided riding 
instruction and conducted trail rides. Boarding horses was the major activity 
of the remaining four. These tended to be located within 30 miles of populous 
areas. 



Land and Water Area 

Recreation usually was not the major use of all land held by the operators. 
Farmers, for example, set aside relatively small areas for campground 
development or for use around fishing waters. Hunters could range over fields 
and forests without conflict with the primary land uses or, in the case of 
goose blinds, practically no dry land was needed. Similarly, horsemen from 
riding stables could roam over pastures, x^roods, and empty fields without 
interfering with usual farming operations. Horses being boarded can graze vj±th 
other farm livestock. And farm vacationer'- benefit from strolling over farm 
premises or even help with seasonal work. 

The reported size of holding — including both land and water — varied widely 
(table 2). The acreage developed for recreation ranged from a low of 41 acres 
for fishing enterprises and 47 acres for campgrounds to a high of 219 acres for 
hunting areas. Riding stables averaged 115 .acres and vacation farms averaged 
83 acres. 

Within these averages, also, wide variations occurred. For example, two 
thirds of the fishing area operators reported less than 20 acres devoted to the 
fishing operation. Half of the campgrounds required less than 25 acres each 
and four in 10 required 10 acres or less. 

Eighty percent of the land developed for recreation uses had been farmed 
previously. 

Seven of every eight enterprises had water for recreation on the property, 
riparian to it, or otlierwise accessible. IJater areas included ponds, lakes, 
streams, rivers, and bays. Campgrounds and fishing areas averaged about 20 
acres of water. Only riding stables seemed to^ have ,no ready access to water. 

OPERATING SEASONS 

The type of recreation enterprise and the kinds of personal services 
required affect both the season when .operated and daily hours v;hen personnel 
must be available. Nearly all enterprises were open 7 days a week during the 
season. 

Most campgrounds were open 6 mpnths or less. A few were open 9 mouths or 
year-round. Their peak season occurred in July and August. 






0 












w •o 






0) (0 0) 














u 




^ U O 1^ 






a u >Ni 0) 




so 


1^ Cd iJ 4J 


6 


o\ 


0) c Cd 


3 




4J tc o ^ 


2: 




ecu 




0k 






(d 


> O 




•H 


Cd c 




x: 






u 






(0 






H 






(d 






a 


0) 








(0 


< 


Cd 0) 0) 


0) 








H 


0) Cd Cd 


u 


(0 




< 




< 
















• 












0) 


Cd )ni 0) 






(DO 4J 






^ U.4 c Cd 






Cd 0 > 




u 




(0 


0) 




0) 


4J 


CO a Cd c 




(d 


Cd 0 0) 


u 






< 




0) 0) U 3 






> > 0) H 




c 


< 0} i4 U 




(d 












«k 






0) 


• f 




(0 






3 


Cd 






0) 




C 


CO )n| 




o 


Cd ^ Cd 




•H 


^ 0 




U 






(d 


•O 0 


u 


0) 


C 0) 


0) 




cd o 4J 


•O 


u 


H ^ (d 


6 




£3 0) 


3 


U 


C 0 ^ 






Cd (0 u 




u 






fo 












c 






(d 






H 


u 






0) 






4J 




0 


ed 






0 ^ 0) 




0) 


4J 


(0 


u 


0) -o Cd 


0) 




CO C )n| 


1^ 


3 


c Cd - 0) 


u 


o 


Cd a 


< 


(0 


o^ -o 0 






c 
Cd 




CO 


H 




c 






•H 






•o 






H 






0 




u 


x: 


0) 


0) 










•i 


1 


0 


•J 






ss 




0) 












•H 






CO 






1 






1 






• 






CM 








4J 




0) 


•H 




H 


H 




*0 


•H 




Cd 


O 




H 


Cd 






U4 





o 

CN4 



CM 



o 

CO 



CO 
CM 



Hi 



CM 



O 
« 

OX 



CO m 

C30 H 



CM 
CM 



O CM 
vO O 



I 



I 



O 

00 



o 
o 

I 

vO 



o 
o 
o 
m 

I 

m 



00 



CO 















H 


Cd 


Cd 




(d 




Q) 


0) 








u 


u 






U 


(d 


Cd 


c 


c 


(0 






3 


o 




CO 


CO 


0 


•H 


CO 


c 


c 




4J 


a 


•H 




CO 


Cd 




U 






u 




C 


(0 


1 








•H 






2^ 




U4 





0) 

u 
Cd 



d 
Cd 



(0 
(0 



HI 



Fishing areas generally were open for 6 months, from March 1 or April 1 to 
September 1 or October 1. Only two were open all year. The busiest :nonths were 
May through August. Some fishing enterprises were open 24 hours a day. 

Opening day for most vacation farms varied from March 1 to June 1, and 
closing day varied from September 1 to November 1. Four were open year-round 
but catered mostly to hunters during the hunting season. However, vacation 
farms are predominantly summertime businesses. The peak season occurred in 
July and August. 

All of the hunting areas were open for two or three months during November, 
.December, and January. Camping was allowed at two araas during the other months 
of the year. 

Riding stables were generally open year-round, although major use occurred 
from May through August. Limited riding activity took place during the spring 
and fall. Boarding horses during the winter was the major recreation service 
provided by two operators. 



Oli?NERSHIP, MANAGEMENT, AND LABOR 

Individuals and families owned 72 of the 86 enterprises, 10 were partner- 
ships, and 4 were corporations (table 3). The properties had been in present 
ownership an average of 11.4 years. Hunting areas had been held the longest 
(20.7 years) and riding stables the shortest time (6.1 years). ' 

Owners managed 71 of the enterprises, 10 were operated by paid managers, 
and 5 by lessees. The owner-operators had managed these businesses an average 
of 8.1 years. Operators of hunting areas had the most experience (15.2 years) 
and riding stable and campground operators the least (5.5 years). 

Six hunting areas were leased tv clubs or groups where either the group 
controlled the hunting rights or the landowner controlled the amount of hunting 
on his land. Two were day-use deer hunting operations. Of the two remaining 
hunting areas, one was a pheasant shooting preserve and the other was a water- 
fowl enterprise where goose pits were leased! 

The average age of operator was nearly 55 years and the range was from 
30 to 83 years. Thirty-seven were between 30 and 50 years old, 31 were 51 to , 
65, and the remaining 18 were between 65 and 83. Generally, the more elderly 
operators were unable to participate in heavy work and the recreation enterprise 
often provided unexpected sources of additional income. For example, a 78-year- 
old man boarded horses on his property. 

Many enterprises were part time, supplemental operations. About one-third 
of the operators were primarily engaged in managing their recreation businesses 
(table 4). The remainder had other full-time or part-time jobs. Riding 
stable operators were proportionately most numerous in the former category and 
most of them were over 60. At least four of the riding stables were primarily 
horse boarding operations. 



8 







c 




0) 


o 


o 




tc 




•H 




CO 


U) 






u 


u 


CO 




0) 


t9 






> 


0) 


0) 




< 


>^ 


.op 





O 
CO 

CO 

c 
< 



CO 



u 
c 

CO 



M 

O 
iJ 

CO 

0) 
P. 
O 



0} 
CO 



o 



CO 
M 

0) 

a. 
o 

o 

•o 
o 



(0 
01 



44.1 
o 



0) 



I 
I 

CO 
0) 

CO 
H 



u 

6C O W 
CO CO 
U Qi U 

> CO D. 
< O 



•d 

iJ 

CO 

u 

Q) 
C 
C 



0) 
0) 

(0 U 4J 

(0 o c 



u 

CO 

c 

4} 



(4^ C 

Q) O 1-1 

tc ^ 

CO (0 (0 

u 

Q) CO Q) 
> Q) C 
< >^ 5 
O 



a 

o 

u 



I 

u 

Q) 0. 
CO 

04 



•o • 

•H U 

> P. 

•H O 

c a 

M 



u 

'3 







CN 




m 




o> 




m 


o> 




00 












\o 


i-i 


f** 


i-l 


CO 






« 














0 


00 






in 








m 


m 






1 


1 


CO 







I-l 


I-l 




00 


03 
















0 


Csl 




I-l 




CM 


I-l 



ON 

C>4 



CO 



C>4 



00 



o 



k h 



CO 



o 



<o 
o 

5 



JO 

<o 



00 

•H 



<0 


I 






u 


u 




<o 


00 


60 


(3 


(3 


1-1 




U 




§ 


(0 




1-1 


a: 





§ 

o 
w 

00 



ON 



u 

CO 
O. 



CO 



0) 



0) 



0) 
0) 

O. 

§ 

(0 
M 

o 



00 
CO 

> 
CO 



o 

i- 



M 
O 

to 

0) 

a 

Q 
I 
I 



CO 
H 



Q) (0 

Q) U 
O. Q) 

tJ C 

o o 

»i 

(0 CO 
U V 

:) ^ 
o u 

is 



0) 



c 

(0 
(0 

PC 



o 

u 
o ^ 

CO ^ 

Q) O 
O. 

O 



C O 
CO 0) 

a 8 (0 

•H >^ H 

U O 0) 

C p. 

•H p. O 

O 



U 

(0 

U4 



•i 

55 



0) 

^ a 

2 



u • 

3 
2 







6 




•H 


u 


AJ 




1 




AJ 






i 


CO 




(l4 





in 

CM 















0) 












1 


•H 3 
















U3 


2 





in r** 

CM Vj" 



St O O %0 CM 
iH iH CM vO 



cn in iH CM 

^ m rH CM 



in 



vD ^ 

CM CM m 



ON 00 vD 00 <t 

iH m f-* 



CM 



in 



00 
CM 



00 



Id 

(3 

o 

•H 
AJ 
CO 

u 

a! 



0) 


(0 


iH 


JO 


o 


CO 


u 


AJ 


<0 


(0 






00 


to 


c 


a 




•H 


AJ 




§ 


i 


33 



CO 

a 

00 

c 

x: 

(0 

P4 



§ 

o 

to 
a 



o 
H 



The reported hours worked per week on the recreation enterprise by the 
operator or his family appear to be unrealistic, particularly in view of the 
low tempo of activities in most of these operations. 

Someone must be available during operating hours to receive guests and- to 
serve them as required. However, this kind of service usually interferes only 
momentarily with usual farm and home activities at the particular time. As 
recreation businesses become more active and visitors are more numerous, they 
require increased time for labor and management. ' 

Managerial and labor functions were performed by the operator or members of 
his family under most circumstances. However, 35 operators hired a total of 52 
people for part-time work during the season. None hired more than five employ- 
ees, even during the peak season, and only five hired one employee each on a 
part-time, year-round basis. Part-time employment \^as concentrated in campground 
operations where maintenance workers, concession stand operators, and lifeguards 
were needed. One operator provided part-time guide services for interested 
tourists. 

A few isolated operators (five) hired one employee each on a part-time, 
year-round basis as caretakers or to do specific chores. 

Part-time maintenance workers and comparable employees earned an average 
of $1.10 per hour. Part-time managers averaged $70 a week. Average weekly 
earnings of the part-time, year-round x^rorkers was $35. 




CAPITAL VALUES 

Average market values reported for land, buildings, equipment, and machinery 
frequently appear to reflect total value of these resources rather than the pro 
rata share properly allocated to the recreation enterprises. Thus, for example, 
the average value of land and buildings for vacation farms ($21,550) in table 5 
probably overstates the proportionate share of use of the home, farm buildings, 
and farmlands. The same limitation seems to apply for estimates of equipment 
and machinery. Most farm equipment, such as trucks or haywagons, is used only 
incidentally for the recreation enterprise. 

Conversely, of course, areas specially designated for recreation uses 
usually are entirely chargeable to the recreation enterprise. Campgrounds and ^ 
fishing ponds with their associated land areas are examples. 

The averages and ranges of values in table 5, therefore, appear to be a 
mixture, with the low point representing specialized recreation uses and the 
high side representing total uses. They could not b^ separated. 

The inventory of supplies and other values appears to more nearly reflect 
investments in recreation enterprises. For vacation farms, this might include 
additional food, bedding, utensils, play equipment, and so forth. For riding 
stables, this item Includes feed, horses, and tack. Hunting enterprises often ^: 
provide dogs, ammunition, and special services such as cleaning game, gun rental, % 
lockers, etc. Fishing areas often require stocking fish, fish food, boats, and | 
gear. Campgrounds require garbage cans, firewood, light and water facilities, 4 
and some operators included Items for sale as part of the supply Inventory. I 

11 



I 

I 



CO 



cd 

0) 



o o 
o o 



o 
o 



o o 
o o 

fS o 



o 
o 
o 



ml 



o 
o 

St 



o o 
in o 
o 



o 
o 

St 



o o 
o 
o 



o. 
o. 



1-1 

u 
o 

p. 
or 
oti 



Hi 



O 
O 
0) 

u 

o 

H 

5 



5 



0) 
U 



g 



9 



u 

o o 

ITJ O 

CM in 



o 
o 



O 
u 

o o 
o o 
^ o 



o 
o 



in 



o o 
m o 
o 



o 
in 



o o 
m o 
o 



o 
o 

00 



tc 



00 
CM 



(0 
60 



9 



o o 
in o 
r** o 



o o 
o o 
in o 



O 

o o 

o o 

o o 



o o o o 
o o o o 
o o o o 



H in 



H O 



O 
O 



H xO 



I in 

00 



o 

CM 



ON 

CM 



O 

in 

CM 
CM 



CM in 
o 



o 
o 

00 
CM 



CM 



o 



§ 

U 

(d 
o 



(0 

to 



fd 

0) 

(d 
to 

C3 



I 

k 

0) 

(d 

to 
a 



o 
u 
to 
6< 



12. 



In most cases, the operators were free of debt. The market values reported, 
therefore, appear to reflect net equity. 

half of the operators had made capital expenditures between 1960 and 1965. 
These included both expenditures for new buildings and facilities and major 
repairs to old ones, as well as, in some cases, those alterations made in order 
to enter the recreation business. 

IVenty operators borrowed from commercial banks or received loans from 
government agencies. The rest financed their expenditures from personal 
resources • 



RETURNS FROM RECREATION 



The part-time, supplemental, and frequently incidental nature of these 
recreation enterprises is reflected in low retjirns received. Average net 
income gains ranged from $330 for hunting areas to $2,490 for riding stables 
(table 6). 



Table 6. —Average recreation income, reported expenses, and net gains, by type 

of enterprise, rural Appalachia, 1966 



Item 



Vacation 
farm 



Facility 



Riding 
stable 



Hunting 
area 



Fishing 
area 



; ^ Number 



Camp- 
ground 



Operators reporting : 



14 



13 



35 





: 1,940 


5,270 


560 


2,940 


4,150 


Reported expenses 1/ — i 


1,320 


2,780 


230 


2,170 


2,640 




620 


2,490 


330 


770 


1,510 



II Includes property and other taxes, insurance, advertising, interest, 
utilities, supplies, hired labor, and other. 

21 Includes return to unpaid family labor and return to capital investment. 



The apparent low returns understate the actual net income for some recrcar- 
tion enterprises. As with estimated land and other values (table 5), some 
operators apparently credited total taxes, total electric bills, total fire 
insurance, and other costs against the recreation business. 



13 



The fact that recreation enterprises are a source of income strengthens 
the justification for introducing such businesses. Fees paid for hunting 
opportunities may pay the tax bill. Earnings from taking guests on vacation 
farms may provide new home furnishings. Caring for a small campground may 
provide tasks and spending money for children. Boarding horses may provide 
supplemental cash and pleasant minor activities for elderly or partially 
incapacitated people. Thus, it is important to recognize that apparently small 
returns from small and intermittent businesses may tell only part of the story. 

'rhe array of returns seems reasonable when we recognize the-^nature of the 
recreation enterprises represented in this survey and the reasons why rural 
people participate. Average returns from hunting areas are lowest among the 
five types of operations. Their gross incomes are lowest and reported expenses 
are .lowest. However, for the effort expended and capital investment actually 
involved in providing recreation services, returns may be exceptionally favor- 
able. This type of operation, except for commercial shooting preserves, often 
represents income resulting from unusual opportunities. Opportunities for 
boarding a few horses or providing fishing opportunities frequently are of the 
same nature. 

Returns from riding stables and campgrounds were highest among the five 
types of recreation enterprises. They reflected larger sizes of business 
through gross income data and reported a higher level of variable or operating 
expenses. Even so, several of these operations reflected losses or low returns 
(table 7). 



Table 7. — Net gains or losses from recreation enterprises reported by 79 operators, 

rural Appalachian 1966 



Range in net ] 
cash returns ] 


Facility 


Vacation 
farm 


:. Riding : 
: stable : 


Hunting : 
area : 


Fishing : 
area : 


Camp- 
ground 


; All 




















Net loss : 


4 


1 


2 


3 


9 


19 


$1 to 500 1 


4 


2 


4 


4 


6 


20 


$501 to 1,500 : 


4 


0 


3 


2 


6 


15 


$1,501 to 3,000 : 


2 


2 


0 


4 


5 


13 


$3,001 to 4,500 


! 0 


1 


0 


0 


4 


5 


$4,501 and more — 


! 0 


2 


0 


0 


5 


7 




: 14 


8 


9 


13 


35 


79 



14 



One fourth of the operations showed a net cash loss for the year* Another 
fourth showed less than $500 of cash returns over expenses. 

Riding stables and campgrounds veve the only enterprises where operators 
realized more than $3,000 for their labor and use of resources. These 12 
operators were concentrating on recreation as a major enterprise. Their 
businesses generally were larger, better managed, better financed, closer to 
metropolitan areas, offered needed services, and frequently were located in 
areas where clusters of other types of recreation facilities attracted large 
numbers of visitors. 

The three riding stables maintained 15 to 30 horses and provided riding 
lessons. The nine most profitable campgrounds appeared to be larger than 
average, provided both tent and trailer sites, frequently provided picnic tables 
and swimming facilities, and maintained related services used by the camping 
public* 

Several of the 28 remaining enterprises earning between $500 and $3,000 
had potential for becoming profitable commercial operations if the demand 
warranted or if the operators wanted more business* This was particularly true 
for several vacation farms and campgrounds. 

Not all operators reported the same expense items and the range among 
estimates for any single expense category was wide. An impression of average 
expenses can be gained from table 8. 

ADVERTISING ' 

Most operators advertised very little. . This lack of active business 
promotion is understandable when one recognizes that these people were catering 
primarily to clientele from the local area. And many were catering largely to 
repeat customers. 

The larger and more profitable recreation enterprises were best advertised. 
Campground operators used three or four different media to advertise their 
businesses. They advertised extensively to attract tourists and vacationers. 
Most had roadside signs. Riding stables, on the other hand, used fewer 
advertising media and their customers were mostly from local areas. 

Operators whose returns from recreation averaged $3,000 or less per year 
made little use of any type of advertising media. Some relied solely on word- 
of -mouth advertising to attract additional customers. Others used only 1 or 2 
forms of advertising media, usually either newspapers or magazir4es. However, 
vacation farm operators generally advertised in 3 or 4 media. Only a fex^ used 
signs at the entrances of their facilities. These commonly were of the small 
metal variety provided free of charge by soft drink or baking companies, banks, 
or other businesses in the area advertising their own products as well as the 
recreation facility. 



15 



er!c 



:5i 



(0 
(0 



2 

U 



0) 

o. 



0) 
iJ 
M 
O 
P. 
0) 
M 

to 

01 

u 
c 

01 

g- 



01 

t(i 

CO 
M 

§! 

a 
c 

CS 

to 

01 
CO 

s 



43 
(0 
CO 

o 
c 



u 
o 

OU 
01 
M 

s 

o 

8. 

o 



I 



00 



I G 
CO 



60 

c 

U 0) 

C M 

3 - 



to 0) 
C H 

t> « 
1-1 AJ 



o 

(« CO 



0) 0) 
00 0} 
CO C 



CI 0) 
60 CO 

CO c 
U 0) 

< 0) 



60 

C 0) 
•H CO 

u <z 

U 0) 

o 
p. 

0) 0) 



0) 0) 

eo CO 
CO c 



t»c 

C 0) 

U B 
0) 

as 

0) 0) 



0) 0) 

60 CO 

CO C 

U 0) 

0) c 

5: 

< 0) 



60 

C 0) 

•H CO 

U c 

M 0) 

O O 

O. X 

qj Q) 



60 CO 

CO B 

U 0) 

0) o 

> 5? 



60 

C 0) 
■H (0 

^ c 

M 0) 

o 
o. 

0) 0) 



5! 



o m 
sr CM 



o 

ox 



o 
sr 



00 
CM 



00 



o 



o 

CM 



o 
o 



o 



00 



O rH 



00 



o 

o 



ON 
CM 



o 
I** 



3 



to 

0) 
(0 

s 



5- a 



(0 

I 



60 



u 

0) 

> 

3 



p. 

§• 

CO 



I 

4, 
Si 



u 



o 

0) 



16 



0) 
CO 

& 

0) 
iJ 

c 

0) 

c 
o 



CO 
0) 
M 

u 

c 

M 

0) 



a 

CO 



u 

0) 

iJ 

CO 

u 

c 
o 



CO 
0) 

p. 
o 



0> 



0) 



0) CO 
(0 0) 
C H 

S-i" 

0) 

0) 

CO 0) 

0) u 
X CO 



O 0) 

CO u 
U 0 
0) ^ 

0) 

CO c 
o * 

M-l 0) 
U 

to d 

S 2 

li 

to 

*N», 0) 



PLANS FOR CAPITAL INVESTMENT 



Most operators who earned more than $3,000 were among the 35 planning 
further capital investment during 1966-67. Of these, 22 were campground 
operators. Half expected to spend $3,000 or less, while 10 expected to spend 
more than $10,000. Only 13 planned to borrow needed investment capital. 

Operators earning less than $500 were primarily among the group who had no 
plans for further capital investment. They generally were satisfied with the 
present size and level of investment in their enterprise, were too old to 
attempt expansion, or felt that further investment could not be justified due 
to poor attendance or lack of customers. Some had difficulty getting lonp-term 
loans. 



INTERPRETATION OF STUDY RESULTS 

Many of the enterprises studied were small-scale and incidental operations 
manned on a part-time basis by family members. They were characterized by low 
capital investment, small total net returns, and limited facilities and 
services. These measures of financial success in similar situations reflect 
quality of managerial skills, intent of the operators, remote locations, and 
local trade orientation. In short, many operations were not intended to be 
major enterprises • Small scale enterprises can provide important supplements 
to family income and thereby make good use of limited capital and underuti,lize4 
labor resources* 

Few rational people would operate businesses' to lose money. Yet it is 
obvious from the data that large total net income, while a factor, was not the 
overriding consideration in the activity of a majority of the operators. Many 
simply were charging for recreation opportunities available on their property. 
The small amounts of additional cash supplemented other income. Quite often, 
personal pleasure, congeniality, neighborliness, and other types of satisfactions 
or incentives weigh more heavily than the profit motives in explaining why 
people operate these recreation facilities. 

Operators receiving more than $3,000 of net income from recreation had a 
variety of motives for being in business. Profit, however, was the primary 
purpose, particularly for campground operators. Riding stable operators also 
mentioned personal pleasure as a motivating factor. 

Some operators who received low net returns were interested in augmenting 
their major income sources. Others derived personal pleasure from meeting 
people; still others were retired and wanted to remain active and continue 
using their personal skills. 

Some enterprises may be open for customers one year, closed the next, only 
to reopen the following year. This tendency was particularly evident for 
vacation farms where use or nonuse of a few spare rooms by tourists is easily 
adaptable to the desires of owners. 



17 



Those few enterprises with net incomes of more than $3,000 were managed by 
experienced personnel • They were in good locations relative to population 
centers and frequently offered the only facilities of that type within 20 miles 
of others — or were close to other types of recreation enterprises attracting 
outsiders into the area* Their larger capital investments in facilities and 
their variety of services reflected a greater capacity for meeting the 
expectations of their clients* In short, the operators who earned more than 
$3,000 were more profit oriented and service conscious* Operators who had been 
in business longer than 5 years tended to demonstrate ability to accumulate 
capital for further business improvements* This phenomenon, although relatively 
rare, shows that farm recreation enterprises in Appalachia can provide sub- 
stantial supplements to income — when circumstances are right* 




on Aduit Kuucatioiji 



18