Economic Impact Study: Moogfest generated $14 million

Nile Rodgers and his band, CHIC, were among headlining acts at the 2014 Moogfest. Photo by David J. Simchock.

This year’s Moogfest generated $14 million for Buncombe County, according to an analysis by the Economic Development Coalition for Asheville-Buncombe County and the Asheville Area Chamber of Commerce. The five-day April event injected $696,000 back into the local and state tax base, with the report concluding that Moogfest provided a return that more doubled the $180,000 in local government incentives provided by Asheville and Buncombe County.

The festival aimed to celebrate the synthesis of technology, art and music as well as spark economic development. Mostly funded with private capital, it cost about $2.74 million to produce and lost roughly $1.5 million.

“This report is a concrete measurement that Moogfest had a strong return on investment for Buncombe County in the short term,” says Moog Music Inc.’s CEO Mike Adams in a press release. “Looking at the big picture, it’s been proven that dynamic cultural events help to attract talent to an area, and talent draws new business. If community leaders embrace events like Moogfest, they could play an integral role in energizing our economy in the long term.”

The Economic Impact Study found:

• $4.7 million additional labor income was generated for residents in Buncombe County.
• State and local tax revenues increased by approximately $696,000.
• Federal tax revenues increased by approximately $996,000.
• 147 jobs in Buncombe County were supported, and for every job supported directly, another 1.1 jobs were supported indirectly.
• Out-of-town visitors stayed an average of 4.6 days and spent an average of $910 per person over the course of their stay.
• Total economic output, which includes labor income and tax revenues, increased by approximately $14 million.

The Economic Impact Study also found that hotels were one of the local industries most positively affected, with a sales increase of $1.7 million generated from outside visitors attending Moogfest. To explore this further, the Economic Development Coalition for Asheville-Buncombe County and the Asheville Area Chamber of Commerce produced a year-over-year analysis of Buncombe County hotels that found that throughout the four nights of Moogfest.

• The average daily rate increased by 13 percent.
• Revenue per room increased by 25 percent.
• Occupancy increased by 10 percent.

The traditional and social media garnered by Moogfest made it one of the “Top 25 Buzzed about Festivals in 2014,” according to a recent report by Eventbrite. The event generated 1.3 billion impressions and positive references to Asheville appeared in dozens of international news and culture publications, including the New York Times, Time magazine, The Huffington Post, BBC, Newsweek, People magazine and many others.

In July, Moogfest organizers announced that it would become a biennial event, skipping 2015 and returning to Asheville in 2016.

Update: The above information was based on a press release from Moogfest organizers. Read a complete copy of the Economic Impact Study here:

 

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About Jake Frankel
Jake Frankel is an award-winning journalist who enjoys covering a wide range of topics, from politics and government to business, education and entertainment.

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7 thoughts on “Economic Impact Study: Moogfest generated $14 million

  1. Fact Checker

    “Economic contribution and impact studies are common tasks for regional economists, but the semantics of the discipline suffer from a lack of standardization with respect to differences between economic contributions, impacts and benefits. These terms refer to 3 distinct metrics which are useful for answering different questions and each has situations when their use is appropriate. . . .The January 26, 2006, edition of the Missoulian newspaper (Missoula, Montana) ran an article that highlights the scope of the problem. The article reports how a consulting economist was forced to adjust down the estimate of the economic impact of restoring wild salmon runs in Idaho after an independent review of the study estimated the impact at $7 million, down considerably from the initial $544 million. How can two seemingly qualified economists arrive at such widely disparate numbers? Aside from simple dishonesty or poor methodology, is it possible for two economists to, in good faith, come up with such different results? In fact, there are likely numerous cases where economists conduct distinctly different economic analyses with different methods but one may erroneously label the results as an ‘economic impact’ (or worse, an ‘economic benefit’) when it should labeled an ‘economic contribution.’ ”

    Determining Economic Contributions and Impacts: What is the difference and why do we care? Journal of Regional Analysis and Policy 37(2):1-15 (2007).

    • Margaret Williams

      Thank you, Fact Checker, for sharing an excerpt from that article, “Determining Economic Contributions and Impacts: What is the difference and why do we care?” The authors also note that, although different economists can arrive at different conclusions/estimates for economic benefits, and that this can be “confusing” to the public, “it may also be helpful at getting to the heart of complex issues and bringing out real nuances and subtleties of the issues at hand may encourage more thoughtful discussion.”

      • Fact Checker

        It would be useful if your Mountain Xpress reporter could ask some economists not associated with Moog or EDC to weigh in on the methodology and the conclusions of the report and help educate citizens and the lawmakers who will be asked to provide more public funds to support what appears to be essentially a commercially sponsored festival enterprise.

        • Jake Frankel

          Hi Fact Checker, I just updated this post with a copy of the complete report, which includes the following section about methodology:

          Surveys were utilized to capture spending of visitors. Over 1,000 surveys were collected and examined. Local spending (within Buncombe County) is not included in the economic impact analysis and was not a part of the scope of the study. The survey sample includes data analyzed for non‐local visitors where Moogfest is the primary purpose of the visit. Other related economic activity such as appropriate expenses associated with the festival, were also included in the impact analysis.

          This study was done to the best of the ability of the Economic Development Coalition of Asheville‐ Buncombe County with the information made available. The Economic Development Coalition and Asheville Area Chamber of Commerce have relied on attendance figures, as well as figures for other related economic activity, provided by Moog Music Inc. and may not be held responsible for any discrepancy.

          Implan (Impact Analysis for Planning) was utilized to perform the economic impact study. Implan software and data are sophisticated economic tools used to estimate impacts of changes in regional economies. The most current dataset representing Buncombe County is employed in this analysis. Outputs and results of the analysis are estimates that provide supplemental information about the project, but do not claim to capture every aspect of the project.
          This report represents this discreet event, Moogfest 2014, and cannot be used to predict the value of future events.

          • Fact Checker

            Thank you to Mr Frankel. Perhaps an economist or maybe an economics class (at UNCA?) could interpret this report for us lay people (and tax payers). If council and commission are going to be asked again to put public dollars towards the festival, we need some objective analysis.

    • bsummers

      Given that the EDC disclaimer makes clear that all the data in this study came from Moog, the private company that commissioned it and stands to benefit from it, we should definitely get an independent take on it.

  2. My two cents

    The data came from Moog but was critiqued by the EDC. According to this article:
    http://archive.citizen-times.com/article/20140130/NEWS/301290071/Moogfest-could-30M-economic-impact
    the organizers predicted $30M, the EDC numbers came in at $14M. IMHO, worth the time and effort put forth by EDC to ‘run the numbers’. In the end would Moogfest happened without the $180,000 of public incentives? Probably so. So should we applaud Moog for the concept of the festival and say thanks for the economic bump of $14M? Yes. Should we debate the use of public funds?
    Yes. Everyone will have their own opinion. I think that we should thank Mood Music for the festival. From afar it seems only logical that the festival returns in two years, it would give the organizers times to optimize their investment dollars to reduce expenses and
    make the festival even more successful. Take the angle that the $180K was the seed money that the festival was seeking as a green light and $14M was the economic benefit, the ROI is 7,677%. Not bad. Not bad, indeed. Now take that $180K and invest it into at-risk secondary students to help them as to see that they graduate from high school. Incentivize them to pursue additional education, pursue a good paying job and break the cycle of dependency on the government. The return may not be as quick, but just think of the possibility for them and their future generations.

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