FORT WORTH ECONOMY ~ SEPTEMBER 2015 ~ IMPACT OF THE 2015 ECONOMIC IMPACT REPORT ECONOMIC IMPACT REPORT ~2015~ ~2015~ THIS THING IS LEGENDARY.

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1 OF THE 2015 ~ SEPTEMBER 2015 ~ Prepared by Gerald L. Grotta, Ph.D. on the FORT WORTH ECONOMY

2 Contents Introduction...2 Executive Digest...4 Summary of Findings Attendance at the Fort Worth Stock Show & Rodeo...5 Expenditures at the Fort Worth Stock Show & Rodeo...9 Taxes Generated by the Fort Worth Stock Show & Rodeo...12 Multipliers...13 About

3 Introduction This report is based on attendance at the 2015 Fort Worth Stock Show & Rodeo and the total impact on the Fort Worth economy. Several previous studies provide the context for the 2015 report. They include: A survey of 370 people who attended the 2003 Fort Worth Stock Show & Rodeo, conducted by. Four surveys by EventCorp Services, Inc., at the 2005, 2008, 2011, and 2014 Shows, using the firm s I-COUNT Survey Service. This is a very different methodology which uses on-site Kiosk computers. However, the results of the 2003 GMR survey and the I-COUNT surveys appear to be quite consistent. Some examples are shown in the following table. Survey Comparisons GMR 2003 I-COUNT 2005 I-COUNT 2008 I-COUNT 2011 I-COUNT 2014 Methodology Intercept Interviews Kiosk Survey Kiosk Survey Kiosk Survey Kiosk Survey Interviews 370 9,164 6,413 6,962 3,527 Male 52.6% 51.7% 47.7% 50.60% 49.4% Female 47.4% 48.3% 52.3% 49.40% 50.6% Average Age Average Income $83,569 $76,871 $81,638 $81,111 $84,718 Married 63.6% 65.8% 62.7% 54.0% 62.3% College Graduate 47.3% 45.0% 42.3% 38.7% 43.9% First Time at Show 11.9% 11.6% 11.6% 11.4% 19.4% A new project to develop a methodology for determining attendance at the Fort Worth Stock Show & Rodeo was designed and conducted by Grotta Marketing Research, LLC during the 2014 event. In the past, the estimates were based on a formula that evolved over the years. Event officials wanted to test the previous projection process to ensure the accuracy of attendance figures at future events. Intercept interviews were conducted with 895 people at locations throughout the Will Rogers Memorial Center. 2

4 For the 2015 Fort Worth Stock Show & Rodeo, used card readers, as recommended in the 2014 report. This results in a more accurate count than at previous events. As a visitor entered the coliseum, the barcode which was printed on each rodeo ticket was scanned. If a badged person gained access to the rodeo without a ticket the ticket taker would scan a pass card to account for the entry on a badge. All Stock Show visitors who entered the grounds through the General Admission gates with Ground Passes or paid the General Admission tickets also were recorded. To better demonstrate the full impact of the Fort Worth Stock Show & Rodeo on the Fort Worth economy, this 2015 report also includes expenditures during the entire year prior to the event since planning, preparation, and other activities all are devoted to the 23-day event. This analysis does not include the use of any multipliers, which are complex and controversial. Therefore, the economic impact projections in this report are conservative. This is discussed in a later section of this report. 3

5 Executive Digest The 2015 Fort Worth Stock Show & Rodeo experienced significant increases in attendance and economic impact. 23 days of the Fort Worth Stock Show & Rodeo 414,058 individuals attended 1,248,500 visitor days generated $62,425,000 direct expenditures by visitors $26,207,307 expenditures by $88,632,307 total expenditures $1,772,646 in Fort Worth taxes $5,539,519 in Texas taxes For the fourth year in a row, attendance at the Fort Worth Stock Show & Rodeo surpassed 1,000,000 visitor days in Here are some other numbers from the 2015 event: Participants came from 41 states, Canada and Mexico The 1,616 people who registered at the International Suite at the 2015 represented 94 countries. $760,793 cash awards won by rodeo contestants. $498,000 in scholarships awarded. $350,000 in educational grants and contributions. Entries Included: - 10,252 cattle - 1,948 horses - 2,433 sheep - 4,137 swine - 2,628 goats - 1,597 poultry pigeons - 1,931 rabbits 11,254 Junior exhibitor entries representing 237 of the 254 Texas counties. Junior Sale of Champions new record $3,700,000 in sales receipts. 4

6 Summary of Findings I. Attendance at the 2015 Fort Worth Stock Show & Rodeo Findings: In 2015, attendance at the Fort Worth Stock Show & Rodeo exceeded a million visitor days for the fourth year in a row. The final count was 1,248,500. Table 1-1: 2015 Visitor Days Type of Admission Rodeo Tickets 191, , ,018 General Admission - Adult 105,322 89, ,674 General Admission - Child 27,867 24,234 28,149 School Day Tickets 12,006 8,319 10,699 School Tours 6,243 5,871 5,768 One Day Passes 3,093 2,328 2,066 Domino s Pizza Coupon N/A 783 N/A Band Passes - Parade Participants Parade Seating - Grounds Adm. 1, NTTA Toll Tag Passes (1,500 Issued) 1, N/A Total, Single Day Admissions 349, , ,926 Season Grounds Passes 37,562 35,509 35,687 Museum Membership 15,805 13,179 15,541 Official Stock Show Badges 2,874 2,643 2,562 Souvenir Pins 2,915 2,255 3,059 Rodeo Contestant Back Numbers 1,825 1,556 1,200 Commercial Exhibits Access Passes 1,049 1, Commercial Exhibits Passes 1,090 1, Media (Grounds) - Buttons Employee (Grounds) - Buttons Rodeo - Buttons Employee (Coliseum) - Buttons Usher - Buttons Food/Beverage - Buttons Event Staff - Buttons Novelty - Buttons Program Sale Buttons - Jr. League Total, Multiple Day Admissions 64,607 58,633 60,991 Average Number of Days Total Multiple Visitor Days 899, , ,474 Grand Total Visitor Days 1,248,780 1,137,100 1,148,400 5

7 Finding: The total number of visitor days in 2015 increased 9.8% over This represents an increase of 53.8% over Table 1-2: Visitor Days by Year GMR 2003 Survey Total Visitor Days 811, ,300 1,166,000 1,148,400 1,137,100 1,248,500 Average People per Day 35,289 40,448 50,696 49,930 49,439 54,283 1,400,000 1,200,000 1,000, , , ,300 1,166,000 1,148,400 1,137,100 1,248, , , ,000 0 GMR 2003 Survey

8 Findings: Almost a million of the visitors (953,854) came from outside of Fort Worth. The 1,616 people who registered at the International Suite at the 2015 represented 94 countries. Table 1-3: Number of Visitors by Geography, 2015 Percent* Total Fort Worth 23.6% 294,646 Other DFW Metroplex 42.1% 525,619 Other Texas 27.3% 340,841 Outside Texas 7.0% 87,395 Total Outside Fort Worth 76.4% 953,854 Totals 100.0% 1,248,500 *Based on 2014 Special Attendance Survey Report Other Texas 340,841 Outside Texas 87,395 Fort Worth 294,646 Other DFW 525,619 7

9 Findings: A total of 414,058 individuals attended the Table 1-4: Total Individuals Attending Single Day 349, , ,926 Multiple Day 64,607 58,633 60,991 Total Individuals 414, , ,917 45, , , ,058 64, ,485 58, ,917 60, , , , , , , , ,000 50, Single Day Multiple Day 8

10 II. Economic Impact of the Fort Worth Stock Show & Rodeo Findings: People who attended the 2015 spent a projected total of $62,425,000. This is an average of $2,714,130 per day during the 23-day event. It represents an increase of 50.9% since Table 2-1: Spending by Year During the Visitor Days 811, ,300 1,166,000 1,148,400 1,137,100 1,248,500 Per Visitor Day * $51 $50 $47 $50 $50 $50 Total Expenditures $41,369,046 $46,265,599 $54,185,713 $57,391,010 $56,855,000 $62,425,000 *Based on previous GMR and I-Count surveys $70,000,000 $60,000,000 $50,000,000 $40,000,000 $41,369,046 $46,265,599 $62,425,000 $57,391,010 $54,185,713 $56,855,000 $30,000,000 $20,000,000 $10,000,

11 Findings: In addition to spending by visitors, the Fort Worth Stock Show & Rodeo had major expenditures both during the 2015 event and during the entire year before the event. These expenditures totaled $26,207,307. Table 2-2: Expenditures for 2015 Event Expenditures During 2015 Event Hotels/Motels $68,392 Meals and Food $368,292 Special events - luncheons, dances, award presentations, etc. $231,787 Prizes for winners (buckles, jackets, etc.) $78,774 Equipment rental $155,897 Entertainment $90,000 Set up for facilities used during the Show $482,864 Feed, Vet, etc. for cattle used in competitions $261,144 Police and EMS personnel $269,377 Other personnel worked only during the show $2,061,793 All other expenses during the 2015 event $10,098,957 Total During 2015 Event $14,167,277 Expenditures the 12-Months Prior to the 2015 Event Wages and Salary $2,296,134 Utilities $206,087 Advertising/Marketing $529,485 Facilities repair and improvement * $6,421,819 Insurance $486,565 Attorney/legal fees $38,147 All other expenses prior to the 2015 event $2,061,793 Total During 12 Months Prior to the 2015 Event $12,040,030 Grand Total Expenditures for the 2015 $26,207,307 *One time expense for City of Fort Worth improvements 10

12 Findings: The grand total direct expenditures associated with the 2015 Fort Worth Stock Show & Rodeo amounted to $88,632,307. Table 2.3 Total Expenditures for 2015 Category 2015 Visitors During Event $62,425,000 During Event $14,167,277 Prior to Event $12,040,030 Grand Total $88,632,307 Prior to event $12,040,030 During event $14,167,277 Visitors During event $62,425,000 11

13 III. Taxes Generated by the Fort Worth Stock Show & Rodeo Findings: Projected taxes generated for the City of Fort Worth by the 2015 Fort Worth Stock Show & Rodeo totaled $1,772,646. For the State of Texas, taxes totaled $5,539,519. Table 3-1: Taxes Generated by 2015 Expenditures Fort Worth Texas Taxes Total Taxes Taxes Visitors During Event $62,425,000 $1,248,500 $3,901,563 $5,150,063 During Event $14,167,277 $283,346 $885,455 $1,168,800 Prior to Event $12,040,030 $240,801 $752,502 $993,302 Grand Total $88,632,307 $1,772,646 $5,539,519 $7,312,165 $4,500,000 $4,000,000 $3,901,563 $3,500,000 $3,000,000 $2,500,000 $2,000,000 $1,500,000 $1,000,000 $1,248,500 $885,455 $752,502 $500,000 0 Visitors During Event $283,346 $240,801 Fort Worth Taxes During Event 12 Prior to Event Texas Taxes

14 IV. Multipliers This analysis does not include the use of any multipliers, which are complex and controversial. Therefore, the economic impact projections in this report are very conservative. Here is a brief explanation of economic multipliers by MIG, Inc. (formerly Minnesota IMPLAN Group): Multipliers- Multipliers are a numeric way of describing the secondary impacts stemming from a change. For example, an employment multiplier of 1.8 would suggest that for every 10 employees hired in the given industry, 8 additional jobs would be created in other industries, such that 18 total jobs would be added to the given economic region. The Multiplier Model is derived mathematically using the input-output model and Social Accounting formats. The Social Accounting System provides the framework for the predictive Multiplier Model used in economic impact studies. Purchases for final use drive the model. Industries that produce goods and services for consumer consumption must purchase products, raw materials, and services from other companies to create their product. These vendors must also procure goods and services. This cycle continues until all the money is leaked from the region s economy. There are three types of effects measured with a multiplier: the direct, the indirect, and the induced effects. The direct effect is the known or predicted change in the local economy that is to be studied. The indirect effect is the business to business transactions required to satisfy the direct effect. Finally, the induced effect is derived from local spending on goods and services by people working to satisfy the direct and indirect effects. 1. Direct effects take place only in the industry immediately affected: if DEMCO lays off 39 employees, the manufacturing industry loses 39 employees. 2. Indirect effects concern inter-industry transactions: because DEMCO is closing, they will no longer have a demand for locally produced materials needed to produce their product. This will affect all of their suppliers, possibly resulting in a further loss of a few more jobs. Supplier employment loss as a result of the Direct effects would be the Indirect effects. 3. Induced effects measure the effects of the changes in household income: employees laid-off by DEMCO and suppliers may reduce their expenditures in restaurants and shops since they are no longer employed. These changes affect the related industries. 4. Impacts the total changes to the original economy as the result of a defined event. i.e. Direct effects + Indirect effects + Induced effects = Impacts A true economic impact multiplier analysis can cost $100,000 or more and still could be open to criticism on a multitude of assumptions. 13

15 While it is not possible to state a precise multiplier without an extensive and expensive special study, typical multipliers today are considerably lower than in the past. For the, it might be reasonable to assume a multiplier of 2.0 to 2.5. Multipliers higher than 2.5 are generally regarded as suspicious. Using the more conservative estimate of 2.0, the total economic impact could be estimated as follows: Total expenditures: $177,264,614 Fort Worth taxes generated: $3,545,292 Texas taxes generated: $11,079,038 Total taxes generated: $14,624,331 14

16 Dr. Gerald L. Grotta has an extensive background in marketing research, including economic impact analyses, product market potential, competitive analysis, membership surveys, focus group sessions, and marketing plans. He has designed and conducted hundreds of marketing research projects in the past 40 years and his company marked its 30th anniversary in is a member of the American Marketing Association and an accredited member of the Better Business Bureau. From 1969 to 1972 Dr. Grotta was a consultant to the National Academy of Sciences Computer Science and Engineering Board for the Project on Computer Data Banks. This resulted in a book, Data Banks in a Free Society: Computers, Record Keeping and Privacy, by Alan F. Westin et. al., which was a factor in passage of the Federal Privacy Act of Before moving to Fort Worth in 1980, Dr. Grotta was vice president of a marketing research firm in the New York City area and president of the firm s Media Research Division. From 1980 until his retirement in July 2000, he was a journalism professor at Texas Christian University where he taught courses in writing; copy editing; publication design; computer graphics; advertising copy, layout and production; and media analysis and research. He also was a tenured professor at the University of Oklahoma, Southern Illinois University, and Idaho State University. His Ph.D. degree from Southern Illinois University is in journalism with emphasis on economics and mass communications research. Dr. Grotta has been invited twice to keynote major conferences in Europe. He was keynote speaker for the Newspaper Management Programme for the Scandinavian Countries in Aarhus, Denmark in 1976 and featured speaker at an advertising conference in Helsinki, Finland in He has been a speaker at conventions, seminars, and workshops throughout the United States and Canada. His articles have been published in leading scholarly and professional journals in the United States and Europe and his work is cited in many university textbooks. Dr. Grotta has done research and consulting projects for a variety of local, state, and national clients, including: AT&T Long Lines Division Alcon American Airlines Employee Credit Union 15 American Angus Association American Arabian Horse Association American Brahman Breeders Association American Miniature Horse Association continued...

17 American Paint Horse Association American Quarter Horse Association Appaloosa Horse Club Atlantic (ARCO) Federal Credit Union Baltimore Telephone Federal Credit Union Better Business Bureau of Tarrant County Chattanooga TVA Federal Credit Union Fort Worth Chamber of Commerce Fort Worth Convention & Visitors Bureau Fort Worth Stock Show & Rodeo Fort Worth Zoo Frito-Lay Galderma Houston Chronicle IBM Mid-Atlantic Employees Credit Union Infomart (Dallas) J.C. Penney Kansas State University Student Media Kelly, Hart & Hallman Law Firm Martinsville DuPont Credit Union Minneapolis Star-Tribune Montreal Star (Canada) NASA Federal Credit Union National Cutting Horse Association NationsCredit Rolling Stone Sid Richardson Museum of Western Art Sovegal (France) Sports Illustrated Star-Telegram Sundance Square Texas & Southwestern Cattle Raisers Association Texas Farm Bureau The City of Fort Worth Time Texas Christian University Student Media The University of Pennsylvania Van Cliburn International Piano Competition Vought Heritage (LTV) Community Credit Union W.R. Grace Wall Street Journal 16

18 Fort Worth Stock Show & Rodeo P.O. Box 150 Fort Worth, TX fwssr.com