Dr. Dennis Foster - W.A. Franke College of Business

Dr. Dennis Foster - W.A. Franke College of Business

Canyon Forest Village:

A Case Study inPublic Choice Theory

Fall 1993 – June 1997

Kaibab National Forest (KNF) gathers input and considers proposals to deal with “Tusayan” growth.

Insiders: Park Service (NPS), NACOG, Coconino County. Some environmental groups.

Outsiders: Cities of Flagstaff & Williams, Tusayan business owners, northern AZ hoteliers.

June, 1997: Draft EIS for Tusayan Growth

(D-EIS)60 days to respond.5 alternatives.Main CFV proposal: Swap 2184 acres (inholdings) for 672 acres. Build 3650 lodging rooms here (and more).Conclusion: Northern AZ will continue to grow even with CFV.

Critique (BBC & BBER):

D-EIS uses 4% annual growth in GC visitation.D-EIS assumes CFV business is displaced from far away (Phoenix, Las Vegas, etc.)

Conclusion - CFV will have huge effects. . . except . . .

What does the Forest Service want?

Housing.Infrastructure.Community services.Assist NPS with GC plans.

…or, just to consolidate the inholdings?

Fall 1997 to July 1998

KNF works on a revision to the D-EIS.

None of the “outsiders” are privy to this process until it is done.

In July, 1998, a Supplemental Draft EIS is released (S-DEIS).

The Supplemental Draft EIS

45 days to respond. [Issued July 17.]3 new alternatives.KNF favors a new version of CFV that has about 270 acres and builds 900 rooms.CFV promotes a 272 acre/1270 room alternative.NPS transit unlinked from CFV proposals.

Conclusion: No. AZ will be a little worse off!

Critique (BBC & BBER):S-DEIS miscalculated “cumulative” impacts over study period.Impacts are too low.“Capture” rates are arbitrary.

What might be the impact?90% x ($550 mill. to $1 billion)

Fall 1998 to August, 1999

KNF works on Final EIS.

City of Williams asks for BBER to run analysis for Alt. H (1200 room CFV proposal), as that has become the favorite of the KNF.

August 1999 – The Regional Forester

Announces DecisionShe picks the 1270 room version of CFV.

Gives details of land swap valuation:2116 acres 272 acres $5.4 million

Dismissed economic analyses as “conflicting”.

Public Choice Aspects of CFV

Is there a market failure here?

Economic growth? Congestion?

What is the market response?

Williams, Flagstaff . . . even Tusayan.

What does the Forest Service really want?

Is the NEPA process valid?

Public Choice Aspects of CFV

How extensive is rent-seeking?

Well, $1 billion worth!

Developers, inholders, enviros, NPS & USFS.• Museum and NAU.

Is there elitism at work here?

What interest is economic growth to USFS?

Scientific management at work here?

Public Choice Aspects of CFV

Extent of Government exploitation

Value of land in the swap.

“Impacts” with large version of CFV.• All economic calculations were suspect.

Notion that project won’t boost visitation.

Doom and gloom scenario• 10 million annual visitors to GCNP by 2010!

Public Choice Aspects of CFV

A Modest Proposal:

Auction off land in . . . 20 acre chunks.

Use the proceeds to buy the inholdings.

A More Dramatic Proposal:

Build CFV on the rim of the canyon!

The dream that was the Grand Canyon Inn.

Aftermath:Spring 2000 County

HearingsCoconino County holds hearings on rezoning of the 272 acres for CFV.

P&Z holds many nights of hearings.Board of Supervisors holds many nights of hearings. Sends back to P&Z.P&Z considers changes made by the board.Board holds final hearing announcing their vote on this issue: 4-0 in favor of rezoning.

Fallout from County Hearings

CFV buildout pared down to 900 rooms.CFV can build an additional 240 rooms if…Opponents start lawsuit.Opponents gather signatures to place zoning decision on the ballot.

Nov. 7, 2000 vote on Proposition 400

2-1 against the rezoning!!

Dr. Dennis Foster - W.A. Franke College of Business

Canyon Forest Village:

A Case Study inPublic Choice Theory