LAKE TRAVIS — Lakeside communities, such as Lakeway and Hudson Bend, have long relied on Lake Travis for their water supply, recreation and electricity, but a new economic study funded by Travis County and the Lake Travis Economic Stakeholders Committee put those benefits into financial terms.
How have lake levels affected your visiting Lake Travis for recreational purposes this year?
A lot—I live near the lake, but prefer when it's full A lot—the lake is not close, so I will only visit when it's worth it Some—closed marinas and docks make recreation more difficult None—I live near the lake to enjoy it Other:
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“Governments at all levels are trying to ensure jobs,” Travis County Precinct 3 Commissioner Karen Huber said at the Lake Travis Economic Impact Study Report findings meeting Sept. 29. “Lake Travis sustains 2,000 jobs related to the lake. When we look at those jobs and when we look at policies that are made out there, this is where this kind of tool will be helpful.”
The 114-page study estimates that the man-made lake contributes $207.1 million annually in state and local revenue, which includes real estate, sales, hotel occupancies and mixed beverage taxes within the study boundaries based on analysis from 2006–10.
Huber pointed out that Central Texas money-makers, such as South By Southwest, are touted for the financial impact they contribute to the area. The $112.6 million Lake Travis brought in from lake-related spending in 2010 was about the same SXSW brought in during the same year. Rodeo Austin and ACL Music Festival each brought in closer to $50 million. Lake-related spending included recreational and tourism activities that would not have come to the area without the lake, such as scuba diving, boating and camping.
For this study, Robert Charles Lesser & Co. (RCLCO) was hired to determine the economic impact of Lake Travis from the north at FM 1431 to the east at RR 620 and Anderson Mill Road to the western Travis County line to the south at Hwy. 71.
How low is too low?
With recent years’ droughts—three of the past four summers in Central Texas have been dry—stakeholders, such as lakeside businesses and cities, have been curious to see what the implications would be to their pocketbooks.
The study showed there was not a significant difference in spending on and near the lake as long as the lake levels were between 660 feet above sea level and full at 681 feet above sea level.
However, after lake levels drop below 660 feet for 60 consecutive days, the study estimates a total loss of between $16.4 million and $21.9 million.
Property values and taxes
Much of the total economic loss would be in property, meaning home sales on and near the lake decrease, which could affect real estate agents, brokers, homeowners looking to sell their homes and the city in terms of property taxes.
“When we start a home on a lakefront property, we generate hundreds of thousands of dollars in revenue on labor, materials, [and] the service industries we use. And contrary to popular belief, when you start a brand-new home, most of the money goes to the community,” said Steve Zbranek, owner of Zbranek & Holt Custom Homes and Lake Travis Chamber of Commerce chairman of the board. “Around Lake Travis, that could be billions of dollars.”
He said in many of the business inquiries he receives, he is asked about the lake levels.
Lakeside businesses affected
Businesses such as charter companies, scuba operators and marina owners can often avoid being hit as hard during a drought in the short-term by diversifying their operations.
However, during longer droughts, it becomes increasingly difficult to continue operating at the same level as when the lake is full or near full.
“Low lake levels impact businesses, and not only is their revenue impacted, but there’s also an increase in cost they must incur,” Principal of RCLCO Todd Larue said.
One example of that is marinas, which can incur costs between $10,000 to more than $300,000 to move for water accessibility.
Pete Clark, owner of Carlos’n Charlie’s, Just for Fun Watercraft Rental and several lake convenience stores, said many of his businesses had cut staff by about half in the past year because of low lake levels and the economic impact it has had on his businesses.
Clark said 80 percent of his revenue comes during a 90-day period in the summer months, and if the lake levels are low, it really hits his business hard.
“It’s kind of like you’re a toy store in the mall and they cancel Christmas, because all of our efforts are concentrated on a 90-day period,” Clark said. “When you upset that 90-day period, it’s real significant to us.”
In September 2010, his restaurants had 88 employees, and during September 2009—a drought year—he had 34 employees. Two of those jobs were management, with the rest hourly jobs, including waitstaff.
Utility expenses increase
Another unexpected cost, which affects not just utility companies but also their customers, is that as lake levels decrease, costs increase. One reason is that pipes must be extended further to pump water out of Lake Travis.
Travis County Water Control and Improvement District No. 17 estimates an added $1,000 per month in electricity whenever lake levels are down.
Clark congratulated the stakeholders for supporting the study.
“I’ve been involved in this cause for years, and I feel like over the last 18 months, we’ve gotten more done than in the past 20 years,” he said.
One of the reasons the study was supported was that stakeholders expect the document to be used by policymakers in making decisions related to the area.
Lake Travis is often defended for its use in generating electricity and providing drinking water, but now it is shown as a driving economic force in the area as well.
“The lake has no voice. It is up to us to try to give it that voice,” Lakeway Councilman Alan Tye said.