Economic Impacts of Historic Preservation in South Dakota

Center for Urban Policy Research, The State University of New Jersey; Sheals, Deb

From "Study Objective and Organization": "This study examines the many significant economic effects of historic preservation in South Dakota. The study examines the total economic effects of historic preservation, encompassing both the direct and multiplier effects. The direct impact component consists of labor and material purchases made specifically for the preservation activity. The multiplier effects incorporate what are referred to as indirect and induced economic consequences. The indirect impact component consists of spending on goods and services by industries that produce the items purchased for the historic preservation activity. The induced impact component focuses on the expenditures made by the households of workers involved either directly or indirectly with the activity. To illustrate, lumber purchased at a hardware store for historic rehabilitation is a direct impact. The purchases of the mill that produced the lumber are an indirect impact. The household expenditures of the workers at both the mill and the hardware store are induced impacts. Economists estimate direct, indirect, and induced effects using an input-output model (I-O). This study specifies the total economic effects of major elements of historic preservation in South Dakota through a state of the art I-O model developed by the Rutgers University Center for Urban Policy Research (CUPR) for the National Park Service, Division of Cultural Resources, National Center for Preservation Technology and Training. The model is termed the Preservation Economic Impact Model (PEIM). In the current analysis in South Dakota, the PEIM is applied to both annual (2011) historic preservation investment in this state and to the cumulative (1982-2011) investment of historic rehabilitation applied in South Dakota. The PEIM is first applied to an annual (2011) outlay of major components of historic preservation investment. The annual South Dakota historic preservation components considered by the PEIM include historic rehabilitation spending in South Dakota aided by major federal and state/local subsidy programs1 ($22.64 million in 2011)2, heritage tourism outlays in South Dakota ($237.25 million in 2011), and the budgetary spending by South Dakota historic museums ($15.25 million in 2011)—for a total of $275.14 million in 2011. The PEIM is then also applied to cumulative (1982-2011) $329.76 million expenditures attributable to historic rehabilitation in South Dakota that has been aided by major federal and state/local subsidy programs3 over this 30-year period. (The $329.76 million is expressed in inflation-adjusted 2011 dollars, taking into account inflation over time.) The results of the PEIM model include many fields of data." Project funding was provided in part by a 2012 Historic Preservation Fund grant administered by the Tennessee State Historic Preservation Office (project number SD-12-031, grant number 46-12-41948) and the State, Tribal, and Local Plans and Grants Division, National Park Service, U.S. Department of the Interior.

Economic Impacts of Historic Preservation in South Dakota

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