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Hood County Lake Granbury Study Economic Impact Study Overview Study Objective Establish the baseline economic impact of Lake Granbury-related activity using as well as consider long-term implications of low lake levels Study Area Water Adjacent Property: properties immediately adjacent to Lake Granbury Water View Property: border lake adjacent properties and within 250 ft of water Lake-Related Activity: the combination of water adjacent and water view Key Questions How important is Lake Granbury-related activity to Hood County? Do any economic indicators show the impact of lower lake levels? 1

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Hood County Lake Granbury Study Social Impacts of Water Shortages Socioeconomic Impacts of Projected Water Shortages for the Brazos G Regional Water Planning Area (Region G) 2011 As the name implies, the effects of water shortages can be social or economic. Distinctions between the two are both semantic and analytical in nature more so analytic in the sense that social impacts are harder to quantify. Nevertheless, social effects associated with drought and water shortages are closely tied to economic impacts. For example, they might include demographic effects such as changes in population mental and physical stress loss of aesthetic and property values reduced recreational opportunities 2

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Hood County Lake Granbury Study Five Lake-Related Economic Indicators Real Estate Activity & Property Values evaluates the distribution of households and price premium paid for lake- related properties Employment & Labor Force considers the distribution of jobs throughout the county by industry sector Lake-Related Taxable Hotel Revenue is the best indicator of water-related tourism Lake-Related Sales Tax Revenue serve as a proxy for how water-related tourism ripples through the economy Lake-Related Mixed Beverage Tax Revenue supplements other visitor datasets 3

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Hood County Lake Granbury Study 1. Real Estate Activity & Property 4

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Hood County Lake Granbury Study Cities & Census Designated Areas 5

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Hood County Lake Granbury Study Hood County Property Values (2013) 6 AreaAccountsAcres% of TotalTaxable Value% of Total Water Adjacent4,31616,4266.2%$1,149,155,94028.5% Water View2,8831,5590.6%$298,057,4117.4% Lake-Related6,03617,9856.8%$1,447,213,35135.9% Rest of Hood County37,433248,31193.2%$2,581,871,48564.1% In 2013, lake-related properties were approximately 6.8 percent of total land area but 35.9 percent of the tax base Lake-related single-family homes are 28.5 percent of net taxable value Between 2012 and 2013, the taxable value of lake-related properties declined 2.7 percent versus Rest of Hood decline of 1.6 percent

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Hood County Lake Granbury Study Average Taxable Value per Single-Family Home 7 Area 20092010201120122013 Water Adjacent $240,486$244,242$243,454$246,931$238,111 Water View $136,529$136,076$135,416$134,408$129,843 Lake-Related $211,671$214,370$213,563$215,775$207,932 Rest of Hood County $103,014$103,759$102,562$101,583$101,209 Area 20092010201120122013 Water Adjacent $714.46$725.62$723.28$733.61$707.41 Water View $405.62$404.27$402.31$399.31$385.75 Lake-Related $628.86$636.87$634.48$641.05$617.75 Rest of Hood County $306.05$308.26$304.70$301.79$300.68 Estimated Hood County Property Tax Revenue

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Hood County Lake Granbury Study Average Taxable Value (2013) of Residential Properties Built between 2000 and 2012 8 New Lake-Related Homes 2.5 x more $ than Rest of Hood

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Hood County Lake Granbury Study MLS Residential Sales from January 1 - July 18 9

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Hood County Lake Granbury Study 2. Employment & Labor Force 10

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Hood County Lake Granbury Study 3. Taxable Hotel Receipts 11 Year Water Adjacent Water View Lake- Related Hood County Lake-Related as % of Total 2008$1,856,832$654,112$2,510,944$8,650,79629.0% 2009$2,712,107$437,132$3,149,239$7,013,73344.9% 2010$3,052,213$409,649$3,461,862$7,042,40549.2% 2011$3,290,168$342,009$3,632,177$8,239,92644.1% 2012$3,069,122$338,568$3,407,690$7,702,91844.2% Change 11-12-6.7%-1.0%-6.2%-6.5%N/A Hotel occupancy revenue generated by Hood County businesses more than doubled since 2000, from $3.6 million in 2000 to $7.7 million in 2012 Lake-related lodging facilities generate approximately 44.2 percent of taxable hotel receipts in Hood County

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Hood County Lake Granbury Study Total Tourism Spending By Year (Hood County) 12 Category20082009201020112012 Spending ($M)$67.5$57.3$55.0$60.4$61.8 Earnings ($M)$15.6$14.6$13.4$14.3$14.4 Employment596541496535515 Local Tax Revenue ($M)$1.2$1.0$0.9$1.0 State Tax Revenue ($M)$4.0$3.6$3.4$3.6$3.7 Hotel Occupancy51.0%35.4%34.3%43.6%43.2% Est. Room Rate$95.52$86.88$77.68$74.57$72.39 Local Tax Receipts Tax receipts collected by counties and municipalities, as levied on applicable travel-related purchases, including lodging, food and beverage service, retail goods and auto rental. Property taxes are not included. State Tax Receipts The state hotel/motel tax, sales tax, motor fuel tax and business franchise tax receipts attributable to travel expenditures.

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Hood County Lake Granbury Study Total Tourism Spending By Year (City of Granbury) 13 Category20082009201020112012 Spending ($M)$54.7$44.0$39.6$44.2$42.9 Earnings ($M)$12.9$11.5$10.0$10.8$10.4 Employment497428371407374 Local Tax Revenue ($M)$1.1$0.9$0.7$0.8 State Tax Revenue ($M)$3.2$2.7$2.4$2.6$2.5 Hotel Occupancy50.6%36.2%34.2%43.2%42.7% Est. Room Rate$96.14$87.48$79.97$77.52$76.40 Local Tax Receipts Tax receipts collected by counties and municipalities, as levied on applicable travel-related purchases, including lodging, food and beverage service, retail goods and auto rental. Property taxes are not included. State Tax Receipts The state hotel/motel tax, sales tax, motor fuel tax and business franchise tax receipts attributable to travel expenditures.

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Hood County Lake Granbury Study 4. Lake-Related Sales Tax Revenue 14

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Hood County Lake Granbury Study Sales Tax Revenue by Subarea 15

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Hood County Lake Granbury Study Hood County Sales Tax Revenue (@ 0.5%) 16 Year Lake- RelatedDowntown North of 377 South of 377 Hood County Lake- Related as % of Total 2008$628,323$210,285$313,565$2,219,647$4,594,66713.7% 2009$615,550$213,645$300,522$2,091,166$3,236,22919.0% 2010$627,599$222,944$284,411$2,065,621$2,989,42021.0% 2011$621,681$228,883$283,522$2,095,517$3,120,45819.9% 2012$608,096$238,381$326,836$2,415,277$3,877,00715.7% CAGR 08-12-0.7%2.5%0.8%1.7%-3.3%N/A Nearly 19.0 percent of all Hood County sales tax payers are lake-related and generated $0.6 million in Hood County sales tax revenue in 2013 Lake-related area was the only subarea to decline between 2011 and 2012

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Hood County Lake Granbury Study 5. Mixed Beverage Taxable Sales 17 Year Water Adjacent Water View Lake- Related Hood County Lake-Related as % of Total 2008$729,156$2,040,633$2,769,789$6,193,81444.7% 2009$507,356$1,784,751$2,292,107$5,505,02541.6% 2010$520,928$1,782,703$2,303,631$5,373,15642.9% 2011$800,887$1,725,519$2,526,406$5,954,20042.4% 2012$740,228$1,853,800$2,594,028$6,054,60842.8% Change 11-12-7.6%7.4%2.7%1.7%N/A Approximately 30.8 percent of all mixed beverage permit holders are within 250 feet of Lake Granbury Lake-related MB permit holders capture 42.8 percent of spending

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Hood County Lake Granbury Study Texas State Data Center Population Forecast 18

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Hood County Lake Granbury Study Undeveloped Land Surrounding Lake Granbury 19 Hood Countys population growth in driven by in-migration (people moving to Hood County from outside of the region) The natural increase in population is effectively flat so it is imperative that the region continue to attract new residents Approximately 27.9 percent of all single-family homes in Hood County are lake-related Since 2000, nearly 24.1 percent of single-family homes built were lake-related.

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Hood County Lake Granbury Study Undeveloped Land Surrounding Lake Granbury 20 Low lake levels would likely impact no more than 25 percent of future residential growth The natural increase in population is effectively flat so it is imperative that the region continue to attract new residents Approximately 6,100 acres of undeveloped land around Lake Granbury Lake-related undeveloped property (land that is within 250 feet of the lake) accounts for roughly 1,500 acres

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Hood County Lake Granbury Study Undeveloped Land Surrounding Lake Granbury 21

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Hood County Lake Granbury Study Undeveloped Land Surrounding Lake Granbury 22 Lake-related property values could increase between $269.8 million and $652.4 million over the next 30 years This would translate into additional Hood County property tax revenue between $0.8 million and $1.9 million per year Scenario New Households Acres Developed Taxable Value ($2013) Hood County Property Tax 0.5 Scenario 1,402751$269,775,216$801,478 1.0 Scenario 3,3911,817$652,420,219$1,938,282

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Hood County Lake Granbury Study Report Findings 23 Proximity to water has a clear impact on key elements of the local economy: tourism-related activity property values tax revenue Prolonged low lake levels undermines both: lake is a key visitor attractor fewer visitors means less jobs, income, and local sales, lodging, and mixed beverage revenue housing values also decline if the water amenity is damaged could have an impact on relocation, second homes, etc. Translation of above is a negative impact on the local economy, as well as lower tax revenue for all local jurisdictions