The South Tahoe Event Center symbolizes the South Lake Tahoe transformation from a skiing and gaming area into a broader entertainment and outdoor recreation destination. Throughout the year, this facility will attract conventions, concerts and sporting events. The Tahoe Douglas Visitors Authority (TDVA) retained SMG Consulting and Triple Point to estimate the economic and social benefits of developing the Tahoe South Event Center.
By forecasting a set of economic scenarios out to the year 2030, this study allowed the Board of Commissioners to make informed decisions about the future of Douglas County. One scenario shows the outcome of not developing the Event Center, while two other scenarios forecast the economic impact of developing the Event Center under different underlying economic growth assumptions.
Specifically, Bayesian Structure Time Series (BSTS) models were developed to forecast revenue and visitation trends to 2030. Twenty years of monthly data allowed for more precise model fits and the separation of seasonal variation from long-term structural trends. The tourist economy was characterized by tax revenues, visitor spending, lodging metrics, population and employment.
Models were estimated for both room nights and revenues. Future economic outcomes were then forecast for each scenario. The chart below shows monthly room night forecasts through 2030.
These analytical techniques formed the basis of our analysis. Linear regression provided non-gaming revenue, room and room tax revenue, occupancy, visitation, visitor spending, sales tax, property tax, and employment forecasts to 2030 for each scenario on an annual basis. The chart below is an example showing room revenue.
The final results showed developing the Event Center will generate between 1,100 and 1,300 jobs and an estimated incremental $75 to $92 million of total tax revenues over the next 12 years. This analysis shaped the decision-making process and allowed the County Commissioners to make an informed decision regarding the strategic direction of Douglas County development of the proposed Event Center.