At Yuba-Sutter Economic Development Corporation, we are tasked with attracting and retaining jobs and investment. One solid way to achieve that is to encourage residents to spend their money where they live.
Money spent beyond where they live is called “economic leakage,” which results from many causes and is always a drain on the local economy. By offering unique experiences or products, the leakage from other areas becomes our gain.
The food and drink market is one industry that could see a big return through the various restaurants and bars planned for the Hard Rock Hotel and Casino Sacramento at Fire Mountain, Enterprise Rancheria’s long-awaited resort project.
Nine hundred residents live within a five-minute drive of the site. There are no (zero!) food and drink establishments in that zone, so the residents take 100 percent their estimated $675,000 in annual food and drink “demand” or buying power elsewhere, outside the zone.
There are 28,000 residents living within a 10-minute drive, creating an annual demand for $24 million. There are 29 local establishments in this zone, where residents spend $9 million each year – meaning nearly $15 million in demand “leaks” away from the local economy.
And there are 205,000 residents living within a 30-minute drive, creating an annual demand for $238 million. There are 334 food and drink establishments in that area, where residents spend $212 million locally – leaving nearly $26 million in unmet demand on the table.
Some of this unmet demand is currently being satisfied by casinos and establishments in communities beyond Yuba-Sutter. HardRock won’t necessarily recapture all those dollars, but certainly more money will stay local once it opens. The opening will lead to similar reversals of “economic leakage” in other sectors as well.
The 205,000 residents within a 30-mile zone of the site create an annual demand of $45 million for entertainment/recreation services, like theater, music, and sports. We can imagine much of this demand is currently satisfied in Sacramento, Placer, Butte or Colusa counties. Some of this will return, along with demand for hospitality services like hotel and meeting space service.
Wages and benefits paid to Hard Rock employees, as well as goods and services purchased by the property, will cause dollars currently leaking to find their way back into the hands of local workers, households, and businesses. Equally exciting, more residents from outside the area will be attracted to spend their money in our local economy. True economic development!
Hundreds of millions in private, front-end investment have flowed into the economy since the summer, in construction alone. A drive by the site illustrates the progress made, aided by local contractor, Frank M. Booth Inc., one of the biggest subcontractors on the job. Nearly a thousand construction workers have been trained to work at the site, a number that will roughly double by grand opening, according to the company. These are well-paying, union scale jobs, thanks to a project labor agreement signed by the Tribe and the building trades years ago.
Once open, the Hard Rock property will host well over 1,000 living wage jobs with benefits, according to project documents. Formal hiring for these positions is planned to begin this summer and HardRock is planning a series of preliminary community information sessions with the local one-stop hiring centers, Yuba College and local employment agencies next month, in order to prepare for the task of hiring.
Once fully operational, the project will provide nearly $5 million a year in direct public funding to the county of Yuba and city of Marysville for public safety and various other community programs. The Tribe made its first payment of nearly $1 million on these funds nearly two years early.
It’s numbers like this that led Yuba-Sutter Economic Development Corporation and many other local groups to support the project over the very long review process. The HardRock Hotel and Casino Sacramento at Fire Mountain is not even open yet and our region is already enjoying substantial economic benefits. We can’t wait for the fall.
Brynda Stranix is president/chief operating officer of Yuba-Sutter Economic Development Corporation.