Executive Summary

The purpose of this study is to identify the economic benefits of a recently completed expressway in Wisconsin.

In cooperation with the Federal Highway Administration and the Economic Development Research Group, the Wisconsin Department of Transportation (WisDOT) agreed to evaluate a recently completed four-lane corridor in north-central Wisconsin in order to determine the actual and potential economic benefits of the highway capacity improvements.

Wisconsin State Highway 29 (a/k/a State Trunk Highway 29 or Highway 29), a 182-Mile expressway, was chosen as a case study for several reasons. First, from a historical perspective, Highway 29 was an important transportation link connecting many of the state manufacturing and food processing facilities to trade centers in the Midwest. Also, Highway 29 was the subject of a previous economic impact study, conducted in 1989 by Glen Weisbrod, currently a principal with the Economic Development Research Group. In the study, [1] a baseline of business information was established and an economic forecasting methodology developed to predict the economic benefits of a four-lane facility. Finally, Highway 29 was chosen for its economic diversity. The cities, villages, and towns along this highway represent rapidly growing regional trade centers as well as smaller, rural, and agriculturally dependent communities.

A recommended methodology for the economic impact study was outlined in a Federal Highway Administration research study, Using Empirical Information to Measure the Economic Impact of Highway Investments. WisDOT followed this methodology along with additional analytical methods for evaluating economic impacts, including utilizing its Geographic Information System (GIS) applications to identify and map businesses along the corridor.

WisDOT's research team conducted surveys of local officials and business leaders to determine the impacts of the highway improvements. Land use plans were gathered for current and anticipated economic activity along the highway. Rates of growth over an 11-year period for population, per capita income, business growth, tourism expenditures, locations of new and expanding manufacturing plants, and Average Daily Traffic (ADT) counts were compared between the four-lane highway (Highway 29) and a comparison two-lane highway (US Highway 10).

Due to the length of Highway 29 and time constraints, the study was divided into two phases. The first phase, discussed here, covers the 55-mile highway corridor between Chippewa Falls and Abbottsford. Phase II of the study will extend the analysis area from Abbotsford to Green Bay, an additional 127 miles. Highway 10, a two-lane corridor, parallel to Highway 29, was selected for comparison purposes. The Phase I analysis area along Highway 10 included the communities between Osseo and Marshfield, approximately 55 miles in length. During Phase II, an additional 104-mile, two-lane comparison corridor will include the communities between Marshfield and Appleton.

Comparative economic analysis was also completed on average daily traffic counts, per capita income, and traveler expenditures for the entire Highway 29 and Highway 10 corridors (Phases I+II).

The following are preliminary findings of Phase I of the study as of mid 2002.

Community Economic Impacts

• Local economic development and planning officials reported that mostly positive economic impacts were related to the four-lane improvement. These highway improvements provided faster travel times, better access to the expressway, and improved safety and driving conditions for both truckers and private vehicle operators.
• Communities along the four-lane highway have accelerated their planning efforts for commercial and industrial development, particularly near new interchanges. Maps of planned land-use were provided by communities and were included in the study, along with maps created from interviews with local officials by research staff. The maps illustrate the proactive local planning efforts taken to increase local economic development along the expanded four-lane corridor.
• Interviews with local property tax assessors provided anecdotal evidence of the changes in property values along the four-lane highway, particularly near the interchanges.
• The highway improvement has reduced travel time and improved employment prospects for many job seekers residing in the communities along the expanded highway. Local officials indicated that many of the workers commute long distances to the large urban centers for the higher paying jobs and benefits. At the same time, wage earners are likely to purchase products and services at these larger urban centers rather than locally in the smaller communities.

Business Impacts

• Manufacturers, food processors, and transportation service providers noted improvements in travel times and increased reliability of product delivery. Improvements in the safety of the new four-lane highway were the most frequently mentioned economic benefit by interviewed businesses.
• Between 1995 and 2002, the total number of businesses within 5 miles of the highway increased from 1,452 to 2,524, a 74% increase. Highway-oriented businesses such as gas stations, motels, restaurants, and convenience stores were the first wave of develop-ment for many of the communities along the improved four-lane highway.
• At a broader countywide level, and focusing just on manufacturing, data from the Wisconsin Dept. of Workforce showed that new and expanding manufacturers in counties along the corridor created 4,871 jobs, more than twice the number of jobs created in the previous six years.
• The highway expansion has also caused shifts in traffic patterns, affecting downtown businesses. A reduction of trucks in the downtown area has increased the visibility and accessibility of businesses along Main Streets. On the other hand, the additional lanes, interchanges, and bypasses facilitated the shift of local shoppers from the smaller local communities to the larger urban centers.

Comparison of four-lane Highway 29 to two-lane Highway 10

• Between 1990 and 2000, population increased 5% in communities along the two-lane highway corridor and 7% along the four-lane highway corridor. This population growth rate was slightly below the statewide average of 9% during this time-period.
• During the same eleven-year period, tourism expenditures for counties along the entire length (Phase I and II) of both highway corridors increased approximately at the same rate. Tourism spending for the four-lane highway increased 115% while expenditures along the two-lane highway increased 108%. However, the level of tourism expenditures on the four-lane highway was significantly higher.
• From 1990-2000, the average growth rate in per capita income in counties along the entire length of the four-lane corridor was slightly higher (by 1%) than in counties along the entire length of the two-lane highway. Also, the average growth in per capita income in counties along both highway corridors was higher than the average statewide.
• During 1995-2002, the number of new businesses grew substantially in communities along both highway corridors. During this eight-year period, the number of business along Highway 29 increased from 1,452 to 2,524, or by 74%. Along the two-lane Highway 10, the number of businesses during the same period increased from 1,080 to 2,183, or by 102%.
• A newspaper clipping file of articles announcing major new industrial businesses, maintained by the Wisconsin Dept. of Commerce, showed 43 new and expanded manufacturing plants located along the study area portion of Hwy. 29 during the 1990-2001 period. The new jobs associated with these plants was twice that found for the comparable two-lane Hwy. 10 segment over the same time period.
• Average Daily Traffic increased by 56% on Highway 29 compared to 52% along Highway 10. This increase in traffic and the observed increase in tourism spending along Highway 29 are most likely related.

It is important to note that these are preliminary findings focusing on the western part of the highway corridor. As more communities are analyzed along the rest of the highway corridor, some of these results may change. Most of the communities examined during the first phase of the study are smaller rural communities. Phase II of the study will include several larger regional trade centers located further east, where development is more rapidly occurring.