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Economic Impact Study of the I-86 Corridor

Contents

1. Executive Summary

2. Acknowledgements

3. 1. Introduction
   1. 1.1 Highway History
   2. 1.2 Agency Roles
   3. 1.3 Objective of this Study
   4. 1.4 Organization of the Report

1. 2. Analysis Framework
   1. 2.1 Definition of the Project and Study Area
   2. 2.2 Definition of the Time Period
   3. 2.3 Measurement of Impacts
   4. 2.4 Definition of the Comparison Area
   5. 2.5 Similarity Between the Study Area and Comparison Area

1. 3. Local Traffic, Business and Land Development Changes
   1. 3.1 Traffic Volumes and Travel Times
   2. 3.2 Local Business and Land Development in the Study Area
   3. 3.3 Local Business and Land Development in the Comparison Area
   4. 3.4 Findings on Localized Development Impacts of I-86 Completion

1. 4. Analysis of Economic Change
   1. 4.1 Sources and Indicators of Overall Change
   2. 4.2 Employment and Number of Businesses
   3. 4.3 Average Income
   4. 4.4 Property Values
   5. 4.5 Population

1. 5. Conclusions
   1. 5.1 Localized Impact Findings
   2. 5.2 Area-wide Impact Findings
   3. 5.3 Uses of this Study

1. Appendix A. Interview Guide

2. Appendix B. Maps of New Business Locations

3. Notes

Executive Summary

The southwestern corner of New York State has long suffered from high unemployment and low income, and a lack of good regional highway access. To address the region's economic needs and accessibility limitations, New York State authorized development of the Southern Tier Expressway, and the Appalachian Regional Commission designated it as Corridor "T" of the Appalachian Development Highway System. The route was initially served by a 2-lane road, but the western portion (185 miles) was upgraded to a four lane, limited access expressway over the 1980's and 1990's. The upgrade was completed in 1999 at which time the highway was formally designated as Interstate 86.

This study examines the nature of initial economic development impacts associated with completion of the four lane expressway and designation of the new Interstate highway. It applies a methodology developed in the Federal Highway Administration report: Using Empirical Information to Measure the Economic Impact of Highway Investments, Vol. 2: Guidelines for Data Collection and Analysis. This report is a joint effort of the Southern Tier West Regional Planning and Development Board and contractors funded by FHWA-- Economic Development Research Group, Inc. and Cambridge Systematics, Inc. This study only shows preliminary, initial impacts. It will take up to ten years of economic data to observe the extent of any net long-term increases in employment and income that are attributable to completion of this highway project.

Notwithstanding the previous sentence, key findings were that:

• The project has spurred interest in land development, which led five communities to develop and adopt land use regulations. At least three communities also noted increases in property values attributed to the new interstate highway.
• The project has spurred construction of new buildings and opening of new businesses. New manufacturing plants came to locate in five communities, and new warehouse distribution centers came to locate in two others.
• Traffic levels have risen in the western part of the highway (the part closest to the intersection with I-90), and new investment has been made in facilities and attractions for new visitors. These include new truck stops in two communities, new motels in three communities (and proposed for others), a new visitor information kiosk in one community and a new Indian casino also opening up. .
• Measurement of overall countywide employment and income trends indicate that the study area's economy is performing better than that of a comparable area located elsewhere in the state. However, more years of post-completion observation are needed to make definitive conclusions regarding project changes on the study area economy.
• Manufacturing was the most notable sector of the study area's economy that clearly grew in total employment at a rate faster than was occurring elsewhere. This is consistent with local reports that a series of new manufacturing and distribution facilities have moved into the region at the time of completion of the interstate highway.

Acknowledgements

Staff of three organizations jointly conducted this study. The lead organization was the Southern Tier West Regional Planning and Development Board (STWRPDB), under whose auspices this report was completed. Using internal funding of the STWRPDB, staff including Don Rychnowski (Executive Director) and Paul Miller collected primary data concerning development impacts.

The study was completed with the assistance of contractors funded by the Federal Highway Administration (FHWA) "Environment and Planning Technical Support" contract (DTFH61-98-00107, TO-24). This contract task order was directed by Martin Weiss of FHWA, and funded to Cambridge Systematics, Inc. as prime contractor and Economic Development Research Group, Inc. as subcontractor for work with regional and state agencies in developing prototype studies of the economic impact of highway improvements.

Glen Weisbrod of Economic Development Research Group (EDRG) directed the overall study design and analysis process, and was assisted by Manisha Gupta of EDRG, who evaluated economic development patterns in the region. Brian Ten Siethof and Chris Porter of Cambridge Systematics (CS) analyzed survey data and also collected data for a comparison area. John Suhrbier of CS oversaw the contract with FHWA.

The study team is indebted to a large number of local, state and county officials, as well as representatives of local business (chamber of commerce) organizations, which participated in interviews and provided local information on property values, development and plans.