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Discussion: The Economics of RAGBRAI

posted on October 16, 2007 at 1:33 PM

Brian Duffy and T. J Juskiewicz are the staffers of “The Des Moines Register” who are entrusted with administering the newspaper’s annual great bike ride across Iowa which, of course, is better known as RAGBRAI. The event is perhaps the best documented festival in the state.

Mundt: Dave Swenson said when RAGBRAI comes through a community, the real impact on that community is probably just what happens on that one day, but it’s a very large impact. Is that a correct assessment, TJ?

Juskiewicz: Oh, absolutely. Towns get ready six months for that one day. A 24-hour period where there’s a lot of dollars getting infused, but there’s a lot of dollars spent in that community getting ready as well. But the towns realize that they’re going to have 10,000 plus visitors, which is typically a lot more in these small towns than they’re used to in a typical day.

Mundt: Well, Brian, that means that probably in some cases, there are outside vendors who come in and want to sell things along with the in-town vendors. So is some of that economic impact split between the town and the folks who come in and work out a deal with the town to sell things?

Duffy: Yeah, to a certain extent. What we try and do is we try and make sure that the owns bring their own people in. We want them to have a benefit of that, but a lot of times they won’t have enough people, enough venues to do that. Then they’ll bring outside sources in. So that will spread out to many places, not just in Iowa but throughout the nation.

Mundt: What does the “Register” spend in a year, if you could tell me, on RAGBRAI? What’s their investment?

Juskiewicz: We’ve got a full staff that’s working on RAGBRAI. The dollars and cents, it’s tough to calculate exactly that, because there’s so many different departments, from marketing departments to the actual RAGBRAI department that works on it. I’m on the road six months working in those towns, coaching them, getting them ready, motivating these towns, from people in churches getting church dinners ready to working with police departments, and just so many different facets of getting ready for that one big day. The “Register” has been committed for thirty-five years to this event. It’s a wonderful event that they’ve been behind since day one.

Mundt: You mentioned the kind of preparation that has to go into making RAGBRAI happen. You get all of that benefit on that one day when all of that money comes rolling into town with those folks. But there’s a lot of expenditure on the back end of this, security, just getting the town ready for the event. I would assume that a lot of communities have to weigh that in the balance. When they consider the benefit, you have to consider the cost too.

Duffy: Well, yeah, you do. But the benefit far outweighs that. If you consider what comes into those towns; T.J. mentioned 10,000 plus. When we say plus, we’re talking about at least 15,000 people. That doesn’t include the people from the surrounding communities that come in. The vehicles that these people bring, the ones that aren’t riding bikes, are really large, and so they take a lot of gas. There’s RVs and our tenements on wheels, which are known as our RAGBRAI buses. So those things take a lot of gas. They will empty out a food store in whatever town they’re in.

Mundt: They’ll stay in a hotel.

Duffy: They’ll stay in a hotel. They’ll go to every single restaurant and empty those places out. So, you know, the economic impact – and T.J. has, kind of, talked to a few people on those numbers. We’ve always tossed out numbers, depending upon the size of the community, of anywhere from $100- to $200,000, way on up. If it’s a larger community such as, maybe, Cedar Falls, then you’re going to be seeing something that’s going to be quite a bit more.

Mundt: Crawford County last week said the liability issue is to much for us, don’t bring RAGBRAI back through our county anytime in the near future. Is that the only situation that has arisen, and how do you look at, then, as you consider not only your future planning but also that liability cost that communities have to endure?

Juskiewicz: We’re certainly, you know, disappointed that that came from Crawford County. We’ve had a great working relationship with all the counties, all 99 counties. We’ve been in every single county in Iowa. The relationships in working with county governments, city governments along the way has been fantastic. We look forward to working with all counties in the future, so I think we’ll certainly work with the counties to find a good solution to make sure that everyone is covered liability wise.

Mundt: Are you continuing to talk to Crawford County about all this?

Juskiewicz: Counties in general. We’ve had some good conversations with Crawford since then. We’re certainly -- We’ve been actually back to Crawford County back in 2006, after the incident took place. So we hope that we can visit all 99 counties in the future, but we certainly understand if they’ve got to do things in their county.

Mundt: RAGBRAI has grown and changed over the years and has developed into an institution, I think, that Iowans greatly love. Brian, how is this going to develop in the coming years? It’s really more than just a bike ride. It’s really something about the entire state and about our culture.

Duffy: It really is because if you consider the amount of different multiday bike rides throughout the nation, people come back time and time again here, when they could go to Colorado or California or someplace else, but they continually come back here. It’s a combination that’s unique to Iowa. It’s the people. It’s the infrastructure that we have. It’s the towns that have such practice in doing these types of things, and that’s what brings them back year after year. Also, you know, for a lot of these teams that come on RAGBRAI, it’s a way of getting together. A lot of them don’t live in the same area, so it’s kind of their way of meeting up with somebody that lives in California, to come back and do this ride together.

Mundt: It’s a great bike ride, the great annual bike ride across Iowa, and a great annual get-together for thousands of people that ride it every year, close to 10,000 riders and thousands of others in communities around the state. This thing is going to continue to go on? The Register is committed to it?

Juskiewicz: Absolutely.

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