Special Reports

The Dunes dollars: Are they worth it?

A steady flow of traffic enters and exits the Oceano Dunes at the Pier Ave.  Ramp in Oceano.  7-24-08 David Middlecamp
A steady flow of traffic enters and exits the Oceano Dunes at the Pier Ave. Ramp in Oceano. 7-24-08 David Middlecamp The Tribune 2008

Everyone seems to agree on one thing about the Oceano Dunes off-roading area: It's a moneymaker.

Chambers of commerce in the Five Cities extol the park as a cash cow. The local State Parks chief enthuses about it. The lines of cars clogging Pier and Grand avenues on summer weekends seem to testify to it.

But the rosy economic picture has blurry spots that call forth some vexing questions:

  • How much money does the Oceano Dunes State Vehicular Recreation Area bring in to the county, really? The estimates range from $70 million to $200 million; who is right?
  • Who gets that money — and who doesn't?
  • What are the costs — the downsides? Is it worth it — in terms of lives lost, people hurt and environment damaged — to keep the off-road park open?
  • Would local economies collapse if state parks replaced motorized vehicles with more traditional beach activities?

The future of the Dunes is very much in the public eye as the county debates whether to sell its piece of the park to the state.

Complicating matters, Dunes enthusiasts, environmentalists and the state are slugging it out in court, via several lawsuits, over the proper use of the land.

Perspective is everything

When you ask how valuable off-roading is, what's most striking about the answers is their variety. The off-road dunes are, or are not, marvelous — depending on your point of view.

Those who sell or rent all-terrain vehicles, for example, are deeply tied to off-road activities.

Some small businesses nearby would just as soon they go away.

"All the traffic goes whizzing by, heading out to the beach," said Jeff Hornaday, who moved his bamboo business to San Luis Obispo after finding no success on busy West Grand Avenue in Grover Beach, one of two entrances to the beach (Pier Avenue in Oceano is the other).

Hornaday thought his business would be a nice fit for a beach community. Within a year, he learned differently. He and other small specialty businesses watched campers and other vehicles head out to the Dunes, stopping only, as Hornaday puts it, to buy gasoline, cigarettes and beer.

"It's a little gem of a beach town that has just become the trash can of the (Central) Valley," adds Samantha McTighe, who runs Beach Botanicals on West Grand Avenue in Grover.

That dim view is not shared by all merchants, especially those who sell or rent all-terrain vehicles or are otherwise tied to off-road activities. That club includes operators of local restaurants and motels.

Rebecca McMurry, chief executive officer of the Pismo Beach Chamber of Commerce, said if you drive around town and look at cars at restaurants, motels and retail stores, you will see tags from the Dunes.

Taking vehicles off the Dunes would be devastating, she said.

"These people come here to the Dunes (primarily) to ride; that's what they do," she said.

And when they're not zooming across the sand, she added, they are often patronizing local merchants.

Jonni Biaggini, former executive director of the San Luis Obispo County Visitors & Conference Bureau, agrees.

"They shop in our stores; they eat in our restaurants," she said.

Ross Currie, who owns Splash Café in Pismo Beach, said 10 percent to 20 percent of his business comes from people who go to the park.

A question unanswered

Nobody can say precisely how much money the off-road area attracts.

It's not that the question hasn't been asked: There have been at least three studies in the past 15 years. But all have faced criticism over their methodology.

In addition, there have been several partial studies, looking at one or another aspect of the Dunes.

The county does benefit from sales tax; it goes to the state Board of Equalization, which distributes a portion to local government, according to Linda Van Fleet of the county's real property services division.

A 2007 study prepared by Cal Poly on the Dunes' economic impact "did not determine what purchases by off-highway-vehicle visitors were made in incorporated cities versus unincorporated towns, so we are unable to determine from the study a direct estimate of revenue received by the county from sales tax," Van Fleet wrote in an e-mail to The Tribune.

No study has tied together all of this economic information.

Lynn Hamilton, a professor of agribusiness at Cal Poly, said it's difficult to measure the full economic impact of the state park.

"If all one does is measure the fees collected at the park for entrance and camping, plus the sales tax and gas tax ... that's a very narrow view of a park's economic impact.

"First, it only measures money coming into the park, not how those funds circulate through the economy.

"Second, it fails to differentiate between money brought in from elsewhere (non-SLO residents) and SLO residents. If a SLO County resident chooses to spend a day at the Dunes versus a day at Morro Bay ... no new money has come into the area.

"In addition, Oceano Dunes is not like Disneyland. At Disney, once you're in the gates, all the money you spend goes to Disneyland concessions."

The people coming to the Oceano Dunes, however, spend money at local restaurants, grocery stores, souvenir shops, automotive shops and other places. So those expenditures are spread throughout the local economy.

The most recent analysis, in which Hamilton participated, was released last year by the Cal Poly program in natural resources, recreation, parks and tourism administration. It said vacationers at the Dunes generate $76 million a year that goes into the county economy — most of that in the Five Cities area.

Local residents and companies spend $25 million on top of that as a result of Dunes activities, the report said, as jobs are created and local residents circulate money through businesses.

Numbers too low?

Off-highway enthusiasts, including State Parks manager Andrew Zilke, contend that figure is low and have cited numbers as high as $200 million, which Zilke calls conservative.

Friends of Oceano Dunes, a nonprofit ATV lobbying group, also found the numbers too low and sent e-mails to Zilke suggesting the Cal Poly files be stored or destroyed.

There are numbers you can calculate, however.

Money collected at the state recreational vehicle area goes into the state's off-highway-vehicle trust fund, as do "green sticker" registration fees and fuel tax. Riders pay $50 every two years for a "green sticker fee" for each off-road vehicle.

That money then is redistributed, under a formula mandated by the California Public Resources Code.

San Luis Obispo County received about $180,000 this year from the trust fund, up from $139,000 last year.

There is sales tax on business in the area, but that is not broken down. A hungry customer who buys spaghetti at Mama's Meatball on Pier Avenue pays tax, but there is no way to know whether he walked up from the beach to eat or motored over from his home in Arroyo Grande.


From one perspective, it may not matter precisely how much wealth the off-road activity creates: It's a gold mine, and shutting it down would be a serious mistake, supporters say.

"No matter how you slice it, it's a significant amount," Zilke said.

Grover Beach Mayor John Shoals agreed: "If we're quoting $70 million, there would be economic devastation" if the park's motorized vehicles went away, he said.

Others, though, bring up the costs, few of which been have been tabulated in any studies.

Like Oceano, local governments pay for police, fire and medical help when a situation goes beyond what park rangers can handle. And taxpayers and hospitals bear some costs when someone is treated at a local hospital and has no insurance.

In addition, the Sheriff's Department was summoned to the Dunes in five major cases and 300 "assist other agencies" calls in the past two years, according to spokesman Rob Bryn. The lesser calls are for such things as backup in stopping suspicious and speeding cars, he said, while the major cases have been as serious as sexual assault and involuntary manslaughter.

Bryn said the Sheriff's Department does not have a cost estimate on these calls and does not consider them a burden because, without state parks police, the sheriff would be handling all these cases.

The human cost

Then there is the human cost — 22 deaths since 2000 and hundreds of accidents every year (2,100 between 2000 and 2006, state parks reports).

Those figures do not reflect all the accidents on the Dunes; many are not reported.

There are also health care costs from pollution, say such off-road vehicle critics as Nell Langford of Pismo Beach.

Finally there is the intangible cost. County Supervisor Bruce Gibson alluded during a recent meeting to what he considers a principal impact from off-roaders: "the loss of that beach to those who don't wish to drive down there."

Swimming is allowed at the recreation area, though a steady stream of vehicles rolls down the beach and, despite speed limits, parents generally do not turn small children loose. The number of families using the water is far fewer than on Pismo Beach to the north.

ATV supporters argue that there are other beaches up and down the coast and that many of them once allowed vehicles. The Oceano Dunes riding area, to them, is the last small corner in what once was a huge riding empire.

If someone wants to walk on the beach, they say, go to Guadalupe Dunes or Morro Bay or Pismo Beach.

One supposed cost that has come up often in public discussions has in fact not been a threat for many years: liability.

Those who want the county to sell to the state say it would hand off the cost of lawsuits. But since the 1990s, it has been illegal to sue under state laws when someone is hurt as a result of participating in a "hazardous recreational activity," the County Counsel's Office reports.

What about Oceano?

Corollary to these questions is why more money does not get back to Oceano--the community from which many offroaders drive onto the beach.

Many believe a community that sidles up to a moneymaking beach park should have a prosperous look and feel.

But Oceano's main street, state Highway 1, is a collection of card rooms, used car lots and assorted businesses that seem to have little connection to one another.

Trash blows off the beach into Oceano, and sand sometimes covers the streets. Traffic, with its attendant pollution, is heavy in summer. Sand clogged a sewer near the entrance kiosk until the parks district installed a sand trap.

"It (the off-road area) doesn't do any good for us," said Patrick O'Reilly, general manager of the Oceano Community Services District. "Most people in the community would rather not have it there."

Nonetheless, Oceano pays a price for the tourist attraction.

O'Reilly said Oceano last year spent 18 percent of its Fire Department budget on the Dunes. He estimated the department responded to 14 incidents in 2007 at an average cost of $200, for firefighter time as well as bandages, splints and the like. O'Reilly added that the district does not have hard numbers because it does not track those costs in detail.

In a letter to Supervisor Katcho Achadjian last year, the district asked to be reimbursed directly. District President Jim Hill wrote that "tourists are occasionally injured on the beach but come into our community for treatment in hotels or other public places.

"When we respond to these incidents, it prevents us from performing other pertinent tasks," Hill wrote.

He also asked that Oceano receive a "substantial portion of the in-lieu off-highway motor vehicle fees received by the county each year."

The county has provided a four-wheel-drive fire truck for going out on the Dunes. And certain local businesses — especially those involved in the ATV craze — are making money for themselves (and tax revenues for the county) and providing local jobs.

But Oceano would like to see more of the gold its beach generates. It has asked for a $1-a-vehicle entrance fee to go to the district. That request has gone nowhere because of ongoing negotiations about the sale, O'Reilly said.

"Does Oceano make any money?" resident Lucia Castelnuevo asked the Board of Supervisors rhetorically at a recent meeting.