a. Industrial Trends Indicate Limited Economic Diversification
    To understand Boundary County's industrial history, it is important to know that over 90 percent of the county is forested. Nine of the remaining ten percent is farmland. These traits become substantial statistics in the context of a County covering 1,277 square miles. Consequently, it is no wonder that for over a century this natural resource base has dominated the regional economy. In fact, for a time in the early part of the twentieth century, Bonners Ferry was home to one of the largest sawmills in the world.

    Transportation, government and commerce also have contributed greatly to the county's economy. With two national rail lines, U.S. Highway 95, and the Kootenai River running through the region, Bonners Ferry served well as a distribution and supply center starting in the 1880s (though it was formally established in 1893). Freight and passenger service operated along the river to Bonners Ferry for many years starting in 1883.

    In recent decades (see Figures 3.1 and 3.2), access to timber became more difficult and more expensive. For all its strength, the timber industry is unstable. Even so, sales and employment have actually continued to climb. Though there is little value added to wood exports from the county, timber remains a major part of the economy. In fact, ninety-four percent of workers in the manufacturing sector are linked to lumber and wood products. For over two decades, there has been practically no change in the number of jobs (about 40) in other manufacturing. 

    Traditional farming of grains and other commodities saw its own decline. Prices in this sector have been weak and undependable for over thirty years. However, a few specialty crops, like hops and landscaping materials, have done well. As a result, agriculture remains a major part of the economy, though its focus is remarkably different from fifty years ago. For example, Anheuser-Busch established Elk Mountain Farms in the mid-1980s, a hops production facility that has become a major regional employer. During harvest, the operation employs up to 200 people, including many migrant workers. Tree and landscaping nurseries also have become major important employers.

    A few unusual companies grew into major employers in recent years. CEDU Family of Services opened its first facility in the county in 1982. Focused on education for troubled youths, this organization is now one of the top two employers in the county. A second major new employer is the Kootenai Tribe of Idaho. In 1986, the Kootenai Tribe opened the Kootenai River Inn. With its casino, restaurant and high quality rooms, the Inn has given the county's small tourism industry new potential. Together, CEDU and the Kootenai Tribe of Idaho are now the largest employers in the county. The third largest employer is the Boundary County School District, well known for quality education but poor facilities. When combined with CEDU figures, educational employment can be seen for the major economic asset that it is.

    The employment base feels narrow: the mainstays being government, education, and timber. However, services and retailing have shown remarkable growth and have even more potential. Construction and transportation also are important growth segments. 

    The chart at left illustrates that most employment sectors have held steady or grown. The largest growth, though, has been in jobs (e.g., Service) that do not provide a livable wage. Consequently, diversification is essential if the regional economy is ever to become stable.

    The county's population grew 20% (about 2% per year) over the past decade. This rate, well above the national growth rate, is relatively small compared to the state average. The rate also is down from the recent decades. For example, during the 1970's, the population grew 32.9% from 5,484 to 7,289 people.

    Economists consider per capita income to be one of the best measures of an area's economic prosperity. The per capita income for Boundary County is 60% of the national average and 72% of the state average. The unemployment rate is four percent above the national average and three percent above the state average. In all of these categories, Boundary County is in distress. Economic development, especially the creation of livable wage careers, is critically important if the region is to become healthy and stable.

b. Airport Development Options Are Limited

1. Airport Development Conditions
    Boundary County, Bonners Ferry Airport is a major regional asset. It contributes about forty-five jobs and $2.1 million to the regional economy. Its facilities are fairly limited but well used by local and itinerant pilots. Its biggest limitation is its relatively short runway length, 4,000 feet. The minimum length recommended by the Federal Aviation Administration is 4,480 feet for a basic utility airfield serving 100 percent of small aircraft with ten passenger seats or less. A length of 4,582 would be necessary to accommodate what the industry currently designates as "critical aircraft" (thought this definition is subject to change).

    A recent study demonstrates there is significant demand for an extension that would allow all small aircraft access to the field. Small jet operations linked to Crown Pacific, Anhauser Busch and CEDU (among others) are severely limited and typically do not land here. An extension of just 600 feet would address these and all other small (ten passengers or less) aircraft.

    In addition to runway length, several other airport development issues are being considered by the County and Airport Board, including:

* Possible Customs Facility: The planning team investigated this possibility and found that U.S. Customs has no interest in creating such a facility at this time. Rumors of Customs expansion in the area were based on misinterpretation of some remodeling of a Customs facility at Eastport.
* Aircraft Fueling Apron: The airport advisory board is evaluating options for fuel storage and dispensing.
* Helicopter Operations: Future development of the airport with accommodations for helicopters is deemed to be important.
* Airport Camping: Areas for on-site airport camping are currently available. The airport board would like to continue and promote this service.
* Industrial Park Land Uses: The current land use plan for the airport designates about sixteen acres for industrial park development on the west side of the airport. 

    The single greatest constraint on the airport is related to geography. The best approach (from the northeast, given the prevailing wind) is constrained by the presence of a tall hill. No matter how much the runway is extended, this hill will always impose an access restriction for larger aircraft and even small ones operating under visual flight rules. In the other direction (southwest), the runway approach goes right over Downtown Bonners Ferry. Even when winds are favorable, this approach is not.

    Note that airport development is a highly technical and complicated subject. This report is intended to provide summary information only about development options. The readers should refer to the 1997 Airport Layout Plan for a more thorough and accurate discussion of this subject.

2. FAA Regulatory Environment 

    The Federal Aviation Administration (FAA) has substantial regulatory control over development at and adjacent to the airport. FAA representatives recently emphasized that most light industrial development in the Industrial Park zone west of the airport may not be condoned. This position is based on FAA's investment in creating airport facilities in the late 1940's and a use agreement made with the County at that time.

    Further discussion between the planning team and FAA officials in Seattle indicated that these apparent limitations are open for negotiation. FAA does not want to prohibit business development. Its priority is the continued and safe operation of the airport. Certainly, some forms of development will be compatible with this priority. FAA recommends that any specific potential development be brought to the attention of the appropriate FAA administrator in Seattle. Every effort will be made to accommodate the proposed use, with the conditions already noted.

3. County Priorities and Options for Development
    Even with FAA's implied degree of flexibility, development within the Industrial Park zone will be difficult for the following reasons:

* Limited infrastructure, especially wastewater disposal
* Building height and environmental constraints (related to air quality) due to location adjacent to the airport)
* Limited commercial value of the small-craft-only airport: Passenger and freight service will always be very limited
* Alternative development sites with better locations: the Airport Industrial Park has no highway frontage and is distant from rail service
* Practically no onsite amenities: the Industrial Park today exists little more than in name
* Air traffic noise may be undesirable to some potential tenants

    For these reasons, the planning team recommends that future airport development focus on aviation and aviation-related uses. For example, the pending agreement with U.S. Border Patrol to construct a facility for its use is an ideal arrangement.

4. Infrastructure and Circulation 
    The Bonners Ferry Airport Improvement Plan (AIP) shows the master plan for a position of the northwest quadrant of the airport to be reserved for commercial/industrial development. This AIP master plan was approved by the Federal Aviation Administration in 1997, and is available for review at the Boundary County Courthouse or at the airport.

    The industrial area already has a paved access road and eight-inch waterline with fire protection. Water service is provided from the Three Mile Water District. The key infrastructure component that is missing at the airport is wastewater disposal.

    The closest city sewer line to the airport industrial site is 2.1 miles away to the south. The airport is not within city limits, and there is no sewer district in the vicinity. The only practical method of wastewater disposal for airport commercial/industrial development is using on-site subsurface sewage disposal (drainfields). The sandy soils, which are prevalent under the airport, are suitable for domestic (non-industrial) wastewater disposal at low loading rates. Industrial wastewater that is not typical of domestic wastewater cannot be disposed using on-site drainfields. Representatives of Panhandle Health District have stated that on-site drainfield disposal would be acceptable for domestic wastewater at the airport. However, drainfield disposal consumes large quantities of land that cannot be used for other purposes (except runway clearance areas).

c. Other Industrial Development Options Offer Opportunity
    1. The Fairgrounds Will Server the Region Better as an Industrial Park. It was noted in Chapter 1 that the County Fairgrounds are ideally suited for industrial development. Presence of ample infrastructure, rail sidings, proximity to the highway, adjacent industrial uses and the benefit of more industrial workers located next to Downtown all support the concept of adaptively reusing the Fairgrounds. The Fair Board itself supports relocation of their facilities, both to expand and to replace dilapidated structures.

    2. Foreign Trade Zone: There are hundreds of Foreign Trade Zones (FTZs) operating successfully around the U.S. Only one is currently authorized in Idaho; even it exists only on paper at this time. A Foreign Trade Subzone appears to have high potential to support business development in Bonners Ferry. Use of the FTZ is described in Chapter 1. Traits of FTZ are outlined below.

    Foreign Trade Zones (FTZs) are areas within the United States which are defined as being outside of the U.S. Customs territory, thus providing certain duty free benefits to users. FTZs were established with the passing of the Foreign Trade Zone Act of 1934. The Act created these zones for the purpose of expediting and encouraging "foreign commerce consistent with the public interest" (Bergan, 1989). However, it was not until 1950 that the zones became authorized to do manufacturing. These customs-free areas were at the forefront of facilitating international commerce.

    There are two kinds of zones: general purpose and subzones. General purpose zones are attached to a port of entry and often handle quantities of merchandise from various companies. Subzones function as an extension (though not physically connected) to an FTZ and usually consist of one large operation. In order to be classified as a FTZ the area must be within 60 miles or 90 minutes from a port of entry (but some subzones have been approved at more distant locations).

    Operations can include storing, repackaging, assembling, and distributing of domestic and foreign merchandise. 

    What is the Federal Government's Role?: The original objective of the Foreign Trade Zone Act of 1934 was to foster and encourage foreign commerce. This objective still holds true, but a broader meaning has been adopted over time. Today, FTZ's are regarded as a means to encourage and create jobs within the United States.

    FTZs are approved by the Foreign Trade Zones Board, consisting of the Secretaries of Commerce, Treasury and the Army. The Foreign Trade Zone Board, located in Washington D.C., has the ultimate authority for approving a grantee's application for FTZ status. Treasury is included due to the Customs Service overseeing the operations of the zones. Customs laws are not applicable in FTZs but regulations are. Customs is authorized to conduct audits and spot checks, making record keeping within FTZs imperative. 

    What are the Advantages of a Foreign Trade Zone?: Many benefits can be attained through the use of a FTZ. Being outside of Customs Territory permits users to:

* Not pay duty on re-exported merchandise from the FTZ
* Not pay duty on domestically sold merchandise until it leaves the zone
* Not pay duty on waste or scrap from production within the FTZ
* Not pay duty on rejected or defective parts
* Not pay duty on value added to products or domestic content
* Not pay duty on merchandise sold to the US Military or NASA

    Relief is also provided in FTZ's in the following areas:
* Relief from inverted tariffs (if merchandise brought into a zone is manufactured into a product which carries a lower duty rate, then the lower rate will apply)
* Relief from local ad valorem taxes (foreign merchandise stored in the FTZ is not subject to any state or local ad taxes levied on imports according to their invoiced value)

    There is a cost advantage resulting from imported parts being assembled into finished products in a subzone and then imported from the zone into the U.S. "If the component is combined such that the total value of the final product consists of more than 50% American labor or components, the product can be classified as American made." In such instances savings can be substantial. In addition, many of the same benefits that apply to general purpose zones also apply to subzones. A subzone can be established if a neighboring general purpose zone has received grant approval. The general purpose zone does not have to be activated in order to establish a subzone.

Subzone uses include, but are not limited to:
    Textiles/apparel
    Ready-to-Assemble Furniture
    Building materials
    Steel
    Televisions
    Auto Parts
    Food Products
    Pharmaceuticals

    How does a Foreign Trade Zone get Established? The U.S. Customs Manual states that establishing a FTZ is a two-stage process. First, the grantee must gain approval by the board (application process); second, the grantee must obtain approval by Customs (activation process). Criteria for grants include:
1) need for zone services
2) adequacy of operational and financial plans
3) suitability location and facility
4) extent of state and local support
5) public opinion
    (taken from the Customs Manual p. 39)

    Applications are submitted to the Foreign Trade Zones Board by state or local governments, port or airport authorities, economic development agencies or non-profit corporations. If the application is approved, the recipient then is known as the grantee. The designated grantee either operates the zone itself or appoints a firm to operate the zone on its behalf (this is the case with the FTZ in Eastport where Eastport industries is designated to operate the zone). Instructions for preparing and submitting applications are described in the Foreign Trade Zones Board Regulations (15 C.F.R. Part 400). Extensive support materials must also be submitted along with the application. The average application processing time is approximately one year. 

    Upon completion of the first stage, operations may not begin until the second process, activation, has been completed. The activation process takes place locally under the supervision of the Customs Port Director. Activation may be granted to all or only a portion of the approved zone. A written request for activation must be submitted after the application is approved. A decision by Customs can take one to four months after the written request has been submitted to the local Port Director of the U.S. Customs Service. 

    FTZs in Idaho: As noted earlier, FTZs are a purely Federal operation. State and local governments have limited jurisdiction over the FTZ. Consequently, many state and local governments have taken a passive role in FTZ establishments and often neglect to have staff on hand with appropriate knowledge, skills and experience on FTZs in their state. 

    The state of Idaho is supportive of FTZs but little has been done to promote operations within the State. An application for a FTZ in Meridian was submitted and approved but appropriate action was not taken and grant approval expired. An application has been submitted and approved for a FTZ in Eastport that is in the process of becoming an activated zone. Creation of a subzone in Bonners Ferry could be beneficial to the Eastport grantee, given the grant approval expiration rule.

    Currently, Idaho does not have an active FTZ or subzone. Opposition toward such an operation would be minimal considering the pressing need for Idaho to have these types of activity within the State. 

3. Business Incubation 
    The planning team believes there is high potential for growing new businesses locally. With an abundance of natural resources, value-added forest products or agricultural firms could be a particularly good target for business assistance. The classic tool for growing small businesses systematically is the business incubator. Such a facility should be considered for development in the Bonners Ferry area. The University of Idaho agrees, and has begun a feasibility study to investigate how or whether one should be established.
Business incubation is a dynamic process of new business development. Incubators help grow young firms during the startup period when they are most vulnerable. Incubators provide hands-on management assistance, access to financing and technical support services. They also offer shared office services, access to equipment, flexible leases and expandable space - all under one roof. 

    An incubation program's main goal is to produce successful graduates - businesses that are financially viable and freestanding when they leave the incubator, usually in three to five years. According to the National Business Incubation Association (NBIA), 87% of incubator graduates are still in business. This is in contrast to the national average of 80% of all startup businesses failing within the first five years.
    Like venture capitalists, incubators impose selection criteria upon prospective clients. Some accept a mix of industries, but others concentrate on industry niches. According to NBIA research, the makeup of incubator clients in recent years has been:
· 43% Mixed Use 
· 25% Technology 
· 10% Manufacturing 
· 9% Targeted** 
· 6% Service 
· 5% Empowerment 
· 2% Other 

**Targeted incubators focus on assisting start-up companies from a specific industry, such as biomedical, wood products, arts, food production, fashion, etc... 

a. Water Supply
    The City of Bonners Ferry has adequate domestic water supply and fire protection facilities to meet current demands; however, expanded demand will require measures to control demand or increase treatment capacity. Water is supplied from a high mountain watershed known as Myrtle Creek, and water is treated in conformance with State and EPA standards through a conventional filtration plant. The plant is capable of producing 1,900 to 2,000 gallons per minute (GPM) and average daily demand is 2,000 GPM at peak periods. Therefore, there is little additional water source capacity available for future economic development unless the water system demand is controlled by employing residential metering, or the treatment source capacity is expanded. This is a critical issue facing economic development within the city.

    The city presently has three water reservoirs, with storage volumes of 400,000, 135,000, and 150,000 gallons. The city intends to add a new 1 million gallon reservoir within the next five years. The present fire protection rating within city limits is class five.

b. Wastewater Treatment 
    The City of Bonners Ferry employs aerated lagoons for wastewater treatment. Treated wastewater is discharged to the Kootenai River, and the discharge is regulated by an EPA discharge permit. Although the City's discharge permit has limitations on the concentration and loading of solids and organics, there is no specific limitation on flow.

    Data demonstrates that, except for the excessive flows from non-wastewater runoff experienced in January 2000, the city has at least 30% of its wastewater capacity volume remaining according to the EPA permit. This additional capacity amounts to approximately 2,000,000 gallons per day or 1,000 equivalent households. However, the city wastewater facility has recently exceeded its permit limitations with respect to conception of solids and organics. Therefore, the City must ensure that the capacity and compliance of wastewater treatment does not become a constraint to future economic development.

c. Circulation, Safety & Highway Traffic are Critical

1. Traffic Volume on U.S. 95
    The figure at right is a graphic representation of traffic volumes on U.S. 95 at Bonners Ferry. This data from the Idaho Transportation Department (ITD) indicates the annual traffic growth rate from 1970 to 1990 was 3.7%, and since 1990 the annual traffic growth rate on U.S. 95 was 6.0%. The total increase in traffic between 1970 and 1999 grew from 2,700 vehicles per day to 9,500 vehicles per day - a total increase of 252%. Figure 3.5 also presents projected traffic volumes on U.S. 95 at Bonners Ferry, assuming a range of future traffic growth rates between 3.7% and 6%.


2. Levels of Service
    The level of service (LOS) is a measure of traffic delay or discomfort. Levels of Service are rated from A to F, with A representing the highest level, and F being the lowest. When the volume of traffic begins to reach the carrying capacity of a roadway, the level of service declines. Extreme delays, congestion, and driver frustration are conditions that result from lower Levels of Service.

    The figure above illustrates that a Level of Service D on U.S. 95 at South Hill (that is, the delay of traffic that results in 25 to 40 seconds delay) is estimated to be reached by year 2005 (assuming 3.7% traffic growth). This Level of Service would be reached sooner if traffic increases at a higher rate. Under either traffic growth scenario, solutions to traffic congestion on U.S. 95 at South Hill must be developed and implemented soon.

a. Retail Trends Are Not Consistent with Overall Business Trends
    Overall, business sales in Boundary County have increased about 42% over the past eight years. According to state figures, total business sales in Boundary County increased from $76.8 million in 1993 to $108.9 million in 1999 - an increase of $32.1 million, or 42% (see Figure 3.6). In Bonners Ferry, total business sales increased from $63.9 million in 1993 to $89.8 million in 1999 (1995 data was unavailable) - an increase of $26 million, or 41%.

    Meanwhile, retail sales varied in growth (or decline) from 1993-1999, depending on the sector. Auto-related goods and services, including gas stations, grew by $6.5 million, or 43% (see Figure 3.7). Specialty retail rose from $4.6 to $19.6 million - a gain of $15 million, or 323%! Grocery and food sales increased slightly, moving upward from $8.9 to $10.3 million, a gain of $1.4 million, or 16%. The largest decline was in building materials and hardware, from $12.6 to $4.6 million, down 64%.
Other retail sectors were mixed in trends (see Figure 3.8 and table below, amounts in millions of dollars):

Retail Sales Category 1993 1999 Change
General Merchandise $1.4 $3.9 +179%
Apparel/Accessories $ .3 $ .2 - 30%
Drug Stores $1.2 $ .5 - 58%
Home Furnishings $1.4 $1.3 - 6%
Restaurant/Bar $3.8 $3.7 - 1%

    The figures above may be affected by the fact that, in Idaho, businesses with multiple locations are not required to report sales in the county(s) where the sales were made. They report in the county of their headquarters (if in Idaho), or directly to the State. This may explain the low numbers in the Apparel/Accessories category, which does not appear to reflect sales of the JC Penney store formerly located in Bonners Ferry. However, the trend information is still useful.

b. Retail Leakage is Nearly $76 Million
    The declining sales from 1993 to 1999 is a result of retail dollars "leaking" out to Bonner, Kootenai and Spokane counties. Estimated total retail leakage from Boundary County in 1999 was nearly $76 million, or more than half (54%) of total potential sales. 

    Apparel and Accessories showed the highest leakage rate, at 92%, with Home Furnishings second at 86%. Drug Stores had leakage of 78%, Building Materials and Hardware 75% and General Merchandise 73%. More than half (50%-56%) of potential sales left the county in the Grocery/Food, Restaurant/Bar and Auto/Gas categories. Note: Potential sales are based on statewide per capita average expenditures.

    The categories with the highest rates of leakage are those most heavily impacted by "big box" and chain retailers such as Wal-Mart and K-Mart in Ponderay, along with competition from the Bonner Mall in Ponderay and Silverlake Mall in Coeur d'Alene. Downtown Sandpoint's specialty retailers also compete with Downtown Bonners Ferry in certain categories, such as books, specialty clothing, art/framing, gifts and dining.

c. Competition is Based More on Selection and Convenience Than Price
    Consumer surveys in Boundary County indicate that while most people would prefer to shop locally, they leave town primarily because of greater selection and convenience of store hours (open evenings and weekends). Working families cannot shop during the day, so when stores close at 5:00 or 5:30 p.m., they lose a large number of customers. One frequent complaint is "there is no place to buy nails or a hammer on Sundays in Bonners." Most consumers indicated that they are willing to pay a bit more for the convenience of shopping at home (and supporting local businesses), but if the convenience is missing, they are forced to leave town.

d. Lack of Physicians Exacerbates Retail Leakage
    Medical services in Boundary County are limited, but expanding. The hospital recently was designated as a "critical access" facility, allowing it to achieve greater financial stability through federal Medicare and Medicaid funding formulas. The hospital currently captures only about 45% of the physician visits by county residents. 

    The greatest source of lost medical business is in obstetrics and pediatrics, because the Boundary County hospital does not accommodate deliveries. Therefore, most women seeking prenatal and pediatric care leave the community. The hospital is attempting to recruit additional physicians; however, the physical condition of the Bonners Ferry schools has been a major detriment to physician recruitment. School conditions also have hampered efforts to recruit pharmacists to the community.

    In 1999, the Boundary County Hospital conducted a survey of county residents related to medical services. The survey found that when residents leave the county for medical reasons, they also shop:

* 46% of residents "always" shop when out of town for medical reasons
* 38% "occasionally" shop when out of town
* Total: 84% shop at least occasionally when out of town for medical reasons

    The economic impact of medical visits on retail leakage from Boundary County is significant:

* 42% of residents spend $25 - $50 while out of town for medical reasons
* 30% spend $51 - $100
* 16% spend more than $100

    In real dollars, these figures translate to at least $600,000 in annual retail leakage because of limited medical care in Boundary County. Therefore, it is in the best interests of the business community to support improvements to school facilities and physician recruitment efforts.

e. Retail Promotion Efforts are Uncoordinated
    As a community, Bonners Ferry (and Boundary County) does not have a strategic, coordinated promotion program for retail and service businesses. There are more than 200 businesses and organizations in Bonners Ferry. Each of them promotes their own products and services with their own messages to their own customer markets. The result is 200+ messages communicated to consumers, causing confusion and information clutter. Coordinated, strategic efforts could enhance Bonners Ferry business efforts to recapture some of the $76 million in retail dollars currently being lost. Chapter 4, Section I suggest cooperative promotion strategies to help reduce retail leakage.

a. Tourism Has Grown Steadily in the 1990's
    Tourism in Boundary County has grown steadily in the 1990's, based on trends in hotel sales, highway traffic counts, and business sales. 

    From 1993 to 1999, lodging sales grew by 35%, from $1.4 million to $1.9 million annually, up nearly $500,000. Outfitting and guiding revenues increased from about $14,000 to about $220,000 - an increase of more than 1,400%! From 1996 to 1999, visitation at the Kootenai National Wildlife Refuge increased from 17,952 to 21,827 annually (up 3,875, or 22%). Visitation was down 12% in 2000, in part attributed to a decrease in Canadian visitors. Specialty retail product sales grew by 323% from 1993 to 1999.

    Auto-related business sales (parts, repair, gasoline, etc.) increased by 43%. Traffic on Highway 95 increased by 6% annually from 1990 to 1999, up from 5,600 vehicles per day to about 9,500 vehicles. This increase of 3,900 vehicles per day translates to about 260 more vehicles per hour (during daylight hours) in 1999 compared to 1990.

    Some of the increase is truck traffic attributed to international trade. From 1992 to 1999, truck traffic at Eastport (both north and south bound) increased from about 160 trucks per day to 270. At Porthill, truck traffic increased from 17 trucks per day in 1995 to 21 in 1999 (most traffic at Porthill is local auto traffic). 

    Therefore, the total impact of increased international truck traffic is only 114 trucks per day, or about 5 trucks per hour. The peak months for southbound truck traffic are (in order): April, March, September, August and May. The slowest months for truck traffic (not surprisingly) are December, November and January. In Bonners Ferry, all trucks (including local delivery trucks) constitute only 7.5% of the total traffic, which equates to 712 trucks per day, or about 30 per hour.

    Population growth in Boundary County also accounts for local traffic increases. However, a large part of the traffic increase from 1990 to 1999 is tourist traffic.

b. Key Visitor Markets Could Be Tapped More Effectively

    Bonners Ferry is Idaho's International Gateway. Between 35% and 45% of non-resident visitors to Bonners Ferry are from Canada. Many of them are visiting the casino, which offers gaming for Canadian dollars at par. The Bonners Ferry visitor center also serves many summer visitors from Germany, Great Britain, Australia and the Pacific Rim countries. Many are traveling a "loop tour", visiting The International Selkirk Loop, or loops from Seattle or Vancouver, B.C. through the Canadian Rockies, Glacier Park, etc.

    Changes in exchange rates have made travel to the U.S. more expensive for Canadians (and travel to Canada cheaper for Americans). Declines in Canadian visitation have been noticed by local businesses, the Wildlife Refuge and others. However, the casino continues to show steady Canadian business because of its "at par" machines. Many other businesses in Bonners Ferry do not even accept Canadian dollars - at par or otherwise.

    Besides Canadians, other significant visitor groups are those from eastern Washington, western Montana and Idaho. Primary motivations for traveling are gaming, outdoor recreation, events, shopping, visiting family or friends and business/commercial travel. Recent traveler research conducted by the University of Idaho provides further information about resident and non-resident travelers to northern Idaho.

2. Implications of Traveler Research Indicate Opportunity
    Based on the results of the UI study and other tourism information gathered by the planning team, it appears that opportunities exist to target the following:
* Extended length of stay year-round for non-resident visitors seeking accessible recreation, entertainment, shopping and cultural activities.
* In Summer, families with kids seeking activities and good value
* In Spring and Fall, retirees seeking entertainment and cultural activities
* In Fall, hunters seeking supplies, relaxation, entertainment
* In Winter, Spring and Fall, business travelers seeking comfortable accommodations with business services (e-mail, copying, fax, etc.)
* Idahoans seeking off-peak season recreation, weekend getaways, entertainment
* Friends and relatives of local residents, especially in Spring and Fall

    In 1997, a separate study on Idaho Travel Impacts conducted by Dean Runyan Associates found that travelers to Boundary County spent $17,978,000 ($49,255 per day), creating 222 direct jobs and a $2.6 million payroll. If just 20% of the visitors to Boundary County would stay one extra day, the economic impact would be more than $3.5 million!

3. Key Traveler Segments Have Different Needs
    Different types of travelers seek different types of goods, services and activities. In order to maximize revenues from visitors, businesses and organizations in Boundary County need to recognize these travelers' needs and cater to them appropriately:
* Leisure Travelers. These visitors include retirees, RV travelers, families, people visiting friends or relatives and pass-through travelers. They seek opportunities for sightseeing, gaming, events and age-appropriate activities (golf, rodeo, shopping). They need good information about the community, businesses and events, and easily-accessible activities (farmers market, parade, river walk, dining, shopping, etc.).
* Recreationists. Outdoor recreation is the primary attraction for these visitors. They tend to be younger, male, active and interested in sports. They need good maps, places to buy equipment and supplies, outfitters and guides, event/competition information, and places to dine, relax and socialize. 
* Heritage/Cultural Visitors. Heritage and cultural tourism is the largest and fastest growing segment of the tourism industry. Heritage tourists are older, more affluent and educated than other tourist segments. They seek learning experiences about local history and culture, fine dining and shopping for quality products and services. Boundary County's heritage and cultural assets include its museum, its historic buildings and churches, and its heritage in timber, mining, agriculture and the Kootenai Tribal. These visitors need quality interpretation, guided tours, arts/cultural events, learning experiences, specialty retail, tourist services and dining.
* Commercial Travelers. These visitors arrive in trucks, company/rental cars (or jets), and government vehicles. They are traveling for business, but also take time to relax. They seek comfortable accommodations and business support services (business supplies and sundry items, motel rooms with data ports, copy/fax services, quick printing, auto/truck repair, audio/visual support, places to relax and socialize. Female business travelers seek places that are safe: well-lit parking lots, secure facilities, professional staff.

c. Casino, Outdoor Recreation, Events and Culture are Key Attractions
    The most prominent man-made tourist destination in Boundary County is the Kootenai River Inn Resort Casino, which draws customers by the bus and carload from Canada, Montana, eastern Washington and northern Idaho. Many of the guests who arrive in groups do not gamble - they are traveling with spouses and friends - and they are looking for other things to see and do in the community.

    Local cultural and sports events such as the County Fair, Kootenai River Days, Demolition Derby, Snowball Festival, Classic Car Show, Kootenai Tribe Pow Wow, softball/soccer/golf tournaments, logging events, Huckleberry Festival and others draw visitors from throughout the Inland Northwest.

    The area's natural beauty and outdoor recreation also draw thousands of visitors each year. Natural attractions include the mountains (hunting, fishing, hiking, mountain biking, snowmobiling), the 2,800-acre Kootenai National Wildlife Refuge (hiking, biking, wildlife viewing, birdwatching, hunting, cross-country skiing) and the Kootenai and Moyie Rivers (fishing, rafting, canoeing). Thirteen licensed outfitters provide guided trips in Boundary County: rafting/kayaking, hiking, biking, backpacking, skiing, snowmobiling, horse trips, rock climbing, photography trips, fishing, hunting and wagon/sleigh rides. 

d. Outfitting and Guiding Offer High-Value Tourism Opportunities
    Thirteen licensed outfitters provide guided trips in Boundary County: rafting/kayaking, hiking, biking, backpacking, skiing, snowmobiling, horse trips, rock climbing, photography trips, fishing, hunting and wagon/sleigh rides. In 1999, these outfitters hosted nearly 6,000 guests in Boundary County (Figure 3.13). Although guided recreation has increased significantly since 1993, there appears to be ample opportunity for additional growth. Summer trail rides and winter snowmobile trips are two areas that could be tapped, along with canoe trips on the Kootenai River, guided interpretive hikes in the Wildlife Refuge and other activities.

    The planning team found virtually no information about local outfitters in the Bonners Ferry visitor center or hotels, and hotel staff were not knowledgeable about guided trip opportunities. In other regions of Idaho (and other states), hotel desk and visitor center staff actually make reservations for their guests to take day trips with local outfitters. Some hotels work with outfitters to package trips to include hotel rooms, meals and guided activities. This type of cooperation leads to increases in business for outfitters, and extended hotel stays for guests. When tourists extend their stays, they spend more money throughout the community on shopping, dining and other activities.

    Outfitted recreationists spend considerably more money in the area than self-guided recreationists. According to outfitter guest research conducted by the Idaho Outfitters & Guides Association in 2000, outfitted trips in Idaho last an average of 3 days in Summer, and 7 days in Fall. The guests spend an extra 3 nights in the area before and after their outfitted trip. 78% stay in hotels/motels/B&B's, and of those, 51% use two or more rooms. Increasing the number of outfitted guests will increase the average visitor spending in Boundary County.

    Growth in outfitted recreation could be accomplished by simply increasing the level of business with existing outfitters. Several local entrepreneurs have expressed an interest in starting new outfitting businesses. However, for trips on public land, the Panhandle National Forest currently is not accepting new outfitter permit applications for at least three years due to revision of the forest plan, lack of funding and staff to process applications, lawsuits and concerns about threatened and endangered species. However, opportunities for new activities may exist on private land or at the Wildlife Refuge.

e. Visitor Services and Tourism Promotion Need to Be Enhanced
    Visitor services and tourism promotion in Boundary County are handled primarily through the efforts of a handful of dedicated volunteers and business leaders. The Chamber of Commerce visitor center is managed by a volunteer coordinator, Margaret Mouat, who often works seven days a week. The center is open limited hours Monday through Friday from October through May, and seven days a week from mid-May to mid-September, staffed completely by volunteers. The volunteers collectively spend more than 2,000 hours to keep the visitor center open! There is no formal appreciation program to recognize the volunteers. 

    The center serves 25,000+ visitors annually, providing tourist and relocation information, event calendars, visitor guides, and referrals to local businesses and attractions. Although highly visible, the visitor center building is "marginally adequate" (as described recently by a Chamber business leader). It has essentially one room, with no office and very limited storage space, and it does not have public restrooms (there is no public restroom between the Canadian border and Bonners Ferry).

    Additionally, a volunteer couple, Carl and Sherry Hendricks, coordinate the Chamber's tourism promotion program. The Chamber is a participant in the North Idaho Tourism Alliance (NITA) regional promotion effort, and The International Selkirk Loop ("Loop") organization (see Figure 3.14). The Boundary County/Bonners Ferry full-color visitor/relocation guide and recreation map is produced in cooperation with NITA using Idaho Travel Council (ITC) grant funds. NITA also provides grant funds to maintain the Chamber's web site, which is hosted by Keokee Creative Group in Sandpoint. 

    The Loop promotes the region with a web site (www.selkirkloop.org), a full-color visitors guide, map, rack cards, advertising, press releases, posters, window decals and a passport program. Recent funding from the states of Idaho and Washington, the province of British Columbia, and the Economic Development Administration will greatly enhance Loop promotions in the next fiscal year. Regional, national and international recognition of the Loop is creating greater visibility for Boundary County, Bonners Ferry and the surrounding region.

    Tourism advertising and promotion is coordinated at the regional level by NITA, including a regional gateway web site (www.visitnorthidaho.com), and ad placements in Northwest Travel magazine and other publications. ITC funds also cover costs for a regional toll-free tourist information line and postage to mail regional and community tourism materials in response to inquiries. 

    Advertising placed by the Chamber is coordinated by the volunteers. There is no strategic promotion plan to target specific markets (such as seniors for Spring and Fall travel, Idahoans for weekend getaways, Canadians for "at par" events/promotions, etc.). Most tourism-related businesses in Boundary County spend money on ads that are not coordinated with Chamber efforts. Key businesses such as the Kootenai River Inn have marketing budgets that, if coordinated with the Chamber, NITA and Selkirk Loop promotions, could be highly effective in drawing targeted visitors.

    The Chamber visitor center provides outstanding service to visitors with inadequate resources. It does not have a toll-free phone number or computer with online access to retrieve e-mail inquiries from the web site. The Internet host company retrieves e-mail messages and faxes them to the center. E-mail responses and requests for tourism and relocation information are fulfilled by the volunteers. To cover expenses, the visitor center sells t-shirts, post cards and other souvenirs to raise funds, and takes donations from visitors. Those efforts net about $2,000 annually. Another $2,000 is provided from the Chamber general budget to help cover the balance of utilities, operating expenses (phone, postage) and maintenance of the building and landscaping.

    Businesses in Boundary County are very fortunate to be served by dedicated Chamber volunteers who promote the area, its businesses, attractions and activities. But volunteers burn out. In order for Boundary County to realize its potential in tourism development, funding must be dedicated for staffing and strategic promotions. Millions of dollars in potential revenues are at stake.