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The Economic and Community Impact of The Maritime Aquarium at Norwalk

Date: September 2023 Submitted to Norwalk Redevelopment Authority

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This report was produced by Econsult Solutions, Inc. (“ESI”). ESI is a Philadelphia-based economic consulting firm that provides businesses and public policy makers with economic consulting services in urban economics, real estate economics, transportation, public infrastructure, development, public policy and finance, community and neighborhood development, planning, as well as expert witness services for litigation support. Its principals are nationally recognized experts in urban development, real estate, government and public policy, planning, transportation, non-profit management, business strategy and administration, as well as litigation and commercial damages. Staff members have outstanding professional and academic credentials, including active positions at the university level, wide experience at the highest levels of the public policy process, and extensive consulting experience.

The Economic and Community Impact of The Maritime Aquarium at Norwalk September 28, 2023

Executive Summary: Page 3

Executive Summary

The Maritime Aquarium at Norwalk is an economic, cultural, and educational anchor located in the South Norwalk business district in Norwalk, Connecticut. The Aquarium showcases the Long Island

Sound ecosystem through its living exhibits and undertakes marine science research, conservation, and education programming. It also serves as a community resource and visitor draw that has played a crucial role in the long-term revitalization strategy for South

Norwalk. The Aquarium draws visitors and economic activity into

Norwalk, supporting employment and spending at other establishments in the area.

This report quantifies the economic benefits of the Aquarium at the local and state level. These benefits arise from several different facets of economic activity driven by the Aquarium:

• Employment and local procurement are generated by the operations and maintenance of the

Aquarium and through the research, conservation and educational grants that the Aquarium receives;

• Aquarium visitors have a significant spending footprint area (estimated at $35 million in FY2022) as they visit other hospitality businesses as part of their trip;

• Major capital investments to revitalize and enhancement of the facility generate periodic large-scale impacts from construction activity; and

• Educational, research and conservation programming from the Aquarium has significant economic and social value for the region and beyond.

Annual Economic Impacts

Impacts from the Aquarium’s organizational expenditures, from its research, conservation and educational programming, and from ancillary visitor spending are non-overlapping and can be summed to represent an aggregate annual impact. Statewide, annual impacts in these categories generated

$88.6 million in total output in FY2022, supporting 620 jobs (Full-time equivalent or ‘FTE’) with $31.4 million in employee compensation.

Within the City of Norwalk, annual impacts from these categories total $55.8 million in economic impact

FY2022. This activity supports 490 direct, indirect, and induced jobs (FTE) with $21.7 million in annual employee compensation (see Figure ES.2).

The Maritime Aquarium at

Norwalk inspires people of all ages to appreciate and protect the Long

Island Sound ecosystem and the global environment through living exhibits, marine science, and environmental education.

Executive Summary: Page 4

Figure ES.1: Economic Impact from FY2022 Organizational Expenditures a, Ancillary Visitor Spending and Conservation and Educational Grant Funding in the State of Connecticut

Impact Type Organizational

Expenditures Visitor

Spending Conservation / Edu

Grant Funding Total

Economic Impact ($M) $30.2 $53.1 $5.3 $88.6

Employment Supported (FTE) 180 410 30 620

Earnings ($M) $11.5 $17.9 $2.0 $31.4

Figure ES.2: Economic Impact from FY2022 Organizational Expenditures, Ancillary Visitor Spending and Conservation and Educational Grant Funding in the City of Norwalk

Impact Type Organizational

Expenditures Ancillary Visitor

Spending Conservation / Edu

Grant Funding Total

Economic Impact ($M) $17.7 $34.9 $3.2 $55.8

Employment Supported (FTE) 130 340 20 490

Earnings ($M) $8.0 $12.3 $1.4 $21.7

One-Time Impacts from Walk-Bridge Related Construction at the Aquarium

Recent capital activity at the Aquarium has been associated with the replacement of the nearby 130-year-old “WALK Bridge” over the Norwalk River. Due to its location and scale, this construction project has significant implications for the Aquarium facility and its operations. Nearly $42 million has been invested to date in projects for the functional replacement of certain Aquarium assets disrupted by construction needs, primarily through federal and state funds. One-time impacts from the Aquarium’s capital projects associated with the WALK Bridge project are estimated to have generated $70 million in economic output across Connecticut supporting 120 FTE jobs with $21 million in total employee compensation. Of this impact, $47 million is estimated to have occurred within the Norwalk economy.

At the same time, the construction activity associated with the WALK Bridge also represents a disruption to the facility, operations, and long-term planning options of the Aquarium. Challenges during the construction period include the loss of functional assets and facilities not addressed by funding already received, as well as impaired access to the facility and disruption of traffic in the vicinity, which may result in decreased visitation to the Aquarium during this time. Longer-term, the project imposes several opportunity costs on the Aquarium, including (1) the need to dedicate additional fundraising to functional replacement rather than enhancement of new assets; and (2) constraints on opportunities for facility expansion given the current construction footprint.

Executive Summary: Page 5

Social Benefits from Education, Research and Conservation

The Aquarium’s mission includes a commitment to marine science research, conservation, and education. The range of programming undertaken by the Aquarium in these areas, often through grant funding attracted by the institution, has localized benefits to the economy and community as well broad ranging social benefits over the longer term.

Educational programs in partnership with Norwalk Public Schools and other nearby school districts expand the opportunities for students and represent a tangible value to the districts by providing instructional programming. The Aquarium’s research and conservation efforts benefit Long Island Sound and its biodiversity, while advancing marine science research more broadly. Current focus programs include climate and salt marsh restoration research, water testing and pathogen monitoring, cleanup efforts to improve the health of Long Island Sound, and community science projects. These initiatives help contribute to healthier and more resilient marine ecosystems in Long Island Sound and beyond, and they deliver economic benefits in areas like marine biodiversity, commercial fishing, and tourism.

Table of Contents: Page 6

Table of Contents

1. Report Background

1.1. About The Maritime Aquarium at Norwalk

1.2. Anchor Institutions and the Halo Effect

1.3. Organization of Report

2. Annual Impact from Institutional Expenditures

2.1. Direct Activity

2.2. Economic Impact from Organizational Expenditures

3. Annual Impact from Ancillary Spending

3.1. Aquarium Attendance

3.2. Ancillary Spending by Visitors

3.3. Economic Impact from Ancillary Spending

4. One-Time Economic Impacts from WALK Bridge Construction Activity

4.1. About the WALK Bridge Project

4.2. WALK Bridge-Related Capital Investments at The Maritime Aquarium

4.3. Operational and Facility Challenges from WALK Bridge Construction

4.4. Economic Impact from WALK Bridge-Related Capital Investments

5. Social Benefits from Education, Research and Conservation

5.1. School Programming

5.2. Conservation Efforts

5.3. Economic Impacts from Education and Conservation Grants

6. Aggregate Economic and Fiscal Impact

6.1. Aggregate Annual Economic Impact

6.2. Benefits from Education, Research and Conservation

Appendix A – Modeling Direct Activity

A.1. Direct Outputs for Ancillary Visitor Spending

Appendix B –Economic and Fiscal Impact Modeling

B.1. Input-Output Model Theory

B.2. Input-Output Model Mechanics

B.3. Employment and Wages Supported

B.4. Tax Revenue Impact

Report Background Page 7

1. Report Background

The Maritime Aquarium at Norwalk is an economic, cultural, and educational anchor located in the

South Norwalk business district in Norwalk, Connecticut. The Aquarium showcases the Long Island

Sound ecosystem through its living exhibits and undertakes research, conservation, and education programs. The Aquarium is a community resource and visitor draw that has served as a crucial part of the long-term revitalization strategy for South Norwalk. The Aquarium draws visitors and economic activity into Norwalk, supporting employment and spending at other establishments in the area.

This report quantifies the economic benefits of the Aquarium at the city, county, and state levels. Impact categories include Aquarium operations, capital investments associated with new and expanded infrastructure, visitor spending attracted to the area, and community and social benefit from educational programming, environmental research, and conservation initiatives.

1.1. About The Maritime Aquarium at Norwalk

The Maritime Aquarium at Norwalk (“Maritime Aquarium”) is the only Aquarium focused on Long Island

Sound. The Aquarium is located on the west bank of Norwalk River near to where the river feeds into

Norwalk Harbor and the Sound.

The Aquarium draws hundreds of thousands of visitors per year through the strength of its collection and visitor experience.

Marquee exhibits include habitats for sharks, sea turtles and jellyfish, interactive experiences with animals, and educational and discovery spaces for children. New features include an expanded seal habitat, a larger meerkat exhibit, and a touch tank featuring Atlantic sturgeon. The Aquarium also supports an active collaborative research and conservation program on species and natural systems related to its collections and is a regional forum for the dissemination of information related to

Long Island Sound and the ocean.

The Maritime Aquarium at Norwalk is a not-for-profit 501(c)3 organization that operates, manages, and programs the facility. The Aquarium and its campus are owned by the City of Norwalk, through the

Norwalk Redevelopment Agency.

The Aquarium was constructed as part of the South Norwalk Revitalization Project and opened to the public in July 1988 as The Norwalk Maritime Center. The Aquarium wing is housed in a former factory, symbolic of the revitalization of the former industrial area. In addition to its live animal collection, the facility originally included an IMAX theater and a maritime boat collection.

The facility was renamed The Maritime Aquarium at Norwalk in 1996 and has undergone expansion and additions over time. Notable projects include the addition of the Environmental Education Center in

2001, the FINtastic RefurbFISHment of the exhibits in 2012, and the 2021 opening of a new 4D theater and expanded seal habitat as part of the changes necessitated by the adjacent WALK Bridge

Mission Statement: The Maritime

Aquarium at Norwalk inspires people of all ages to appreciate and protect the Long Island Sound ecosystem and the global environment through living exhibits, marine science, and environmental education.

Report Background Page 8 construction project (see Section 4). Collectively, these additions have expanded the Aquarium’s exhibits, educational programming, and research and conservation capabilities, and with it the visitation and footprint of activity that it attracts.

1.2. Anchor Institutions and the Halo Effect

Anchor institutions that attract external visitors play a crucial role in urban redevelopment efforts like the revitalization of South Norwalk. Previously a blighted industrial area, the area has been rebranded over time as “SoNo” and has developed the entertainment, shopping, and food options characteristic of a successful urban downtown. The success of the area has helped to attract new residential demand and investment, supporting population growth in Norwalk in recent decades. As an early anchor of this revitalization, the Aquarium has been a contributor to the success of the area and to the broader

Norwalk community in a number of ways.

The Aquarium brings hundreds of thousands of visitors annually to South Norwalk. These visitors become potential customers for other businesses in the area, helping to support nearby businesses on commercial centers like Washington Street and The SoNo Collection shopping mall. Beyond the spending power they bring, the extra base of family activity helps contribute to a safe and welcoming environment and density of activity that helps urban corridors thrive.

The Aquarium also represents a positive amenity for the neighborhood and broader Norwalk community. Through the recreational and educational experiences it offers, including its partnership with Norwalk Public Schools, the Aquarium is an attractive feature for residents of Norwalk, and families in particular. Through public and educational cruises on its vessel, The Maritime Aquarium provides access to the harbor for students and families, which may be inaccessible otherwise. This is beneficial to the community, from an educational and equity point of view.

Another feature of an anchor institution is the role it can play in raising awareness and shaping the image of community in ways that contribute to business and resident attraction. Many residents of the

Southern Connecticut and Long Island area may have visited the Aquarium in their youth or may have familiarity with it as a well-known regional attraction. This association can serve as an entry point for their familiarity with Norwalk as a destination to visit, and potentially to live and work in. While a cultural attraction cannot be expected to ‘close the sale’ itself for resident and business attraction, positive associations can provide a ‘halo effect’ that helps increase awareness and perception of the community.

Report Background Page 9

1.3. Organization of Report

This report reviews the economic benefits provided by The Maritime Aquarium for the City of Norwalk, Fairfield County, and the State of Connecticut. Benefits are described and quantified across a number of dimensions:

• The Aquarium is an economic driver through its operating expenditures and employment footprint in Norwalk. Section 2: Annual Impact from Institutional Expenditures details the economic activity and jobs directly and indirectly supported by its operating expenditures.

• Visitors to the Aquarium are a source of demand for local hospitality, food, and retail businesses beyond the Aquarium itself. Section 3: Annual Impact from Ancillary Spending estimates the economic impact from this additional local spending attributable to the presence of the

Aquarium.

• Periodically, the Aquarium undertakes major capital projects to improve its infrastructure, generating significant construction activity and jobs for the project duration. Section 4: One-

Time Economic Impacts from WALK Bridge Construction Activity reviews the economic impacts, as well as some of the operational and facility challenges, from capital investments at the Aquarium to accommodate the broader Walk Bridge project over the Norwalk River.

• The Aquarium is also a leader in educational programming for Norwalk and surrounding school districts, and a center for marine research. Section 5: Social Benefits from Education, Research and Conservation describes these programmatic efforts and their social benefits both locally and on a broader scale.

• Together, the Aquarium generates significant economic and social benefits for the City of

Norwalk and State of Connecticut. Section 6: Aggregate Economic and Fiscal Impacts sums these impacts.

Report Background Page 10

Economic Impact Methodology

Within this report, Econsult Solution, Inc. (ESI) employs industry-standard economic modeling techniques to translate direct economic activity generated by The Maritime Aquarium into total economic impact within the City of Norwalk, Fairfield County, and the State of Connecticut.

Data inputs on institutional activity are largely provided by The Maritime Aquarium and are verified and supplemented by other third-party data sources and assumptions, as needed. Where appropriate, data is averaged or annualized to represent the activity level associated with a typical year of activity at the

Aquarium’s current level.

Economic impact estimates of institutional spending, ancillary spending and capital projects are generated by utilizing input-output models to translate an initial amount of direct economic activity into the total amount of activity that it supports. This total impact includes multiple waves of spillover impacts from initial expenditures. These economic impacts are modeled using IMPLAN, an industry standard input-output model software program. Such models are designed to estimate two sets of spillover impacts from organizational expenditures:

• The indirect effect, which measures the multiplier effect from the purchase of goods and services from local vendors (i.e., supply chain impacts); and

• The induced effect, which measures the multiplier effect from the spending of labor income by employees within a geography (i.e., labor income impacts).

The total economic impact for each category is the sum of the direct economic footprint (organizational spending, visitor spending, or capital investment), plus the indirect and induced effects generated by that direct footprint (see Figure 1.1). Throughout this analysis, economic impacts are estimated for the

City of Norwalk, Fairfield County, and the State of Connecticut.

For the period from 2019-2022, visitor spending patterns were significantly influenced by the events of the COVID-19 global pandemic, which had differential effects on both consumer behavior and inflation rates by sector. To account for these effects, annualized estimates are derived from data reported for

FY2022, rather than over a multi-year period. It is possible that activity for this period (covering July

2021 – June 2022) remained below typical annual levels, and that future impacts will exceed the point in time estimates reflected in this report. Where applicable, additional years of data are shown to illustrate broader activity patterns.

The economic impacts estimated using IMPLAN are translated to fiscal impacts for the State of

Connecticut using a custom fiscal model, which establishes the relationship between economic activity and tax revenue collections (i.e., effective tax rates).

Annual Impact from Institutional Expenditures Page 11

2. Annual Impact from Institutional Expenditures

Each year, The Maritime Aquarium expends millions of dollars to support its staff, its regular operations and routine maintenance on its facility. These ongoing operating expenditures are supplemented periodically by larger capital investments (discussed in Section 4), and by grants that support education, research, and conservation programs (discussed in Section 5).

Institutional spending on operations includes employee costs, and the procurement of goods and services. This spending circulates through the economy, creating downstream effects at the local, regional, and state level. To estimate the extent of these spillover effects, the institutional expenditures from Fiscal Year 2022 were analyzed and modeled in their relevant industries.

2.1. Direct Activity

The Maritime Aquarium is open year-round to visitors providing exhibits, educational workshops/programs, animal feedings and training sessions, and other events. Throughout the year, it also features several special exhibits, generating additional visitation and additional revenue for the institution. As an anchor institution in Norwalk, The Maritime Aquarium’s direct operating activity has a significant impact on the local economy. The Aquarium serves as an amenity to Norwalk, which was recently named as the best place to live in Connecticut, as well as 29th in the nation among family friendly cities.1

Additionally, external funding sources such as public and private donations and grant funding, which comprises roughly 30 percent of the Aquarium’s budget, can provide an infusion of funds from outside the immediate area which are then used to support programming and ultimately employment and activity in Norwalk. These monies effectively represent “net new” dollars drawn into the area by The

Maritime Aquarium, contributing to local growth and economic opportunity.

In FY2022, The Maritime Aquarium had $13.6 million in total operations expenditures. Of this total, approximately $7.0 million was dedicated to wages and benefits for the Aquarium’s workforce each year. The remaining $6.6 million was dedicated to other operating costs, including the procurement of goods and services (see Figure 2.1).2

Figure 2.1: The Maritime Aquarium Annual Operations, FY2022

Operations ($M) FY2022

Salaries & Benefits $7.0

Other Operating Costs $6.6

Total $13.6

Source: The Maritime Aquarium (2023)

1 Livability, Top 100 Best Places to Live in the US 2 Due to rounding, tables throughout this report may not sum to total.

Annual Impact from Institutional Expenditures Page 12

In addition to the overall expenditures associated with operations, the Aquarium invests funds into maintenance and renovations each year to improve guest experience and make improvements to its facilities.

Over the past decade, expenditures associated with maintenance and renovations of the Aquarium averaged approximately $1.7 million annually. Due to the variability of each year’s expenditures on maintenance and renovation, this average is used in modeling. Together, the Aquarium spends roughly

$15.3 million annually within the local and state economies.

Figure 2.2: The Maritime Aquarium Annual Operations, Maintenance, and Renovation Expenditures

Expenditures ($M) Annual

Operations $13.6

Maintenance and Renovations $1.7

Total Modelable Expenditures $15.3

Source: The Maritime Aquarium (2023)

From hard costs such as labor and equipment to soft costs such as architectural, engineering, and other professional services, the investments undertaken by the Aquarium reach various industries within the regional economy.

2.2. Economic Impact from Organizational Expenditures

Organizational expenditures on operations, maintenance, and renovations generate “spillover” effects in both the local and state economies, stimulating business activity and supporting increased employment across a variety of sectors. The Aquarium’s total economic impact is the sum of its organizational expenditures, the indirect impacts resulting from the Aquarium’s spending on goods and services with vendors, and the induced impacts resulting from the Aquarium employees spending their wages locally.3 Spillover impacts expand with each successively larger geography, as leakage of downstream activity is lesser within a broader economic area.

Organizational expenditures on operations and maintenance by The Maritime Aquarium in FY2022 led to a total economic impact of $18 million, supporting 130 direct, indirect, and induced jobs (FTE) with $8 million in annual employee compensation within the City of Norwalk.

Within Fairfield County, organizational operating and capital expenditures generated $29 million in total output, supporting 170 jobs (FTE) with $11 million in annual employee compensation.

3 See Appendix A for a detailed description of the economic modeling approach in this analysis, which uses IMPLAN modeling software.

Annual Impact from Institutional Expenditures Page 13

Statewide, the Aquarium’s annual operating and capital expenditures generated $30 million in total output, supporting 180 jobs (FTE) with $12 million in annual employee compensation (see Figure 2.3).4

Figure 2.3: Economic Impact from FY2022 Maritime Aquarium Organizational Expenditures

Impact Type City of

Norwalk Fairfield County Connecticut

Direct Output ($M) $15.3 $15.3 $15.3

Indirect & Induced Output ($M) $2.4 $13.7 $14.9

Total Impact ($M) $17.7 $29.0 $30.2

Employment Supported (FTE) 130 170 180

Employee Compensation ($M) $8.0 $11.1 $11.5

Source: IMPLAN (2021)

Fiscal Impact from Organizational Expenditures

The economic activity generated by the Aquarium and its expenditures also enhance the tax base, generating government revenue. The Aquarium is a not-for-profit institution, and thus exempt from certain taxes, and its facility and property are city owned. However, employee earnings supported directly and indirectly by the Aquarium are tax generating, as are activity of many of the private sector vendors in its supply chain.

It is estimated that the Aquarium’s organizational expenditures generated $667,000 in state tax revenue in FY2022 (see Figure 2.4).

Figure 2.4: State Tax Revenue Impact from FY2022 Maritime Aquarium Organizational Expenditures

Tax Type State of Connecticut

Income $485,000

Sales $141,000

Business $41,000

Total Tax Impact $667,000

Source: IMPLAN (2021), ESI (2023)

4 Direct employment counts include full-time, part-time, and seasonal employees. These counts were converted into full-time equivalent (FTE) employees before modeling, so that modeling results would be stated in terms of FTEs supported.

Annual Impact from Ancillary Spending Page 14

3. Annual Impact from Ancillary Spending

The Maritime Aquarium at Norwalk attracts visitors from the region and beyond into the City of

Norwalk. In addition to their spending within the Aquarium (which is accounted for in the organizational analysis in Section 2), these visitors often spend at other local businesses as part of their trip, such as restaurants, shops, and hotels. This “ancillary spending” by Aquarium visitors is an additional source of economic impact from the Aquarium on the local and state economy.

3.1. Aquarium Attendance

From FY2018 through FY2022, the Aquarium attracted over 1.5 million visitors. As depicted in Figure 3.1 below, visitation experienced a significant drop between FY2019 and FY2020 due to temporary closures and required capacity restrictions stemming from the COVID-19 pandemic. As restrictions eased, the

Aquarium maintained a number of protocols including masking, social distancing, timed ticketing, partitions and adjustment to exhibits to enhance the safety of the Aquarium guests, staff, and the living collection.5

In FY2021, visitation rebounded to pre-pandemic levels, with visitation levels nearly identical to those in

FY2018. In FY2022, the Aquarium welcomed nearly half a million visitors, an impressive increase of 63 percent from FY2021, and well above pre-pandemic levels from FY2018 and FY2019 (see Figure 3.1).

Figure 3.1: Maritime Aquarium Ticketed Attendance, FY2018-FY2022

Source: The Maritime Aquarium (2023)

5 See: As Capacity Limits Are Lifted, Aquarium is Ready to Welcome More Guests, March 2021

298,457 259,343

161,902

297,048

484,148

100,000

200,000

300,000

400,000

500,000

600,000

FY18 FY19 FY20 FY21 FY22

https://www.maritimeaquarium.org/newsroom/posts/as-capacity-limits-are-lifted-aquarium-is-ready-to-welcome-more-guests

Annual Impact from Ancillary Spending Page 15

As part of its ticketing process, the Aquarium collects zip code information from visitors when available / possible.6 Data from this process demonstrates that the Aquarium visitors bring significant new spending power into Norwalk and Connecticut.

Visitors came to The Maritime Aquarium from all 50 states and the District of Columbia over the 2018-

2022 period.

• Out-of-state visitors represented 36 percent of attendees, with around 30 percent of attendees coming from New York state.

• In-state visitors represented 64 percent of the ticketed attendance.

Figure 3.2 below shows the towns and cities providing the largest share of visitors to the Aquarium, based on the addresses associated with ticket purchases from FY2018 – FY2022. Top visitor origins include several Connecticut communities, as well as suburban and urban locations in New York state.

Figure 3.2: Share of Visitors to The Maritime Aquarium by Cities, FY2018-FY2022

Rank City Proportion of

Visitors Rank City Proportion of

Visitors

1 Norwalk, CT 11.4% 11 New York, NY 1.5%

2 Stamford, CT 6.3% 12 White Plains, NY 1.3%

3 Darien, CT 3.9% 13 Trumbull, CT 1.3%

4 Fairfield, CT 3.5% 14 Danbury, CT 1.3%

5 Westport, CT 3.4% 15 Ridgefield, CT 1.2%

6 Bronx, NY 2.5% 16 Yonkers, NY 1.2%

7 New Canaan, CT 2.4% 17 New Haven, CT 1.2%

8 Wilton, CT 2.4% 18 Stratford, CT 1.1%

9 Greenwich, CT 2.2% 19 Milford, CT 1.1%

10 Bridgeport, CT 2.2% 20 New Rochelle, NY 1.1%

Source: The Maritime Aquarium (2023), ESI (2023)

6 Zip code information was not available for all visitors and therefore a total summary of visitor origins is unknown. Maps represent shares and total numbers of visitors based on known locations.

Annual Impact from Ancillary Spending Page 16

3.2. Ancillary Spending by Visitors

Visitors to the Aquarium are also by definition visitors to Norwalk. Many travelers do not limit themselves to a single activity on a trip – they also look for places to eat, shop, and be entertained.

Visitors from a sufficient distance may also choose to stay overnight, extending their trip further.

This additional spending power brought to the area benefits local businesses and the Norwalk economy.

The proximity of the Aquarium and the visitors that it attracts helps to drive demand to South Norwalk’s major commercial areas, Washington Street and The SoNo Collection mall, and the retail, food, and entertainment options they include. Visitor spending helps to sustain these businesses, creating local jobs and supporting an amenity that impacts the quality of life for Norwalk residents.

To estimate the level of ancillary spending at Norwalk business supported by Aquarium visitors, attendees are divided into three categories based on geographic analysis of ticket data, and expenditure profiles are developed for each visitor type based on a mix of industry data sources (see Figure 3.3).7

• Attendees from within the city of Norwalk are defined as Local. Ancillary spending by these visitors associated with their trip to the Aquarium is conservatively excluded, because these outlays are not “net new” to the local economy.

• Attendees from within 50 miles and within the State of Connecticut are defined as Regional. It is assumed that these visitors do not stay overnight in Norwalk and therefore do not have spending on lodging, but may have ancillary spending on food & beverage, retail, and transportation. Spending in these categories is estimated at 75% of the out of region visitor profile, based on federal per diem guidance for day trip travelers.8

• Attendees from beyond 50 miles or from outside of the State of Connecticut are considered Out of Region. These visitors bring net new dollars into the local and state economy, and a portion of them stay overnight. The expenditure profile for these visitors is based on estimated per visitor per day spending published by the Connecticut tourism office.9

Ancillary spending represents the expenditures of visitors elsewhere in the local economy, since revenue captured by the Aquarium is already reflected in the institutional expenditures (modeled in Section 2).

Expenditures on “recreation” are therefore excluded from the visitor spending analysis to prevent double counting.

7 Appendix A details the data sources, assumptions, and calculations within this methodology.

8 U.S. General Services Administration Per-Diem Guidelines

9 Economic Impact of Visitors in Connecticut 2021, Tourism Economics, December 2022. Note that the use of a per day spending profile in effect attributes only a single day of spending to the Aquarium in the case where a visitor makes a multi-day trip to the area.

https://www.gsa.gov/travel/plan-book/per-diem-rates/faq#15 https://portal.ct.gov/-/media/DECD/Tourism/EconImpactStudies/Connecticut-Tourism-Economic-Impact---2021.pdf

Annual Impact from Ancillary Spending Page 17

Figure 3.3: Est. Net New Ancillary Visitor Expenditures by Visitor Type (in $2022)

Expenditure Type Local

(Norwalk) Regional

(CT <50 Miles) Out of Region

Lodging N/A N/A $29

Food & Beverage N/A $28 $38

Retail Purchases N/A $17 $22

Local Transportation N/A $15 $15

Daily Spend N/A $60 $104

Est. Attendees FY2022 45,600 248,500 190,100

Source: ESI (2023), Tourism Economics (2022), The Maritime Aquarium (2023)

Based on the distribution of visitors and estimated spending types described above, it is estimated that the Aquarium visitors in FY2022 brought $34.8 million in ancillary spending into the local economy. Of those expenditures, the amount available to circulate through the local economy after accounting for the “non-modeled amount” on consumer goods is estimated to be $30.9 million (see Figure 3.4).10

Figure 3.4: Net New Ancillary Visitor Spending Attributable to The Maritime Aquarium, FY2022

Expenditure ($M) FY2022

Lodging $5.4

Food & Beverage $14.2

Retail $8.4

Local Transportation $6.8

Total $34.8

Non-modeled amount ($3.8)

Total Modeled $30.9

Source: The Maritime Aquarium (2023), ESI (2023) Totals may not sum due to rounding

10 In cases where retailers purchase items for distribution from wholesalers outside of the region, there is a difference between the price paid by consumers and economic value that circulates through the local economy. ESI’s conservative economic modeling discounts these purchases to include only the portion of these purchases that accrues and circulates locally.

Annual Impact from Ancillary Spending Page 18

3.3. Economic Impact from Ancillary Spending

Direct visitor expenditures in these visitor-serving sectors yield indirect and induced impacts throughout a variety of sectors as dollars are circulated through the local economy. Importantly, most visitor dollars originate outside of the area, meaning that this activity serves as a form of export for the local economy.

Ancillary spending by Maritime Aquarium visitors in FY2022 led to a total economic impact of $34.9 million, supporting 340 direct, indirect, and induced jobs (FTE) with $12.3 million in annual employee compensation within the City of Norwalk.

Within Fairfield County, this ancillary spending generated $51.1 million in total output, supporting 400 jobs (FTE) with $17.3 million in annual employee compensation.

Statewide, this ancillary spending generated $53.1 million in total output, supporting 410 jobs (FTE) with

$17.9 million in annual employee compensation (see Figure 3.5).

Figure 3.5: Economic Impact from Ancillary Visitor Spending, FY2022

Impact Type City of

Norwalk Fairfield County Connecticut

Direct Output ($M) $30.9 $30.9 $30.9

Indirect & Induced Output ($M) $4.0 $20.2 $22.1

Total Impact ($M) $34.9 $51.1 $53.1

Employment Supported (FTE) 340 400 410

Earnings ($M) $12.3 $17.3 $17.9

Source: IMPLAN (2021)

Fiscal Impact from Ancillary Spending

Spending activity outside of the Aquarium by its visitors occurs largely within the private economy and is tax revenue generating. Direct expenditures by visitors generate sales tax and support personal and corporate income tax bases. These are supplemented by tax revenue generated by downstream activity from the supply chains of visitor serving businesses, and as employees recirculate their earnings in the state economy in the form of household spending.

It is estimated that the ancillary spending attributable to The Maritime Aquarium in FY2022 generated approximately $4.1 million in tax revenue for the State of Connecticut (see Figure 3.6).

Figure 3.6: State Tax Revenue Impact from FY2022 Ancillary Visitor Spending

Tax Type State of Connecticut

Income $754,000

Business $3,162,000

Sales $157,000

Total Tax Impact $4,073,000

One-Time Economic Impacts from WALK Bridge Construction Activity Page 19

4. One-Time Economic Impacts from WALK Bridge Construction Activity

In addition to routine maintenance on its facility that occurs annually, large-scale capital investments have been made for the construction and enhancement of the aquarium facility. These projects may be funded by a capital campaign, government revenue source, or a combination of sources depending on the circumstances. While irregular in timing, when they occur these major capital investments create material levels of economic activity and employment in the local area during the project duration.

Recent capital activity at the Aquarium has been associated with a large transportation infrastructure project occurring in the vicinity of the facility: the replacement of the 130-year-old “WALK Bridge” over the Norwalk River by the Connecticut Department of Transportation. Due to its location and scale, this construction project has significant implications for the Aquarium facility and its operations. To mitigate some of these impacts, the State of Connecticut and City of Norwalk reached an agreement in which $40 million was allocated to capital projects at the Aquarium to offset some of the components of the facility that are compromised by the construction project. This capital activity, supplemented by existing and future capital investments by the Aquarium in WALK Bridge-related projects, creates a one-time impact in the local and state economy. This chapter quantifies these impacts, and reviews some of the challenges associated with the WALK Bridge project for the Aquarium facility and its operations.

4.1. About the WALK Bridge Project

The WALK Bridge is a four-track railroad crossing the Norwalk River, connecting South and East Norwalk.

The existing swing bridge, built in the 1890s, is part of Metro-North Railroad's (MNR) New Haven Line and Amtrak’s Northeast corridor, the busiest rail corridor in the nation. The aging bridge has begun to fail in recent years, and its replacement is a priority infrastructure project for the Connecticut

Department of Transportation.

The WALK Bridge program comprises several inter-related rail and infrastructure projects in Norwalk centered around the replacement of the bridge. These include track and catenary improvements, upgrades to the East Norwalk Train Station, replacement of local railroad bridges and roadway and utility improvements in East Norwalk.

The Maritime Aquarium sits on the western edge of the Norwalk River traversed by the WALK Bridge.

The bridge bisects the Aquarium property on the western bank, with the main facility located to the north and the Aquarium dock located to the south. The 1988 IMAX theater, recently demolished, was within the construction footprint of the project. Other Aquarium components, including its signature indoor-outdoor seal habitat as well as a tent space that previously housed a meerkat exhibit, African animal exhibit, and “Go Fish” exhibit on Long Island Sound, the Aquarium’s bus access loop, and the

Aquarium’s dock, have also been or will be, compromised by the construction footprint.

In recognition of the complications for the Aquarium and its operations presented by the project, the

State of Connecticut, the City of Norwalk, and the Aquarium reached an agreement providing for the functional replacement of several of the Aquarium’s some assets lost due to the construction. This

One-Time Economic Impacts from WALK Bridge Construction Activity Page 20 agreement resulted in state and federal funding in the amount of $40 million to support the expansion and enclosure of the seal habitat, relocation and expansion of the meerkat exhibit, and construction of a new 4D theater. Further funding for these projects had been contributed by the Aquarium. The

Aquarium will also be undertaking additional fundraising in the future to restore other functional assets disrupted by the WALK Bridge construction project and not covered via the allocated replacement funding.

4.2. WALK Bridge-Related Capital Investments at The Maritime Aquarium

As a result of the WALK Bridge construction project and City and State agreement described above, three major capital projects have recently been undertaken at the Aquarium:

• The seal habitat was expanded and enhanced and was fully enclosed to minimize disruption and ensure the safety of animals and guests from the nearby construction activity.

• The meerkat exhibit was moved from the tent area and occupies an expanded space on the

Aquarium’s second floor.

• The IMAX theater located south of the bridge has been demolished to provide sufficient clearance for construction activity and was replaced with a new 4D theater experience in a different location.

The combined expenses for the expansion and enclosure of the seal habitat, relocation and expansion of the meerkat exhibit, and construction of a new 4D theater amount to a total of $41.7 million over a three-year construction period (see Figure 4.1). These investments were made with $40 million in state funds pursuant to the city / state agreement, and $1.7 million Aquarium capital funds, and were utilized for a mix of “hard” (construction) and “soft” (planning, design, permitting, etc.) costs across the projects.

Figure 4.1: WALK-Bridge Associated Capital Investments at The Maritime Aquarium ($M)

Project Category Capital

Expenditures ($M)

Theater Construction $13.6

Seal and Meerkat Exhibit Construction $16.1

Subtotal - Hard Costs $29.7

Subtotal - Soft Costs $12.0

Total Expenditures $41.7

Source: Maritime Aquarium (2023), ESI (2023)

Direct construction activity associated with these projects employs construction workers and professional service providers for the duration of the project period. Those workers in turn will spend a portion of their salaries and wages within the local and state economies. This construction activity will also catalyze the procurement of a wide range of goods and services, translating into new economic opportunities for local and state vendors.

One-Time Economic Impacts from WALK Bridge Construction Activity Page 21

The circumstances of the WALK Bridge project and associated Aquarium investments are unique, and this economic activity is best understood as a one-time economic event rather than a recurring annual impact. However, prior large-scale investments in the development and enhancement of the Aquarium facility have also had significant economic effects. The first of these investments was the construction of the facility and the IMAX theater, which opened in 1988. This was followed by a $9.5 million investment in the Environmental Education Center, an expansion project completed in 2001, and a $4.5 million investment in the FINtastic RefurbFISHment project to revitalize exhibits, completed in 2012. These investments and others bring corporate, private, and government contributions to enhance the

Aquarium facility, and create construction activity and jobs in Norwalk.

4.3. Operational and Facility Challenges from WALK Bridge Construction

While the associated infrastructure investment generates local economic activity and employment, the construction of the WALK Bridge also represents a disruption to the Aquarium facility and its environs.

The construction activity surrounding the WALK Bridge project has had significant impacts on the operations of The Aquarium, including:

• The loss of functional assets and facilities, including several exhibits and the use of the main entrance, has disrupted the immersive experience that visitors enjoy.

• Impaired the accessibility of key Aquarium facilities, such as the outdoor pavilion, bus circle, and dock, which are vital for accommodating visitors efficiently and allowing them to fully access the

Aquarium’s assets.

These disruptions to the facility and its operations, as well as expected disruptions and interruptions to traffic flow and road access near the construction zone, may result in decreased visitation to the

Aquarium during the course of the construction period.

The WALK Bridge project has also had impacts on the long-term planning and fundraising path for the

Aquarium:

• Fundraising for functional replacement represents an opportunity cost for funds that could have otherwise been utilized for enhancements to the Aquarium facility.

• Constraints on the ability to plan and construct expansions pending the completion of the WALK

Bridge project also constitute a long-term opportunity cost.

These impacts are discussed in more detail below.

Visitor Experience and Access

The scale of the WALK Bridge project necessitates the staging of construction equipment along the shore of the Norwalk River in proximity to the Aquarium campus. This creates an incursion on some of the physical space previously occupied by the Aquarium, including its tent space, dock, former IMAX theater and bus loop. While some programming aspects have been relocated through the capital projects funded by the city-state agreement and projects discussed above, others remain to be addressed, reducing the programming and exhibits at the Aquarium.

One-Time Economic Impacts from WALK Bridge Construction Activity Page 22

The adjacent construction also creates a disamenity for visitors due to the noise, air particulates and other disruptions created by the construction process. Among these are congestion created by road or lane closures which will make the Aquarium more difficult or time-consuming for visitors to access. The construction period and these associated disruptions are anticipated to last for several years.

The negative effects on Aquarium access and the visitor experience at the attraction are likely to reduce

Aquarium attendance levels in the coming years relative to what could have been achieved absent this construction disruption.11 This in turn could reduce economic activity levels in the categories described in this report. At particular risk is the ancillary spending category and the economic benefits for nearby business, which is proportional to the number of visitors attracted and the ease with which they can access other locations outside of the Aquarium on their visit to Norwalk.

Opportunity Cost of Fundraising and Capital Planning

The Aquarium periodically undertakes fundraising campaigns in which it seeks private and philanthropic donations and public funding sources to support capital investments at the facility. Past campaigns have been oriented to raising funds for projects that enhance or expand the Aquarium infrastructure. Under the current circumstances, near-term fundraising efforts contemplated by the Aquarium will be oriented towards raising funds to restore programmatic and facility elements disrupted by the WALK Bridge construction. While these restoration projects will generate economic activity and employment when they are undertaken, the use of these funds for restoration represents an opportunity cost relative to utilizing newly raised funds for the enhancement or expansion of the facility.

The space needed for the siting of the WALK Bridge construction also creates constraints on the planning and development options for the Aquarium. For example, prior Aquarium master planning efforts envisioned the construction of an annex in an area now occupied by construction activity. While this enhancement may still be possible in the future, the delay in potential advancement of this or other capital planning projects during the duration of the construction period represents another form of opportunity cost for the Aquarium associated with the WALK Bridge project.

11 See: Yavuz, Attanyake, Aktan 2017, “Economic Impact on Surrounding Businesses due to Bridge Construction” for a review of case studies illustrating the economic impacts from construction disruption on surrounding businesses.

One-Time Economic Impacts from WALK Bridge Construction Activity Page 23

4.4. Economic Impact from WALK Bridge-Related Capital Investments

The construction activity associated with the $41.7 million invested to date in WALK Bridge-related capital projects at the Aquarium generates significant direct and spillover impacts for the construction industry and more broadly the local, regional, and state economy.

Capital expenditures associated with the Aquarium’s WALK Bridge related projects are estimated to generate a one-time total economic impact of $47 million, supporting 80 direct, indirect, and induced jobs annually (FTE12) with $13 million in total employee compensation within the City of Norwalk.

Within Fairfield County, these projects generate $67 million in total output, supporting 110 FTE jobs annually with $20 million in total employee compensation.

Statewide, these projects generate $70 million in total output, supporting 120 FTE jobs annually with

$21 million in total employee compensation (see Figure 4.2).

Figure 4.2: One-Time Economic Impacts from WALK Bridge Related Capital Investments13

Impact Type City of

Norwalk Fairfield County Connecticut

Direct Output ($M) $41.7 $41.7 $41.7

Indirect & Induced Output ($M) $4.7 $25.5 $28.0

Total Impact ($M) $46.5 $67.2 $69.8

Employment Supported (FTE) 80 110 120

Employee Compensation ($M) $13.3 $20.0 $20.8

Source: IMPLAN (2021), ESI (2023)

Fiscal Impact from WALK Bridge-Related Capital Investments

This direct and spillover economic activity also supports the state’s tax base. Over the course of the construction period, it is estimated that $1.36 million in tax revenue has been generated directly and indirectly for the State of Connecticut (see Figure 4.3).

Figure 4.3: One-Time State Tax Revenue Impact from WALK Bridge Related Capital Investments

Tax Type State of Connecticut

Income $875,000

Sales $285,000

Business $197,000

Total Tax Impact $1,357,000

12 IMPLAN generates job estimates based on the term “job-years”, or how many jobs will be supported each year.