OCS Study 

MMS 2002-024 

Socioeconomic Baseline and 

Projections of the Impact of an 

OCS Onshore Base for Selected 

Florida Panhandle Communities 

Volume I : Final Report 

U.S. Department of the Interior 

Minerals 1Vlanagement Service 

Gulf of Mexico OCS Region 
OCS Study 

MMS 2002-024 

Socioeconomic Baseline and 

Projections of the Impact of an 

OCS Onshore Base for Selected 

Florida Panhandle Communities 

Volume I : Final Report 

Authors 

Ronald T. Luke 

Eric S . Schubert 

Greg Olsson 

Research and Planning Consultants, Inc. 

Austin, Texas 

and 

F. Larry Leistritz 

North Dakota State University 

Prepared under MMS Contract 

1435-01-96-CT-30821 

by 

Research and Planning Consultants, Inc. 

Austin, Texas 

Published by 

U.S. Department of the Interior New Orleans Minerals 1management Service 

Gulf of Mexico OCS Region May 2002 
DISCLAIMER 

This model and user's guide were prepared under contract between the Minerals Management 

Service (MMS) and Research and Planning Consultants, Inc. This report has been technically 

reviewed by the MMS, and it has been approved for publication. Approval does not signify that 

the contents necessarily reflect the views and policies of the MMS, nor does mention of trade 

names or commercial products constitute endorsement or recommendation for use. It is, 

however, exempt from review and compliance with the MMS editorial standards . 

REPORT AVAILABILITY 

Extra copies of this model and user guide may be obtained from the Public Information Unit 

(Mail Stop 5034) at the following address: 

U.S . Department of the Interior 

Minerals Management Service 

Gulf of Mexico OCS Region 

Public Information Unit (MS 5034) 

1201 Elmwood Park Boulevard 

New Orleans, Louisiana 70123-2394 

Telephone: (504) 736-2519 or 

1-800-200-GULF 

CITATION 

Suggested citation : 

Luke, R. T., E.S . Schubert, G. Olsson, and F.L.Leistritz . 2002 . Socioeconomic baseline and 

projections of the and OCS onshore base for selected Florida Panhandle Communities, 

Volume I : Final Report. U.S. Dept. of the Interior, Minerals Management Service, Gulf 

of Mexico OCS Region, New Orleans, LA. OCS Study MMS 2002-024. 242 pp. 

iii 
TABLE OF CONTENTS 

Page 

List of Figures vii 

List of Tables ix 

Chapter 1 Executive Summary 1-1 

Chapter 2 OCS Activity in the Eastern Gulf of Mexico 2-1 

Chapter 3 Tourism 3-1 

Chapter 4 Major Military Bases 4-1 

Chapter 5 Florida Panhandle Fishing Industry : An Overview 5-1 

Chapter 6 Port Facilities 6-1 

Chapter 7 Socioeconomic Baseline of the Florida Panhandle 7-1 

Chapter 8 Projected Impacts of Offshore Activity in the Florida Panhandle 8-1 

Chapter 9 Bibliography 9-1 

v 
LIST OF FIGURES 

Figure Page 

1 .1 Socioeconomic Baseline and Projections for Selected 1-2 

Panhandle Communities Study Area 

4.1 Proposed Lease Area in the Eastern Gulf of Mexico 4-19 

4.2 Overwater Airspace Region of Military Influence 4-20 

vu 
LIST OF TABLE 

Table Page 

2 .1 The Projected Output of the Proposed Sales in the Gulf of Mexico 2-3 

2 .2 Percent of Total Production Levels - Lease Sale 181 2-4 

2 .3 .1 Projected Production Levels of Oil from Lease Sale 181 2-5 

2.3 .2 Projected Production Levels of Natural Gas from Lease Sale 181 2-6 

2.4 Projected Natural Gas Production from Destin Dome 2-7 

2.5 Industries Associated with Offshore Oil and Gas Exploration, Development, 2-10 

and Production 

2.6 Industries Associated with Operation and Maintenance of 2-12 

Offshore Oil and Gas Platforms 

2.7 Potential Operation and Maintenance (O&M) Expenditures in the Florida 2-15 

Panhandle from Lease Sale 181 in the Eastern Gulf of Mexico Offshore Oil 

Wells 

2.8 Potential Operation and Maintenance (O&M) Expenditures in the Florida 2-16 

Panhandle from Lease Sale 181 in the Eastern Gulf of Mexico Offshore 

Natural Gas Wells 

2.9 Range of Operation and Maintenance Expenditures in the Florida Panhandle 2-17 

on Oil and Gas Production from Lease Sale 181 in the Eastern Gulf of 

Mexico 

2.10 Potential Operation and Maintenance (O&M) Expenditures in the Florida 2-18 

Panhandle Offshore Natural Gas Wells - Destin Dome 

3 .1 Population of Counties in the Florida Panhandle Study Area in 1990, 3-2 

Estimated Population in 1995 and Projected Population in 2000 and 2010 

3 .2 Population Growth in Panhandle Study Area Counties and Florida, 1940- 3-4 

1990 

3.3 Characteristics of Visitors Arriving by Automobile by Quarter for the 3-8 

Escambia County Area, 1995 

3.4 Characteristics of Visitors Arriving by Automobile by Quarter for the 3-14 

Okaloosa County Area, 1995 

3 .5 Characteristics of Visitors Arriving by Automobile by Quarter for the Bay 3-20 

County Area, 1995 

3 .6 Characteristics of Visitors Arriving by Air by Quarter for the Bay County 3-27 

Area, 1995 

4 .1 Employment and Expenditures of Major Military Bases in Florida Panhandle 4-15 

Study Area 

ix 
Table Page 

4.2 Five Stipulations in Oil/Gas Drilling Leases 4-18 

7.1 Population in the Florida Panhandle Baseline Scenario 7-2 

7.2 Annual Migration in the Florida Panhandle Baseline Scenario 7-3 

7.3 Population of Florida Panhandle Living in Unincorporated Areas in 1997 7-4 

7.4 Educational Attainment for Residents of the Florida Panhandle, Ages 25 and 7-4 

Older in 1990 

7.5 .1 Baseline Output by Major Non-Farm Industry for the Florida Panhandle - 7-6 

Fort Walton Beach 

7.5 .2 Baseline Output by Major Non-Farm Industry for the Florida Panhandle - 7-7 

Panama City 

7.5 .3 Baseline Output by Major Non-Farm Industry for the Florida Panhandle - 7-8 

Pensacola 

7.6 .1 Projected Expenditures by Tourists in the Fort Walton Beach Area 7-10 

7.6 .2 Projected Expenditures by Tourists in the Panama City Area 7-11 

7.6 .3 Projected Expenditures by Tourists in the Pensacola Area 7-11 

7.7 .1 Baseline Employment by Major Non-Farm Industry for the Florida 7-14 

Panhandle - Fort Walton Beach 

7.7 .2 Baseline Employment by Major Non-Farm Industry for the Florida 7-15 

Panhandle - Panama City 

7.7 .3 Baseline Employment by Major Non-Farm Industry for the Florida 7-16 

Panhandle - Pensacola 

7.8 .1 County Government Revenues of Bay County- FY 1996-1997 7-17 

7.8 .2 County Government Revenues of Escambia County - FY 1996-1997 7-18 

7.8 .3 County Government Revenues of Okaloosa County- FY 1996-1997 7-18 

7.8 .4 County Government Revenues of Santa Rosa County- FY 1996-1997 7-19 

7.8 .5 County Government Revenues of Walton County- FY 1996-1997 7-19 

7.9 County Government Expenditures- FY 1996-1997 7-20 

7.10.1 Combined Municipal Government Revenues of Bay County- FY 1996-1997 7-21 

7.10.2 Combined Municipal Government Revenues of Escambia County- FY 1996- 7-22 

1997 

7.10.3 Combined Municipal Government Revenues of Okaloosa County- FY 1996- 7-22 

1997 

x 
Table Page 

7 .10 .4 Combined Municipal Government Revenues of Santa Rosa County- FY 7-23 

1996-1997 

7 .10.5 Combined Municipal Government Revenues of Walton County- FY 1996- 7-23 

1997 

7 .11 Combined Municipal Government Expenditures- FY 1996-1997 7-24 

7 .12 Average Taxable Value of Residential Property in 1997 7-25 

7 .13 Value of Taxable Commercial and Industrial Property in 1997 7-26 

7 .14 Millage Rates for County Governments and Selected Special Districts in the 7-27 

Florida Panhandle 

7 .15 Millage Rates for School Districts in the Florida Panhandle 7-28 

7 .16 Municipal Taxation in the Florida Panhandle in 1997 7-28 

7 .17 Number of Teachers and Public School Enrollment - 1996 7-29 

7 .18 School District Expenditures per Full-Time Equivalent (FTE) Student 7-30 

7.19 School District Revenues per Full-Time Equivalent (FTE) 7-30 

by Source 

7.20 Baseline Community Service Multipliers for Counties in the Florida 7-31 

Panhandle 

8 .1 Stakeholder Interviews 8-3 

8 .2 Industries Associated with Operation and Maintenance of Offshore Oil and 8-13 

Gas Platforms Adjusted for Commuting Patterns of Offshore Workers 

8 .3 .1 MMS Florida Panhandle Model - Panama City 8-16 

OCS Scenario Report - Minimum Threshold 

8 .3 .2 MMS Florida Panhandle Model - Panama City 8-17 

Population Report - Minimum Threshold 

8.3 .3 MMS Florida Panhandle Model - Panama City Output and Employment 8-18 

Report - Minimum Threshold 

8.3 .4 MMS Florida Panhandle Model - Panama City Fiscal Balance Report - 8-19 

Minimum Threshold 

8.3 .5 MMS Florida Panhandle Model - Panama City Schools Report - Minimum 8-20 

Threshold 

8.3 .6 MMS Florida Panhandle Model - Panama City Public Services Report - 8-21 

Minimum Threshold 

8.4 .1 MMS Florida Panhandle Model - Panama City 8-24 

OCS Scenario Report - Reasonable Maximum 

xi 
Table Page 

8.4 .2 MMS Florida Panhandle Model - Panama City 8-25 

Population Report - Reasonable Maximum 

8.4 .3 MMS Florida Panhandle Model - Panama City 8-26 

Output and Employment Report - Reasonable Maximum 

8 .4 .4 MMS Florida Panhandle Model - Panama City 8-27 

Fiscal Balance Report - Reasonable Maximum 

8 .4 .5 MMS Florida Panhandle Model - Panama City 8-28 

Schools Report - Reasonable Maximum 

8 .4 .6 MMS Florida Panhandle Model - Panama City 8-29 

Public Services Report - Reasonable Maximum 

8 .5 .1 MMS Florida Panhandle Model - Panama City 8-32 

OCS Scenario Report - Destin Dome 

8 .5 .2 MMS Florida Panhandle Model - Panama City 8-33 

Population Report - Destin Dome 

8 .5 .3 MMS Florida Panhandle Model - Panama City 8-34 

Output and Employment Report - Destin Dome 

8 .5 .4 MMS Florida Panhandle Model - Panama City 8-35 

Fiscal Balance Report - Destin Dome 

8 .5 .5 MMS Florida Panhandle Model - Panama City 8-36 

Schools Report - Destin Dome 

8 .5 .6 MMS Florida Panhandle Model - Panama City 8-37 

Public Services Report - Destin Dome 

8 .6 .1 MMS Florida Panhandle Model - Pensacola 8-40 

OCS Scenario Report - Minimum Threshold 

8 .6 .2 MMS Florida Panhandle Model - Pensacola, Escambia, Santa Rosa 8-41 

Population Report - Minimum Threshold 

8 .6 .3 MMS Florida Panhandle Model - Pensacola 8-42 

Output and Employment Report - Minimum Threshold 

8 .6 .4 MMS Florida Panhandle Model - Pensacola 8-43 

Fiscal Balance Report - Minimum Threshold 

8.6 .5 MMS Florida Panhandle Model - Pensacola 8-44 

Schools Report - Minimum Threshold 

8.6 .6 MMS Florida Panhandle Model - Pensacola 8-46 

Public Services Report - Minimum Threshold 

xii 
Table Page 

8 .7 .1 MMS Florida Panhandle Model - Pensacola 8-50 

OCS Scenario Report - Reasonable Maximum 

8 .7 .2 MMS Florida Panhandle Model - Pensacola, Escambia, Santa Rosa 8-51 

Population Report - Reasonable Maximum 

8 .7 .3 MMS Florida Panhandle Model - Pensacola 8-52 

Output and Employment Report - Reasonable Maximum 

8 .7 .4 MMS Florida Panhandle Model - Pensacola 8-53 

Fiscal Balance Report - Reasonable Maximum 

8 .7 .5 MMS Florida Panhandle Model - Pensacola 8-55 

Schools Report - Reasonable Maximum 

8 .7 .6 MMS Florida Panhandle Model - Pensacola 8-57 

Public Services Report - Reasonable Maximum 

8 .8 .1 MMS Florida Panhandle Model - Pensacola 8-61 

OCS Scenario Report - Destin Dome 

8 .8 .2 MMS Florida Panhandle Model - Pensacola, Escambia, Santa Rosa 8-62 

Population Report - Destin Dome 

8 .8 .3 MMS Florida Panhandle Model - Pensacola 8-63 

Output and Employment Report - Destin Dome 

8 .8 .4 MMS Florida Panhandle Model - Pensacola 8-64 

Fiscal Balance Report - Destin Dome 

8 .8 .5 MMS Florida Panhandle Model - Pensacola 8-66 

Schools Report - Destin Dome 

8 .8 .6 MMS Florida Panhandle Model - Pensacola 8-68 

Public Services Report - Destin Dome 

8 .9 Employment Impacts of OCS Scenarios, compared to baseline levels 8-70 

xiii 
CHAPTER 1 

EXECUTIVE SUMMARY 

The MMS, in its most recent Five-Year Plan (1997-2002), stated its intention to lease an 

area for development in the western edge of the Eastern Planning Area of the Gulf of 

Mexico in the year 2001 . Because the experience of Texas and Louisiana has indicated 

substantial social and economic impacts onshore from Outer Continental Shelf (OCS) 

activity are possible, the MMS wanted to investigate the potential impacts on affected 

communities in the Eastern Gulf of Mexico. 

The purpose of this study was to develop a projection of the effects of this potential 

offshore activity on the Florida Panhandle. The MMS asked the RPC team to develop a 

baseline socioeconomic description for Panama City, Pensacola, and Ft. Walton Beach 

and to develop projection models to investigate the possible socioeconomic 

consequences of various onshore support scenarios on these communities. The project 

also includes studies on four local industries that could be impacted by the operations of 

a support base in the Florida Panhandle: fishing, military, ports, and tourism. The 

project also analyzes possible user-conflicts or benefits that these industries might 

encounter with the operations of the support base located in the Florida Panhandle. 

The RPC team defined the study area in the Florida Panhandle as the five counties of 

Escambia, Santa Rosa, Okaloosa, Walton, and Bay. Escambia and Santa Rosa comprise 

the Pensacola metropolitan area, Bay County comprises the Panama City metropolitan 

area, and Okaloosa and Walton Counties comprise the Fort Walton Beach metropolitan 

area (see Figure 1 .1) . 

1-1 
Figure 1 .1 . Socioeconomic Baseline and Projections for Selected Panhandle 

Communities Study Area. 

As part of our investigation, we identified and reviewed the literature relevant to the locales and 

issues addressed in the study. The literature reviews focused on the four special industries (i .e ., 

fishing, military, ports, and tourism) and the socioeconomic impacts from offshore oil and gas 

development. The RPC team gathered historical and projected economic baselines from two 

sources : Bureau of Economic and Business Research at the University of Florida at Gainesville 

and the U.S. Bureau of Economic Analysis. Using field trips and phone calls, the RPC team 

collected primary data in the form of selected stakeholder interviews with representatives of the 

four industries, local, county and state government officials and local community and business 

leaders. In speaking with stakeholders, we focused on the issue of a support base rather than oil 

and gas exploration in general . 

The RPC team developed an economic-demographic model to project the impacts of OCS 

activity in the Florida Panhandle. The MMS hopes to distribute this model to stakeholders and 

government planners in the Florida Panhandle to provide estimates of impacts supported by our 

research . 

The Florida Panhandle will continue to experience the substantial demographic and economic 

growth that it now faces. The five county area contained 643,000 people in 1990 and is projected 

to have nearly 876,000 residents by 2010. In an average year in the 1990s, 7,400 people migrated 

to the Florida Panhandle, which has started to cause strains in the infrastructure, particularly in 

the Ft. Walton Beach metropolitan area. These infrastructure bottlenecks have the potential of 

1-2 
potential of getting worse, as projected average annual migration will exceed 5,000 people 

through the year 2010. 

The military has had a substantial presence in the Florida Panhandle since World War II . The 

four main military installations in the study area are the Pensacola Naval Air Station, Eglin Air 

Force Base (Fort Walton Beach), Tyndall Air Force Base, and the Coastal Systems Station (both 

in Panama City) . The three air bases use the Northern Gulf of Mexico as a weapons testing and 

training range. The Coastal Systems Station uses St. Andrew's Bay and the nearby waters of the 

Gulf of Mexico for testing and training in antisubmarine and underwater warfare . The military 

employs over 30,000 people in the Florida Panhandle economy, accounting for 8 .6 percent all 

nonfarm employment in 1995, compared with only 1 .5 percent in the United States as a whole. 

These bases were largely untouched by the downsizing of the military in the 1990s and are 

expected to remain an important part of the Florida Panhandle economy for the foreseeable 

future . 

The development of the Florida Panhandle as a major tourist area began in the mid-1930s and 

grew rapidly after the Second World War, becoming what is now a key industry in the Florida 

Panhandle. Traditionally a place in the "Old South" to go for swimming and fishing, the Florida 

Panhandle is often called the "Southern Riviera." 

"Sugar-white" beaches, fishing, other water-based activities, and natural habitats are key parts of 

the tourist experience in the Florida Panhandle, a type of tourism known as ecotourism. In the 

mid-1990s, the area attracted 10 million visitors annually who generated $1 .5 billion of business . 

Heavily visited by automobile traffic, the Florida Panhandle represents one of the few high 

quality beach areas available to many visitors in the southeastern U. S., with high proportions 

coming from Alabama, Arkansas, Louisiana, Mississippi, and Texas. Tourist spending is 

projected to increase substantially in the study area between 1995 and 2045 . In the Fort Walton 

Beach area, tourist expenditures were projected to more than double over the 50-year study 

period (i .e ., an increase of 103%). During the same period, tourist expenditures were projected 

to increase 75 percent in the Panama City area and 73 percent in the Pensacola area. 

The study area has two major, deep water ports that would make the best locations for an onshore 

support base in the Florida Panhandle - the Port of Pensacola and the Port of Panama City. 

While the Port of Pensacola has a history extending back into the nineteenth century, the presentday location of the Port of Panama City opened only after World War II . The ports of Pensacola 

(ranked 78th) and Panama City (ranked 62nd) in 1995 were among the top 100 U.S . ports in the 

dollar value of goods exported. They ranked 120th and 100th, respectively, in the value of 

imports. The Port of Panama City served as an onshore support base for exploratory drilling in 

the Gulf of Mexico in the early 1980s and in 1990 and has an adjacent industrial park that houses 

industries associated with the offshore oil and gas industry . 

The commercial fishing industry employs around 700 people in the Florida Panhandle. In 1995, 

fishermen in the area landed 8.9 million pounds of fish and 2.4 million pounds of shellfish. 

1-3 
The projected levels of OCS development and production from the proposed leases in 2001 are 

small compared to the projected production levels from leases in the Western and Central Gulf of 

Mexico scheduled for auction in 1997-2002 . Because the specialized needs of offshore 

exploration and production are likely to occur from states with established services such as 

Texas, Louisiana, and Alabama, expansion of offshore facilities and services into the Florida 

Panhandle likely would come in the form of an onshore support base that would service offshore 

platforms during the operation and maintenance portion of any offshore oil and gas development. 

This means that the potential impacts likely will be of a different form than often associated with 

oil and gas development and that direct socioeconomic impacts likely will be smaller than those 

that have occurred in the Western and Central Gulf of Mexico. 

Though a small onshore base in the Florida Panhandle would cause few direct user conflicts with 

the tourist industry, stakeholder views of the impacts of OCS development on tourism will result 

as much from perceived reality as from the evolution of actual events . Because tourism in the 

area is largely based on the aesthetics of the environment, environmental issues likely will 

dominate any debate on the benefits and costs of OCS development. The major threats likely to 

be perceived from OCS-related activity are environmental . Fear that such development could 

depreciate the aesthetic or use quality of beaches, of coastal waters, and of fish and other wildlife 

is widely-held by stakeholders in tourism and related industries in the Florida Panhandle. 

The two ports (Panama City and Pensacola) would benefit from housing an onshore support 

base. The Coastal Systems Station expressed a concern that a high level of supply boat traffic 

from the Port of Panama City might interfere with its operations. The air bases would have 

potential conflicts with supply boats and helicopters crossing their testing ranges, but stipulations 

in any oil leases in the Eastern Gulf of Mexico put the onus of these conflicts on the oil industry . 

Though the commercial and recreational fishing industry have well-known benefits and conflicts 

with offshore rigs in the Gulf of Mexico, our research did not uncover any major user-conflicts 

with onshore bases that would be located in one of the two ports . 

Operations and maintenance (O&M) activity from the developed wells in the Eastern Planning 

Area will generate tens of millions of dollars of sales of goods and services for an onshore base 

each year. If an onshore service base were located in the Florida Panhandle, however, many 

O&M supplies would have to be imported from outside the region, limiting the potential 

economic benefits to the Florida Panhandle. 

Even though the level of OCS-related increases in employment would be small given the 

projected size of an onshore support base, because the Florida Panhandle is projected to be at or 

near full employment, those jobs not taken by commuters from outside the Florida Panhandle 

would require additional net inmigration into the area. Our estimates suggest that in the long 

term, even if both the Lease Sale 181 and the Destin Dome project are supported by a base in the 

Florida Panhandle, the increase in the population due to this support will be less than two percent 

of the increase due to inmigration from 2000 to 2035. The peak year is 2020, in term of the 

number of cumulative persons added to the population due to the sum effect of both projects. At 

2020 this increase would be at most between 2 .7% and 4.6% of the cumulative baseline 

1-4 
inmigration. This assumes both the OCS activity at a reasonable maximum scenario for Lease 

Sale 181 and it assumes the Destin Dome scenario . Infrastructure impacts on local communities 

from OCS development also will be small in comparison to such impacts from projected 

economic growth in the baseline . 

Few economic incentives are present to drive OCS support industries into the Florida Panhandle 

at the projected levels of OCS development in the Eastern Gulf of Mexico because support bases 

are most efficient when close to offshore wells . Concerns among stakeholders in the area's 

tourism industry about the risks of offshore oil and gas production have lent support to the 

Governor of Florida's public position that the Federal Government should not sell new oil and 

gas leases in Florida Federal waters within one hundred miles of the Florida coast. If made law 

by Congress, this restriction would limit future appeal and opportunities for onshore OCS-related 

industry in the Florida Panhandle. 

1-5 
CHAPTER 2 

OCS ACTIVITY IN THE EASTERN GULF OF MEXICO 

If the oil industry were to locate an onshore service base in the Florida Panhandle, the projected 

socioeconomic impacts on the Florida Panhandle would depend on (1) the size of the 

hydrocarbon potential in the Eastern Gulf of Mexico, (2) the intensity with which the industry 

could exploit it, and (3) the range of goods and services that an onshore support base in the 

Florida Panhandle could provide the offshore oil industry . 

Projected Hydrocarbon Production in the Eastern Gulf of Mexico 

Current Leasing Policy 

According to the MMS Gulf of Mexico Region website, the Eastern Gulf of Mexico Planning 

Area extends along the Gulf's northeastern coast for some 1,120 kilometers (700 miles) from 

Baldwin County, Alabama, southward to the Florida Keys . Seaward of the State/Federal 

boundary (three leagues or roughly nine miles off the Florida coast) the area extends southward 

for more than 480 kilometers (300 miles) . The MMS estimates that between 7.5 and 8 .7 trillion 

feet of cubic feet of natural gas and 1 .6 and 2.5 trillion barrels of oil and condensate are 

contained in the Eastern Gulf of Mexico. Since the late 1980s, however, a limited amount of 

OCS activity has taken place in this planning area because of administrative deferrals and annual 

Congressional moratoria. 

This report will focus on two future offshore oil and gas projects in the Eastern Gulf of Mexico 

that the Florida Panhandle could service: proposed Lease Sale 181 scheduled for 2002 and 

Chevron's Destin Dome project, which is undergoing a two-year review by the MMS and the 

States of Mississippi, Alabama, and Florida that could begin operating in 2000.' Map 2.1 shows 

the general location of both these areas. Current Federal policy will preclude other development 

of offshore hydrocarbon deposits in the Eastern Gulf of Mexico that might be relevant to this 

report . Quoting the MMS from a press release on January 25, 1999, announcing the proposed 

Lease Sale 181 : 

The area covered . . . is a small portion of the Eastern Gulf of Mexico (EGOM) 

Planning Area 15 miles or more due south of the coast of Alabama and 100 miles 

or more due south of the Florida Panhandle. It includes 1,033 blocks covering 

5 .949 million acres. . . . This would be the first Federal oil and gas lease sale in the 

Eastern Gulf of Mexico since 1988. . . . None of the EGOM outside the Sale 181 

area is available for leasing in this Five-Year Program. In addition, in a June 

1998 announcement, the President withdrew from leasing until after 2012 

MMS website, http ://www.gomr.mms.gov/homepg/offshore/egom/eastern.html 

2-1 
numerous areas of the OCS, including all of the EGOM outside the area identified 

as available for leasing consideration for Sale 181 .2 

Lease Sale 181 

According to MMS projections, the levels of OCS production from Lease Sale 181 in the Eastern 

Planning Area are small compared to the projected production levels from leases in the Western 

and Central Gulf of Mexico scheduled for auction in 1997-2002.3 (See Table 2.1) The project 

will have a life of forty years including its exploration phase. Projected output is 500 to 810 

billion cubic feet of natural gas and 30 to 60 millions barrels of oil pumped from five to eight 

platforms and twenty to thirty wells. The MMS anticipates that the production will not require a 

new pipeline landfall and that an existing shore base in Mobile, Alabama, will service the 

production arising from Lease Sale 181 . Key informant interviews with contacts in the oil 

industry confirmed these assertions . 

Z MMS website, http://www.gomr.mms.gov/homepg/whatsnew/newsreal/990126 .htm1 

'An attempt was made to discuss the hydrocarbon potential of this sale with contacts in 

the oil industry . It was indicated that companies would be highly reluctant to reveal their own 

production projections of the sale area, so the MMS projections were the sole source used for this 

report . 

2-2 
Table 2.1 

The Projected Output of the Proposed Sales in the Gulf of Mexico 

Variable Western Central Eastern 

Number of sales 5 5 1 

Anticipated production of oil 

(Billions of barrel) 0 .03-0 .43 0 .76-2.19 0.03-0.06 

Anticipated production of natural gas 

(Trillions of cubic feet) 2 .83-9 .67 7.65-21 .93 0.50-0.81 

Years of activity 40 40 40 

Number of platforms 10-40 70-210 5-8 

Number of exploration and 

delineation wells 20-115 185-540 15-30 

Number of development and 

production wells 65-355 515- 1,495 20-30 

Pipeline miles 550- 1,150 650- 1,450 100-300 

Number of landfalls 5 5 0 

Number of shore bases 6 7 0 

Source: Minerals Management Service, Proposed Outer Continental Shelf Oil and Gas Leasing 

Program for 1997 to 2002, Environmental Impact Statement, Page IV-74, August 1996. 

Based on information that MMS provided to RPC, this report assumes that hydrocarbon 

production starts in 2010 and ends by 2040.4 The percent of total production in a given year 

ranges from 1 .0 percent to 5 .5 percent. For reasons of confidentiality prior to the actual sale in 

2002, the figures in Table 2.2 are a simulation based on the MMS numbers and are presented in 

five-year intervals to match the presentation in the MMS Florida Panhandle model. 

4 Personal communication with Ms. Katherine Ross of the Minerals Management Service. 

2-3 
Table 2.2 

Percent of Total Production Levels 

Lease Sale 181 

Year Oil Gas 

1995-2005 0 .0% 0.0% 

2010 1 .0% 1 .0% 

2015 3 .0% 3 .5% 

2020 5 .5% 5 .0% 

2025 4 .5% 4.5% 

2030 4 .0% 4.0% 

2035 2.5% 3 .0% 

2040-2045 0.0% 0.0% 

Source: Based on projections provided by the Minerals Management Service. 

Using information from Tables 2.1 and 2.2, RPC made estimates of annual production levels of 

oil and natural gas from Lease Sale 181 (Tables 2.3 .1 and 2.3 .2) . 

2-4 
Table 2.3 .1 

Projected Production Levels of Oil from Lease Sale 181 

(millions of barrels) 

Percent Range of 

of Range of Annual 

Year Total Total Production Production 

1995-2005 0.0% 30 .0-60.0 0.00 

2010 1 .0% 30 .0-60.0 0 .30-0.60 

2015 3 .0% 30 .0-60.0 0 .90-1 .80 

2020 5 .5% 30 .0-60.0 1 .65-3 .30 

2025 4.5% 30.0-60.0 1 .35-2.70 

2030 4.0% 30 .0-60.0 1 .20-2.40 

2035 2.5% 30 .0-60.0 0 .75- 1 .50 

2040-2045 0.0% 30.0-60.0 0.00 

Sources: MMS, FEIS, August 1996 ; personal communication. 

2-5 
Table 2.3 .2 

Projected Production Levels of Natural Gas from Lease Sale 181 

(billions of cubic feet) 

Percent Range of 

of Range of Annual 

Year Total Total Production Production 

1995-2005 0.0% 500-810 0.00 

2010 1 .0% 500-810 5.00-8.10 

2015 3 .5% 500-810 17 .50 - 28 .35 

2020 5 .0% 500-810 25 .00 - 40.50 

2025 4.5% 500-810 22 .50 - 36.45 

2030 4.0% 500-810 20 .00 - 32.40 

2035 3 .0% 500-810 15 .00 - 24.30 

2040-2045 0.0% 500-810 0.00 

Sources: MMS, FEIS, August 1996; personal communication. 

Destin Dome 

The Destin Dome project consists of eleven leased blocks of water 25 miles off the coast of 

Pensacola jointly owned by Chevron, Murphy Exploration and Production, and Conoco, Inc. 

Exploratory wells have confirmed large quantities of natural gas but no oil. The project will 

have between 12 to 21 active wells. A central processing facility will be installed offshore near 

the production wells and move by pipelines in Federal waters to existing gas plants in Mobile, 

Alabama (Chevron 1996). According to Chevron's Development and Production Plan submitted 

to the MMS, the Destin Dome project is scheduled in production from 2000 to 2020, with 

production peaking at 109 .5 billion cubic feet of natural gas in 2005 (Table 2.4). 

The onshore support base for the project will be an existing base located on the Theodore Ship 

Channel near Mobile, Alabama, or Bayou Cassotte in Pascagoula, Mississippi. Chevron does not 

anticipate that expansion of any onshore support base will be necessary to support the Destin 

Dome project. Contacts in the offshore oil and gas industry told RPC that Mobile is the sight for 

the service base for Destin Dome because it also is servicing a series of projects located west of 

2-6 
Destin Dome. Mobile has more than sufficient capacity to handle current and future natural gas 

produced from offshore wells near Mobile. (William Wade, Foster Associates, personal 

communication). 

Table 2.4 

Projected Natural Gas Production from Destin Dome 

(billions of cubic feet) 

Natural Gas 

Year Production 

1995 0 .0 

2000 54.8 

2005 109.5 

2010 71 .2 

2015 42.0 

2020 25 .6 

2025-2045 0.0 

Note : Data from Chevron (1996) was converted from millions of cubic feet per day to 

billions of cubic feet per year. 

Source : DPP, Vol. IV. A., Nov. 1996, page 2-31 . 

Feasible OCS Expenditures in the Florida Panhandle 

In order to estimate the impact of locating an onshore support base in the Florida Panhandle that 

would service production arising from Lease Sale 181 or Destin Dome, RPC reviewed the likely 

capability of such a base to service offshore oil and gas wells during the entire life cycle of an 

off-shore project. Such projects include the following phases of the life cycle : exploration and 

development drilling, platform fabrication and installation, pipelines, and production operations 

and maintenance (Chevron 1996). 

Because the specialized needs of offshore exploration and production are likely to occur from 

states with established services such as Texas, Louisiana, and Alabama, expansion of offshore 

facilities and services into the Florida Panhandle likely would come in the form of an onshore 

support base that would service offshore platforms during the operation and maintenance portion 

of any offshore oil and gas development. This means that the potential impacts likely will be of 

2-7 
a different form than often associated with oil and gas development and that direct 

socioeconomic impacts likely will be smaller than those that have occurred in the Western and 

Central Gulf of Mexico. 

One logical source of information to determine what goods and services a service base in Florida 

would have is a development and production plan (DPP) for hydrocarbon production in the 

northeast corner of the Gulf of Mexico. The economics of servicing the offshore production 

should be comparable to a base in the Florida Panhandle. 

In November 1996, Chevron submitted a such DPP for its proposed Destin Dome Unit 56 

project. In the DPP, Foster Associates, on behalf of Chevron, conducted a socioeconomic study 

of the impact of the project on Mobile, Alabama, the most likely location of an onshore base that 

would service the project. As part of its research, Foster Associates reviewed two studies that 

described the industries associated with offshore oil and gas exploration, development, and 

production . Foster Associates then translated the distribution of spending on various goods and 

services for each phase of the life into SIC categories appropriate for estimating socioeconomic 

impacts of OCS activity in the Mobile areas 

In the development and production plan (DPP) for the Destin Dome project, Chevron determined 

that onshore support bases and industries in coastal Louisiana and Texas would account for 85-

90 percent of the project's expenditures in the following phases: exploration and development 

drilling, platform fabrication, and pipeline construction . This high percentage of work contracted 

outside Mobile reflects the specialization of these segments of the offshore industry that has 

developed over the decades . The assumption for this report is that if Mobile, with its history of 

onshore support for its offshore gas industry, has not developed the infrastructure for these 

activities, the Florida Panhandle would not. RPC confirmed this assumption in its conversations 

with contacts in the offshore oil industry. 

' Centaur (1986) . The DPP looked at only servicing gas production, but review of the Centaur 

(1986) report revealed that it reported the same mix of goods and services for servicing both oil and gas 

production. 

2-8 
Table 2 .5 lists the SIC categories that comprise onshore service industries associated with 

offshore exploration and development and which already are present in Pensacola, Panama City, 

and Fort Walton Beach.b The three cities in the Florida do not have a developed industrial 

infrastructure that supports offshore oil and gas exploration and production. Panama City, does 

have industries that produce steel pipe and fabricated metal plate work. The Port of Panama 

City's industrial park includes Berg Steel Pipe and Wellstream, companies that produce material 

for offshore drilling . These industries, however, could sell pipe to any offshore oil and gas 

project whether or not an on-shore support base is located in the Florida Panhandle. 

° The correspondence between SIC and IMPLAN sectors were taken from the DPP. RPC used a 

1994 IMPLAN database to determine if each city in the Florida Panhandle had industries in these 

categories. Please note that this table corrects a small error in the corresponding tables in the DPP. In the 

DPP, water and air transportation were listed under the same SIC code. A call to Foster Associates 

confirmed that this was a misprint . 

2-9 
Table 2.5 

Industries Associated with Offshore Oil and Gas Exploration, 

Development, and Production 

Code Number 

sic 

132 

1381 

1382 

1389 

1629 

1629 

1629 

2899 

291 

324 

3317 

3443 

3462 

3511 

3533 

3559 

356 

3613 

3631 

3731 

3823 

44 

45 

58 

7359 

871 

872 

873 

IMPLAN 

39 

57 

57 

57 

53 

53 

53 

209 

210 

232 

258 

284 

290 

307 

313 

331 

332 

356 

361 

392 

403 

436 

437 

454 

473 

506 

507 

509 

Description in Destin Dome 

Oil & gas operations 

New well drilling 

Oil & gas exploration 

Other oil and gas services 

Misc. natural resource facilities construction 

New gas utility facilities 

Pipeline construction 

Chemical, not elsewhere classified 

Petroleum fuel 

Hydraulic cement 

Steel pipe 

Fabricated plate work 

Iron & steel forgings 

Turbines 

Oil & gas field machinery 

Special industry machinery, not elsewhere 

classified 

Pumps and compressors 

Switchgear 

Construction machinery & equipment 

Shipbuilding 

Instrumentation 

Water transportation 

Air transportation 

Eating and drinking places 

Miscellaneous equipment rent / lease 

Environmental and engineering services 

Accounting / miscellaneous business services 

Test / research services 

Areas with industries having this 

SIC code 

Panama Ft . Walton 

Pensacola City Beach 

X X 

X X X 

X X X 

X X X 

X X X 

X X X 

X X X 

X 

X 

X 

X X X 

X X X 

X X X 

X X X 

X X X 

X X X 

X X X 

X X X 

Sources: Centaur, 1986; Foster Associates, 1994; MIG, 1997 . 

2-10 
Table 2.6 lists the industries associated with the operation and maintenance portion of the oil and 

gas well life cycle, comparing which industries are involved in O&M spending in a typical 

support base and what a Florida Panhandle support base would likely be capable of providing. 

The Florida Panhandle would receive at most 53 percent of all O&M dollars because the area 

does not have hydrocarbon processing plants or manufacture specialized equipment.' RPC 

assumes that any service related to O&M could easily be established but that manufacturing 

capacity would not be established in the area solely based on servicing the Destin Dome or Lease 

Sale 181 project. Most of the equipment for a base that would be located in the Florida 

Panhandle would need to come from areas west of the Florida Panhandle. 

In Table 2.6, oil and gas operations (SIC 132) refers to oil refining or gas processing, which the 

MMS assumes would not take place in the Florida Panhandle because the project does assume a 

new landfall (oil or gas pipeline). Pipelines linked to these two projects would take gas and oil 

to appropriate locations within the Gulf of Mexico that have established refining and gas 

processing capacity. 

Description of a Support Base in the Florida Panhandle 

In addition to using the DPP for information on onshore service bases, RPC contacted a number 

of firms associated with offshore activity in the Gulf of Mexico to get a description of a 

theoretical support base located in the Florida Panhandle. 

An optimal onshore base would operate vessels, helicopters, and store materials at one location 

and handle all phases of oil and gas production (drilling an exploratory well, installing a facility, 

operation and maintenance). For purposes of this study, however, RPC assumes that a base in 

the Florida Panhandle would only service the operation and maintenance portion of an offshore 

project's life cycle. Space for storing equipment and supplies is very important. Boat running 

time is an important consideration, so a base is typically close to where the drilling is located. 

' In contrast, a base located in Mobile, Alabama would receive about 85 percent of such 

expenditures . Chevron, November, 1996, page 7 . 

2-11 
Table 2.6 

Industries Associated with Operation and Maintenance 

of Offshore Oil and Gas Platforms 

Code Number Operation and Maintenance Spending 

Florida 

Typical Percent of Panhandle Percent of 

SIC IMPLAN Description in Destin Dome Supply Base Total Supply Base Total 

132 39 Oil & gas operations X 363% 0.0% 

1389 57 Other oil and gas services* X 18.4% X 35.0% 

2899 209 Chemical, not elsewhere X 0 .9% 0.0% 

classified 

291 210 Petroleum fuel X 4.4% 0.0% 

324 232 Hydraulic cement X 0.7% 0.0% 

3559 331 Special industry machinery, not X 5 .1% 0.0% 

elsewhere classified 

44 436 Water transportation X 4.0% X 7.6% 

45 437 Air transportation X 3 .8% X 7.2% 

58 454 Eating and drinking places X 1 .7% X 3.2% 

7359 473 Miscellaneous equipment rent / X 1 .4% X 2.7% 

lease 

871 506 Environmental and engineering X 14 .7% X 27.9% 

services 

872 507 Accounting / miscellaneous X 4.2% X 8.0% 

business services 

873 509 Test / research services X 4.5% X 8.6% 

Total for a typical onshore base 100.0% 

Total for Florida Panhandle 52.6% 100.0% 

onshore base 

* Assumes all offshore workers are locals . This issue will be discussed further below. 

Sources: RPC, 2001 ; Chevron, Destin Dome Unit 56, Development and Production Plan, July 1997 . 

For onshore support bases that are in the middle of nowhere (such as Venice, Louisiana), the 

onshore support base has living quarters on the premises. However, if such a base were in the 

Florida Panhandle, a firm likely would hire its onshore workforce locally and not need to build 

living quarters . 

A port is an optimal location for an onshore support base. As one contact from a offshore 

drilling company stated : 

A support base typically needs a 100-ton crane, liquid tanks for drilling fluids, 

ramps that would allow forklifts to board a boat, plenty of warehouse space and a 

2-12 
bulkhead four or five feet high. As such, ports are preferable to shipyards for 

locating support bases . 

The projected production level associated with Lease Sale 181 is five to eight platforms (U.S . 

Dept. of the Interior, MMS 1996a) . A service base associated with Lease Sale 181 would require 

3 to 5 acres (130,680 square feet to 217,800 square feet) of space at the port. RPC assumes that 

the Destin Dome project would need a support base of roughly the same size . Information in 

literature review suggests that the Ports of Pensacola and Panama City would have the 

appropriate space available for the expected size of support base. The Port of Pensacola has 

710,000 square feet of storage space comprised of 460,000 square feet of warehouse space and 

250,000 square feet of open space. The Port of Panama City has 500,000 square feet of 

warehouse space and X square feet of open space. 

Because the factors described above, two deep water ports in the area are the appropriate location 

for a support base. The Port of Panama City has experience serving as an onshore support base, 

and both have the capacity available for servicing offshore platforms. Every contact in the 

offshore industry who was asked stated that Fort Walton Beach, not having a deep-water port, is 

not appropriate area for an onshore service base. 

The projected production from Lease Sale 181 would be serviced by ten onshore personnel (two 

twelve-hour shifts of five workers) on a seven days on, seven days off rotation. The warehouse 

manager and one other person might be imported, but the remainder of the crew would be locals. 

A normal crew complement for an offshore platform would be 10-15 people . A number of 

offshore workers would live outside the Florida Panhandle and commute to the service base. 

According the Destin Dome Production Plan, helicopters will make 24 round trips between the 

onshore support base and the platforms each week, or 1,248 round trips per year. Supply boats 

will make 24 round-trips between the onshore base and the platforms each month, or 288 round 

trips per year. RPC assumes that helicopter and supply activity per well for production from 

Lease Sale 181 would be comparable to the Destin Dome project. Given that Destin project will 

have about 20 production wells operating and that Lease Sale 181 would have 20-30 wells 

operating, production from Lease Sale 181 would have about 1,248 helicopter round trips per 

year and about 288 supply boat round trips per year. 

2-13 
Levels of Direct Expenditure from OCS Activity 

Lease Sale 181 

According to background research, RPC found that the operation and maintenance costs of an 

offshore gas well were on average $0.36 per thousand cubic feet (MCF) of gas produced and that 

such costs for an offshore oil well were about $2 per barrel . The conversion factor is about 5 .6 

($0 .36 / MCF * 5 .6 = $2 / barrel). The conversion factor is based on assuming that the O&M 

cost per BTU is the same. This information was confirmed by two sources in the offshore oil 

and gas industry . 

This report assumes that all O&M services that an onshore base in the Florida Panhandle can 

provide will be provided there (i .e ., no services go to Mobile or Pascagoula that could be 

serviced from the Florida Panhandle).' The minimum threshold scenario is assumed to be the 

minimum projected gas production plus the minimum projected oil production . The maximum 

likely production is assumed to be the maximum projected gas production plus the maximum 

projected oil production. 

RPC estimated the potential OCS expenditures that would occur in the Florida Panhandle by 

multiplying the O&M expenditure per barrel or per thousand cubic feet by the volume produced 

in a given year. Tables 2.7 and 2.8 calculate the potential O&M expenditures related to 

production from offshore oil (Table 2.7) and natural gas (Table 2.8) wells developed from Lease 

Sale 181 in the Eastern Gulf of Mexico. 

The MMS Florida Panhandle model makes an adjustment for offshore workers that 

commute from outside the Florida Panhandle. This report discusses the adjustment in Chapter 8 

below. 

2-14 
Table 2.7 

Potential Operation and Maintenance (O&1V) Expenditures 

in the Florida Panhandle from Lease Sale 181 in the Eastern 

Gulf of Mexico Offshore Oil Wells 

Range O & M O&M 

of Annual Expenditures Expenditures 

Production Expenditure Total Florida Panhandle 

(millions of per (in millions of (in millions of 

Year barrels Barrel dollars) dollars 

1995-2005 0.00 $2.00 $0.00 $0 .00 

2010 0.30-0.60 $2.00 $0.60 - $1 .20 $0.32 - $0.63 

2015 0.90-1 .80 $2.00 $1 .80 - $3 .60 $0.95 - $1 .90 

2020 1 .65-3.30 $2.00 $3 .30 - $6.60 $1 .74 - $3 .48 

2025 1 .35-2.70 $2.00 $2.70 - $5 .40 $1 .42 - $2.85 

2030 1 .20-2.40 $2.00 $2.40 - $4.80 $1 .27 - $2.53 

2035 0.75- 1 .50 $2.00 $1 .50 - $3 .00 $0.79 - $1 .58 

2040-2045 0.00 $2.00 $0 .00 $0.00 

Source: RPC, 2001 . 

2-15 
Table 2.8 

Potential Operation and Maintenance (O&1V) Expenditures 

in the Florida Panhandle from Lease Sale 181 in the Eastern 

Gulf of Mexico Offshore Natural Gas Wells 

O&M 

Range of O & M Expenditures 

Annual Expenditure Expenditures Florida 

Production per Total Panhandle 

(billions of Thousand (in millions of (in millions of 

Year cubic feet Cubic Feet dollars dollars 

1995- 0.00 $0.36 $0 .00 $0.00 

2005 

2010 5.00-8.10 $0.36 $1 .80 - $2.92 $0.95 - $1 .54 

2015 17 .50 - 28 .35 $0.36 $6.30 - $10.21 $3 .32 - $5.38 

2020 25 .00 - 40.50 $0.36 $9.00 - $14.58 $4.74 - $7.68 

2025 22.50 - 36 .45 $0.36 $8.10 - $13.12 $4.27 - $6.92 

2030 20 .00 - 32 .40 $0.36 $7.20 - $11 .66 $3 .79 - $6.15 

2035 15 .00 - 24.30 $0.36 $5 .40 - $8.75 $2.85 - $4.61 

2040- 0.00 $0.36 $0 .00 $0.00 

2045 

Source: RPC, 2001 . 

2-16 
Table 2.9 shows the timing and the range of operation and maintenance expenditures in the 

Florida Panhandle of the combined production of oil and natural gas production from the Lease 

Sale 181 in the Eastern Gulf of Mexico . Production begins in the model in 2010 and ends in 

2035 . Direct O&M expenditures begin about the year 2010 at a low level ($1 .3 million to $2 .5 

million), peak in the year 2020 in both the threshold ($6 .5 million) and the reasonable maximum 

($11 .2 million) scenarios, cease by the year 2040. 

Table 2.9 

Range of Operation and Maintenance Expenditures in the Florida Panhandle 

on Oil and Gas Production from Lease Sale 181 in the Eastern Gulf of Mexico 

(in millions of dollars) 

Oil Natural Gas Total 

Year 

Minimum 

Threshold 

Reasonable 

Maximum 

Minimum 

Threshold 

Reasonable 

Maximum 

Minimum 

Threshold 

Reasonable 

Maximum 

1995- 

2005 $0.00 $0.00 $0.00 $0.00 $0.00 $0.00 

2010 $0.32 $0 .63 $0.95 $1 .54 $1 .26 $2 .49 

2015 $0 .95 $1 .90 $3 .32 $5 .38 $4.27 $7 .28 

2020 $1 .74 $3 .48 $4.74 $7.68 $6.48 $11 .16 

2025 $1 .42 $2 .85 $4.27 $6.92 $5 .69 $9.76 

2030 $1 .27 $2 .53 $3 .79 $6.15 $5 .06 $8 .68 

2035 $0.79 $1 .58 $2.85 $4.61 $3 .64 $6.19 

2040- 

2045 $0.00 $0 .00 $0.00 $0.00 $0.00 $0.00 

Source: RPC, 2001 . 

2-17 
Destin Dome 

Table 2.10 shows the operation and maintenance expenses associated with Destin Dome between 

2000 and 2040. Expenditures peak at $20.7 million in 2005 and fall to $4.5 million in 2020 and 

$0 in 2025 . If one were to combine the reasonable maximum for oil and gas production arising 

from Lease Sale 181 with the projected Destin Dome production, expenditures would peak at 

$20 .7 million in 2005 and average about $15 .8 million from 2010 to 2020, then fall below $10 

million from 2025 to 2035 . 

Table 2.10 

Year 

1995 

2000 

2005 

2010 

2015 

2020 

2025-

2045 

Potential Operation and Maintenance (O&M) Expenditures 

in the Florida Panhandle 

Offshore Natural Gas Wells - Destin Dome 

(in millions of 1994 dollars) 

Range of 

Annual 

Production 

(billions of 

cubic feet 

0.0 

54.8 

109.5 

71 .2 

42.0 

25 .6 

0.0 

O & M Expenditures 

per Thousand Cubic Feet 

of Natural Gas 

$0 .36 

$0 .36 

$0 .36 

$0 .36 

$0 .36 

$0 .36 

$0 .36 

Total O & M 

Expenditures 

$0.0 

$15 .1 

$39.4 

$26.9 

$15 .1 

$8 .5 

$0.0 

Florida 

Panhandle 

$0 .0 

$7 .9 

$20 .7 

$14.2 

$7 .9 

$4.5 

$0 .0 

Source : Chevron, November 1996, Table B-30. 

2-18 
CHAPTER 3 

TOURISM 

It is difficult to overestimate the importance of tourism to the Panhandle area of Florida. It along 

with the U.S . Military are the mainstays of the regional and local economies of the area. Thus, it 

is obvious that the tourism industry and the potential impacts of OCS activity on tourism in the 

region deserve special attention. In this chapter, the characteristics of tourism in the region are 

described, the major individual tourist areas are described including a discussion of key facilities, 

the major stakeholders in the industry in the area are delineated, and the areas of potential 

impacts of OCS development most likely to be of interest to tourism-related stakeholders in the 

region are noted. A listing of information and literature sources is provided at the end of the 

report . 

The general region of interest for purposes of this examination of tourism in the Panhandle 

includes the area from Pensacola on the West to Panama City on the East. Specifically, we give 

special attention to the coastal counties of Escambia and Santa Rosa that make up the Pensacola 

MSA, Okaloosa County which makes up the Ft. Walton Beach MSA and to Bay County which is 

the county making up the Panama City MSA. To cover the remainder of the coastal area between 

Ft. Walton Beach and Panama City, we also include some data for Walton County. Tourism is 

discussed for this region as a whole and for each of the areas of Pensacola, Fort Walton Beach 

including Destin, and the Panama City area. 

A Brief History and Current State of Tourism in the Panhandle of Florida 

The five county area which is the focus of this discussion contained 642,936 persons in 1990 

(Bureau of Economic and Business Research 1994) and, as shown in Table 1, is estimated by the 

Bureau of Economic and Business Research at the University of Florida (1995) to have had more 

than 714,000 persons in 1995 and is projected to have nearly 890,000 residents by 2010. Its 

projected growth of more than 38 percent over the 20-year period from 1990 to 2010 is nearly 

identical to that projected for the State of Florida as a whole (37.7 percent) and indicates an area 

undergoing substantial demographic and economic expansion. 

Although this region was among the first discovered and settled in North America by the 

explorers Panfilo de Narvaez and Cabeca de Vaca in the 1520s and was twice owned by Spain, 

as well as by France, England and only formally transferred to the United States by Spain in 

1821 (Hutchinson, L. 1961), it remained largely an "undiscovered" agricultural area with 

recreational uses primarily by local residents and persons from other parts of the Southern United 

States until well into this century. It was recognized as the place in the "Old South" to go for 

swimming and fishing and thus came to be referred to as the "Southern Riviera" . Its sugar white 

sand (it is actually finely ground quartz) and turquoise waters were a major attraction, especially 

to persons in the states immediately adjacent to the Panhandle. Their appreciation of the area 

earned it the additional nickname of the "Emerald Coast." 

3-1 
The development of the area as a major tourist area, however, did not begin until the mid-1930s 

when the first casinos were constructed such as those by A.W. Pledger, J.E. Churchwell and 

others (Strategic Planning Group, Inc. 1995; Hutchinson, L. 1961). Tourist hotels began to be 

constructed during the same period but it was not until after World War II that the tourism 

industry began to grow rapidly. In fact, as shown in Table 2, the area's population growth has 

generally been slower than that in the remainder of Florida except in the 1940s when the growth 

of military bases substantially impacted the area. Its rate of increase is rapid, however, and will 

lead to a substantial expansion of its population base. 

Table 3.1 

Population of Counties in the Florida Panhandle Study Area in 1990, 

Estimated Population in 1995 and Projected Population in 2000 and 2010 

County 1990 

Year 

1995 2000 

(Estimated) (Projected) 

2010 

(Projected) 

Bay 126,994 139,173 150,099 171,302 

Escambia 262,798 282,742 302,390 329,699 

Okaloosa 143,776 162,707 178,198 208,202 

Santa Rosa 81,608 96,091 110,402 135,801 

Walton 27,760 33,415 37,296 44,198 

Total 5 County Area 642,936 714,128 778,385 889,202 

Source : Estimates and Projections by the Bureau of Business Research, University of 

Florida. 

3-2 
Throughout the years, the industry has grown and by the mid 1990s the area had become among 

the major tourist regions in Florida and the Nation. Tourism is the major industry of Florida 

creating roughly 700,000 jobs and more than $2.0 billion in direct sales annually (Strategic 

Planning Group, Inc. 1995). Florida has more than 41 million visitors annually, and it is 

estimated that over 7 .0 million persons visit the study area annually (Strategic Planning Group, 

Inc. 1995). Florida has mor than 41 million visitors annually, and it is estimated that over 7.0 

million persons visit the study area annually (Florida Department of Commerce 1995). In fact, 

of the nearly 20 .0 million persons estimated to have visited Florida by automobile in 1995 

(Florida Department of Commerce 1995), roughly 21 percent were estimated to have visited 

either Bay county (about 14.0 percent) or Okaloosa County (about 7 .0 percent) . This is a 

recurrent pattern that marks the region as one of the key areas for tourism in Florida. Although 

organizations and agencies in each part of the region complete independent estimates of the 

number of tourists and their economic impacts, and there is some overlap in impacts across areas, 

a summation of these estimates of the local economic impact of tourism in the three subareas 

within the study region suggests that tourism is responsible for more than $1 .5 billion annually in 

total (direct, indirect and induced) economic activity in the study area. Tourism is clearly among 

the key industries of the Panhandle of Florida. 

3-3 
Table 3.2 

Population Growth in Panhandle Study Area Counties and Florida, 1940-1990 

Percentage Change 

1940- 1950- 1960- 1970- 1980- 

County 1940 1950 1960 1970 1980 1990 1950 1960 1970 1980 1990 

w Florida 1,897,414 2,771,305 4,951,560 6,791,418 9,746,961 12,937,926 46.1 78.7 37.2 43.5 32.7 

41 

Bay 20,686 42,689 67,131 75,283 97,740 126,994 106.4 573 12 .1 29.8 29.9 

Escambia 74,667 112,706 173,829 205,334 233,794 262,798 50.9 54.2 18 .1 13 .9 12.4 

Okaloosa 12,900 27,533 61,175 88,187 109,920 143,776 113 .4 122.2 44.2 24.6 30.8 

Santa Rosa 16,085 18,554 29,547 37,741 55,988 81,608 15 .3 59.2 27.7 48.3 45 .8 

Walton 14,246 14,725 15,576 16,087 21,300 27,760 3.4 5.8 3.3 32.4 303 

Source : Decennial Censuses of Population for years indicated. 
The tourist base of the region includes an increasingly diverse base of tourists . Although 

persons from the Southern part of the United States and middle age and older tourists 

continue to provide the bulk of tourists to the area, it is evident that the tourist base of the 

area is diversifying both geographically and relative to the sociodemographic characteristics 

of the tourists visiting the area. 

Tables 3-6 provide an indication of the characteristics of visitors coming to the three 

counties of Escambia (where Pensacola is located), Okaloosa (where Fort Walton Beach and 

Destin are located) and Bay (where Panama City is located) . The data in these tables are 

derived from Florida Visitor Profile Reports prepared for the Florida Department of 

Commerce. The data in these tables are for the year for which most complete data were 

available at the time this report was completed, 1995. Although data for a single year must 

be used with caution, an examination of data for several years (Coggins 1995 ; Bell 1991) 

suggests that the characteristics of visitors shown for 1995 appear to be typical for visitors in 

the area. Data are shown by the quarter of the year to indicate the variation in tourist 

populations by time of year. Florida divides its analysis of visitors into two groups, those 

who arrive by air and those who arrive by automobile. Visitors arriving by air are a 

relatively small part of the total tourist population of the study area, being a significant 

group only in the Bay County Area. Both Bay County and Okaloosa appear among the top 

10 tourist counties in Florida for visitors arriving by automobile (Florida Department of 

Commerce 1995), but no county in the study area is among the top 10 for visitors arriving 

by air. As a result, data provided on visitor characteristics concentrate on automobile visitors 

for Escambia and Okaloosa Counties with data for both air and automobile visitors only for 

Bay County. 

The data in these tables reveal several important patterns about visitors to the study area. It 

is evident, for example, that for each of the three areas there are two distinct tourist 

populations. In the winter months (the fourth and first quarters including the months from 

October through March) visitors are disproportionately older adults . In Escambia and 

Okaloosa counties in these months, the proportion of persons over 65 years of age is 

between 20 and 25 percent with between 35 and 53 percent being 55 years of age or older. 

The visitors are highly educated with about 25 to 40 percent having completed post-graduate 

work and are of upper middle income status with median incomes in the mid $50,000 range. 

During the spring and summer months (April through September), the visitors are younger 

with the proportion 66 years of age or older dropping to 8 to 20 percent and with around 20 

percent being young persons 7 to 17 years of age and another 14 to 25 percent being 18 to 

35 years of age. This summer tourist population is also relatively highly educated and from 

upper middle class income groups . These two areas are also similar in the origins of their 

visitors . Visitors are primarily from southern states with high proportions being from 

Alabama, Arkansas, Louisiana, Mississippi, and Texas. The visitors to Escambia and 

Okaloosa visit primarily for purposes of taking vacations and utilize a variety of attractions. 

In both areas, however, when asked the major activities that they most enjoyed, visitors cite 

the use of beaches, the climate and a variety of historical and water-based resources such as 

3-5 
fishing, cruises, etc . They utilize hotels/motels and lodging in rented condominiums and 

spend $45 to $100 per day per person, staying 2.5 to roughly 5.5 days on average, depending 

on the season . 

The Bay County Area's automobile visitors show seasonal patterns but there are smaller 

differences in populations between seasons . In the winter months, the percentage of visitors 

66 years of age or older varies between 10 and 17 percent and the proportion in the ages of 

36 to 55 is higher than in Escambia and Okaloosa Counties. Bay County visitors are similar 

to those in the other two counties in terms of income and education. In the summer months, 

the Bay County Area has larger proportions of young adults than in the other two areas. As 

might be expected given its location, the Bay County Area's visitors also tend to be from 

somewhat different origins . Although Alabama, Arkansas, Louisiana, Mississippi, and 

Texas remain major origins, Georgia, Tennessee, and some Midwestern states (e .g., 

Michigan and Ohio) and some other southern locations (e .g ., Kentucky and Virginia) appear 

with greater frequency. Vacationing and similar attractions tend to be important to visitors in 

the Bay County area and beaches, climate, and other natural resource-related amenities 

appear to be equally important as in the Escambia and Okaloosa areas . Expenditures per 

person per day tend to be lower with levels of $30 to $60 per day reported for Bay County 

visitors in 1995 . 

The Bay County Area's air-based visitors are different than its auto visitors . During the 

winter months, these visitors tend to be middle aged with between 40 and 60 percent being 

36 to 55 years of age. They tend to be highly educated with roughly 40 percent having postgraduate degrees and with median incomes in the $60,000 to $70,000 range. These visitors 

are not only different in age but also in origin . Midwestern and East Coast areas such as 

Wisconsin, Ohio, Virginia, and Maryland appear as frequent sources. Business as well as 

vacationing appear as major reasons for visiting the area, attractions remain the same as for 

automobile visitors, and the importance of the area's beaches and climate remain central to 

these visitors . 

It is evident that beaches and water-related activities are key parts of the tourist experience 

in the Panhandle. Relative to beaches, the quality of such beaches is attested to by the fact, 

that five of the top twenty beaches in the United States are located in the region and in both 

1994 and 1995 beaches in the study area (namely Grayton Beach in 1994 and St. Andrews 

Beach in 1995) were rated as the best beach in the Nation (Leatherman 1994 & 1995). 

Relative to other water-based resources, an example of the importance of such industries can 

be seen by examining the party and charter boat industries . Party boats involve boats that 

charge on a per passenger per trip basis and usually involve relatively large numbers of 

passengers while charter boats rent by the boat per trip . An article by Ditton et al . (1992) 

estimated that the Gulf of Mexico had 97 operating party boats with roughly two-thirds 

operating off Florida Coasts. Of the 62 boats operating in Florida, 14 operated from ports in 

the Panhandle of Florida. Florida's boats were estimated to make 17,329 trips per year 

involving 320,587 passengers . If one assumes that the Panhandle had its proportionate share 

(as indicated by its proportion of all boats in Florida), this would indicate more than 3,900 

3-6 
trips were made by such boats per year involving more than 72,000 passengers. Similarly an 

article by Holland et al . (1992) suggested that 736 of 971 charter boats in the Gulf were in 

Florida with 196 in the Panhandle. Florida charter boats were estimated to have made 

118,202 trips involving 472,897 passengers . If one again assumes that the Panhandle's 

proportion of trips and passengers is equal to its proportion of Florida boats, panhandle 

boats would have made more than 31,000 trips involving nearly 126,000 persons. These 

same articles plus others (Ditton et al . 1991) point out that party boats tended to charge 

between $15 and $70 per person and that charter boats charge in excess of $300 per boat 

with an average of six persons per boat. A more recent analysis of charter boats operating 

off of the coast of Alabama (Malone 1994) estimated the average charter boat cost at $825 

per day. Although the definition of the Panhandle used in these analyses is different than 

that used in this analysis, and there is a wide range in the estimates of potential charges, it is 

obvious that the direct expenditures from party and charter boats are substantial. For 

example, if one assumes the $70 .00 per person for party boats with 72,000 participants and 

$825 per charter boat with 31,000 trips, the combined expenditures would exceed $30.0 

million per year and this would not include indirect or induced costs. Although again care 

must be taken not to extrapolate these results too extensively, the same Alabama study cited 

above suggested that such direct costs were about 25 percent of the total expenditures of 

persons involved in charter boat-related visits . This example provides an indication of the 

economic effects of just one part of the tourist industry in the Florida Panhandle. 

The general region (including counties in close proximity to the counties used in this 

analysis) is also a major site of nature and preservation areas for wildlife and other natural 

resources. These areas include the Gulf Island National Seashore; the Bradwell Bay and St. 

Marks Wilderness areas; the Apalachicola National Forest ; and the St. Marks, St. Vincent 

Island, and Pig Island National Refuges. It also includes the Blackwater River State Park; 

Fort Pickens, Yellow River, St. Joseph Bay, and other preserve areas; as well as the La 

Floresta, Perdida, St. Regis, Blackwater, Eglin, Point Washington, and Gaskin wildlife 

management areas. These are areas that are all within, or within driving distance of, the 

study area and represent major bases for wildlife-based tourism. 

What this section suggests, then, is that tourism is among the two major industries in the 

study region . It is tourism that involves primarily automobile visitors with a predominance 

of southern origins. It is tourism heavily dependent on the natural resources of the area 

particularly the beaches and other water-based resources available in the area. 

3-7 
Table 3.3 

Characteristics of Visitors Arriving by Automobile by Quarter for the Escambia County Area, 1995 (percents) 

1st Quarter 2nd Quarter 3rd Quarter 4th Quarter 

Characteristic (Jan .-March) (April-June) (July-Sept .) (Oct .-Dec.) 

Age 

w 

00 

Male Female Male Female Male Female Male Female 

Infant to 6 yrs. 3.1 .0 3.4 5.1 6.2 3.2 1 .8 4.1 

7 to 17 9.4 .0 15 .3 19 .2 12 .5 14 .3 1 .8 2.0 

18to25 6.2 .0 6.8 11 .5 6.2 7.9 3.6 6.1 

26 to 35 12.5 11 .5 13 .6 14 .1 83 12 .7 7.1 12 .2 

36 to 45 9.4 30.8 20.3 14 .1 25.0 19 .0 19.6 6.1 

46 to 55 21 .9 23.1 13 .6 24.4 16 .7 11 .1 25.0 24.5 

56 to 65 12 .5 23.1 16 .9 9.0 16 .7 17 .5 16 .1 24.5 

66 or over 25.0 11 .5 10 .2 2.6 83 14 .3 25.0 20.4 

Education 

K-11 th Grade .0 .0 .0 .0 

High School Graduate 6.5 3 .9 2.4 1 .9 

Some College 22.6 15 .7 19.0 33.3 

College Graduate 25.8 29.4 21 .4 25.9 

Post-Graduate Work 16 .1 25 .5 40.5 24.1 

Advanced Degree 6.5 3 .9 4.8 .0 

Currently Enrolled (Not 

High School) 16.1 15 .7 9.5 13.0 

Vocational-Technical .0 .0 .0 .0 

Other 6.5 5 .9 2.4 1 .9 
Table 3.3 (continued). 

1st Quarter 2nd Quarter 3rd Quarter 4th Quarter 

Characteristic (Jan .-March) (April-June) (July-Sept .) (Oct.-Dec.) 

w 

110 

Household Income 

$ 0 - 9,999 .0 2.0 .0 .0 

$ 10,000- 19,999 7 .4 2.0 4.9 8 .2 

$ 20,000- 29,999 18 .5 15 .7 24.4 20.4 

$ 30,000- 39,999 18 .5 19 .6 17.1 20.4 

$ 40,000- 49,999 3 .7 19 .6 14.6 20.4 

$ 50,000- 59,999 11 .1 15 .7 4.9 4.1 

$ 60,000- 69,999 11 .1 3.9 17.1 8 .2 

$ 70,000- 79,999 11 .1 3.9 12.2 4.1 

$ 80,000- 89,999 11 .1 2.0 2.4 4.1 

$ 90,000 - 99,9999 3 .7 2.0 .0 .0 

$ 100,000 - 124,999 .0 5.9 2.4 10.2 

$ 125,000 - 149,999 .0 3.9 .0 .0 

$ 150,000 and above 3 .7 3.9 .0 .0 

Visitor Expenditures 

Expenditures/Party/Trip $705.11 $683 .31 $509 .50 $446.37 

Number/Party 1 .87 2.69 2.64 1 .91 

Expenditures/Person/Trip 377.06 254.02 192.99 233 .70 

Average Number of Nights 3 .74 237 331 2.60 

Expenditures/Person/Day 100.82 107.18 58.31 89.89 

Expenditures/Party/Day 188.53 288.32 153.93 171 .68 
Table 3.3 (continued). 

w 

0 

State 

1st Quarter 

(Jan .-March) State 

2nd Quarter 

(April-June) State 

3rd Quarter 

(July-Sept.) State 

4th Quarter 

(Oct.-Dec.) 

Origin Areas for Visitors 

Texas 19 .4 Alabama 15 .7 Mississippi 143 Louisiana 14 .5 

Alabama 9.7 Louisiana 13 .7 Texas 11 .9 Georgia 14 .5 

Pennsylvania 6.5 Mississippi 11 .8 Arkansas 11 .9 Texas 12 .7 

Oregon 6.5 Texas 9.8 Missouri 9.5 Tennessee 9.1 

Ohio 6.5 Pennsylvania 5 .9 Alabama 9.5 Alabama 73 

Mississippi 6.5 Michigan 5 .9 Louisiana 7.1 Oklahoma 5.5 

Louisiana 6.5 Missouri 3 .9 North Carolina 4.8 Missouri 3.6 

Tennessee 6.5 Indiana 3 .9 Indiana 4.8 Mississippi 3.6 

Rhode Island 3.2 Illinois 3 .9 Georgia 4.8 Virginia 3.6 

New Hampshire 3.2 Tennessee 3 .9 Tennessee 4.8 Washington 3.6 

Virginia 32 South Carolina 4.8 North Carolina 3.6 

Minnesota 3.2 

Michigan 3.2 

Saskatchewan 3.2 

Indiana 3.2 
Table 3.3 (continued). 

1st Quarter 

Characteristic (Jan .-March) 

2nd Quarter 

Characteristic (April-June) 

3rd Quarter 

Characteristic (July-Sept .) 

4th Quarter 

Characteristic (Oct .-Dec .) 

Reason for Trip 

Vacation 61 .3 Vacation 54.9 Vacation 59 .5 Visit Friends 

Business (Co., Visit Friends/ Visit Friends and/or Relatives 56.4 

Govt., Personal) 25 .8 and/or Relatives 21 .6 and/or Relatives 31 .0 Vacation 273 

Visit Friends Business (Co., Business (Co ., Business (Co., 

and/or Relatives 9 .7 Govt., Personal) 21 .6 Govt., Personal) 9 .5 Govt ., Personal) 16.4 

Honeymoon 3.2 Honeymoon 2.0 Convention/Confer- Convention/ConferConvention/Confer- Convention/Confer- ence/Trade Show .0 ence/Trade Show .0 

ence/Trade Show .0 ence/Trade Show .0 Cruise .0 Cruise .0 

Cruise .0 Cruise .0 Honeymoon .0 Honeymoon .0 

Other .0 Other .0 Other .0 Other .0 

Additional Reasons for Trip 

w 

Visit Friends Visit Friends Vacation 47 .6 Vacation 60.0 

'-' and/or Relatives 55 .6 and/or Relatives 43.5 Visit Friends Visit Friends 

Vacation 44 .4 Vacation 43.5 and/or Relatives 42 .9 and/or Relatives 25 .0 

Business (Co., Convention/Confer- Honeymoon 4.8 Business (Co. 

Govt., Personal) .0 ence/Trade Show 13 .0 Business (Co ., Govt., Personal) 10.0 

Convention/Confer- Business (Co., Govt., Personal) 4 .8 Convention/Conference/Trade Show .0 Govt., Personal) .0 Convention/Confer- ence/Trade Show 5.0 

Cruise .0 Cruise .0 ence/Trade Show .0 Cruise .0 

Honeymoon .0 Honeymoon .0 Cruise .0 Honeymoon .0 

Other .0 Other .0 Other .0 Other .0 

Table 3 . continued 
Table 3.3 (continued). 

1st Quarter 2nd Quarter 3rd Quarter 4th Quarter 

Characteristic (Jan .-March) Characteristic (April-June) Characteristic (July-Sept .) Characteristic (Oct .-Dec.) 

Parks/Preserves 15 .4 Walt Disney Resort 

Walt Disney Resort & Attractions 

& Attractions 11 .5 Parks/Preserves 

Universal Studios 7.7 Nat'l Museum of 

The Pier (St . Petersburg) 7.7 Naval Aviation 

Nat'l Museum of Universal Studios 

Naval Aviation 7.7 Sea World 

Cypress Gardens 7.7 St . Augustine 

Busch Gardens 3 .8 Historic District 

Bok Tower Gardens 3.8 

Attractions Visited 

Miracle Strip 

30 .0 Amusement Park 

25 .0 Nat'l Museum of 

Naval Aviation 

15 .0 Gulfarium 

10 .0 Gulf World Aquarium 

10 .0 Parks/Preserves 

Everglades National Park 

5 .0 Walt Disney Resort 

& Attractions 

Walt Disney Resort 

22 .7 & Attractions 23 .5 

Nat'l Museum of 

22 .7 Naval Aviation 17.6 

13 .6 Spaceport USA 5 .9 

13 .6 King Henry's Feast 5 .9 

9.1 Busch Gardens 5.9 

4 .5 State Capitol 5 .9 

Universal Studios 5.9 

4.5 Parks/Preserves 5.9 

St . Augustine 

Historic District 5.9 

Ripley's Museum 

(Orlando) 5 .9 
Table 3 .3 (continued) . 

w 

rr 

w 

1 st Quarter 

Characteristic (Jan .-March) 

2nd Quarter 

Characteristic (April-June) 

3rd Quarter 

Characteristic (July-Sept .) 

4th Quarter 

Characteristic (Oct.-Dec .) 

Major Activity 

Rest and Relaxation 24.0 Shopping/Restaurants 20.6 Shopping/Restaurants 19.2 Shopping/Restaurants 28.7 

Shopping/Restaurants 15 .4 Rest and Relaxation 18 .6 Beaches 18.1 Rest and Relaxation 20.1 

Beaches 11 .5 Beaches 17 .1 Rest and Relaxation 16.4 Climate 12 .8 

Climate 11 .5 Climate 12 .1 Climate 6.8 Beaches 12 .2 

Attractions (and Pool Activities 7.0 Water Sports 5.6 Attractions (and 

Daily Cruises) 7.7 Attractions (and Attractions (and Daily Cruises) 6.7 

Camping/Hiking 7.7 Daily Cruises) 6.0 Daily Cruises) 5.6 Historical Sites 6.1 

Historical Sites 5.8 Historical Sites 5.5 Historical Sites 5.1 Golf 3.7 

Other 4.8 Golf 2 .5 Dancing, Night Life 3 .4 Boating/Charter Boating 1 .2 

Dancing, Night Life 2.9 Dancing, Night Life 2.0 Pool Activities 3.4 Cultural or Special 

Cultural or Special Camping/Hiking 2.0 Pan-Mutuels 2.8 Events 1 .2 

Events 2.9 Fishing 1 .5 Boating/Charter Boating 2.8 Dancing, Night Life 1 .2 

Water Sports 1 .9 Other 1 .5 Camping/Hiking 23 Educational Programs 1 .2 

Educational Programs 1 .0 Water Sports 1 .5 Tennis 1 .7 Pool Activities 1 .2 

Pool Activities 1 .0 Educational Programs 1 .0 Sports to Watch Pari-Mutuels .6 

Fishing 1 .0 Cultural or Special (Baseball, etc.) 1 .7 Sports to Watch 

Sports to Watch Events .5 Fishing 1 .7 (Baseball, etc.) .6 

(Baseball, etc.) 1 .0 Pan-Mutuels .5 Golf 1 .1 Water Sports .6 

Golf .0 Sports to Watch Educational Programs 1 .1 Camping/Hiking .6 

Tennis .0 (Baseball, etc.) .0 Other 1 .1 Fishing .6 

Boating/Charter Boating .0 Tennis .0 Cultural or Special Tennis .6 

Pan-Mutuels .0 Boating/Charter Boating .0 Events .0 Other .0 

Types of Lodging Facilities Used 

Hotel/Motel 56 .2 Hotel/Motel 59.0 Hotel/Motel 48.9 Hotel/Motel 45.1 

Campground/RV Park 313 Friends and/or Relatives 26.2 Friends and/or Relatives 29.8 Friends and/or Relatives 43.7 

Friends and/or Relatives 6 .2 Campground/RV Park 6 .6 Campground/RV Park 10.6 Condo/Apt./Home (Rent) 4.2 

Condo/Apt./Home (Rent) 3 .1 Other 4.9 Condo/Apt./Home (Own) 6.4 Other 2.8 

Other 3 .1 Condo/Apt./Home (Rent) 33 Condo/Apt./Home (Rent) 43 Campground/RV park 2.8 

Timeshare Unit .0 Timeshare Unit .0 Timeshare Unit .0 Condo/Apt./Home (Own) 1 .4 

Condo/Apt./Home (Own) .0 Condo/Apt./Home (Own) .0 Other .0 Other .0 

Source : Derived from Visitor Profile Reports for the periods indicated from the Florida Department of Commerce, 1995 
Table 3.4 

Characteristics of Visitors Arriving by Automobile by Quarter for the Okaloosa County Area, 1995 (percents) 

w 

1st Quarter 2nd Quarter 3rd Quarter 4th Quarter 

Characteristic (Jan.-March) (April-June) (July-Sept.) (Oct.-Dec.) 

Age 

Male Female Male Female Male Female Male Female 

Infant to 6 yrs . 1 .6 4.5 2.9 4.7 10 .3 7 .6 3 .0 1 .5 

7 to 17 4 .9 9 .0 16 .5 20 .2 16 .2 11 .1 4 .5 9.0 

18 to 25 8.2 7.5 7.2 4.7 3.8 7.1 1 .5 3.0 

26 to 35 9 .8 9 .0 9 .4 10 .9 11 .9 18 .7 4 .5 6.0 

36 to 45 9.8 10 .4 21 .6 19 .4 27 .6 19 .7 14 .9 11 .9 

46 to 55 11 .5 16 .4 15 .1 17 .1 10 .3 14 .6 22 .4 22 .4 

56 to 65 26.2 23.9 17 .3 14 .0 10 .3 11 .1 20 .9 20.9 

66 or over 27 .9 19 .4 10 .1 93 9.7 10 .1 28 .4 25 .4 

Education 

K-l lth Grade .0 .0 .0 1 .6 

High School Graduate 3 .4 2.4 .8 .0 

Some College 37.9 23 .8 24.8 23 .8 

College Graduate 8.6 17 .9 24.0 28 .6 

Post-Graduate Work 34.5 36 .9 35 .5 38 .1 

Advanced Degree 3 .4 6 .0 3 .3 1 .6 

Currently Enrolled (Not 

High School) 6.9 11 .9 10 .7 6 .3 

Vocational-Technical 0 .0 .0 .0 

Other 5 .2 1 .2 .8 .0 
Table 3.4 (continued). 

1st Quarter 2nd Quarter 3rd Quarter 4'" Q uarter 

Characteristic (Jan .-March) (April-June) (July-Sept .) (Oct.-Dec.) 

Household Income 

$ 0 - 9,999 2.0 3 .8 .0 .0 

$ 10,000- 19,999 5 .9 2.5 2 .6 3 .6 

$ 20,000- 29,999 11 .8 6.3 9.6 18 .2 

$ 30,000- 39,999 19 .6 15 .2 13 .9 16 .4 

$ 40,000- 49,999 13 .7 11 .4 12.2 5 .5 

$ 50,000- 59,999 15 .7 13 .9 14.8 18 .2 

$ 60,000- 69,999 2.0 13 .9 8 .7 14 .5 

$ 70,000- 79,999 9.8 8 .9 13 .0 1 .8 

$ 80,000- 89,999 2.0 7.6 9.6 1 .8 

v' $ 90,000 - 99,9999 9.8 2.5 6.1 1 .8 

$ 100,000 - 124,999 .0 8.9 7.8 10 .9 

$ 125,000 - 149,999 .0 .0 .0 .0 

$ 150,000 and above 7 .8 5 .1 1 .7 7.3 

Visitor Expenditures 

Expenditures/Party/Trip $716.67 $853.80 $866.85 $435.54 

Number/Party 2.21 3 .18 3 .20 2.09 

Expenditures/Person/Trip 324 .29 268 .49 270.89 208.39 

Average Number of Nights 5.43 3 .72 4.76 4.62 

Expenditures/Person/Day 59.72 72.17 56.91 45 .11 

Expenditures/Party/Day 131 .98 229.52 182. 1 1 94.27 
Table 3 .4 (continued). 

W 

State 

1st Quarter 

(Jan.-March) State 

2nd Quarter 

(April-June) State 

3rd Quarter 

(July-Sept .) State 

4th Quarter 

(Oct.-Dec .) 

Origin Areas for Visitors 

Louisiana 13 .8 Louisiana 30.6 Texas 213 Louisiana 28.1 

Mississippi 10 .3 Mississippi 153 Louisiana 21 .3 Texas 15 .6 

Tennessee 8.6 Texas 11 .8 Mississippi 13 .9 Georgia 9.4 

Michigan 6 .9 Georgia 7 .1 Arkansas 9 .0 Alabama 9 .4 

Illinois 6 .9 Tennessee 3 .5 Alabama 6 .6 Mississippi 7 .8 

Alabama 6.9 Michigan 3.5 Tennessee 5.7 Missouri 4.7 

Ohio 5.2 Arkansas 3.5 Georgia 4.9 Arkansas 3.1 

Texas 5.2 New Jersey 2.4 Missouri 4.1 Illinois 3.1 

Missouri 3.4 Alabama 2.4 Illinois 1 .6 North Carolina 1 .6 

Ontario 3.4 New Hampshire 1 .2 New York 1 .6 New York 1 .6 

Georgia 3.4 Nevada 1 .2 Oklahoma 1 .6 Virginia 1 .6 

Virginia 3.4 Montana 1 .2 Kentucky .0 West Virginia 1 .6 

Missouri 1 .2 Michigan 1 .6 

South Carolina 1 .2 South Carolina 1 .6 

Minnesota 1 .2 Iowa 1 .6 
Table 3 .4 (continued). 

1st Quarter 2nd Quarter 3rd Quarter 4th Quarter 

Characteristic (Jan.-March) (April-June) (July-Sept .) (Oct.-Dec.) 

Vacation 50.4 Vacation 

Visit Friends Visit Friends 

and/or Relatives 41 .4 and/or Relatives 

Business (Co., Business (Co., 

Govt., Personal) 8 .6 Govt., Personal) 

Convention/Confer- Convention/Conference/Trade Show .0 ence/Trade Show 

Cruise .0 Cruise 

Honeymoon .0 Honeymoon 

v Other .0 Other 

Vacation 52.6 Vacation 

Visit Friends Visit Friends 

and/or Relatives 42.1 and/or Relatives 

Business (Co., Convention/ConferGovt., Personal) 5 .3 ence/Trade Show 

Convention/Confer- Business (Co., 

ence/Trade Show .0 Govt., Personal) 

Cruise .0 Cruise 

Honeymoon .0 Honeymoon 

Other .0 Other 

Reason for Trip 

69.4 Vacation 

Visit Friends 

17 .6 and/or Relatives 

Business (Co., 

12 .9 Govt., Personal) 

Honeymoon 

.0 Convention/Confer- 

.0 ence/Trade Show 

.0 Cruise 

.0 Other 

Additional Reasons for Trip 

39.3 Vacation 

Visit Friends 

35.7 and/or Relatives 

Business (Co., 

179 Govt., Personal) 

Convention/Confer7 .1 ence/Trade Show 

.0 Cruise 

.0 Honeymoon 

.0 Other 

65 .6 Visit Friends 

and/or Relatives 46.9 

23 .0 Vacation 31 .3 

Business (Co., 

9.8 Govt., Personal) 21 .9 

1 .6 Convention/Conference/Trade Show .0 

.0 Cruise .0 

.0 Honeymoon .0 

.0 Other .0 

61 .4 Vacation 53.3 

Visit Friends 

36.4 and/or Relatives 40.0 

Business (Co., 

2.3 Govt., Personal) 6.7 

Convention/Confer- 

.0 ence/Trade Show .0 

.0 Cruise .0 

.0 Honeymoon .0 

.0 Other .0 
Table 3 .4 (continued). 

1st Quarter 2nd Quarter 3rd Quarter 4th Quarter 

Characteristic (Jan .-March) Characteristic (April-June) Characteristic (July-Sept .) Characteristic (Oct.-Dec.) 

Attractions Visited 

w 

00 

Nat'1 Museum of 

Naval Aviation 

Spaceport USA 

John Ringling 

Museum Complex 

Gulfarium 

Universal Studios 

Parks/Preserves 

Bok Tower Gardens 

The Pier (St. 

Petersburg) 

Wooten's Airboat Tours 

The Shell Factory 

Miracle Strip 

10 .0 Amusement Park 17 .1 

6.7 Walt Disney Resort 

& Attractions 14 .3 

6.7 Parks/Preserves 11 .4 

6.7 Gulfarium 8.6 

6.7 Universal Studios 5.7 

6.7 Ernest Hemingway House 5.7 

3 .3 Everglades National Park 5.7 

Sightseeing Cruise Not 

33 At Attractions 2.9 

3.3 Gulf World Aquarium 2.9 

33 Sea World 2.9 

Miracle Strip Walt Disney Resort 

Amusement Park 25 .0 & Attractions 25 .0 

Gulfarium 143 St. Augustine 

Parks/Preserves 10.7 Alligator Farm 12.5 

Gulf World Aquarium 7.1 Spaceport USA 12.5 

The Shell Factory 7.1 Cypress Gardens 12.5 

Nat'1 Museum of Parks/Preserves 12.5 

Naval Aviation 7.1 St. Augustine 

Walt Disney Resort Historic District 12.5 

& Attractions 7.1 

Busch Gardens 3 .6 

John Ringling Museum 

Complex 3 .6 

Miami Metro Zoo 3 .6 
Table 3.4 (continued). 

1st Quarter 2nd Quarter 3rd Quarter 4th Quarter 

Characteristic (Jan.-March) Characteristic (April-June) Characteristic (July-Sept .) Characteristic (Oct.-Dec.) 

w 

Types of Lodging Facilities Used 

Friends and/or Relatives 32.3 Hotel/Motel 45.7 Condo/Apt./Home (Rent) 34.6 Friends and/or Relatives 45.8 

Hotel/Motel 30.6 Condo/Apt./Home (Rent) 28.7 Hotel/Motel 28.5 Hotel/Motel 27.8 

Condo/Apt./Home (Rent) 14.5 Friends and/or Relatives 17 .0 Friends and/or Relatives 23 .8 Condo/Apt./Home (Own) 13 .9 

Campground/RV Park 14.5 Campground/RV Park 5.3 Condo/Apt./Home (Own) 8.5 Condo/Apt./Home (Rent) 6.9 

Timeshare Unit 3 .2 Other 2.1 Campground/RV Park 3 .8 Campground/RV Park 4.2 

Condo/Apt./Home (Own) 3 .2 Timeshare Unit 1 .1 Timeshare Unit .8 Other 1 .4 

Other 1 .6 Condo/Apt./Home (Own) .0 Other .0 Timeshare Unit .0 

Source: Derived from Visitor Profile Reports for the periods indicated from the Florida Department of Commerce, 1995. 
Table 3.5 

Characteristics of Visitors Arriving by Automobile by Quarter for the Bay County Area, 1995 (percent) 

1st Quarter 2nd Quarter 3rd Quarter 4th Quarter 

Characteristic (Jan .-March) (April-June) (July-Sept .) (Oct .-Dec.) 

Age 

Male Female Male Female Male Female Male Female 

Infant to 6 yrs. 3.9 .7 3.2 7.9 6.5 4.5 .0 1 .8 

7 to 17 6.5 83 15 .2 15 .8 16 .4 19 .8 5.8 .0 

18to25 9.7 16.7 16 .0 18 .2 9.2 12 .1 5.8 10 .7 

26 to 35 17 .4 13 .9 16 .4 19 .0 19 .2 19.5 10 .9 6.2 

36 to 45 16 .1 15 .3 21 .2 13 .0 24.3 22 .4 17 .5 18 .8 

46 to 55 12 .9 16.0 12 .4 13 .0 11 .6 10.9 23.4 19 .6 

56 to 65 20.0 18 .1 9.6 8 .7 8.9 8 .3 19 .7 25.9 

66 or over 13 .5 11 .1 6.0 43 3.8 2.6 16 .8 17 .0 

Education 

K-11 th Grade .0 .0 .0 .0 

High School Graduate 1 .4 5 .8 2.5 8.4 

Some College 35 .5 26.4 30.7 35.9 

College Graduate 28.3 21 .4 233 20.6 

Post-Graduate Work 22.5 24.3 37.6 23.7 

Advanced Degree 1 .4 3 .5 1 .0 8.4 

Currently Enrolled (Not 

High School) 10.1 8.1 4.5 3.1 

Vocational-Technical .0 .0 .0 .0 

Other .7 .6 .5 .0 
Table 3.5 (continued). 

1st Quarter 2nd Quarter 3rd Quarter 4th Quarter 

Characteristic (Jan .-March) (April-June) (July-Sept .) (Oct.-Dec.) 

Household Income 

$ 0 - 9,999 4.4 3.2 1 .0 .0 

$ 10,000- 19,999 6.1 12 .7 6.0 5.5 

$ 20,000- 29,999 12.3 17 .2 12 .0 18 .2 

$ 30,000- 39,999 20.2 14.0 20.0 15 .5 

$ 40,000- 49,999 11 .4 13 .4 18 .0 19 .1 

$ 50,000- 59,999 15 .8 153 13 .0 16 .4 

c,, $ 60,000- 69,999 10.5 10.8 11 .5 8.2 

tv $ 70,000- 79,999 7.0 5 .7 8.0 5.5 

$ 80,000- 89,999 7.9 3 .2 4.0 5.5 

$ 90,000 - 99,9999 1 .8 2 .5 2.0 1.8 

$ 100,000 - 124,999 1 .8 .0 2.0 3.6 

$ 125,000 - 149,999 .9 .6 .5 .9 

$ 150,000 and above .0 13 2.0 .0 

Visitor Expenditures 

Expenditures/Party/Trip $711 .22 $723 .03 $654.67 $640.54 

Number/Party 2.18 2.97 3.00 1 .90 

Expenditures/Person/Trip 326.25 243 .44 218.22 337.13 

Average Number of Nights 10.95 4.06 5.58 9.37 

Expenditures/Person/Day 29.79 59.96 39.11 35.98 

Expenditures/Party/Day 64.95 178.09 117.32 6836 
Table 3 .5 (continued). 

w 

N 

N 

State 

1st Quarter 

(Jan .-March) State 

2nd Quarter 

(April-June) State 

3rd Quarter 

(July-Sept .) State 

4th Quarter 

(Oct .-Dec.) 

Origin Areas for Visitors 

Georgia 15 .2 Georgia 32.6 Georgia 28.7 Georgia 22.9 

Alabama 13 .0 Texas 9.7 Alabama 243 Alabama 12.2 

Tennessee 8.0 Alabama 9.1 Tennessee 7.9 Tennessee 8.4 

Michigan 5.1 Mississippi 63 Arkansas 5.4 Texas 6.1 

Texas 5.1 Louisiana 5 .1 Louisiana 4.5 Louisiana 3.8 

Mississippi 5.1 Tennessee 4.6 Texas 4 .5 Kentucky 3.8 

Ontario 3.6 Indiana 2.9 South Carolina 3 .5 Virginia 3.8 

Colorado 3.6 Arkansas 2.9 North Carolina 2 .5 Ohio 3.8 

Indiana 3.6 Illinois 2.9 Indiana 2 .5 North Carolina 3.1 

Wisconsin 2 .9 Kentucky 23 Illinois 2 .5 Mississippi 3.1 

Ohio 2.9 South Carolina 23 Ontario 3.1 

North Carolina 29 
Table 3 .5 (continued). 

1st Quarter 2nd Quarter 3rd Quarter 4th Quarter 

Characteristic (Jan .-March) Characteristic (April-June) Characteristic (July-Sept.) Characteristic (Oct.-Dec.) 

Visit Friends Vacation 

and/or Relatives 44.9 Visit Friends 

Vacation 43 .5 and/or Relatives 

Business (Co., Business (Co., 

Govt., Personal) 8.0 Govt., Personal) 

Honeymoon 3 .6 Honeymoon 

Convention/Confer- Convention/Confer- 

,, ence/Trade Show .0 ence/Trade Show 

Cruise .0 Cruise 

Other .0 Other 

Vacation 52.2 Vacation 

Visit Friends Visit Friends 

and/or Relatives 43 .5 and/or Relatives 

Convention/Confer- Business (Co., 

ence/Trade Show 43 Govt., Personal) 

Business (Co., Convention/ConferGovt., Personal) .0 ence/Trade Show 

Cruise .0 Cruise 

Honeymoon .0 Honeymoon 

Other .0 Other 

Reason for Trip 

73.1 Vacation 

Visit Friends 

20.0 and/or Relatives 

Business (Co., 

5.1 Govt., Personal) 

1 .1 Honeymoon 

Convention/Confer- 

.6 ence/Trade Show 

A Cruise 

.0 Other 

723 Vacation 41 .2 

Visit Friends 

22.8 and/or Relatives 35 .9 

Business (Co., 

4.0 Govt., Personal) 22.9 

1.0 Convention/Conference/Trade Show .0 

.0 Cruise .0 

.0 Honeymoon .0 

.0 Other .0 

Additional Reasons for Trip 

522 Visit Friends 

and/or Relatives 

43.5 Vacation 

Business (Co., 

4.3 Govt., Personal) 

Honeymoon 

.0 Convention/Confer- 

.0 ence/Trade Show 

.0 Cruise 

.0 Other 

Visit Friends 

59.1 and/or Relatives 43 .5 

36.4 Vacation 39.1 

Business (Co., 

1 .5 Govt., Personal) 17.4 

1 .5 Convention/Conference/Trade Show .0 

1 .5 Cruise .0 

.0 Honeymoon .0 

.0 Other .0 
Table 3.5 (continued). 

1st Quarter 2nd Quarter 3rd Quarter 4th Quarter 

Characteristic (Jan .-March) Characteristic (April-June) Characteristic (July-Sept.) Characteristic (Oct .-Dec.) 

Attractions Visited 

w 

N 

Parks/Preserves 11 .1 Miracle Strip Miracle Strip 

Miracle Strip Amusement Park 24.3 Amusement Park 

Amusement Park 6.7 Parks/Preserves 13 .5 Gulf World Aquarium 

Wakulla Springs 6.7 Walt Disney Resort Walt Disney Resort 

Universal Studios 6.7 & Attractions 13 .5 & Attractions 

Sea World 4.4 Wakulla Springs 5.4 Gulfarium 

Homosassa Springs 4.4 The Shell Factory 5.4 Sea World 

Arabian Nights 4.4 Sea World 5.4 Universal Studios 

Cypress Gardens 4.4 Spaceport USA 2.7 Busch Gardens 

St . Augustine Everglades Alligator Parks/Preserves 

Historic District 4.4 Farm 2.7 State Capitol 

Walt Disney Resort Everglades National Church Street Station 

& Attractions 4.4 Park 2 .7 

Miccosukee Indian 

Village 2 .7 

Walt Disney Resort 

40.3 & Attractions 14.8 

11 .2 Parks/Preserves 11 .1 

Cypress Gardens 7.4 

6.7 Gulf World Aquarium 7.4 

6.0 Wakulla Springs 7.4 

6.0 Homosassa Springs 7.4 

3 .7 St . Augustine 

3 .0 Alligator Farm 3 .7 

3 .0 Busch Gardens 3 .7 

1 .5 Marineland 3 .7 

1 .5 Gulfarium 3 .7 
Table 3.5 (continued) . 

w 

N 

Characteristic 

1st Quarter 

(Jan.-March) Characteristic 

2nd Quarter 

(April-June) 

3rd Quarter 

Characteristic (July-Sept .) Characteristic 

4th Quarter 

(Oct.-Dec.) 

Major Activity 

Rest and Relaxation 20.4 Beaches 26.3 Beaches 20.1 Rest and Relaxation 21 .6 

Beaches 17.4 Rest and Relaxation 25.2 Rest and Relaxation 17.8 Beaches 19.2 

Climate 15.4 Climate 18 .4 Shopping/Restaurants 12 .2 Shopping/Restaurants 18 .6 

Shopping/Restaurants 14.0 Shopping/Restaurants 8.5 Climate 11 .2 Climate 10.0 

Golf 5 .9 Pool Activities 5.0 Pool Activities 7.4 Golf 6 .2 

Pool Activities 4.5 Fishing 2.8 Attractions (and Attractions (and 

Attractions (and Attractions (and Daily Cruises) 5 .6 Daily Cruises) 5 .2 

Daily Cruises) 3 .9 Daily Cruises) 2.4 Water Sports 5 .2 Fishing 4.5 

Other 3 .4 Water Sports 2.0 Boating/Charter Boating 4.4 Historical Sites 3.1 

Dancing, Night Life 3 .1 Boating/Charter Boati ng 1.8 Fishing 3 .6 Boating/Charter Boating 2 .1 

Camping/Hiking 2.8 Dancing, Night Life 1.8 Golf 33 Camping/Hiking 2.1 

Fishing 2.8 Golf 1.7 Dancing, Night Life 2.6 Pool Activities 2 .1 

Historical Sites 2.2 Camping/Hiking 1.1 Historical Sites 1 .6 Other 1 .7 

Water Sports 1 .4 Historical Sites 1.1 Camping/Hiking 1 .5 Sports to Watch 

Boating/Charter Boating .8 Pari-Mutuels .9 Other 1 .2 (Baseball, etc.) 1 .0 

Pari-Mutuels .6 Educational Programs .6 Pari-Mutuels .7 Dancing, Night Life 1 .0 

Sports to Watch Tennis .2 Cultural or Special Water Sports .7 

(Baseball, etc.) .6 Cultural or Special Needs .6 Tennis .7 

Tennis .6 Events .2 Tennis .4 Pari-Mutuels .3 

Cultural or Special Other .2 Sports to Watch Cultural or Special 

Events 3 Sports to Watch (Baseball, etc.) .4 Needs .0 

Educational Programs .0 (Baseball, etc.) .0 Educational Programs .2 Educational Programs .0 
Table 3 .5 (continued). 

1st Quarter 2nd Quarter 3rd Quarter 4th Quarter 

Characteristic (Jan .-March) Characteristic (April-June) Characteristic (July-Sept .) Characteristic (Oct.-Dec.) 

Types of Lodging Facilities Used 

Friends and/or Relatives 38.4 Hotel/Motel 52.7 Hotel/Motel 40.3 Friends and/or Relatives 42.0 

Hotel/Motel 33.8 Friends and/or Relatives 21 .7 Friends and/or Relatives 28.2 Hotel/Motel 32.6 

Condo/Apt./Home (Rent) 113 Condo/Apt./Home (Rent) 15 .2 Condo/Apt./Home (Own) 14.4 Condo/Apt./Home (Rent) 9.4 

Campground/RV Park 8.6 Campground/RV Park 5 .4 Condo/Apt./Home (Rent) 9.7 Condo/Apt./Home (Own) 8 .0 

Condo/Apt./Home (Own) 4.6 Condo/Apt./Home (Own) 3 .8 Campground/RV Park 6.9 Campground/RV Park 6.5 

Timeshare Unit 2.0 Timeshare Unit .5 Timeshare Unit .5 Other 1 .4 

Other 1 .3 Other .5 Other .0 Timeshare Unit .0 

Source: Derived from Visitor Profile Reports for the periods indicated from the Florida Department of Commerce, 1995 . 
Table 3.6 

Characteristics of Visitors Arriving by Air by Quarter for the Bay County Area, 1995 (percents) 

w 

N 

Characteristic 

1st Quarter 

(Jan .-March) 

2nd Quarter 

(April-June) 

3rd Quarter 

(July-Sept .) 

4th Quarter 

(Oct.-Dec.) 

Age 

Male Female Male Female Male Female Male Female 

Infant to 6 yrs. .0 .0 5.9 13 .9 2.0 3.4 2.9 4.8 

7 to 17 .0 .0 2.9 .0 163 .0 .0 .0 

18 to 25 8.8 15 .4 11 .8 2.8 4.1 10 .3 2.9 .0 

26 to 35 5.9 11 .5 17 .6 19 .4 20.4 24.1 14.7 28.6 

36 to 45 412 19 .2 29.4 19 .4 20.4 24.1 44.1 19.0 

46 to 55 29.4 19 .2 14 .7 13 .9 26.5 24.1 20.6 23 .8 

56 to 65 14 .7 15 .4 17 .6 19 .4 8.2 10 .3 11 .8 14.3 

66 or over .0 19 .2 .0 11 .1 2.0 3.4 2.9 9.5 

Education 

K-11th Grade 2.1 .0 .0 .0 

High School Graduate .0 2.3 .0 4.7 

Some College 12.5 22.7 17.8 7.0 

College Graduate 22.9 20.5 24.4 14.0 

Post-Graduate Work 43.7 31.8 33.3 37.2 

Advanced Degree 12.5 11.4 133 20.9 

Currently Enrolled (Not 

High School) 6.2 6.8 11 .1 14.0 

Vocational-Technical .0 .0 .0 .0 

Other .0 4.5 .0 23 
Table 3 .6 (continued). 

1st Quarter 2nd Quarter 3rd Quarter 4th Quarter 

Characteristic (Jan .-March) (April-June) (July-Sept .) (Oct.-Dec.) 

Household Income 

$ 0 - 9,999 .0 .0 .0 .0 

$ 10,000- 19,999 2.3 7.1 4.5 2.4 

$ 20,000- 29,999 4.7 9.5 .0 9.8 

$ 30,000- 39,999 14.0 9.5 11 .4 9.8 

$ 40,000- 49,999 9.3 23 .8 9.1 9.8 

$ 50,000- 59,999 27.9 11 .9 20.5 7.3 

w $ 60,000- 69,999 14.0 143 9 .1 26.8 

$ 70,000- 79,999 11 .6 4.8 11 .4 12 .2 

00 $ 80,000- 89,999 7.0 4.8 4.5 2.4 

$ 90,000 - 99,9999 4.7 2.4 4.5 .0 

$ 100,000 - 124,999 4.7 4.8 6 .8 17 .1 

$ 125,000 - 149,999 .0 .0 2 .3 .0 

$ 150,000 and above .0 7.1 15.9 2.4 

Visitor Expenditures 

Expenditures/Party/Trip $391 .21 $711 .88 $894.40 $671.75 

Number/Party 125 1 .59 1 .73 128 

Expenditures/Person/Trip 312.97 447.72 516.99 524.80 

Average Number of Nights 5.27 7.52 9.18 6 .05 

Expenditures/Person/Day 59.39 59.54 5632 86 .74 

Expenditures/Party/Day 74.23 94.66 97.43 111.03 
Table 3.6 (continued). 

1st Quarter 2nd Quarter 3rd Quarter 4th Quarter 

State (Jan .-March) State (April-June) State (July-Sept .) State (Oct .-Dec.) 

Origin Areas for Visitors 

w 

N 

Wisconsin 14 .6 Tennessee 11 .4 

Virginia 12 .5 Ohio 9.1 

Texas 8.3 Maryland 9.1 

Pennsylvania 6.2 Missouri 6.8 

Ontario 6.2 California 6.8 

New York 6.2 Texas 4.5 

Ohio 4.2 Wisconsin 4.5 

Missouri 42 Georgia 4.5 

Michigan 4.2 Virginia 4.5 

Maryland 4.2 Arizona 4.5 

Georgia 4.2 

Tennessee 

Virginia 

California 

Georgia 

New Jersey 

Kentucky 

Pennsylvania 

North Carolina 

Ohio 

Texas 

Washington 

Missouri 

Massachusetts 

Louisiana 

Rhode Island 

17.8 

133 

11 .1 

8.9 

4.4 

4.4 

4.4 

4.4 

2.2 

2.2 

2.2 

2.2 

2.2 

2.2 

2.2 

Virginia 18 .6 

Maryland 11 .6 

New York 7.0 

South Carolina 4.7 

Texas 4.7 

Michigan 4.7 

Tennessee 4.7 

Georgia 4.7 

Colorado 4.7 

California 4.7 
Table 3.6 (continued). 

lst Quarter 2nd Quarter 3rd Quarter 4th Quarter 

Characteristic (Jan .-March) Characteristic (April-June) Characteristic (July-Sept .) Characteristic (Oct.-Dec.) 

Business (Co., Business (Co., 

Govt., Personal) 62.5 Govt., Personal) 

Visit Friends Vacation 

and/or Relatives 25.0 Visit Friends 

Vacation 8.3 and/or Relatives 

Convention/Confer- Convention/Conference/Trade Show 4.2 ence/Trade Show 

Cruise .0 Cruise 

Honeymoon .0 Honeymoon 

Other .0 Other 

Vacation 60.0 Vacation 

Convention/Confer- Visit Friends 

ence/Trade Show 40.0 and/or Relatives 

Visit Friends Business (Co., 

and/or Relatives .0 Govt., Personal) 

Business (Co., Convention/ConferGovt., Personal) .0 ence/Trade Show 

Cruise .0 Cruise 

Honeymoon .0 Honeymoon 

Other .0 Other 

Reason for Trip 

Business (Co., 

36.4 Govt., Personal) 

34.1 Vacation 

Visit Friends 

29.5 and/or Relatives 

Convention/Confer- 

.0 ence/Trade Show 

A Cruise 

.0 Honeymoon 

.0 Other 

Additional Reasons for Trip 

66.7 Vacation 

Visit Friends 

33 .3 and/or Relatives 

Business (Co., 

.0 Govt., Personal) 

Convention/Confer- 

.0 ence/Trade Show 

.0 Cruise 

.0 Honeymoon 

.0 Other 

Business (Co., 

533 Govt., Personal) 69.8 

24.4 Visit Friends 

and/or Relatives 20.9 

17.8 Vacation 93 

Convention/Confer4.4 ence/Trade Show .0 

.0 Cruise .0 

.0 Honeymoon .0 

.0 Other .0 

833 Visit Friends 

and/or Relatives 66.7 

16 .7 Vacation 33.3 

Business (Co., 

.0 Govt., Personal) .0 

Convention/Confer- 

.0 ence/Trade Show .0 

.0 Cruise .0 

.0 Honeymoon .0 

.0 Other .0 
Table 3 .6 (continued). 

1st Quarter 2nd Quarter 3rd Quarter 4th Quarter 

Characteristic (Jan.-March) Characteristic (April-June) Characteristic (July-Sept.) Characteristic (Oct.-Dec.) 

Attractions Visited 

Parks/Preserves 14.3 Parks/Preserves 50.0 Miracle Strip 

Walt Disney Resort Miracle Strip Amusement Park 273 

& Attractions 14.3 Amusement Park 10.0 Parks/Preserves 27.3 

Ybor City 7.1 Spaceport USA 10.0 Walt Disney Resort 

Gulf World Aquarium 7.1 & Attractions 18.2 

State Capitol 7.1 Busch Gardens 9.1 

The Pier Florida Sports 

(St. Petersburg) 7.1 Hall of Fame 9.1 

Bayside Market Place 7.1 Wakulla Springs 9.1 

Merritt Island 

National Wildlife 7.1 

Spaceport USA 7.1 

None Listed 
Table 3 .6 (continued). 

Characteristic 

1st Quarter 

(Jan--March) Characteristic 

2nd Quarter 

(April-June) Characteristic 

3rd Quarter 

(July-Sept .) Characteristic 

4th Quarter 

(Oct .-Dec.) 

Major Activity 

Shopping/Restaurants 20.8 Beaches 22 .2 Shopping/Restaurants 20.5 Shopping/Restaurants 32.0 

Climate 19.8 Shopping/Restaurants 17 .4 Beaches 18 .5 Climate 14.0 

Beaches 19.8 Rest and Relaxation 17 .4 Climate 12 .6 Rest and Relaxation 14.0 

Rest and Relaxation 15 .1 Climate 153 Pool Activities 12 .6 Beaches 12.0 

Dancing, Night Life 5 .7 Boating/Charter Boating 5 .6 Rest and Relaxation 12 .6 Golf 12.0 

Attractions (and Pool Activities 5 .6 Dancing, Night Life 5.3 Historical Sites 4.0 

Daily Cruises) 4.7 Water Sports 4.2 Boating/Charter Boating 4.6 Cultural or Special 

w Water Sports 2.8 Dancing, Night Life 4.2 Water Sports 4.0 Events 4.0 

Pool Activities 2.8 Fishing 2.8 Golf 2.6 Water Sports 2.0 

Fishing 1 .9 Tennis 1 .4 Fishing 2.0 Pool Activities 2.0 

Golf 1 .9 Golf 1 .4 Historical Sites 2.0 Boating/Charter Boating 2.0 

Boating/Charter Boating .9 Historical Sites 1 .4 Attractions (and Dancing, Night Life 2.0 

Historical Sites .9 Attractions (and Daily Cruises) 2.0 Sports to Watch 

Camping/Hiking .9 Daily Cruises) .7 Tennis .7 (Baseball, etc.) .0 

Sports to Watch Other .7 Sports to Watch Tennis .0 

(Baseball, etc.) .9 Sports to Watch (Baseball, etc.) .0 Fishing .0 

Tennis 9 (Baseball, etc.) .0 Pari-Mutuels .0 Attractions (and 

Pari-Mutuels .0 Pari-Mutuels .0 Camping/Hiking .0 Daily Cruises) .0 

Cultural or Special Camping/Hiking .0 Cultural or Special Pari-Mutuels .0 

Events .0 Cultural or Special Events .0 Camping/Hiking .0 

Educational Programs .0 Events .0 Educational Programs .0 Educational Programs .0 

Other .0 Educational Programs .0 Other .0 Other .0 
Table 3.6 (continued). 

1st Quarter 2nd Quarter 3rd Quarter 4th Quarter 

Characteristic (Jan.-March) Characteristic (April-June) Characteristic (July-Sept .) Characteristic (Oct.-Dec.) 

Types of Lodging Facilities Used 

Hotel/Motel 55 .8 Hotel/Motel 43.5 Hotel/Motel 55 .3 Hotel/Motel 

w Friends and/or Relatives 30.8 Friends and/or Relatives 28.3 Condo/Apt./Home (Rent) 213 Friends and/or Relatives 

Other 9.6 Condo/Apt./Home (Rent) 13 .0 Friends and/or Relatives 14.9 Other 

Timeshare Unit 3 .8 Condo/Apt./Home (Own) 10 .9 Other 43 Condo/Apt./Home (Rent) 

Campground/RV Park .0 Other 43 Condo/Apt./Home (Own) 43 Condo/Apt./Home (Own) 

Condo/Apt./Home (Own) .0 Campground/RV Park .0 Campground/RV Park .0 Campground/RV Park 

Condo/Apt./Home (Rent) .0 Timeshare Unit .0 Timeshare Unit .0 Timeshare Unit 

60.5 

25 .6 

4.7 

4.7 

23 

2.3 

.0 

Source: Derived from Visitor Profile Reports for the periods indicated from the Florida Department of Commerce, 1995. 
Description of Tourism Within Individual Subareas of the Region 

In this section, each of the three major tourist areas in the study region are examined. These are 

the Pensacola (Escambia and Santa Rosa Counties), Fort Walton Beach and Destin (Okaloosa 

County) and Panama City (Bay County) areas . For each, the overall economic impacts of tourism 

in the area are discussed, some of the major tourist attractions are identified, and the general 

characteristics of the industry in the area are delineated. Any such list must be selective because 

the industry is constantly growing and changing. The intent is only to indicate the potential range 

of tourist activities in subareas within the study area. 

The Pensacola Area 

Tourism is a major source of employment and economic activity in the Pensacola area. A 1995 

study (Huth and Stewart 1995) estimated that the Pensacola Metropolitan Area had roughly 4.0 

million visitors in 1994. These visitors were estimated to have had a total economic impact 

amounting to $380 million, to have generated $150 million in personal income and to have 

generated nearly 10,000 jobs. Survey data for the area (Martin 1995) indicated that these visitors 

tended to have similar socioeconomic characteristics as those shown in Table 3 . More than 86 

percent arrived by automobile with more than 50 percent arriving via Interstate 10 from origin 

areas that are primarily within the Southern United States . More than 75 percent listed 

vacationing as the primary reason for their visit and nearly one-half indicated that the area's 

beaches were the primary factor that attracted them to the area. This proportion was 8 times 

greater than the proportion mentioned for any other factor . More than 80 percent spent one or 

more nights in the area, nearly 61 percent stayed in hotel or motels and another 14 percent stayed 

in condominiums with 84 percent staying in either Pensacola or Pensacola Beach. They are 

estimated to have spent an average of $288 per day per party (Ruth and Stewart 1995) with an 

average party size of 1 .5 to 2.5 people. 

Among the area's key attractions is the Gulf Islands National Seashore. Established in 1971, it 

preserves more than 14 miles of Santa Rosa Island and includes both the old Naval Live Oaks 

Reservation and historic Fort Pickens. It is highly visited as an area abundant in birds of a variety 

of species and beautiful beaches. Another central attraction is the Naval Air Station which began 

in 1825. It provides an overview of U.S. Naval History. It includes the Naval Aviation Museum 

which recounts the story of naval aviation in the United States . It also includes such historic sites 

as Fort Barrancas which with Ft. Pickens was built to defend the harbor . Other often visited sites 

include Old Christ Church, and numerous historic homes and facilities in the Historic District of 

Pensacola. 

Coupled with its beaches, its substantially developed hotel, motel and marina areas, the 

Pensacola area is a major center for such tourist activities as birding, fishing, swimming, scuba 

diving, and serves as a locus for those interested in historical tourism, especially that related to 

the U.S. military. 

3-34 
The Fort Walton Beach and Destin Area 

This area is estimated (Okaloosa County Tourist Development Council 1996) to have about 2 .6 

million visitors annually with an estimated economic impact of roughly $440 million dollars per 

year. As with the Pensacola area, a variety of the visitors to the area arrive by automobile (nearly 

90 percent) and nearly 84 percent come to the area on vacation. The area has appeared as among 

the top ten destinations of automobile visitors to Florida for several years. Visitors to the area 

rate beaches as the key attraction of the area, and the area has a variety of tourist facilities 

including an estimated 11,500 hotel, motel, and townhouse units . 

The beaches in the Fort Walton, Destin, and Beaches of South Walton area include beaches, such 

as Grayton Beach, that are considered among the best in the Nation. It is a major center for 

charter and party boat traffic and is the home of the huge Eglin Air Force Base, and such 

attractions as the Air Force Armament Museum, and the Indian Temple Mound Museum. It is the 

natural resource base of the area, however, that is at the center of its tourism industry. 

The Panama City Area 

The Panama City Area like the rest of the Florida Panhandle shows a codependency on military 

installations and tourism. The area's two largest employers are the Tyndall Air Force Base (more 

than 7,000 employees) and the Coastal System Station (more than 3,300 employees), but the role 

of tourism in the local economy is also apparent (Strategic Planning Group, Inc. 1995) . 

The area ranks second only to the Orlando/Disney World area as a destination for visitors to 

Florida arriving by automobile, and it is estimated that about 3 .4 million persons visited the area 

in 1994 (Strategic Planning Group Inc. 1995). Vacationing is the major reason for such visits as 

in other areas of the Panhandle, and the general socioeconomic characteristics of tourists tends to 

be as noted in Tables 5 and 6. The area contains more than 17,000 hotel and motel rooms and 

condominiums available for rent. Overall, it is estimated that the economic impacts of tourism 

are more than $730 million per year and that tourism creates more than 11,000 local jobs 

(Strategic Planning Group, Inc. 1995). 

Among the area's often visited attractions are both natural resource and human-constructed 

facilities . For example, the Miracle Strip Amusement Park is Florida's oldest amusement park. 

Other constructed amusements include Shipwreck Island, Gulf World, the Museum of Man in the 

Sea, the Ebro Greyhound Track, and a variety of theaters, restaurants, marinas, and other 

facilities . The area's beaches are among the best in the Nation and the area is the home for the 

largest fleet of charter boats in the Southeastern United States . Scuba diving, snorkeling, 

jetskiing, parasailing are other major activities in the area. 

Whether examined relative to the total study region or for each of the three major areas, it is 

obvious that tourism, and tourism based primarily on the beauty of the natural resources of the 

area, particularly its beaches, is central to the economy of the Panhandle. 

3-35 
Major Stakeholders in the Tourism Industry in the Panhandle of Florida 

The analysis provided above suggests that a number of different groups are likely to be 

particularly concerned with any form of activity that may impact tourism in the Panhandle of 

Florida. Although any listing of such groups is likely to omit one or more important groups, it is 

critical to attempt to identify some of those likely to be particularly concerned. Such a 

preliminary identification is attempted in this section. 

Among those interested in the potential effects of any development on tourism are the public 

officials of the state and local areas. Tourist-related taxes are a major source of revenue for the 

state and local areas . Although not discussed above, analysis of the sources noted for each of the 

three areas suggests that tourism is a major source of local and state tax revenue. Although public 

officials would always be concerned about any development that might potentially impact a 

major industry, the financial dependence of their jurisdictions on tourism will likely enhance 

their interest . 

Clearly, those involved in the provision of food and lodging services to tourists will be interested 

in any potential OCS-related development. This includes all major hotel chains in the Nation as 

well as thousands of individual condominium owners who rent units privately. This is a 

substantial source of economic impacts and their stakeholders will be keenly interested in what is 

likely to happen to the area. Similarly, the restaurant industry is a major employer and is likely to 

show substantial concern related to any factor affecting the size of tourist populations . 

Those involved in the provision of party and charter boat services will also be major 

stakeholders . As the discussion above noted, this activity is highly dependent on open access to 

gulf waters and to adequate fisheries' stocks . Stakeholders from this industry are likely to be 

interested both in what impacts any proposed development will have on the operation of their 

boats and on the stock of sports-related fish species. 

Operators of amusement, theme-park and similar facilities that are dependent on tourists who, as 

noted above come to the area primarily to utilize the beaches, are important stakeholders . As the 

data in Tables 5 and 6 suggest, in the eastern part of the area, this includes not only local 

facilities but those related to the Disney entertainment complexes as well. Such stakeholders will 

likely view any factor negatively impacting the beaches as likely to decrease their customer base. 

Those involved in the management of the area's national and state parks, sanctuaries, preserves, 

and other natural resource conservation areas are also obvious stakeholders . The area's numerous 

bird, fish, and other species are both tourist attractions and objects for preservation . This group is 

likely to be particularly environmentally sensitive and an active stakeholder. 

A large tier of service industry representatives will be stakeholders . These include those 

operating small entertainment-related businesses ; persons involved in equipment rental of waterrelated recreational equipment; real estate developers involved in the selling of beach-related 

properties; those providing gas, oil and service for marine equipment, and similar groups . These 

represent the secondary and tertiary service providers who are very dependent on tourism. 

3-36 
The tourists themselves are also stakeholders . Although this is obvious, there are several aspects 

about tourism in the area that make it likely that such groups could play a more active role than 

simply that of customers who would desert the area, if its tourist-related attractions were 

depreciated in any manner. Among these characteristics is the fact that the area represents a 

region that is heavily visited by automobile visitors from southern states in close proximity to the 

Panhandle. Unlike areas with large proportions of visitors who arrive by air, this area likely 

represents one of the few high quality beach areas available to many visitors to the area. They 

may simply not have the resources to visit alternative sites that require more expensive air travel . 

As a result, the loss of any beach or other resource in this area means that they would lose their 

beach access . Under such conditions, it appears likely that they may take a more activistic role as 

stakeholders . Similarly, the socioeconomic characteristics of the area's tourist may also make 

them more likely to play an active role . That is, they appear to be age groups for whom time for 

group-related actions is available, and they appear to have the economic and educational 

resources necessary to knowledgeably participate in group-related activities . 

In sum, the important role of tourism in the Panhandle of Florida, coupled with the nature of such 

tourism and the characteristics of tourists in the area, make it apparent that any activity that may 

potentially impact tourism in the area will result in a number of what are likely to be quite active 

stakeholder groups. Tourism is likely to bring a multitude of stakeholders into any discussion of 

the effects of other forms of development on the area. 

3-37 
The Potential Impacts of OCS Development on Tourism in The Florida Panhandle 

Tourism and its impacts have been extensively examined. The tourism literature is extensive 

(Seaton et al . 1994 ; Manfredo 1992) and includes examinations of what the nature of tourism is 

and of means of both examining its specific forms and their short-term and long-term impacts 

(Gunn 1994). Its demographic (Philipp 1993); temporal (Hartmann 1986); geographic (Hughes 

1992), international (Crick 1989), and socioeconomic dimensions (Cohen 1979) have all been 

extensively examined from economic (Steele 1995), social (Cohen 1988a), anthropological 

(Graburn 1983), marketing (Cohen 1988b), political (Britton 1982), and numerous other 

perspectives (Seaton et al . 1994). It is thus an increasingly complex area that is impossible to 

examine in all its dimensions as they relate to OCS, or any other form of development, within 

any single work. 

Similarly, tourism has been extensively examined as its relates to OCS and related forms of 

developments (Dornbusch & Company 1987; A.T. Kearney Inc. 1991 ; French et al . 1983) . 

However, available analyses do not examine specific OCS impacts for the study region for the 

most recent patterns of development projected for the area. Therefore, any discussion of the 

impacts of current or projected OCS development on tourism in the area must be largely 

speculative. 

The general literature on tourism (Gunn 1994; Seaton et al . 1994) and that in impact assessment 

(Leistritz and Murdock 1981 ; Murdock et al . 1991), however, suggest that potential OCS 

development-related impacts can be examined through the categories of factors that are likely to 

become the focus of interest of the stakeholders noted above. The likely perceptions of 

stakeholders are examined as they relate to potential environmental, economic, demographic, 

public service and fiscal, and social impacts. 

Before beginning the discussion of each of these areas of potential impacts, it is important to note 

that OCS development off the Florida Coast is likely to involve primarily gas-related rather than 

oil-based developments and that the servicing of any developments off the Florida Coast is likely 

to occur largely from non-Florida sites . This means that the potential impacts will likely be of a 

different form than often associated with oil development and that direct socioeconomic impacts 

may be smaller than those which have occurred at other sites in the Gulf. Despite these 

characteristics, we believe that stakeholders' views of the impacts of OCS development on 

tourism will result as much from perceived reality as from the evolution of actual events and thus 

must be carefully delineated. 

The major threats likely to be perceived from OCS-related activity are environmental. Fear that 

such development could depreciate the aesthetic or use quality of beaches, of the coastal waters, 

and of fish and other wildlife in the area will be the center of attention because of the effects of 

changes in these factors on tourism. In fact, these environmental resources are so central to the 

economic base of the area that any perceived threat to them is likely to galvanize stakeholders 

who often hold very different views on development. Thus, business-related stakeholders as well 

as environmentalists and preservationists are likely to jointly seek to protect beach habitats, 

wildlife and other natural resources. Because tourism in the area is largely environmentally-based 

3-38 
tourism, environmental issues will likely dominate any debate on the benefits and costs of OCS 

development. 

The perceived environmental impacts will likely also be manifested as economic concerns, 

particularly by business-related stakeholders . Given the estimated $1 .5 billion impact of tourism 

in the area, concerns will be raised about the effects of even small risk events, like an oil spill, on 

tourism. Given that each day of potential disruption in this industry could have a $4.1 million 

impact, it is likely that few risks will be so small as to not be of interest to stakeholders . Other 

economic issues may relate to workforces, if OCS related workforces were to locate in the area. 

Some previous analysis (French et al . 1983) has suggested concern about how such personnel 

would effect tourist's perceptions of the area. Although this concern appears to be highly 

speculative given that no negative perceptions have apparently occurred due to the presence of 

military personnel in the area, the mixing of the oil and tourism cultures will likely be of concern 

to some stakeholders . 

In regard to economic concerns, the paradox is that OCS activity, because the servicing of the 

industry will likely be from sites in other parts of the Gulf, will likely have small direct impacts. 

This will reduce such potentially problematic impacts as competition between boating and OCS 

activity but at the same time reduce potential economic benefits. As a result, the potential 

economic risks to tourism of OCS development, however small, will likely be evaluated relative 

to very small economic benefits. This is likely to create a perception of "much to lose and little to 

gain" . 

The demographic impacts are likely to be small, particularly if the servicing of the industry 

occurs from non-Florida sites. The potential differences in the characteristics of OCS workers 

and tourists noted above is a potential, if unlikely, concern. What is more likely is that some 

indirect and induced economic activity associated with OCS development will lead to increased 

levels of population growth. To the extent that OCS-related population growth is seen as 

promoting general economic growth, it may be seen as a positive impact by business-related 

stakeholders . If such growth were to be extensive, environmental and related stakeholders may 

perceive it as unduly increasing pressure on fragile natural ecosystems. 

Public service effects will likely be perceived as minimal, except if some small risk event such as 

an oil spill were to occur. Questions are likely to be raised about the level of services necessary 

and available to handle any such event in order to minimize the duration and extent of its effects 

on beaches, habitat and wildlife. Fiscal impacts will be highly interrelated with those of 

economic impacts on tourism and will be of keen interest to public sector stakeholders . Given the 

current royalty payment system where payments go to the federal government, state and local 

government stakeholders are likely to be in a similar situation to the paradox noted above relative 

to economic stakeholders . If the direct economic benefits are small, oil-based public royalty and 

other revenues are not available, and even a small risk event could seriously disrupt tourist-based 

revenue flows, they are likely to express concerns about OCS-related developments. 

The social impacts of OCS development may be perceived as extensive. Fear, perceptions of 

risk, aesthetic and similar concerns will likely play prominent roles in any debate about OCS 

3-39 
development. Similarly, discussions related to OCS development are likely to result in the 

creation of increased friction between some development-related groups and some tourism and 

environmental groups. Given the economic importance of tourism in the area and given the 

extent to which that tourism is based on natural resources and the environment, it is difficult to 

imagine that substantial social conflict will not occur as a result of OCS development. Whatever 

the actual technical risks, risks will be perceived to be present and will create concern. It seems 

highly unlikely that extensive OCS development will occur in the area without substantial social 

conflict and its resultant complications for the social integration of communities in the siting 

area. 

Conclusions 

Overall, this review of available information on tourism in the Florida Panhandle Study Area 

suggests that tourism must be a major focus of any analysis of OCS-related impacts. It is a major 

economic force in all parts of the study region and, with expected continued cutbacks in military 

expenditures in the region, will likely become of increasing importance. It is a tourism based 

largely on tourists' aesthetic appreciation of natural resource and environmental-based 

characteristics of the area. Any perceived threat to the beaches, waters, and wildlife habitats of 

the area will be of concern to nearly all stakeholder groups in the area because of their economic 

as well as environmental importance. Under such conditions, tourism interests and concerns must 

be extensively addressed and analyzed in any attempts to assess the impacts of OCS development 

off the Florida Panhandle. 

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CHAPTER 4 

MAJOR MILITARY BASES 

The major military bases in the study area include Naval Air Station Pensacola and associated 

facilities located near Pensacola, the Eglin Air Force Base complex near Fort Walton Beach, 

and the Coastal Systems Station and Tyndall Air Force Base near Panama City. The nature of 

these bases is described in the sections that follow . 

Naval Air Station Pensacola 

Known as "The Cradle of Naval Aviation," the Naval Air Station Pensacola and associated 

facilities at Saufley Field, Corry Station, and Whiting Field serves as the launching point for the 

flight training of every Naval Aviator, Naval Flight Officer (NFO), and Enlisted Air crewman. 

As of January 1996, the Pensacola Naval Complex in Escambia and Santa Rosa Counties had 

approximately 10,700 military personnel and 6,300 civilian employees (Nichols 1996) . 

The headquarters of the Naval Education and Training Command, one of the largest Navy shore 

commands, is located at Naval Air Station (NAS) Pensacola. The Chief of Naval Education and 

Training (CNET) is a vice admiral . CNET oversees a network of training and education 

programs and activities that extend from coast to coast and to ships at sea (Navy Pensacola 

1996) . 

CNET is responsible directly to the Chief of Naval Operations for the education and training of 

officer and enlisted Navy and Marine Corps personnel. This training includes recruit, technical 

skill, precommissioning for officers, warfare specialty, fleet individual and team, on- and offduty education programs, and foreign students from many nations . A staff of about 28,000 

military and civilian personnel conducts Navy education and training programs for nearly 34,000 

students (nationwide) every day. The CNET headquarters staff that manages this huge network 

from Pensacola consists of over 300 military and civilian personnel. 

Training Air Wing SIX (TraWing SIX), with headquarters at NAS Pensacola, encompasses 

primary, intermediate, and advanced Naval Flight Officer and E2/C2 Pilot Training. The wing 

commander is overall commander of NAS Pensacola and aviation training squadrons VT-4, VT10, and VT-86 . Supported by the air station, the Wing SIX mission is to plan for, supervise, 

support, and conduct flight training of quality student Naval Aviators, Naval Flight Officers, 

Undergraduate Navigators, and International Military to satisfy service requirements . Among a 

myriad of other responsibilities, TraWing SIX also provides liaison between local operational 

units and the Chief of Naval Air Training, coordinates training airspace within the Pensacola 

area, and is the designated command for disaster control and hurricane procedures . 

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Naval Technical Training Center (NTTC) Corry Station is the site of a number of training 

programs. These include cryptology, electronic warfare, optical and instrumentation schools, and 

a joint (multi service) aviation warfare training school . 

The Naval Education and Training Program Management Support Activity (NETPMSA) at 

Saufley Field has the mission of designing, developing, and administering the Navy's Enlisted 

Advancement System. NETPMSA also provides information systems support, administers the 

NROTC and NJROTC programs, manages the Navy's Voluntary Education Program, including 

CAMPUS offices throughout the world, oversees the Navy's General Library Program, and 

designs and delivers training programs for the Chaplains' Corps (Navy Pensacola 1996). 

Eglin Air Force Base 

The Eglin Complex is one of the largest Air Force bases in the world, encompassing 724 square 

miles of land area and 86,500 square miles of water ranges in the Gulf of Mexico. Established in 

1935, the military reservation has three active airfields (Eglin Main, Duke Field, and Hurlburt 

Field), as well as several auxiliary fields . Eglin is the home of the Air Force Materiel Command's 

Air Force Development Test Center (AFDTC), where the Air Force has developed, tested, and 

evaluated nearly every non-nuclear munition in its inventory for the past 50 years . Its mission is 

accomplished through its two component wings, the 46th Test Wing and the 96th Air Base Wing. 

The base has approximately 16,600 military personnel and 5,800 civilian employees (including 

non-appropriated fund employees and Army-Air Force Exchange Services employees) (Greater 

Fort Walton Beach Chamber of Commerce, 1996). 

The McKinley Climatic Laboratory is capable of testing military hardware as large as bombers in 

environments ranging from minus 65 to plus 165 degrees F with 100 mph winds, icing, clouds, 

rain, and snow. 

Other facilities unique to Eglin are the Guided Weapons Evaluation Facility (GWEF) and the 

Pre-flight Integration of Munitions and Electronic Systems (PRIMES) Facility. The GWEF is the 

only facility of its kind able to test the complete spectrum of weapon seekers under one roof, 

including millimeter wave, laser, infrared, radio frequency, and electro-optical. The PRIMES 

facility provides ground test and evaluation support for aircraft electronic and weapons systems. 

A fiber-optic data link connects the PRIMES to the GWEF for laboratory simulation tests of 

weapon seekers. 

The AFTDC is host to approximately 50 associate units. These units include the ASAF Air 

Warfare Systems Center, the 33rd Fighter Wing, the Aeronautical Systems Center, the Air Force 

Special Operations Command. the U.S . Army with its Ranger Camp, the U.S . Navy Explosive 

Ordinance Disposal School, and a unit of the Federal Prison System. 

The 33rd Fighter Wing "Nomads" is the largest associate unit at Eglin AFB, as well as the 

premier air-to-air combat unit of the Air Combat Command (Eglin Air Force Base 1996). With 

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three F-15 squadrons and one air control squadron, the wing's mission is to deploy worldwide 

and then gain air superiority by engaging and destroying enemy forces (Eglin Air Force Base 

1996). Participating in Desert Storm/Shield, the 58th Fighter Squadron became the first Air 

Force unit to employ the F-15 in combat, achieving 16 aerial victories against Iraqi forces . 

Hurlburt Field, home of the 16th Special Operations Wing and the Air Force Special Operations 

Command, is located five miles west of Fort Walton Beach. The base organizes and equips Air 

Force Special Operations forces for global deployment . Utilizing specially designed or modified 

aircraft, including MC-130 E/H Combat Talons, HC-130 P/N Combat Shadows, AC-130H/U 

Spectre/Spooky gun ships, MH-53J Pave Lows, and MH-60G Pave Hawks, the wing has been 

active in operations in Grenada, Panama, Iraq, Bosnia, and Haiti. 

The 919th Special Operations Wing, located at Eglin's Duke Field (Auxiliary Field 3), is one of 

the most unique organizations in the U.S . Air Force and Air Force Reserves. Their mission is to 

maintain and fly the Combat Shadow and MC-130E Combat Talon 1 . The wartime mission of 

the Combat Shadow is refueling of special operations helicopters while the Combat Talon 1 is 

designed for infiltration, exfiltration, and resupply of special operations forces . 

Coastal Systems Station 

The Coastal Systems Station is located on St. Andrew Bay near Panama City in Bay County. The 

Coastal Systems Station (CSS) is one of the major research, development, test, and evaluation 

laboratories of the U.S . Navy, with a wide base of engineering and scientific expertise. The CSS 

is the principal Navy research, development, technology, and engineering activity for naval 

missions that take place in coastal regions . As such, the CSS is responsible for Navy-wide 

leadership in mine warfare, amphibious warfare, naval special warfare, and diving and salvage 

(Coastal Systems Station 1995). 

Together with its major tenants, the Navy Experimental Diving Unit (NED) and Naval Diving 

and Salvage Center (NDSTC), the CSS provides the nucleus of all Department of Defense 

(DOD) diving efforts. In addition, the CSS has recently gained additional capabilities as a result 

of the Base Realignment and Closing (BRAC) process. These have included Mine Development 

personnel transferred from White Oak, MD; the In-Service Engineering Activity from Yorktown, 

VA; and the Naval Medical Research Institute (diving related) . 

The CSS has nearly 2,000 civilian and military personnel . In FY 1995, the CSS had 1,250 

civilian employees and 126 military personnel . Other Navy tenant commands accounted for 77 

civilian and 331 military personnel, while non-Naval tenant commands accounted for 144 

military personnel and 30 civilians. Of the CSS civilian personnel, about 53 percent are scientists 

and engineers; 33 percent have advanced degrees (CSS Facts and Figures 1996). 

The location of CSS on St. Andrew Bay is advantageous, as wind, weather, and ocean conditions 

are generally moderate year around (Coastal Systems Station 1995). This location also allows 

4-3 
easy access to many diverse environments, including ocean, enclosed bays, estuaries, rivers, 

beaches, marshlands, and navigable harbors . Immediately to the south, the Gulf of Mexico offers 

an oceanic and coastal setting, from deep ocean and wide continental shelf to surf-bound 

beaches. The Apalachicola River, 60 miles to the east, is a major river complex, with a large 

main channel and a network of connecting tributaries, swamps, marshes, delta, barrier reefs, and 

lagoons. 

Tyndall Air Force Base 

Established in 1941, Tyndall Air Force Base (AFB) encompasses more than 29,000 acres in 

southeastern Bay County. Home of the 325th Fighter Wing of the Air Combat Command, 

Tyndall is authorized 77 F-15 Eagle aircraft and two E-9A aircraft . The base also has five 

watercraft to recover its 142 assigned missiles and drones . The 3245th Fighter Wing is 

responsible for training F-15 pilots and maintenance personnel before their assignment to other 

units. The wing also manages the southeastern air combat maneuvering instrumentation range 

and provides mission-ready F-15 air superiority forces in support of Commander in Chief North 

American Aerospace Defense Command/ lst Air Force contingency plans. The wing's 325th 

Operations Group is the focal point for all pilot training. The 1 st, 2nd, and 95th Fighter 

Squadrons provide initial F-15 qualification training for pilots, in addition to conversion and 

recurring checkouts (Bay County Military Installation Guide 1992) . 

Tenant units at Tyndall AFB include Headquarters 1 st Air Force/CONUS NORAD Region, the 

475th Weapons Evaluation Group, and the 3625th Technical Training Squadron. The 1 st Air 

Force relocated from Langley AFB (VA) to Tyndall on Sept. 12, 1991, as part of an Air 

Forcewide reorganization . Assigned to the Air Combat Command, 1 st Air Force organizes, 

trains, and equips air defense forces for the commander in chief of the binational U.S ./Canadian 

North American Aero-space Defense Command. These resources include the control centers, 

radar warning systems, and fighter aircraft used to conduct peacetime air sovereignty and 

wartime air defense missions. 

The 475th Weapons Evaluation Group (WEG), a unit of the Air Warfare Center at Eglin AFB, is 

a unique organization whose overall mission is to enhance air combat readiness through 

evaluation of air-to-air weapon systems, exercises that test air defense capability, and operational 

testing and evaluation of tactical and strategic air defense radar systems. One of the 475th WEG's 

responsibilities is the coordination, management, and execution of the Air Combat Command 

Air-to-Air Weapon System Evaluation Program, code named Combat Archer. This program is 

designed to measure the effectiveness of air-to-air weapons systems under realistic conditions . 

The 3625th Technical Training Squadron is Tyndall's largest Air Training Command associate 

unit. Its history goes back to 1947, when the U.S . Air Force Air Weapons Controller School was 

established at Tyndall . The school is the single source for all ground-based air weapon controller 

training for Air Force and Air National Guard officers . 

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Tyndall AFB has about 5,550 military personnel and about 2,500 civilian employees (including 

civilian contract personnel) (Tyndall Air Force Base 1995). 

4-5 
HISTORY OF BASES 

The major military bases discussed in the previous section have a substantial history in the 

Florida Panhandle, as all of them date back to the World War II era or before . The history of each 

of the installations is briefly outlined in the sections that follow . 

NAS Pensacola 

The U.S . purchase of the Floridas from Spain in 1821 soon led to interest in Pensacola as a site 

for a support facility for naval squadrons operating in the Gulf of Mexico and the Caribbean. 

Realizing the advantages of the Pensacola harbor and the large timber reserves nearby for 

shipbuilding, President John Quincy Adams and Secretary of the Navy Samuel Southard 

arranged to build a Navy yard on the southern tip of Escambia County, where the NAS is today. 

Construction began in 1826, and the Pensacola Navy Yard became one of the best equipped 

naval stations in the country (Navy Pensacola 1996) . In its early years, the base dealt mainly with 

the suppression of slave trade and piracy in the Gulf and Caribbean. 

The Pensacola Navy Yard was occupied by Confederate forces early in the Civil War. In 1862, 

after New Orleans had been captured and Mobile was under attack, the Confederates evacuated 

Pensacola, destroying most of the yard facilities before leaving (Parks et al . 1978) . After the war, 

the ruins at the yard were cleared away, and work began to rebuild the base. Many of the present 

structures on the air station were built during this period . However, in 1906, a severe hurricane 

and tidal wave destroyed many of the newly rebuilt structures ; and an epidemic of yellow fever 

less than two years later brought reconstruction to a standstill . In 1911, the yard was 

decommissioned (Navy Pensacola 1996, McKee 1978). 

Meanwhile, the Navy began exploring the potential of aviation. In 1913, extensive experiments 

involving fleet and aerial scouting planes were conducted with gratifying results, and the 

Secretary of the Navy appointed a Board to make a survey of aeronautical needs and to establish 

a policy to guide future development. One of the board's recommendations was the establishment 

of an aviation training station at Pensacola. The first U.S . Naval Air Station was created in 1914 

at the site of the abandoned navy yard. 

In the early days of the Pensacola NAS, U.S . Naval Aviation consisted of 9 officers, 23 enlisted 

mechanics, and 8 airplanes . When the U.S. entered World War I, Pensacola was still the only 

naval air station and had 38 naval aviators, 163 enlisted men trained in aviation, and 54 airplanes . 

However, by the end of the war, in November 1918, the air station had 438 officers and 5,538 

enlisted personnel and had trained 1,000 naval aviators. The expanded activity at the air station 

contributed to increased prosperity for the Pensacola area, and its influence permeated most 

aspects of the community's cultural scene (Harden and Ford 1970). 

In the years following World War I, aviation training slowed down -- an average of 100 pilots 

per year were graduated from the 12-month flight course . The majority of the students were 

Annapolis graduates, and NAS Pensacola became known as the "Annapolis of the Air." 

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The post-WWI period also saw changes in the NAS facilities . To facilitate training in land planes 

(as well as seaplanes), the training center's first field was built in 1922 . Originally known as 

Station Field, it is now known as Chevalier Field (Soaring the Centuries 1960). Then, in 1928, 

the Navy Department ordered the construction of an auxiliary field five miles northwest of NAS, 

which was named in honor of Lt. Cmdr. W. M. Corry, Pensacola's 23rd flight student. In August 

1940, another auxiliary base, Soufley Field, was added to Pensacola's facilities . 

As WW II began, training activity at NAS Pensacola increased. By 1940, the number of pilots in 

training had risen to 1,000 (or 11 times the number being trained in the 1920s) . The number of 

pilots trained by NAS reached an all-time high of 12,010 in 1944. The record of the Navy pilots 

in WW II attests to the excellence of their training; they shot down 6,444 Japanese planes while 

losing fewer than 450 of their own -- a 14 to 1 superiority in aerial combat (Navy Pensacola 

1996). 

In 1948, the Naval Air Basic Training Command (NABTC) headquarters moved to Pensacola 

from Corpus Christie, Texas. Working with the Naval Air Training Command, also located at 

Pensacola, the NABTC was instrumental in expanded naval air training, coordinating all basic 

flight, ground, and specialized training . 

War in Korea presented problems as the military was in the midst of transition from propeller 

planes to jets, and the NAS revised its courses and training techniques . Nevertheless, the NAS 

produced 6,000 pilots from 1950 to 1953 . Pilot training requirements shifted upward again to 

meet the demands for the Vietnam War, which occupied much of the 1960s and 1970s . Pilot 

production was as high as 2,522 (1968) and as low as 1,413 (1962) (Navy Pensacola 1996). In 

1971, NAS Pensacola was picked as the headquarters site for CNET, a new command that 

combined direction and control of all Navy education and training . 

NAS Pensacola today has a myriad of activities, including the headquarters and staff of CNET; 

Training Air Wing Six and subordinate squadrons ; Naval Aviation Schools Command; and the 

Blue Angels Flight Demonstration Squadron. A continuing attraction to visitors to the area is the 

National Museum of Naval Aviation. 

Eglin AFB 

Eglin AFB dates back to 1935, when it was established as the Valparaiso Bombing and Gunnery 

Base (VBGB), associated with the U.S . Army Air Corps Tactical School at Maxwell Field, 

Alabama. The selection of the site, surrounding Valparaiso, FL was based in part on the area's 

sparsely populated pine barrens and the vast expanse of adjacent water. The early effort to 

establish the facility was also aided by a local businessman, James E. Plew, who saw the 

potential of a military payroll to boost the depression-stricken economy of the area (Futrell 

1978). In 1935, Maxwell Field leased 1,460 acres from Mr. Plew's Valparaiso Realty Company 

and activated the VBGB. The leasehold was donated to the War Department in 1937, and the 

facility was named Eglin Field. 

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With the outbreak of war in Europe and President Roosevelt's calling for an expansion of the 

Army Air Corps, General Henry H. "Hap" Arnold ordered the establishment of a proving ground 

for aircraft armament, which led to the selection of Eglin for the testing mission. On June 27, 

1940, the U.S . Forestry Service ceded to the War Department the Choctawhatchee National 

Forest, consisting of some 800 square miles of forest and shore . In 1941, the Air Corps Proving 

Ground was activated, and in the months preceding the entry of the U.S . into WW II, Eglin 

became the site for gunnery training for the Army Air Forces fighter pilots, as well as a major 

testing center for aircraft, equipment, and tactics . 

In addition to the testing of all new aircraft and their serial modifications, the Proving Ground 

Command, because of the isolation and immensity of the Eglin ranges, was especially well suited 

for special tasks, In 1944, it developed the tactics and techniques for the destruction of German 

V-1 rocket installations that were being built for attacks on England. A second test, credited with 

contributing to the success of the fire raids against Japan, was one in which Eglin personnel 

constructed a "Little Tokyo" and demonstrated the effectiveness of incendiaries against standing 

wooden houses of the types targeted for destruction in Japan's urban areas. 

By the end of WW II, Eglin had made a recognizable contribution to the effectiveness of the 

American air operations in Europe and the Pacific and continued to maintain a role in research, 

development, and testing of air armament. As a pioneer in missile development, Eglin in early 

1946 activated the First Experimental Guided Missiles Group, developed the techniques for 

missile launching and handling, established training programs, and monitored the development 

of a drone (pilotless) aircraft capability to support the Atomic Energy Commission tests. 

Over the next decade, there were a number of redesignations of the proving ground, but the 

mission of conducting operational suitability testing of aircraft and equipment remained 

essentially the same. After the start of the Korean War, test teams moved to the combat theater 

for testing in actual combat. They number among their accomplishments improved air-to-air 

tactics and improved techniques for close air support. 

Both as a reaction to the Soviet atomic explosion in 1949 and in recognition that research and 

development had lagged, the Air Force in early 1950 established the Air Research and 

Development Command (later Air Force Systems Command). The following year, the Air 

Research and Development Command established the Air Force Armament Center at Eglin, 

which for the first time brought development and testing together. On December 1, 1957, the Air 

Force combined the Air Proving Ground Command and Air Force Armament Center to form the 

Air Proving Ground Center . The Center built the highly instrumented Eglin Gulf Test Range and 

for the next few years was a major missile test center . 

As the Southeast Asia conflict increased emphasis on conventional weapons, the responsibilities 

at Eglin grew . On August 1, 1968, the Air Proving Ground Center was redesignated the 

Armament Development and Test Center to centralize responsibility for research, development, 

test and evaluation, and initial acquisition of nonnuclear munitions for the Air Force. On October 

1, 1979, the Center was given division status . The Armament Division, redesignated Munitions 

Systems Division on March 15, 1979, placed into production the precision guided munitions 

4-8 
(laser, television, and infrared guided bombs, two anti armor weapons systems, and an improved 

hard target weapon) used in Operation Desert Storm . The Division was also responsible for the 

development of the Advanced Medium Range Air-to-Air Missile (AMRAAM), developed jointly 

with the U.S . Navy under Air Force leadership. 

On July 11, 1990, the Munitions Systems Division was redesignated the Air Force Development 

Test Center . The Center provides test and evaluation support for development of conventional 

non-nuclear munitions, electronic combat systems, and navigation guidance systems . 

Coastal Systems Station 

The Coastal Systems Station had its origins in the mine countermeasures research conducted 

during World War II at the U.S . Naval Mine Warfare Test Station, Solomons, Maryland. In 

1945, equipment, facilities, and personnel were transferred from Solomons to Panama City, FL 

to occupy a 373 acre site, in caretaker status . The site had been used as a Naval Section Base in 

1942, as the U.S . Naval Amphibious Training Base in 1944, and had been inactivated in June, 

1945 . It was established as the U.S . Navy Mine Countermeasures Station on July 20, 1945, Over 

the next 10 years, the station prospered in the warm climate and excellent location. Naval experts 

from around the world joined to discuss new and vital mine countermeasure strategies and 

hardware. 

Modern equipment changed the face of the station. A transducer test pool, underwater television 

tank, an instrumentation building in the Gulf beach area, a digital computer for data reduction 

and analysis, and an analogue computer to analyze and solve specialized problems in a new 

torpedo countermeasures program were added. Also, medical, photographic, and reproduction 

equipment came on line (Bay County Military Installation Guide 1992) . 

So good was the environment that by 1955, the station's mission had expanded to include torpedo 

countermeasures, helicopter mine countermeasures, minehunting and minewatching study 

projects and advanced mine countermeasures training. Along with the increase in mission came a 

new name (U.S. Navy Mine Defense Laboratory) and an increase in size to 648 acres. 

Involvement of the laboratory in the Vietnam War began in early 1964 when a mine countermeasures expert was sent to investigate the needs of U.S . forces in Vietnam, both material and 

procedural, in coping with river mines . This began a major effort to develop equipment for use in 

Vietnam for mine countermeasures and for protection against swimmers. Much of the work 

required in-country support; many laboratory employees went to the combat theater. 

In November 1968, the base was redesignated Naval Ship Research and Development 

Laboratory, Panama City. This change resulted from a naval internal reorganization effort to 

combine several of the closely related research and development laboratories . Annapolis (MD) 

and Panama City labs were combined with the David Taylor Naval Ship Research and 

Development Center at Carderock (MD) . The laboratory regained separate command status 

again in February 1972, being designated Naval Coastal Systems Laboratory, and reporting 

4-9 
directly to the Chief of Naval Material . Its mission expanded into special warfare areas including 

inshore undersea warfare and amphibious operations. 

To accurately reflect the broad range of products and services provided and to bring its name into 

line with other research, development, test and evaluation centers commanded by the Chief of 

Naval Material, the base once again took on another name. In March 1978, it became the Naval 

Coastal Systems Center, a name it would retain until 1992. In May 1985, the Navy Material 

Research and Development Centers, along with the Director of Navy Laboratories, were 

transferred to the office of Chief of Naval Research. 

In line with the Secretary of Defense's recommendations for base closures and realignments 

(BRAC), Naval Coastal Systems Center was realigned from Space and Naval Warfare Systems 

Command to Naval Sea Systems Command on Oct. 1, 1991 . Sonar countermeasures and torpedo 

countermeasures activities were transferred to the Naval Underseas Warfare Center, Newport, RI. 

Also, some mine countermeasures and special warfare related efforts were transferred to 

Dahlgren Division of the Naval Surface Center, Dahlgren, VA. 

As a final realignment move, NSCS was renamed Coastal Systems Station on Jan. l, 1993 and 

came under the Naval Surface Warfare Systems Command, Dahlgren Division, a move that 

would bring the major workings of the station in line with similar activities (Bay County Military 

Installations Guide 1992). 

Tyndall AFB 

Tyndall AFB began in 1941 as a gunnery school for the U.S. Army Air Corps . The base 

officially opened on December 8, 1941, and soon became the center for the Air Corps' first 

flexible gunnery school . Hundreds of officers were trained at Tyndall between 1942 and 1954 . 

In May 1946, Tyndall became the home of Air University's Air Tactical School, training junior 

officers in the responsibilities of command at the squadron level. This mission continued until 

1950, when the base became responsible for training all-weather interceptor pilots and air 

weapons controllers. The air weapons controller school remains an important part of the 

activities at Tyndall . 

The base transferred from Air Training Command to Air Defense Command in July 1957. At that 

time its mission shifted to that of a weapons center . The U.S . Air Force Air Defense Weapons 

Center was activated Jan. 1, 1968 to provide a single area within the Department of Defense for 

the centralization of operational and technical expertise on air superiority matters. 

Tyndall and the Weapons Center transferred to the Tactical Air Command on Oct. 1, 1979 as part 

of an Air Force reorganization when TAC picked up the continental air defense mission. On July 

1, 1981, the USAF ADWC again reorganized and activated the 325th Fighter Weapons Wing. 

Under the center and wing concept, the USAF ADWC continued to provide a variety of 

missions, all tied directly with combat readiness training for Tactical Air Command. 

4-10 
The U.S . Air Force Air-to-Air Weapons Meet, nicknamed William Tell, has been held at Tyndall 

since 1958. William Tell is a biennial exercise in which competing teams demonstrate their 

proficiency in air-to-air operations (Bay County Military Installation Guide 1992). 

Over the years, Tyndall has gained additional missions as other units were stationed on the base. 

The Air Force Civil Engineering Support Agency (AFCESA) has been on Tyndall since July 1, 

1978, when it moved from Washington, DC as part of a major force realignment. AFCESA is the 

Air Force worldwide focal point for all processes essential to air base operability in peace and 

war. In March 1983, Tyndall became the site of TAC's first Region Operations Control Center 

with the region becoming the Southeast Air Defense Sector of Oct. 1, 1986. The sector is 

responsible for surveillance of air approaches and identification of aircraft approaching from 

outside the continent and interception of unknowns. 

As Tyndall moved into its 50th year, it once again underwent a major reorganization . In response 

to Department of Defense efforts to streamline management, the Air Defense Weapons Center 

was inactivated on Sept. 12, 1991, and 1st Air Force and the Continental United States North 

American Aerospace Defense Region moved to Tyndall from Langley AFB (VA), as tenant 

units . With the inactivation of ADWC, the 325th Tactical Training Wing became installation 

host and was assigned to 1st Air Force. On Oct. 1, 1991, the 325th Tactical Training Wing was 

redesignated the 325th Fighter Wing, and the base became part of the Air Combat Command 

when ACC was activated June 1, 1992 . 

4-11 
FACTORS AFFECTING THE ECONOMIC IMPACTS OF 

MILITARY BASES 

The economic impacts of military bases are an important issue. Many areas of the U.S . are 

affected by military installations, and many of the nation's military bases have experienced 

realignments, closures, expansions, or other changes in their activities in recent years (Glassberg 

1995, Tuohy 1997, President's Economic Adjustment Committee 1981) . These changes have 

resulted from a number of factors including changes in national security needs and advances in 

military technology (Lynch 1987, U.S . Department of the Air Force 1991), as well as other 

factors. When a substantial change in a base's level of operations is proposed, questions often 

arise concerning the effects of these changes on the local economy and population (Rowley and 

Stenberg 1993, President's Economic Adjustment Committee 1981) . The economic impacts of 

military bases are also of interest because these impacts are often seen as local benefits, and thus 

are one of the bases for local support of such facilities (Hampton 1996, Glassberg 1995), as is 

often the case with various types of industrial facilities (Eiser et al . 1988). 

Military bases and their expansion and contraction can have effects across a broad range of 

socioeconomic dimensions, including economic, demographic, public service, fiscal, and social 

aspects . The purpose here is to highlight a few of the characteristics of military bases that may 

affect their local socioeconomic impacts. 

Economic impacts of military bases arise from their local expenditures for goods and services, 

for salaries and wages, and for construction activities (Parai et al . 1996). As with any facility, the 

economic impacts of a base can be categorized into direct, indirect, and induced effects. The 

direct impacts of a base can be defined as the net expenditures made to recipients within the host 

community. The indirect impacts include the subsequent expenditures received by intermediary 

firms and workers within the host community that provide the goods and services purchased by 

the base workers, as well as by contractors providing goods and services to the base. For 

example, a local paving company will buy gravel, tools, and equipment, as well as pay its 

workers, with money it receives from a base to repair a runway. The suppliers (located in the host 

community) of these materials, equipment, and labor services are included as part of the indirect 

impact. These suppliers, in turn, also purchase some of their requirements from within the 

community. These indirect impacts diminish on each following round, particularly in smaller 

local economies since a larger portion of spending leaves such areas as payments for goods and 

services from external suppliers (such losses of spending from the local economy are often 

termed leakages) . The sum of these successive rounds of local purchases (or net income 

generated) is the indirect impact . The induced impacts of a base consist of the additional 

spending (and incomes generated) within the host community that is attributable or in response 

to direct and indirect impacts (Parai et al . 1996) . 

Factors that may limit the local economic impacts of bases include on-base housing and base or 

post exchanges. If most of the personnel live in on-base housing, their interaction with the local 

economy may be less than if they live off the base. Similarly, a base or post exchange may 

4-12 
supply personnel with many items that would otherwise be purchased through the local retail 

sector (Rowley and Stenberg 1993) . 

Another factor influencing the extent of local economic impact of bases is military procurement 

policy . For example, in Australia, initiatives have been undertaken to increase commercial 

participation in defense support activities . This is expected to lead to increased commercial 

opportunities in the logistics sector (Barber 1996) . 

Military retirees add another dimension to the impact of military bases. After retirement, many 

military personnel continue to reside in communities near major bases (Rowley and Stenberg 

1993). Like other retirees, they can contribute substantially to the local economy (Fagan and 

Longino 1992, Green and Schneider 1989, Cook 1990, Glasgow 1990) . For example, the Tyndall 

AFB Economic Resource Impact Statement (FY 1995) lists 8,138 retirees with a total annual 

military retirement income of $125 .7 million. 

Demographic impacts of military bases can include effects on the area's population age structure, 

as military personnel tend to be concentrated in the younger age brackets . At bases where 

personnel turnover is rapid, demands for rental housing may be high, and schools and other 

community services may be affected. When base closures or realignments occur, the military 

personnel are typically transferred to other bases, which can lead to rapid changes in the host 

area's population and school enrollments . On the other hand, such personnel transfers may 

alleviate the local unemployment problems that would otherwise be associated with facility 

closure (Parai et al . 1996). 

4-13 
ECONOMIC CONTRIBUTION OF THE 

FLORIDA PANHANDLE BASES 

The military bases just described have a substantial impact on the area economy. Together, these 

installations account for nearly 50,000 jobs -- 33,466 military personnel and 16,054 civilian 

employees (Table 4.1) . The base payrolls total about $1 .26 billion annually. In addition, base 

construction, local service contracts, and other local purchases add significantly to the local 

economic base . Information regarding these other local expenditures was available for only two 

of the four bases. However, at these facilities, the other local expenditures totaled about 71 

percent of the value of the base payrolls (Table 4.1). 

4-14 
Table 4.1 

Employment and Expenditures of Major Military Bases in Florida Panhandle Study Area 

Base Employment' Expenditures 

Military Civilian' Payroll Construction Other Local 

Military Civilian Expenditures 

-------------------$ millions--------------------- 

Coastal Systems Station 601 1,357 22.8 74.7 --- 140.73 

~ Eglin AFB 16,612 5,891 600.7 198.8 --- ---

UN 

NAS Pensacola 10,706 6,305 112.4 58.1 --- --- 

Tyndall AFB 5,547 2,501 148.6 44.3 26.2 39.6 

Total 33,466 16,054 884.5 375.9 

'Includes tenant commands 

Z Includes civilian contract employees 

'Includes construction expenditures 
FORCES AFFECTING THE FLORIDA PANHANDLE BASES AND 

NEAR-TERM OUTLOOK 

During the 1990s, the entire U.S. military establishment has been scrutinized in light of the 

lessening of the Soviet threat . This scrutiny was formalized through a process termed Base 

Realignment and Closure (BRAC), which was completed in 1995 . The purpose of BRAC 

was to identify opportunities to streamline the nation's system of military bases, consistent 

with the changing nature of national security needs (Glassberg 1995, Tuohy 1997). 

While the BRAC process has led to many bases throughout the world being closed or scaled 

back, the bases in the Florida Panhandle study area have not been adversely affected . In fact, 

some have gained positions and functions as a result of realignment or closure of other bases . 

For example, Tyndall AFB gained 110 positions when a numbered Air Force headquarters 

moved there, and 130 evacuees from Clark Air Base in the Philippines came to Tyndall (Bay 

Biz 1992). Similarly, as described earlier, Coastal Systems Station gained capabilities and 

personnel from the BRAC process; Mine Development personnel from White Oak, MD and 

the In-Service Engineering Activity from Yorktown, VA were assigned to CSS, along with 

the Naval Medical Research Institute. 

The NAS Pensacola is also adding personnel as a result of the development of a new Naval 

Air Technical Training Center (NATTC). The NATTC complex is expected to bring an 

additional 5,000 personnel to Pensacola (Nichols 1996). 

The outlook for the bases for the next few years appears to be stable . For example, the 

Coastal Systems Station expects its staffing to remain stable for the next five to ten years 

(Applegate 1997) . The Eglin and Tyndall Air Force Bases appear to have well-established 

missions, while NAS Pensacola will have an expanded personnel and activity level 

associated with the NATTC. With the BRAC process completed, the outlook for the nearterm appears to be for relatively stable levels of activity . 

4-16 
RELATIONSHIP OF MILITARY BASES TO OCS ACTIVITY 

A potential for conflict exists between military and OCS activities . The Gulf of Mexico 

Office of the MMS has worked closely with the three major centers of air operations in the 

Florida Panhandle (Eglin, Tyndall, and Pensacola Naval Air Station) regarding the 

encroachment of offshore drilling activities on military operations. The central body that 

addresses these issues for the military is the Southeast Test and Training Area Committee. 

Oil companies operating in the Eastern Planning Area of the Gulf of Mexico would have to 

adjust their operations to the military presence rather than vice versa. In the past the military 

has made an operating agreement with oil drilling companies to address possible user 

conflicts in the Gulf of Mexico. This agreement has five basic stipulations involving 

scheduling of air and boat traffic and electronic emissions as well as sheltering and 

evacuation agreements. (See Table 4.2). Sheltering and evacuation agreements cover 

situations where falling debris from military operations would pose a danger to oil industry 

workers. The basis for these stipulation agreements was published in the Federal Register a 

number of years ago. 

The location of a support base in the Florida Panhandle for offshore drilling will pose some 

user-conflicts with military operations because onshore support operations would have to 

traverse military test areas to reach offshore rigs and platforms located in the area to be 

leased in 2001 . Figure 4.1 shows the Proposed Lease Area in the Eastern Gulf of Mexico. 

Figure 4.2 shows the Overwater Airspace Region of Military Influence. The military has 

conducted more military operations in the test area that is between Destin/Ft. Walton and 

Panama City and the proposed lease sites, Warning Area 151 (W-151), than in other parts of 

the Eastern Planning Area of the Gulf of Mexico . 

The oil companies would have fewer user conflicts using Mobile as a service base than using 

a comparable base in the Florida Panhandle. EWTA-1 and W-155B, areas between Mobile 

and the proposed lease sites, are located on the edge of Eglin's test area and would pose few 

if any user-conflicts with military operations. 

If a service base were located in the Port of Panama City, the CSS's operations are in the 

shallow regions of the nearby Gulf, up to ten to twelve miles offshore and to a depth of 100 

feet (Applegate 1997). Offshore rigs would not be a problem for the CSS, but conflicts could 

arise if a high volume of ship or helicopter traffic developed in the Panama City area to 

service the rigs . If pipelines were developed from offshore fields to Panama City, this could 

pose another potential conflict with the CSS. However, given the present orientation of the 

Panama City area economy (i .e ., largely based on tourism and the two major military bases), 

it appears unlikely that major OCS support base or refinery facilities would be developed 

there. 

4-17 
Increased traffic from supply boats destined for offshore rigs could be a serious nuisance to 

operations, and beyond a certain level would disrupt CSS operations . Comments from people 

interviewed at the CSS stated that their intuitive sense is that while two or three supply boats 

going towards off-shore rigs would not be a problem, ten, twenty, or thirty transits per day 

would complicate what the CSS does (if, indeed, the higher volume is a large percentage 

increase in current boat traffic of all kinds.) 

Table 4.2 

Five Stipulations in Oil/Gas Drilling Leases 

Schedule all air traffic through test wing scheduling 

Schedule all surface boat traffic through test wing scheduling 

Schedule all electronic emissions through test wing scheduling 

Sheltering agreement 

Evacuation agreement 

4-18 
4-19

Figure 4.1. Proposed Lease Area in the Eastern Gulf of Mexico.
4-20

Figure 4.2. Overwater Airspace Region of Military Influence.
CHAPTER 5 

FLORIDA PANHANDLE FISHING INDUSTRY: AN OVERVIEW 

Geographical Context 

The Florida Panhandle area stretches geographically from the Florida line (just west of 

Pensacola) eastward to Apalachee Bay (just south of the capital, Tallahassee) and 

encompasses the waters around what is known as the "Miracle Strip"--Panama City, Destin, 

Ft. Walton, and Pensacola--as well as Gulf Shores, Alabama (Hoskins 1993). The focus of 

this report will be restricted to Northwest Florida and will include both the Gulf and adjacent 

inland salt and marine-influenced estuaries and bays of the region . 

The eastern most part of the Panhandle is an extension geologically and geographically of the 

upper west coast peninsula. "From Sarasota to Fort Myers, the Gulf now changes to a great 

mud puddle, the distance to blue water even further offshore the more northward you venture . 

The northeastern corner of the Gulf of Mexico is shark and mullet country. Heading 

westward along the Gulf Coast, blue shores begin once again at about Panama City and 

continue all the way to Destin . . ." (Goldstein 1989). 

Outdoor recreation is a major industry in Northwest Florida and includes such activities as 

swimming, surfing, and other beach recreation sports, as well as boating, skin diving, 

hunting, and nature studies . But fishing is one of the most significant components of the 

recreation industry . "Sport fishing attracts millions of resident and out-of-state (tourist) 

saltwater anglers, and is a multimillion dollar a year business" (French et al . 1983). 

This is in the context of trends in recent decades for the Florida coastline that have paralleled 

the rest of the country--accelerating demand for outdoor recreation, but in the face of 

declining opportunities . This trend has been particularly pronounced in Florida, with only a 

small part of the state's coastline available to the public, and commercial development taking 

land for other uses. 

. . .Problems caused by water pollution, sedimentation and dredge and fill operations, 

have reduced the value of coastal waters as recreation areas. As Floridians and 

tourists increase their mobility, disposable income, and leisure time, their demands 

for recreation and tourism also increase. The consequences are that many different 

interest groups are likely to compete for the use of a limited supply of resources. 

(French et al . 1983) 

A key issue resulting from the rapidly shrinking natural coastline is public access to fishing 

grounds (Hinman 1978). Estuarine and near-shore fisheries have been degraded by sewage 

disposal and silt-laden runoff from dredge and fill navigation projects. Anglers have had to 

go farther and farther offshore to find quality fisheries. And they have therefore had to spend 

more money to get there. Consequently, added offshore oil and gas development and its 

supporting, in-shore infrastructure are getting close scrutiny by various segments of the 

fishing industry, both recreational and commercial . This is especially the case in regard to 

5-1 
the sport fishing industry . With increasing demand and dwindling supply, the real value of 

sport fishing is increasing, along with the stakes for its protection and enhancement. 

Nature, Extent and Value of the Fishery 

Gulf of Mexico fishery resources constitute one of the largest known fishery biomasses in the 

world, with the total commercial harvest in 1983 by the five Gulf States amounting to 2.4 

billion pounds and with $615 million paid to fishermen for their catch (Perret and Roussel 

1984). An economic analysis of the saltwater recreational fishery in Florida (Bell 1979) 

reveals: 

$851 million spent by residents and tourists on saltwater fishing; 

34,700 retail-level jobs in Florida directly dependent on saltwater fishing; 

83,739 jobs indirectly supported by the recreational fishing tourist dollar; 

118,000 jobs as a result of total direct and indirect employment attributed to saltwater sports 

fishing; 

$1 .16 billion received in user value from the saltwater recreational fishery resource and 

associated activities . 

This same report indicated that for commercial fisheries : 

$60 million was generated by retail sales within the state and an additional $100 million 

out of state; 

17,000 jobs were directly generated; 

19,262 jobs were indirectly generated through exports to other states ; 

as many as 36,262 jobs could be attributed to direct and indirect employment from 

commercial fishing. 

A report by the National Oceanic and Atmospheric Administration (1985) cites three 

consecutive years in which the Gulf of Mexico yielded the nation's largest regional 

commercial fishery. High-lights of this report are : 

Gulf fisheries comprised 39 percent of the nation's total by weight, 28 percent by value. 

In terms of landings by state, Louisiana ranked third nationally by value, followed by 

Texas and Florida in fourth and fifth place respectively . 

The major components of this fishery were shrimp, oysters, blue crabs, and menhaden. 

The most valuable segment of the commercial fishery on a per unit basis is the shrimping 

industry . To illustrate, shrimp accounted for only 7% of the total catch poundage in 1976, 

while comprising more than 23% of the total dollar value of seafood landed in the U. S . that 

year (Christmas and Etzold 1977). 

In 1991 menhaden was the largest commercial fishery in the Southeastern United States with 

a yield of 514.6 thousand metric tons, while shrimp was the most valuable fishery with a 

value of $478.4 million (U.S. Dept. of Commerce 1993). The Southeast Region's recreational 

5-2 
catch constituted about 56% of the total 63,457 metric tons (for all regions of the United 

States), with 23,797 coming from the Gulf of Mexico. 

Other studies (e.g ., Goodyear and Phares 1990; Prochaska and Cato 1975; Centaur 

Associates, Inc. 1984; Cato and Prochaska 1978-1980; Browder et al . 1978; Prochaska and 

Morris 1978) document the value and extent of Gulf fishery. They all lead to the same 

conclusion : the extent and economic value of both the commercial and recreational fisheries 

are significant and large, with the value of the recreational segment trending higher in 

comparison to the commercial . 

Competition, in fact, is intensifying among stakeholders within the fishing industry . A 1989 

report concerning the seafood industry cites increasing commercial fishing activity in the face 

of a limited resource base from lack of regulation and population pressures in the Gulf 

Region (Keithly 1989). Recreational fishing is also cited to be on the increase, due to 

increases in discretionary income and leisure time. These trends are against the backdrop of 

competition with foreign imports of seafood. 

Non-Charter Sport Fishing 

The Panhandle area is known for both its variety of recreational angling opportunities and as 

a base from which to travel "far-out-into-the-Gulf" for big game fishing (O'Keefe and Larsen 

1992) . Thus, the primary attraction of the Panhandle region for most anglers is boat fishing in 

the Gulf, which. . . "offers access to deeper water and underwater structures that attract bait 

fish and their inevitable predators (Hoskins 1993). But a wide variety of angling 

opportunities avail themselves in the Gulf and its feeder estuaries. These opportunities can be 

described in terms of at least three dimensions: location (whether offshore, near shore, 

onshore, or in rivers and bays), species (in terms of "big game"--usually defined not just in 

terms of size of fish, but fighting qualities as well--or smaller fish, sometimes more valued 

for food quality than fight), and technique (trolling, bottom fishing, fly-fishing, etc.) . 

Big game fishing: Big game fishing starts in earnest at the beginning of July, with a 

significant part of the activity cantered around tournaments. At least three competitive events 

are of note for the Panhandle area: the Bud Light King Mackerel Tournament out of 

Pensacola in July, the Bay Point Invitational out of Panama City also in July, and the Destin 

Fishing Rodeo out of Destin in September (Price 1996). The "blue-water" areas of the Gulf 

are known for their marlin, wahoo, and yellowfin tuna fishing, as well as for dolphin. While 

these fish can be caught 20 to 30 miles out, a 50 to 100 mile run is required to reach the 

billfish and yellowfin tuna (O'Keefe and Larsen 1992) . Sailfish must be pursued far offshore 

in the summer but move closer to shore during the fall . 

Other important and actively sought game species can be caught much closer to shore as 

well. Species sought (and their size range) are: king mackerel (8-SO lbs.), Spanish mackerel 

(2-15 lbs.), trigger fish (1-15 lbs.), amber jack (18-901bs.), cobia (10-801bs.), tarpon (50-200 

lbs .), barracuda (10-SO lbs.), bluefish (2-151bs.), bonito (4-201bs.), jack crevalle (95-SO lbs.), 

5-3 
wahoo (15-451bs.) (Hoskins 1993) . The most common techniques for catching these fish 

include bottom fishing, drift fishing, cast fishing, and trolling . 

Bottom Fishing in the Gulf 

Bottom fishing is most closely associated with snapper and grouper. Fishing for these species 

"on the bottom" in 200-250 feet of water is a major activity in the area. A three-decade 

decline occurred (from about 1960 to 1990) in both the fishery and interest in it and only 

recently seems to be reversed . It has been surmised that the decline in the fishery resulted 

from over-harvest, and that the decline in interest by anglers was due to reliance on heavy, 

"not-so-sporting" tackle . One outdoor writer muses: 

While I caught my first red snapper over 30 years ago, and throughout that 

time have thoroughly enjoyed eating them, I never cared much about 

fishing for them. Granted, a very good reason for that could have been I 

never caught many--and sometimes none--on a trip, and not one of those 

very few exceeded three pounds in weight . When jerked from bottom some 

200 feet below with a winch loaded with 80-pound line atop a pool-cue rod, 

they were also not especially fun to catch. So I hoarded those few I did 

capture for special occasions, most often targeted specks and reds, and had 

them for my weekly fish dinners. (Cooper 1997) 

But more refined, lighter tackle and the supplementing of natural reefs with "artificial 

habitat" have countered the trend toward decline. While productive natural offshore reef 

areas stretch from Pensacola to Panama City and numerous other locations are described in 

fishing guide books (e.g ., O'Keefe and Larsen 1992), some of the more popular fishing spots 

listed in the guides are artificial reefs in the form of sunken ships, barges, or bridge rubble 

(O'Keefe and Larsen 1992 ; Hoskins 1993). Red snapper from 3-30 pounds and grouper from 

10-65 pounds are now once again common (Hoskins 1993). And some anglers are 

specializing in snapper fishing to an extent unknown in the past. This conclusion is supported 

by the fact that specialized fishing articles (e .g ., Cooper 1997) and even major publications 

(e .g., Richard 1996) are devoted to recreational snapper fishing. 

Near-shore, Shore, and Pier fishing 

Near-shore, shore and pier fishing are available for the following species: king mackerel (8-

lO lbs.), Spanish mackerel (2-15 lbs.), red fish (5-401bs .), sheepshead (2-lO lbs.), flounder 

(2-lO lbs.), cobia (10-80 lbs.), tarpon (50-2001bs .), barracuda (10-SO lbs.), bluefish (2-15 

lbs.), bonito (4-401bs .), jack crevalle (5-SO lbs .), whiting (1-3 lbs .), and pompano (3-81bs .) 

(Hoskins 1993). The most common kinds of fishing for these species are bottom fishing, drift 

fishing, and cast fishing, with shore and pier anglers often specializing in redfish (Hoskins 

1993). 

A primary focus of a significant segment of these anglers is on specific, high-profile species 

of fish, such as tarpon and shark. The Panhandle area is noted for these species. One writer of 

5-4 
popular angling literature writes of the area: "Tarpon are everywhere you find current and 

water. The northern Gulf of Mexico probably has the largest inshore shark population in the 

United States" (Goldstein 1989). 

Looking at industry segments more specifically in terms of angling methods, techniques can 

be further specified as trolling : drawing a bait through the water by means of a boat (Wulff 

1968) ; drift fishing: ". . .a cross between trolling and stillfishing . The boat is carried only by 

wind and current, perhaps with a slight assist from the motor to keep the craft's head into the 

seas (Wulff 1968); chumming: using bait or "chum" in the water to attract fish--whether 

drifting, trolling, or stillfishing : staying, usually by means of an anchor, in a particular spot; 

and casting: to "high surf," tidal marshes and flats (with the trend being toward the use of 

light tackle and artificial lures) ; from bridges and piers, in tidal rivers, and offshore in deep 

water. 

Another classification system is in terms of stillwater techniques, which refers to inshore 

fishing with a boat to reach bays, estuaries, and saltwater creeks ; bottom fishing (as the term 

implies); off-shore fishing over sandbars and offshore reefs ; wreck fishing--whether "at 

anchor," or "on the drift;" surfcasting into and beyond the waves of an ocean beach; shore 

fishing at the edge of a bay, estuary, or canal; and big-game fishing for the larger species by 

means of trolling a lure or bait fishing (The Darling Kindersley Encyclopedia of Fishing 

1994). 

Inland Waters Fishing 

Inland waters of the Panhandle include bays and intracoastal waterways between the 

"Miracle Strip" barrier islands and the mainland, as well as the backwaters and mud flats 

westward from Panama City and curving for some distance down the peninsula. These 

waters typically offer areas protected from the wind and are a favorite for light-tackle anglers. 

Species sought (and their size range) are as follows: white trout (1-61bs .), speckled trout (2-

lO lbs .), croaker (1-61bs.), Spanish mackerel (2-15 lbs.), redfish (5-401bs.), sheepshead (2-10 

lbs .), and flounder (2- 10 lbs.) (Hoskins 1993). 

The most highly sought species in inland waters are the spotted sea trout ("speckled trout") 

and red drum ("redfish") (NOAA 1985). The most common kind of fishing for inland water 

species is bottom fishing using shrimp, squid, or cut mullet . Drift and cast fishing using live 

shrimp or lures are also popular, with many of the inshore anglers specializing in speckled 

trout (Hoskins 1993; Phillips 1997). 

Saltwater Flyfishing 

The growing appeal of flyfishing as a specialized fishing technique applied to saltwater 

settings qualifies its adherents as a particularly significant industry segment. Advocates of 

this sport can be traced back to the last century and before . But the sport's more recent 

history and possibilities became explicitly recognized in Sand's popular work, Salt-Water 

Fly-Fishing (1969) . In 1969, in the book's jacket, the work was billed as "the only guide now 

5-5 
available to one of the fastest-growing sports today: fly fishing for salt-water game fish ." 

Sand's work is particularly valuable in tracing the history of the sport in Florida. For 

example, he cites a 1931 book by Stewart Miller, Florida Fishing, in which the author writes : 

"Fly fishing has taken hold in Florida like fire on a sun-baked prairie," describing such fish 

as "tarpon, barracuda, spook, jack, channel bass, sea trout, bluefish, mackerel, dolphin and 

grouper" as being "successfully handled on a fly rod" (Sand 1969). Today the sport's appeal 

as a "light-tackle" approach to saltwater fishing appears to be riding a new wave of 

popularity as evidenced by the rise of publications solely devoted to the sport and increasing 

tackle sales of saltwater flyfishing equipment (e.g ., Kumiski 1995) . 

Saltwater flyfishing can be applied to most of the range of the fishery, including offshore, big 

game species. In fact, one writer about the sport divides his guidebook in terms of places and 

techniques for inshore wading, inshore boat, from the beach, and offshore (Kumiski 1995) . 

But the real growth segment of the sport appears to be largely in the bays, inland waterways, 

and "back country" areas. The Florida Panhandle area has a variety of water attractive to back 

country flyfishermen . Areas considered as especially good include the St. Mark's area south 

of Tallahassee; St. Joseph's Bay between Panama City and Appalachicola; the Panama City 

St. Andrew Bay system; the Choctawhatchee Bay area of Destin and Ft. Walton Beach; and 

the Pensacola Bay, Santa Rosa Sound, and Big Lagoon areas of Pensacola (Kumiski 1995). 

Charter Sport Fishing 

Commercial Fishing Charters: Two types of fishing charter services are available along the 

Florida Panhandle. So-called walk-on charters or head boats (also called party boats) get 

their names from the fact that owners typically do not require reservations far in advance--

usually on the morning of the trip, if at all--that tickets are sold on an individual, "per head," 

basis (Hoskins 1993 ; Hunn 1997). These vessels usually accommodate from ten to fifty 

fishermen. This type of angling tends to appeal more to neophyte anglers and, at around $35-

$40 per day, is less expensive than the private charter. Trip lengths can range from a half to 

over-night to reach remote fishing grounds. 

Private Charters 

These involve smaller and faster boats, usually require advanced reservations, and carry from 

two to six anglers (Hoskins 1993 ; Hunn 1997). Therefore, a day on this type of vessel is 

relatively expensive--around $600 per day for up to six passengers plus $50 per person 

beyond this number. "These types of charters are more tailored to your individual desires as 

your part is the only group on board the vessel . They offer trolling (for everything from king 

mackerel to blue marlin) as well as bottom fishing and more individualized assistance with 

fishing" (Hoskins 1993). Trip lengths span the same range as for walk-on, head-boat charters. 

5-6 
A study of the charter/party boat industry on the Gulf Coast of Florida (Holland and Milton 

1989) reveals : 

Out of a total of 808 boats operating as charter/party boats from the west coast of Florida, 

70 were identified as party boats and 738 as charter boats. 

The 221 boats operating out of the Florida Panhandle comprised 27% or the total. 

Species targeted most by charter boats in the Panhandle were snapper (17%), grouper 

(15%), amber jack (10%), king mackerel (10%), Spanish mackerel (6%), and shark (6%) . 

Species targeted most by parry boats in the Panhandle were snapper (100%), grouper 

(100%), amber jack (100%), bonito (100%), dolphin (100%), cobia (67%), shark (67%), 

and blackfin tuna (67%). 

Both party and charter boats made the majority of their trips to offshore areas (85% and 

88% respectively), but a significant proportion of these trips (46% and 45% respectively) 

were in waters less than nine miles offshore . 

"Party boat operations had higher revenues and expenses than charter boats but a lower 

rate of return due to a higher level of investment" (p. 3). Net return on investment for 

party boats was estimated to be only 1 .75%, while for charter boats the return was 5.5%. 

The majority of owners in both categories felt that their businesses had improved or 

remained the same compare to the prior three years. 

Fifty-eight percent of the charter captains had chartered tournaments in 1987, while ten 

percent of the party boat captains had. (Note : the nature of tournament fishing requires 

the smaller number of anglers per boat, smaller and more maneuverable vessels typical of 

charter boats.) 

Fifty-eight percent of the charter boat captains and 75% of the party boat captains in the 

Panhandle believed that the quality of fishing had decreased in recent years, with 

"overfishing" being cited most frequently as the reason (33% and 57% respectively) . 

Non-Charter Snapper / Grouper Fishermen. 

This constitutes a "hybrid" category of those who pursue snapper and grouper commercially 

in the Panhandle area have been estimated to be comprised of one-third full-time snapper / 

grouper fishermen, one-third part-time commercial fishermen, and one-third strictly sport 

fishermen (i .e ., they fish for sport but have commercial fishing licenses, so as to be able to 

sell their fish) (Dimitroff 1983). 

Observations have been made that differences attend the character of snapper / grouper 

commercial fishing fleets in the ports on the west end of the Panhandle from those on the east 

end, with vessels working out of Appalachicola, Carabelle, and Panacea being smaller, more 

antiquated, less sophisticated electronically, and seemingly not very committed to market 

fishing as for the western Panhandle area of Panama City, Niceville, 

and Pensacola. Speculation for these differences center on the eastern area being over fished 

for these species and the fact that anglers seemed more apathetic about maximizing their 

economic returns. 

5-7 
Commercial Fishermen 

Shrimping 

This industry is based over a wide area including the territorial seas in which shrimp are 

found, associated bays, inlets, wetlands, and even upland drainage areas. "Consideration of 

this large area is necessary because of the migratory natures of the exploited species and 

fishermen, the critical role of estuaries in the life cycles of the dominant shrimp species, and 

the impacts upland alterations may have on the quality of shrimp habitat" (Gulf of Mexico 

Fishery Management Council 1981). There are four targeted species of shrimp--brown 

shrimp, white shrimp, pink shrimp, and royal red shrimp. Two other species are considered as 

"incidental by catch", seabobs and rock shrimp. 

Four segments in the shrimping industry can be identified : harvesters (those directly involved 

with the taking of shrimp) processors, marketers, and consumers (Gulf of Mexico Fishery 

Management Council 1981) . Of particular relevance to this report are the harvesters and 

processors . Harvesting is done by recreational fishermen, as well as by commercial bait 

shrimpers and commercial food shrimpers . Harvesters include owners and employees of 

vessels-- ". . .smaller boat operations, which are restricted to inland bay and shallow offshore 

activities, and the offshore vessels, which range from the territorial seas out to the limits of 

the FCZ and into foreign waters" (Gulf of Mexico Fishery Management Council 1981) . 

Harvesters are supported by the boatyard and gear industry, and the suppliers of ice to 

preserve the shrimp and fuel for the vessels. 

Processors, at the first level, include the harvester who heads the shrimp and fish houses, 

which may head, peal, grade, ice, freeze, cook, or dry the shrimp. Additionally, non-shrimper 

processors handle the shrimp between the fish house and the purchaser. Fifty-nine percent of 

Gulf processors (in 1974) were producers of "green" (fresh) or frozen shrimp, 29% produced 

"breaders" (91% of which were accounted for by Florida and Texas), and 7% were for 

canning (Gulf of Mexico Fishery Management Council 1981). 

The history of the industry can be traced from the long haul seines in shallow, inshore areas 

prior to 1917; the otter trawl, which usually operated about six miles offshore, from 1917 to 

the late 1940s; then a period of rapid expansion in the 1950s with the discovery of new 

fishing grounds (Gulf of Mexico Fishery Management Council 1981). But the expansion put 

additional pressure on the established grounds near shore as well, and vessels began to move 

further and further offshore in search of unpressured areas . 

5-8 
INTERPLAY BETWEEN OFFSHORE OIL AND GAS 

DEVELOPMENT AND THE FISHING INDUSTRY 

In addition to its prolific fishery, the Gulf coastal region also has the greatest concen-tration 

of coastal and offshore oil industries in the world (Perret and Roussel 1984) . 

A number of issues pertain to the interplay between OCS development and the fishing 

industry. The literature on this topic does not reveal complete consensus, as policy analysts at 

different periods of OCS development attempt to anticipate effects, as well as interpret what 

has already occurred. Historically, receptivity to offshore drilling--whether from various 

segments of the fishing industry or other stakeholders--has been a function of timing and the 

region's social and geographical circumstances. Thus, analysts' insights into the potential 

interplay between offshore oil and gas development and the fishing industry in the Gulf of 

Mexico are frequently framed by comparisons between other geographical regions and their 

offshore development histories. Much of the literature on this topic is based on the 

experiences in California and Louisiana, particularly Louisiana. 

General Attitudes Toward OCS Development 

The literature reveals that early policy studies anticipating OCS development generally 

characterized impacts as being negative for the fishing industry . Though "energy crisis polls" 

regarding OCS development in Florida indicated that most Floridians favored offshore 

drilling in response to the energy crisis, with about 60% being in favor in 1974 and 69% in 

1979 (Bell et al . 1980), other studies were not as positive. McGinnis (1983) inferred from a 

review of one study of OCS development in Texas and Louisiana (Havran and Collins 1980) 

and projected effects to Florida: 

The production of oil and gas sometimes led to the growth of massive onshore industrial 

complexes that cause many environmental problems . The most severe offshore 

environmental impacts are apparent in frontier areas where few of the needs for onshore 

operations and facilities are available. Since port facilities along the Florida coastline are not 

geared for OCS oil and gas development, any high or moderate level oil and gas find along 

the Florida Gulf Coast could cause local economic and community upheaval. (McGinnis 

1983) 

The U.S . Department of Interior, Minerals Management Service's sponsored studies 

comparing development histories in California and Louisiana explain key contrasts 

(Grambling and Fruedenberg 1996). Researchers concluded that attitudes toward offshore oil 

development were significantly different in the respective states, with the development of the 

oil industry being welcomed in Louisiana in the 1950s and 1960s and protested in California 

in the 1970s . 

5-9 
Louisiana was characterized at the time by a low education base and economic difficulties . 

Thus oil development led to an economic boom. . . "totally transforming the way of life in 

Louisiana's central coast . . .In the boom economy, money was easy, jobs were plentiful, and 

unemployment was consistently less than 5 percent" (Coleman 1997). But California's 

economic base was diversified and relatively secure . Furthermore, the positive reception in 

Louisiana is attributed in part to its coastal and marine topography, defined by vast marshes 

and with little in the way of access to the state's few defined beaches. "`People in Louisiana 

don't view the beach in the same way that Californians do--as an important resource--because 

they don't have beaches to view,' says Gramling. `And anything that happens offshore is too 

distant to arouse much concern"' (Coleman 1997). But Californians do have a distinct and 

easily accessible beach, with 60 percent of its population living along it . Californians saw a 

threat to their scenic beaches and their way of life . But the differences were beyond the 

people in Louisiana experiencing an economic boom from development and those in 

California being threatened by risks akin to the Santa Barbara oil spill in their state in 1969. 

What people really feared was the "boomtown effect" that had been documented for Morgan 

City, Louisiana and other places with resource dependency. 

Gramling found northern Californians more interested in the social and environmental 

amenities of their region than in any potential for economic prosperity. In fact, many of the 

people he interviewed did not think of "prosperity" in connection with offshore oil 

production, but only of the boom-bust quality of the industry, because they were aware of 

what had happened in Louisiana. (Coleman 1997) 

In contrast, the offshore oil industry for all practical purposes was invented and developed in 

coastal Louisiana. Along with it came the development of an extensive infrastructure to 

support the industry . This included all the onshore supply and transportation services that 

provided such diverse elements as drilling mud and helicopters. The support activities were 

so extensive that direct employment in oil production was less than 15 percent--even at the 

peak of the boom. But in northern California, little in the way of job growth was anticipated, 

because it was believed that people already trained in offshore oil production would be 

brought in from Louisiana. 

Credibility of government information was an issue as well in California. By the time of the 

pro-posed development off California, a history of mistrust concerning the oil industry and 

the role of government in its growth had developed. In contrast, little was known at the 

advent of Louisiana's experience . Only about 12 percent of the state's adults had graduated 

from high school, and many were already involved in such extractive activities as trapping, 

fishing, and the lumber industry . 

With regard to findings specific to segments of the fishing industry, a number of factors come 

into play. Space is limited along the California coast, and competition for docking space at its 

few ports can be intense. Thus, fishing and other recreation interests, particularly in the 

northern part of that state, face environmental risks, competition and possible displacement 

from oil industry production platforms, pipelines, and supply boats. 

5-10 
Louisiana's broad continental shelf slopes gently for over a hundred miles into the Gulf of 

Mexico, generously accommodating a wide variety of commercial and recreational pursuits. 

Fishing, recreational boating, and oil drilling don't have to compete for space; indeed, the 

presence of oil production platforms is considered an advantage for fishing because the 

platforms act as artificial reefs around which large numbers of fish congregate . 

"In Louisiana," says Grambling, "when fishermen have to detour around oil production platforms, it doesn't matter--they just do it and go on trawling . In California, if a fisherman has 

to detour off the shelf contour as much as a quarter of a mile, the water depth changes by a 

hundred feet and it's impossible to trawl." (Coleman 1997:6) 

Florida's Panhandle area has some characteristics in common with northern California--

easily accessible and well-defined beaches, beach site residential and commercial / tourism 

development based on the aesthetic attractions of water views, well educated and mobilized 

stakeholders, large population base, an economic diversity that places less of a premium on 

new industry and development than was the case in Louisiana, and a timing of oil and gas 

development that allows examination historically of the risks as well as benefits of this 

development. But there are significant differences as well. The Florida Panhandle has more 

coves, inlets, and estuaries than the California coastline, therefore there is less competition 

for dockage space (see Shepherd 1964); the population is less urban then California's ; port 

facilities are available to accommodate oil and gas development infrastructure; restrictions 

that place drilling platforms offshore at an established minimum distance will cause less 

threat to the aesthetic sensibilities of coastal residents and tourists ; and well-advertised 

technological advances in the oil and gas industry that reduce risks of spills and permit 

horizontal drilling at distance from rigs mediate concern. 

West of the Florida Panhandle, preliminary findings regarding attitudes by a variety of 

stakeholder groups toward OCS development offer further context for interpretation of likely 

stakeholder concerns in the Panhandle. OCS activities generally found support from most 

stakeholder groups in Louisiana, with the exception of "several environmental groups" and 

some shrimpers--the latter contend that some areas cannot be shrimped due to the presence of 

discarded oilfield trash on the bottom (Gramling 1993). 

"Most business interests in coastal Mississippi are not excited about offshore oil, but they are 

not organized or focused on the issue . . . . the current gambling fiasco has them so focused on 

gambling as an economic activity that Outer Continental Shelf concerns have shifted into the 

background" (Gramling 1993). Mobile Bay is where significant opposition to OCS 

development begins . This opposition is at least correlated with the beginnings of strong 

beach-oriented tourism. 

5-11 
Drilling Rigs and Fishing 

Historically, the literature indicates that the relationship between the oil and gas industry and 

fishermen has been largely positive on the specific topic of drilling platforms, at least for 

those anglers who pursue their sport in the open waters of the Gulf. Oil and gas platforms 

provide "structure" for the fish, something for the fish to relate to--but more. Wrecks, rocks, 

ledges, and other structures in the Gulf 

. . .are home to numerous food chains, starting with tiny barnacles and krill, and ending with 

large gamefish. Obstructions draw the small species because they offer a protective lair and 

an opportunity to trap plankton. Shrimp, crabs, and an array of bivalves are lured to the area, 

and small fish like grunts, pinfish, and squirrel fish are not far behind. All this activity 

subsequently draws larger predators, most notably grouper and amber jack. This continuous 

web of interaction . . .unequivocally places the angler in an advantageous position . (Feldman 

1997) 

Other writers on the topic are explicit in their linkage of offshore structure with good fishing. 

The most important thing when bottom fishing in the Gulf is to make sure you are over some 

type of irregularity in the bottom such as a shipwreck or rocks. These types of underwater 

irregularities provide a platform for the growth of underwater organisms that provide food for 

small bait fish . As these bait fish collect, they attract larger fish which feed on the bait fish . 

Since most of the Gulf bottom is barren sand, randomly anchoring over any old spot is a sure 

way to decrease your odds of catching fish when bottom fishing. (Hoskins 1993) 

Scuba divers are able to offer an explicit picture of fish in their underwater habitat: 

Fish congregate at certain levels along the vertical and horizontal support members of a rig; 

however, cruisers search all levels for prey. Barracuda prefer the upper 50 feet of water, 

although they occasionally swim to deeper depths . Groupers remain at or below the 50 foot 

depth. Snapper range throughout the water column but avoid the near-surface area. Cobia, 

which look like sharks to novice divers, congregate three to four feet below the surface at 

those times of the year when the water is warmer. The slow, cumbersome jewfish remain 

close to the bottom in muddy water. Amber jack cruise at 180 foot depths . (Caldwell 1982) 

Recognition of the importance of these underwater structures has led to the building and 

placing of artificial reefs throughout the Gulf area. These can consist of washing machines, 

concrete rubble, or even old train boxcars and decommissioned ships. 

With the building of oil and gas drilling platforms, not only has fishing activity centered 

around operating structures, but in a "rigs-to-reefs" program to convert and preserve 

structures no longer used into fish-holding structures (Reggio 1987). The Texas Coastal 

and Marine Council is credited with the development of four artificial reefs off the Texas 

coast in the mid-1970s by sinking U. S. Government Liberty ships . Subsequent development 

has been extensive in most coastal states . 

5-12 
The value and potential of oil and gas structures as artificial reef development material are 

the primary focus of research evaluation of the program (Bull and Kendall 1994; Reggio and 

Kasprzak 1991) . The significance of these structures can be inferred from the fact that a 1987 

report (Reggio) cited the presence of around 4,000 petroleum structures in the Gulf. These 

ranged in size and complexity from simple single well jackets supporting small platforms to 

large and complexly structured production platforms, collectively attracting a large amount of 

recreational angling activity (Reggio 1987). 

Research literature on the topic of drilling rigs and fish confirms popular writing on the 

subject. A study of offshore platforms and their use by recreational fishermen and scuba 

divers off the Louisiana Coast revealed that fishing and recreational diving are centered 

around oil and gas platforms (Stanley and Wilson 1989) . Other researchers make the point of 

the importance of platforms as de facto artificial reefs in Louisiana . . .that sport fishing 

opportunities in the state would be greatly reduced without them (Dugas et al . 1979). In fact, 

in one study it was found that in inshore areas the average catch rate for fishing trips taken to 

sites near oil and gas rigs was two-thirds greater than the average taken at non-rig sites 

(Witzig 1986). Oil and gas platforms in Louisiana have been estimated to account for the 

destination of 37% of all saltwater recreational angling trips (Witzig 1986), as well as being 

the focus of recreational divers in the state (Roberts and Thompson 1983). Part of the reason 

is the few suitable hard bottom areas or natural reefs off the Louisiana Coast. The nearest 

natural reefs are located at least 75 miles offshore (Stanley and Wilson 1989) . Alabama is 

another state committed to the value of artificial reefs and advertises its artificial reef 

program through a pamphlet that provides Loran coordinates and a coastal and offshore 

features map (Alabama Department of Conservation and Natural Resources date not cited) . 

The Minerals Management Service conducted a workshop representing key investigators, 

fishermen, and government and industry representatives to evaluate and document 

interrelationships between offshore oil and gas development and fishing. Among the 

conclusions contained in the resulting report were the fish-attracting nature of oil and gas 

structures and pipelines, that confrontations among and between various fishing groups 

attempting to access the fishery resource were far more likely than confrontation between 

industry officials and fishermen, and advocacy for preservation and use of the structures as 

fish attractors (Minerals Management Service 1983). Within the work-shop framework, a 

series of reports dealt with specific topics pertaining to fishing and the oil and gas industry. 

Topics and findings included past and future surveys of the extent of oil and gas plat-form 

fishing, the desirability of a proposed policy for use as artificial reefs in other areas after their 

being decommissioned (Scogin 1982; Ditton 1982), and a survey of snapper and grouper 

fishermen on the Northwest Florida Coast showing a positive relationship between this 

fishery and oil and gas development (Dimitroff 1982). 

In this same document a series of testimonials from representatives of key fishing stakeholder 

groups is reported . A commercial fisherman (who operated an 80-foot boat rigged for both 

trawling and long lines) believed that pipeline canals through inland waterways allowed 

easier and quicker travel but changed the estuarine habitat of shrimp and other sea life 

dependent on the area's nursery grounds (Tate 1982). Pipelines can be a detriment to net5-13 
dragging fishermen if older pipeline valves are not properly covered. The problem of any 

objects on the bottom, debris or not, from oil and gas activity is significant, since shrimp are 

harvested by pulling a trawl across the sea bottom (Rayburn 1984). Thus pipelines can act as 

bottom obstructions and cause loss of equipment. Additionally, "freshly dug pipelines make 

passage impossible to conventionally rigged nets" (Tate 1982) . Compensation for these 

perceived ill-effects was that those fishermen willing to add mud-dragging gear to their nets 

would find abundant harvest of the shrimp which tend to concentrate on each side of the 

pipelines' muddy bottoms. But spokes people for the shrimping industry would like to see 

shrimpers having a more active role in decisions about the placement of oil rigs and other 

structures (Rayburn 1984). 

For longline bottom fishermen, older pipelines were seen as having a continuing positive 

effect on the fishery, because of their artificial reef effect . But it is new pipeline activity that 

is seen as having the most profound effect . ". . .The newly broken up bottom tends to cause 

fish within the area to collect and forage through the disturbed bottom searching out clams 

and other freshly exposed food sources, " which is cited as the "same principle as birds and 

other animals flocking to a newly plowed field" (Tate 1982). 

A direct correlation was perceived between the amount and size of current-driven debris 

trapped by valve stems and the amount of fish sustained and concentrated in immediate 

proximity. World record size fish have been caught proximate oil and gas structures . At the 

1982 Gulf of Mexico Information Transfer Meeting, it was reported that "the woman's world 

record and largest blue marlin ever caught in the Gulf (1,018 . lbs.) was caught during the 

Ladies Tournament in July, 1977, while trolling the anchor buoys around PennRod 72. 

PennRod radioed an offer to hoist the fish aboard their crewboat for the run the Club's weigh 

station." (Claverie 1982). 

Scuba divers report that rigs attract fish and serve as "cages without walls" for their quarry, 

though the divers prefer the older production platforms and their clearer water, rather than 

working plat-forms (Caldwell 1982). 

Reliance on the artificial reef effect of offshore oil and gas structures extends to the Florida 

Panhandle. Snapper and grouper fishing, particularly on the west side of the Panhandle (i .e ., 

out of Panama City, Niceville, and Pensacola), place heavy reliance on fishing man-made 

structures (Dimitroff 1982) . However, some experts have cautioned that artificial structures 

may merely concentrate fish, rather than increase snapper production, that unexploited fish 

stocks may exist over soft bottom structures in the Gulf some distance from the structures 

(Perret and Roussel 1984). 

Water Quality and Ecosystem Integrity 

Threats to water quality and ecosystem integrity are of particular concern to those who assess 

the potential effects of OCS development. 

5-14 
The potential for oil pollution is a major issue raised by offshore drilling. Leaks from 

pipelines and platforms potentially could have some damaging effects on sport and 

commercial fishing, saltwater beach recreation, and boating. Pipeline construction may 

disrupt the bottom habitat and destroy benthic organisms. Even buried pipelines may threaten 

beaches or residential sites . In addition to terminal sites and channels, turning basins may 

need to be dredged or maintained for deep draft tankers . Loss or alteration of coastal lands 

and water would reduce recreational potentials . (McGinnis 1983) 

This same report mentions concerns about damage from dragging platform anchors and 

bottom trawls and blowout spillage from producing wells. Reference to the latter is made to a 

blowout in 1980 in the southern Gulf area off the coast of Mexico, which threatened rich 

shrimping and fishing grounds. Concerns about spills also relate to weather events, such as 

hurricanes and other storms . Hurricane Hilda in 1964 caused about 12,000 barrels of oil to be 

spilled from storage tanks in Louisiana. Accidental spills from tankers and barges are also 

cited as threats . But the overriding concern is with large spills which ". . .can kill birds and 

marine organisms, weaken key links in the food chain necessary to support sport fisheries, 

and modify coastline habitats" (McGinnis 1983). Scuba divers express concern about 

offshore pollution as well (Caldwell 1982). 

Issues raised in recent focus groups of fishing industry and other stakeholders on the topic of 

OCS development do not reveal as much concern over spills, with increased technological 

safeguards being cited. In one focus group report, a big game angler stakeholder 

representative characterizes the pre-President Nixon era as a time of offshore mineral 

pollution, while the Nixon era brought in better pollution controls--oil producers now being 

perceived as "clean neighbors" (Claverie 1982). There is also the perception of a distinction 

between the perceived lower risks associated with gas development, as opposed to oil 

development. 

Pollution problems are complex, and include different effects resulting from chronic and 

accidental pollution, oil emulsion drilling muds, and dispersants and detergents used in 

cleaning up accidental oil spills . Accidental pollution can be costly, create great public 

concern, and cause spectacular short-term local environmental disruption, there is no 

evidence that accidental oil-pollution has a gross permanent effect on the ecosystem. (Peret 

and Roussel 1984) 

However, the effects of long-term, chronic pollution raise other issues . While in the shortterm daily drips and loss of small amounts of oil or other chemicals overboard does not 

appear to be serious because of their dispersal into a large volume of water, the cumulative 

impact of such sublethal pollution is yet to be determined. 

One of the most serious and long-lasting types of pollution associated with the petroleum 

industry occurs when diesel oil is added to the mud system to enhance the drilling of deep 

wells. If the excess or used mud cuttings from such an operation are accidentally lost 

overboard, a serious pollution of the substratum may result, since the oil is absorbed onto the 

5-15 
heavy mud particles and settles to the bottom. With this type of pollution, visible oil slicks 

may not occur and pollution may go undetected . (Perret and Rousel 1984) 

The same authors note that additional problems can be caused by the detergents, dispersants, 

and other chemicals used to clean up oil spills, as these agents are more toxic to marine life 

than oil. 

In regard to near and in-shore activities in Louisiana, recent concern has centered on issues 

related to loss of wetlands / saltwater infusion issues . It is thought that the dredging of 

navigation channels for OCS activity transport has caused tidal erosion of marsh islands and 

saltwater encroachment problem (Rogers 1988). Yet if pollutants associated with oil and gas 

exploration, drilling, and production are sublethal, some authorities maintain that the overall 

effects only have no significant long-term detrimental effects on marine fauna but, on 

balance, have been beneficial, due to the "reef effect" of the rigs and other structures (Perett 

and Rousel 1984). 

Other Issues 

Other issues are mostly framed in terms of the Louisiana experience with OCS development. 

Conflicts over navigation rights-of-way (i .e ., between fishing and oil and gas industry 

vessels) have occurred "as a result of two industries competing for space" (Perret and 

Roussel 1984) . The reduction of fishable sea floor from the sheer number of offshore 

producing platforms and other above water structures has been a continuing concern as well. 

Other concerns have been mitigated to various degrees. The problem of underwater 

obstructions from structures associated with oil and gas activity and materials discarded from 

rigs was countered somewhat by rules and regulations that require everything to be brought 

back in (Perret and Roussel 1984). Another problem has been seismic crews detonating 

explosives in waters historically belonging to fishermen. Regulations and guidelines put into 

place by the Louisiana Department of Wildlife and Fisheries as a result of this initial conflict 

have largely resolved this problem. 

Not all interrelationships and concerns relate to water quality and rigs . One big game angler 

characterizes some of the positive effects of offshore oil and gas development on fishing as 

"passive assistance" (Claverie 1982) . This includes the encouragement or development by the 

oil and gas industry of better radio weather information, navigation aids, protection provided 

by platforms and drilling rigs as safe havens in rough weather, 

and accessibility to fishing areas. "Active help," based on personal anecdotes, included 

emergency services via company helicopters and boats, as well as direct aid from personnel 

on the platforms (e.g ., provision of emergency fuel). 

5-16 
THEORETICAL PERSPECTIVES 

At least two theoretical perspectives are applicable to understanding and predicting the 

interplay between the oil and gas and fishing industries : specialization theory and the concept 

of institutional complexity. 

Specialization Theory 

Specialization theory, originally developed to explain and predict behaviors and preferences 

of fishermen (Bryan 1977), expanded to apply to outdoor recreationists in general (Bryan 

1979), and subsequently applied to broader issues of resource policy (Bryan 1982), has direct 

application in understanding and predicting how different segments of the fishing industry 

will respond to OCS development. The primary thesis supported in the original research and 

confirmed in numerous subsequent studies of specialization is that recreationists and others 

who use and depend on various natural resources for their enjoyment and livelihood can be 

arranged on a continuum of behaviors, orientations, and preferences from the general to the 

specific. These are a product of the nature and extent of people's experience with the activity-

-specifically how long they have engaged in it and how frequently. Thus, in regard to fishing, 

it is not so much the category of "being a sports fisherman," "commercial fisherman," or 

more specifically, being a "big-game angler" or being a "shrimper" that determines how 

people may respond to and interact with OCS development. Rather it is their level of 

involvement in and commitment to the activity, their degree of specialization. 

Findings suggest that the longer, more frequent, and heavily committed user of a resource 

tends to be not only more knowledgeable about his or her own activity, but to be more 

sensitive to the specific characteristics of the particular resource on which he or she depends. 

For example, the commercial shrimper with long experience with and commitment to the 

vocation (i .e ., "the specialist") will be more attuned to the habitat requirements of his quarry 

than the "occasional for fun and family consumption" shrimper (i .e ., "the generalist") . In 

short the specialist in any activity tends to be more involved with, knowledgeable, and 

sensitive to the requirements of the activity. 

The implications of specialization theory for the interplay between different segments of the 

fishing industry and OCS development are several. The most vocal and active supporters or 

critics of OCS development are likely to be specialists who are well aware of the likely 

impacts of oil and gas activity on their areas of interest. They tend to be well-informed and 

organized politically, willing to be involved to protect and enhance the resource on which 

they depend. These specialists will be present in all the different segments of the fishing 

industry . But they are likely to be disproportionately represented 

in segments that have particular appeal to specialists--e .g ., saltwater flyfishermen, other inshore light tackle anglers, big game fishermen who run their own boats. These will be the 

sentinels for the fishery, the observers of water quality, the state of the fishery, etc. 

5-17 
On a speculative note, one might conclude that those who fish rigs may fall on the less 

specialized end of the angling continuum. Specialists tend to release their fish, since their 

orientation is more in the hunt for the fish than their consumption. The specialist is interested 

in the sport as a vehicle for proving skill, while the generalist angler is into "being lucky 

enough" to catch some fish and bring them home to the table (or to show off) . Indirect 

support for the contention of rig fishermen tending to be less specialized comes from a study 

of what anglers did with their catch. One study including the catch disposition near rigs less 

than three miles from shore vs. away from rigs (but still within three miles of shore 

concluded that approximately 60% of the fish caught near rigs were kept (Witzig 1985). This 

compared to only 10% of the catch being kept at non-rig sites . At sites greater than three 

miles out the respective percentages were 70% and 35%. The significance of this conclusion 

about less specialization among rig fishermen is that their advocacy of the oil and gas 

industry as being good for fishing may very well be drowned out by more vocal and 

committed anglers who do not depend on the reef effect of oil and gas structures for their 

fishing. 

Institutional Complexity 

A core theoretical perspective in the literature on social impact assessment (i .e ., the science 

of determining the social effects of environmental change) is that the complexity of a 

community's infrastructure has a significant bearing on a particular area's capability to cope 

with change (Taylor et al . 1995). The greater the complexity, the more able people are able to 

resist change or shape the future to their liking . Though the concept has been applied largely 

to small communities to be affected by such events as dam building, resort development, and 

mining, it is applicable in the anticipation of offshore oil and gas development for the Florida 

Panhandle . Simply put, the diversity of the economy, of goods and services (and the 

professional and other skilled backgrounds of those providing the goods and services), can be 

a major factor in the course of events of OCS development. An indication of this theoretical 

perspective at work can be had from the contrasting experiences of California and Louisiana 

in regard to offshore oil and gas development. From literature previously cited, the 

explanation for California's effective resistance to development was in terms of a diverse, 

healthy economy that did not especially need another industry, as well as concern for 

protection of a scenic shoreline (with limited docking space for OCS activity). Louisiana's 

acceptance of the oil and gas industry was explained in terms of a greater need for economic 

development and little in the way of defined or accessible scenic beaches to protect (but 

much in the way of relatively inaccessible marshland). But the institutional complexity 

perspective adds to the explanation of why and how communities or regions can mobilize to 

deal with change. 

From this perspective, California had more resources to bring to bear on determining their 

own future than Louisiana, a state which at that time could have been considered "less 

institutionally complex." 

The Florida Panhandle can be considered more similar to California than to Louisiana. 

Hence, one would expect mobilization of more diverse resources to shape the nature of 

5-18 
offshore oil and gas development--and to resist additional development if negative impacts 

are perceived to occur--whether in regard to the fishing industry (which in itself is diverse 

and institutionally complex) or to any other segment of the economy. 

5-19 
IMPLICATIONS FOR POLICY 

From this selected review of the literature, a number of policy implications can be inferred 

for ascertaining the interrelationships between offshore oil and gas development and the 

Florida Panhandle fishing industry. 

1 . Different segments in the fishing industry (the "stakeholders") will likely respond in 

different ways to OCS development. These responses will largely be in terms of three 

basic issues : general risks (costs) / benefits, specific risks (costs) / benefits to fisheries 

and aesthetics . 

2. Industry stakeholders perceiving the most benefit will be those that depend on near and 

offshore structures for the enhancement of their targeted fishery--i.e ., snapper/ grouper 

"bottom anglers" and trolleys and casters for other gamefish that frequent the rigs . 

3. Industry segments perceiving the least benefit will be the near-shore and bays/estuary 

anglers and big game anglers who do not reap direct benefits from oil and gas structures 

in the Gulf. 

4 . Within the fishing industry segments, those who are most specialized will likely be those 

who are most informed and politically active, regardless of their orientation to oil and gas 

development in the Gulf. 

5 . Within the fishing industry segments, those who are least specialized will be the most 

likely to have opinions about oil and gas development based on interests outside of 

fishing (e .g., aesthetics, perceived threats to the ecosystem from spills, etc.) . 

6 . Commercial "for-food" fishery segments will continue to lose ground politically in the 

allocation of the fishery resource as the value of recreationally-based fishing goes up and 

aquaculture alternatives increase . 

These specific inferences are to be interpreted within the larger context of the Florida 

Panhandle, an area in which promoters point with pride to their "sugar-white" sands as its 

basic and most essential marketing tool . While the literature points to acceptance and even 

eagerness by many in the fishing industry to embrace oil and gas development because of the 

"reef generation effect" of drilling platforms, overlapping concern is high that the aesthetics 

of the clear water and white-sand beaches not be jeopardized. 

Some distrust of the oil and gas industry exists in this regard . Pointing to experiences in other 

Gulf Coast states, reports of focus group results cite illegal dumping from rigs and service 

boats as a problem that is not managed well by the industry . Industry officials may be 

strongly motivated to be good citizens, but the actual on-water operations people may be 

more concerned about a quick and easy way to get rid of their waste. Thus, issues can range 

from the possibility of trash and chemicals being illegally jettisoned from service 

boats and rigs to potential leaks from drilling and pipelines leading to "dirty water and dirty 

beaches." 

5-20 
A major inference that can be drawn from this review is that anglers' positive attitudes about 

rigs as artificial reefs to attract fish can quickly be overridden by aesthetic and environmental 

concerns that go beyond the immediate health of the fishery. These individuals not only will 

respond in terms of their stake in the fishery, but also in terms of their stake in other activities 

dependent on clean water and the associated aesthetic qualities of that environment--as beach 

tourists, Gulf front property owners, and the business people who support these activities . 

Based on focus group reports, this is in a context of an air of distrust--a distrust that extends 

not only to the oil and gas industry but to state and federal agencies as well, that these 

agencies are "in-the-pockets of industry." For this reason, it is particularly important that 

there is representation by state and federal officials--whether elected or appointed--at such 

meetings to answer questions, address issues and "clear the air." This should part of an ongoing program of monitoring and mediation for the life of the activity . 

Finally, any treatment of impacts of OCS activities on the fishing industry in the Panhandle 

should be in recognition that at the different stages of the life of the development there will 

be different and distinctive issues, i .e ., impacts are temporal in scope (Gramling and 

Freudenberg 1992). The earliest planning stage of the development will be characterized by 

"opportunity-threat impacts." 

These impacts result, to a large extent, from the efforts of interested parties to identify, 

define, and to respond to the ongoing and the anticipated implications of development, 

whether as opportunities (to those who see the changes as positive) and/or threats (to those 

who feel otherwise) . Impacts occur not just when social groups are faced with threats over 

which they have little effective control, but also when there are conflicts over the extent to 

which a proposed development represents threats and/or opportunities. (Gramling and 

Freudenberg 1992) 

Experiences specific in this regard to OCS oil and gas development in Northern California 

and Florida have been contrasted with those in Texas and Louisiana. While the opportunitythreat-impacts in the former states were high, they were relatively low in the latter. The 

issues were so contentious in California and Florida that they eventually required Presidential 

intervention . On the other hand, Texas and Louisiana largely embraced the proposed 

development (for reasons previously stated). Yet it is noteworthy that fishing industry 

anticipations in Florida, at least, seem to remain largely positive. 

The second type of impacts is classed as "development-stage"--which is where most impact 

research is focused. This is the projection of effects associated with the actual onset of 

development. However, since this review of the Florida Panhandle fishing industry and OCS 

oil and gas development has focused primarily on the opportunity-threat-impact stage, it 

should be noted that people will continue to respond to opportunities, threats, and the 

opportunity-threat debates, even during the most intensive part of the implementation stage 

(Gramling and Freudenberg 1992) . It is perhaps too early to determine whether the generally 

positive reception by fishermen to the proposed oil and gas industry development off the 

Panhandle coast will carry the debate (and the perceptions) through the development stage, or 

other stakeholders' more negative perceptions of the industry . 

5-21 
The third type of impacts are characterized as those of the "longer-term : adaptation and over 

adaptation." These are the effects that continue long after the activity in question has ceased . 

Adaptation to the activity may lead to over-specialization which results in a loss of 

flexibility--or to situations where altered behaviors are adaptive in some situations but not in 

others, over adaptation, in other words. (Grambling and Freudenberg 1992). In the case of oil 

and gas activities, this could take the form of overbuilding infrastructure to support the 

industry, over-dependency on associated jobs during the height of the activity, or in the case 

of the shrimp industry out of Morgan City, Louisiana--cessation of the activity for thirty 

years until after the oil boom, then an attempted return only to realize that the resident shrimp 

fleet and processing facility were no longer there (Grambling and Brabant 1986). In the case 

of the Panhandle Region, this type of impact would be considered un-likely, due to the 

diversified nature of the economy. It is not a matter of dropping one industry and replacing it 

with another, rather a matter of co-existence between the oil and gas industry and fishing 

industry segments . Certainly the "rigs-to-reefs" factor will likely create demand for leaving 

oil and gas structures in place after their production lives are over--as has been the case in 

Texas and Louisiana. Decisions in this regard are likely to be balanced against the risk of 

their being navigation hazards, aesthetically unpleasing, or somehow posing risk to water 

quality. 

5-22 
CHAPTER 6 

PORT FACILITIES 

INTRODUCTION 

Outer Continental Shelf (OCS) petroleum development requires onshore support facilities, 

which are usually sited in or near harbors proximate to the sites of offshore exploration, 

development, and production . During offshore development and production, onshore service 

bases typically include companies providing mud, cement, drilling tools, well head 

equipment, catering, helicopter transportation, logging and perforating, rental tools, welding 

and machine shops, diving services, trucking, labor contracting, inspection and testing, and 

other supplies. Onshore port facilities provide dock space and loading facilities to transship 

necessary pipe, mud supplies, and other material to the offshore operation. Ports may also 

provide sites for equipment and supplies, staging areas for companies, yards to store pipe and 

steel used offshore, and space for production force headquarters, docking for crew boats, and 

heliports. Ports themselves may provide additional services such as waste disposal, marine 

repair, aid to navigation, towage, pilotage, marine police, and fire fighting, among other 

services. 

Outer Continental Shelf development creates the potential for additional uses of vacant land 

and redevelopment of existing land in ports for OCS-related uses; but it may also result in 

competition with existing port users (such as commercial shipping companies and the sports 

and commercial fishing industries) for port facilities, such as docking and turning space, and 

for port services. The degree that such competition occurs depends on the space and facility 

needs of OCS-related Indus-tries and the capacity of ports (channels, turning space, dock 

space, land, water, electricity, sewerage, landslide transportation, etc.) to accommodate 

additional use or, if at or near capacity, to expand to accommodate additional uses . 

The ports of Pensacola (ranked 78th) and Panama City (ranked 62nd) in 1995 were among 

the top 100 U.S . ports in the dollar value of goods exported (Global Trade Information 

Services, Inc. 1996) . They ranked 120th and 100th, respectively, in the value of imports. 

There is the potential for OCS-related conflicts with the existing operations of both ports, as 

well as for significant benefits to the ports from additional OCS-related business . 

This chapter summarizes the results of an extensive literature review conducted to provide 

background information that will be useful in exploring the impacts of OCS development on 

the two ports. It is based on a search for and review of literature related to issues in port 

development in the U.S. and worldwide, impacts of OCS development on ports, and histories 

of West Florida and the cities of Pensacola and Panama City and their ports. A complete list 

of references consulted is provided in the bibliography . Before proceeding, an important 

caveat should be noted. This study examined issues related to port development, operation, 

and use rather than the broader topic of the use of the harbors in which ports are located. 

Typically, harbors will be used by ports and by a variety of commercial enterprises and 

6-1 
residential uses that need or desire access to water. In the case of Outer Continental Shelf 

activities, support and service bases may be located within and use port facilities, but they 

may also locate within harbors and operate independently of a port located in the same 

harbor. When the latter occurs, the impacts of OCS activities on ports are likely to be much 

lower than when OCS activities are located within the formal boundaries of the port. 

Methods used in the literature review included computerized searches of social science and 

economic business reference data bases, searches of the catalogs of the libraries of Florida 

State University, Louisiana State University, University of Florida, University of New 

Orleans, and University of West Florida, review of the references reported in publications 

consulted and in specialized bibliographies dealing with port development and operation 

(e .g ., Green 1985 ; Marr et al . 1987), and direct contacts with port experts and port research 

centers and institutes . Additional materials were located through site visits to Pensacola and 

Panama City by RPC staff, which included interviews with port personnel. Reference 

material identified in the literature searches was either abstracted directly or photocopied. 

The literature review is organized in six parts. Part I examines issues in port development 

and management facing ports in the United States and that will may affect how the ports of 

Pensacola and Panama City respond to opportunities offered by OCS development. Part II 

summarizes descriptive information about the ports of Pensacola and Panama City that is 

available from secondary sources. Part III provides a social and economic history of 

Pensacola and Panama City, focusing on the past and current roles of the ports in the 

economic and social life of the communities . Part IV lists stakeholders associated with the 

ports and the communities that may be affected by OCS-related activity at the ports. Part V 

summarizes literature on the impacts of OCS development on ports in other areas, while Part 

VI concludes this report by looking at the potential of the ports of Pensacola and Panama 

City as OCS service and support bases. 

6-2 
INTRODUCTION TO PORTS AND PORT ISSUES 

Ports function to load and discharge ships, receiving cargo from the port city and interior 

regions and exporting it to other regions or overseas, while unloading and dispatching 

incoming goods by road, rail or waterway. Port development and operation has been strongly 

affected by rapidly changing technology in a highly competitive environment, scarcity and 

high costs of capital, and by changes in the external environment in which ports operate 

(Hoyle and Hilling 1984; Herschman 1988a) . Technological innovation to improve the 

efficiency of goods movement has required significant investment by ports in new harbor and 

water- and land-side facilities and equipment to remain competitive . The ability of ports to 

make such changes, however, is strongly affected by the costs of capital, environmental 

constraints, and by growing competition among a number of port and harbor users, many of 

which have little or no relation to traditional port functions (Mayer 1988). Thus, ports have 

been subjected to wide-ranging demands from shippers and other users of harbors, which 

have brought about serious conflicts over land uses and port policy (Hershman 1988). In 

many cases in the past, U.S. ports failed to adapt to changing conditions, which led one 

national review to conclude that many waterfront areas and harbors were losing their 

economic significance and rapidly becoming obsolete and largely abandoned (Panel on 

Future Port Requirements of the United States 1976). 

Hershman (1988) characterizes ports in the United States as ". . .a community of independent 

enterprises tied together by a common interest in maritime affairs." Public port agencies and 

authorities are critical institutions in this community of interest, because of their powers and 

financial resources, in helping ports respond to changing technological, economic, and social 

demands . Most public ports operate as public enterprises. They are set up by state statute, 

owned by a city or state, and often subsidized with public funds, but they typically operate 

independently and are financed, wholly or in part, by operating revenues and borrowed funds. 

The statutes that establish them typically specify their corporate powers, area of operation, 

functions, and mode of governance. 

According to Hershman (1988), many ports focus on revenue-raising activities, such as 

improving facilities and management for more efficient handling and movement of cargo and 

promoting economic development, and pay less attention to "public interest" activities such 

as environmental enhancement, public access, and redevelopment of obsolete facilities for 

recreational or educational uses. This focus is required, to some extent, because ports depend 

on the revenue generated by their operation and receive little direct tax support; thus, they try 

to keep overhead low and generally "stick to their basic business" (Dowd 1988). 

6-3 
Changing Technology and Economic Conditions and Their Impacts on Ports 

Port facilities include berths and equipment for handling general cargo (a mixture of 

packages containing a variety of commodities other than timber and bulk cargoes) and, 

frequently, berths and equipment designed to accommodate specialized cargoes. The latter 

include containers and bulk cargoes (such as oil, coal, and grains) . Efficient movement of 

these cargoes, particularly the prevention of delay, is a key ingredient in successful port 

operation (Nettle 1988) . The most critical factors in efficient operation, beyond adequate 

depth of channels and space for anchorage and movement, is the availability of space for fast 

inland clearance of imported cargoes and for reception of cargoes for export through the port 

and effective integration and coordination of port infrastructure with road and rail facilities 

for land transport. Problems facing many ports have been shortages of space for handling 

cargo and inefficiencies in rail and road access . Where rail lines have numerous at-grade 

crossings to access the port, rail traffic may face serious delays . Similar delays occur if 

trucks accessing the port must traverse streets that lack access control or are heavily 

congested. Additional problems can occur if access routes traverse residential areas, since 

heavy trucks create objectionable noise. 

Technological Innovation 

Competitive conditions in the transportation of goods has fostered rapid innovation in 

maritime shipping and related port facilities to improve efficiency. Adapting to these 

innovations has been critical to the economic health of ports. Innovations include several 

developments in ship technology and methods of packaging various types of cargo, including 

larger ships (which require deeper channels and moorage), and rollon-rolloff ships (roros) 

and container ships (which require specialized berths with ramps for roros, container gantries 

for container ships, adequate space for parking and container storage, and improved highway 

access). General cargo also has been subject to changes to improve efficiency (unitization 

through palletization, banding, bundling, and crating), which have made port facilities such 

as multi-storied dockside warehouses obsolete, while creating demand for more space at 

dockside to load and unload and more warehouse space back from the docks for long-term 

storage. 

Providing berths for larger ships can mean additional dredging, with its attendant adverse 

environmental impacts, or, if funds for channel improvements cannot be secured, simply that 

ports cannot accommodate the ships (Redden 1967). Tankers, for example, have increased in 

size from 60,000 dwt (tons deadweight) and a loaded draft of 40 feet to 100,000 dwt (48-50 

foot draft) to supertankers of 200,000 or more dwt (drafts of 60 or more feet), well beyond 

the depth of most ports. Deep water is also required for roll-on, roll-off vessels (drafts of 30 

to 35 feet), along with facilities for clearing the vehicles carried by these ships quickly from 

the port area (and for assembling them prior to loading on roro vessels). In the case of 

containers, according to Nettle (1988) "Arguably the most significant development in the 

movement of goods. . . ."), which were first introduced in 1955, ever larger ships require deep 

water too (for their loaded drafts of 30 to 35 feet) and facilities (heavy gantry cranes, 

storage/stacking areas of from three to 40 acres, road rail access to load/unload and move the 

6-4 
20- and 40-foot container boxes) . Handling procedures required are so specialized that many 

ports cannot handle containers efficiently. 

An important factor in a port's ability to take advantage of this new technology has been the 

availability of adequate land resources for the staging of containers waiting to be loaded on 

incoming ships. However, according to Mayer (1988), some ". . . ports are handicapped by 

inadequate nearby level land, or by existing land uses that are incompatible with port 

activities . . . . At many ports throughout the world, high-density central development of office 

buildings, commercial and industrial establishments, recreation and esthetic uses, and even 

high-rise residential structures, together with insufficient land for rail and highway access to 

the port terminals have restricted maritime activities ." 

As a result of the economies of scale that can be achieved with larger operations, so-called 

"load center" or "superports" for containerized and other forms of intertnodalism have 

emerged, so that mid-size and small ports (such as Pensacola and Panama City), ". . .will 

either decrease their maritime activities or become highly specialized" (Hershman 1988a; 

also see Maritime Administration 1986). This phenomenon was noted as early as 1976 by 

the Panel on the Future Port Requirements of the United States (1976), which observed that 

"land bridges" made possible by containerization had led to goods destined for Europe, and 

once handled by nearer Gulf Coast ports, to be diverted to Charleston, South Carolina, which 

had greater capacity to handle containers. Since 80 percent or more of general cargo (as 

distinct from bulk cargoes) is now moved in containers (Mayer 1988), ports that lack the 

facilities to handle them are severely handicapped in competition with other ports. In 

addition, they can find themselves ". . .with a surplus of smaller, obsolete port facilities, such 

as finger piers . 

Economic Conditions 

In addition to changes brought about technological innovation to improve competitiveness, 

ports are also affected by changing economic conditions . Most ports have been adversely 

affected by the movement of industry from waterfront and other central city locations to the 

suburbs (Goodwin 1988) Smaller ports and specialized ports often are highly dependent 

upon business from a narrow sector of industrial firms, which tend to use these ports for bulk 

cargoes. The fortunes of the port can rise and fall with the fortunes of that industry or of the 

firms that traditionally have shipped or received goods through the port. In many cases, 

according to Randall (1988), these industries tend to be highly cyclical in nature, such as the 

timber industry, oil and gas, and iron and steel. In addition, maritime industries, such as 

shipbuilding and fish processing, are increasingly moving inland or to other countries, which 

adds further economic stress to smaller and mid-size ports (Hershman 1988a) . This has led 

some ports to become actively involved in efforts to spur economic development, to find new 

sources of revenue through diversification of port 

activities (such as through the development of port real estate holdings for residential and 

other non-water-dependent uses), and, to further improve efficiency, to privatize various port 

operations (Randall 1988 ; New England River Basins Commission 1981) . 

6-5 
Financing Improvements 

Urban port authorities have had severe difficulties in financing the major capital 

improvements that are needed to adjust to technological innovations and changing demands 

on port land and facilities . Hershman, for example, notes, 

Finding funds for major capital improvements is a key problem facing the industry . 

The causes of the problem include the higher costs of capital construction, reduction 

in subsidies from federal, state, and local governments, and greater competition for 

funds for public works projects, especially at the local level where Port projects may 

have to compete with social service projects. Further, changes in the tax laws have 

reduced the benefits available to Ports through tax-exempt borrowing. (Hershman 

1988a) 

This situation adds to the pressure on ports to generate capital internally, either through 

retained revenues or generation of revenue streams sufficient to support debt service, and to 

be more entrepreneurial in seeking out joint ventures. It is further complicated by changes in 

federal policy regarding funding of navigation projects such as channel improvements . 

While these were funded completely by the federal Treasury in the past, the trend is now to 

share costs with beneficiaries, such as ports and shipping companies (Mayer 1988). 

Changing Conditions in the Port Environment 

Hershman (1988b) notes that in addition to accommodating the needs of traditional marine 

industries (such as shipping, fishing, boating, shipbuilding), ports must also be managed to 

reflect the special place of the port in the culture of a city and its people. He writes : 

The harbor is far more than a transportation utility, or a community service like those 

that provide water, buses, or electricity. It is the place where settlement first occurred 

and where economic roots are found; where people's memories of welcomes and 

farewells are relived; where the symbols of the city (skylines, towers, statues) evoke 

pride, loyalty, honor; where major events celebrate the city and its accomplishments ; 

where trade forms linkages with other cultures . . . . A harbor is for and about people . It 

is a transport node, but also it is a maritime cultural resource . 

Thus, people value ports and harbors for reasons that go far beyond their direct roles in 

maritime commerce. This special role of the port in the history, economy, and life of cities 

requires a unified vision and comprehensive planning and management of the shore, water, 

and submerged land. But, according to Hershman, instead responsibilities are widely 

dispersed among public and private agencies, which leads to frequent conflicts and decision 

making in an adversarial environment (e .g ., see Fleming 1988; Kenyon 1968). 

6-6 
Typical major issues in port development and operation include: 

Community and environmental impacts from development projects at the 

water's edge. 

Competition between recreation and industry for scarce shoreline space. 

Pollution of harbors from channel improvements and maintenance, vessels, 

and shoreline land uses. 

Obsolete, vacant, and decayed port and industrial facilities that are dangerous 

and unsightly. 

Debates over expenditure of scarce public funds and the expected "return on 

investment" expected from harbor and port improvement projects (Hershman 

1988a) . 

Resolving these issues can add to the cost of (or may delay or stymie) port improvements 

designed to take advantage of innovations that will improve the efficiency (and 

competitiveness) of ports. In addition, in some cases their resolution can actually damage 

port competitiveness, such as when waterfront land is diverted from industrial to recreational 

uses (National Academy of Sciences 1980 ; Wrenn 1983) . Marr et al . (1987) observes that 

"Old waterfronts which have fallen into decay are increasingly being refurbished into 

attractive recreation, residential, commercial and open-space development. . .," but he warns, 

"However, there is a need to accommodate shipping interests in either the rehabilitated zone 

or elsewhere in the vicinity." This concern is echoed by Goodwin (1988), who has observed 

"A plea for protection against displacement. . . particularly from fishermen and the industries 

that serve them: boatyards, seafood plants, fish brokers, and auctioneers." In fact, Goodwin 

(1988) reports that "Some maritime community leaders fear that erosion of the `critical mass' 

of support industries necessary to retain local fishing fleets and other maritime activity will 

result in loss of business and jobs to other ports." 

According to Hoyle and Hilling (1984), the economic and political environment plays a large 

role in decision making by port agencies . Economic forces within the region in which a port 

is located lead the port to develop new facilities to meet the needs of various industries, but 

the location, timing, and type of facility built depends on the political environment 

(Hershman 1988a) . The political environment, over the past twenty-five years, has been 

dominated, in many areas, by concerns for environmental quality (what Mayer (1988) terms 

the "docks or ducks" issue) and by pressures to revitalize central city and downtown 

economic development through promotion of tourism (Goodwin 1988). These changes in the 

port economic and political environment have required port authorities and agencies, which 

previously had a free rein in pursuing economic development objectives (Walsh 1978), to 

recognize competing interests. 

The role of environmental regulations in the costs of port improvement was noted as early as 

1976 by the Panel on Future Port Requirements of the United States, which found that 

responding to environmental issues was increasing costs (1976) . Relatively recent public 

opinion surveys (e.g ., DeHaven-Smith 1991) indicate that in the Florida Panhandle there is 

strong public support for environmental protection and strong public opposition to economic 

6-7 
development that results in environmental harm. In general, ports have found they must 

revise their goals, which, as noted above have focused largely on port revenue-generating 

operations and economic development, so that those concerns are ". . .balanced with public 

concern for efficient use of existing facilities and the preservation of unexploited natural 

areas" (Hershman 1988a) . As a result of such balancing, Mayer (1988) suggests that "Over 

the past two or three decades, an abrupt halt to massive reclamation in harbors has occurred 

in the United States" and to increasing difficulties have been experienced in improving 

channels because of difficulties in disposing of dredge spoil. One result of failure to expand 

the land base of ports and the depth of channels, however, can be increasing competition for 

existing port land resources, but decreasing business for core facilities and services of the 

port. 

Another source of environmental pressure can come from waterside residential uses, which 

can be adversely affected by the air and water pollution, noise, dust, etc. associated with 

many traditionally "messy" waterfront industrial activities . Goodwin (1988) notes that 

industries such as sawmills, pulp and paper manufacturers, oil refineries and petrochemical 

plants, batch concrete manufacturers, flour mills, marine construction yards, and iron and 

steel mills are, to varying degrees, water dependent and favor port locations, but they also 

generate externalities that lead other shoreline uses to lobby for their relocation to land that is 

less scarce (and less valuable) than harbor sites. 

Another set of political factors revolve around the business interests served by port 

authorities. In some cases, ports can be "captured" by particular industries and, as a result, 

fail to adjust to changing technology with consequent adverse consequences for the port's 

competitive position relative to other ports. Kertstein and Omori (1997) note, for example, 

that the Tampa Port Authority invested heavily in port improvements to serve the bulk-cargo 

needs of the phosphate industry in the 1950s and 1960s, which caused it to ignore 

improvements needed to keep pace with the containerization revolution and remain 

competitive for general cargo with Gulf Coast ports such as New Orleans . Later, this same 

port authority's activities became highly politicized in the late 1980s as it moved 

aggressively to expand its general cargo business by purchasing and improving with funds 

from bond issues, several privately owned port terminals and 

stevedore companies, which some in the community viewed as an unwarranted intrusion into 

the private sector (Kerstein and Omori 1997). 

Finally, as noted earlier, ports in many parts of the United States are rapidly diversifying 

(Hershman and Bittner 1988), ". . .having become desperate to replace revenue lost through 

decentralization, deindustrialization, and changing port technologies" (Randall 1988). To 

some extent, diversification also has been thrust on ports by the communities in which they 

are located, as port-owned land is increasingly viewed as a community cultural and 

recreational asset or possible source of jobs and income from tourism (Goodwin 1988). In 

some cases, ports responded by launching new leisure ventures (such as cruise ship terminals, 

aquariums, parks, fishing piers, small boat marinas and boat launches) (Fleming 1988), 

while, in others, ports have ventured into non-maritime activities (such as use of port-owned 

6-8 
land for office and residential real estate ventures) . In the case of Tampa, for example, when 

the port authority found it could not compete effectively for container business, in the 1980s 

it worked to improve its general cargo business, as noted above, but it also focused its 

attention on tourist-related projects by building a cruise-boat terminal and aquarium. In part, 

this also represented an adjustment to the political environment, since Tampa's mayors by 

then favored tourism as a key element of the city's economic development strategy (Kerstein 

and Omori 1997). Ports increasingly are also offering an array of new services to their portrelated commercial clientele, such as truck consolidation and computerized cargo tracking 

(Fleming 1988) . 

The Ports of Pensacola and Panama City 

This section summarizes descriptive information on the characteristics of the ports of 

Pensacola and Panama City obtained from a review of published material and information 

obtained directly from the ports by RPC. Neither port is a large load center or superport, and 

both have largely been passed by in the competition among ports for container business. 

Thus, they appear to have excess capacity and are seeking new business to utilize their 

facilities . 

Port of Pensacola 

The Port of Pensacola, which is an enterprise agency administered by the Transportation 

Department of the City of Pensacola, is located on the north shore of Pensacola Bay, 11 miles 

from the sea buoy on the Gulf of Mexico (and 68 road miles/87 nautical miles east of Mobile 

and 103 road miles/100 nautical miles west of Panama City) . The port has a deep-water 

roadstead some 12 miles long and two miles wide, with natural depths of 20 feet to 45 feet, 

which provides good, well-protected anchorage (Coverdale and Colpitts 1960 ; Corps of 

Engineers 1969; Ranelli 1979). The entrance channel across Caucus Shoal to Pensacola Bay 

is 37-feet deep; deep-water bay channels, 33-feet to 35-feet deep, provide access to the port 

facilities (Florida International Handbook 1968; Corps of Engineers 1969). No bridges cross 

the main ship channels between Pensacola and the Gulf of Mexico. The Gulf Intracoastal 

Waterway crosses the harbor entrance channel in the lower part of Pensacola Bay (Corps of 

Engineers 1969). 

The port site, adjacent to downtown Pensacola, occupies approximately 50 acres . It offers 

the following major facilities (Port of Pensacola no date, probably 1996): 

2,500 linear feet of primary 33-foot MLW berth space 

Berth 1 - All Purpose - 540' 

Berth 2 - All Purpose - 400' 

Berth 3 - All Purpose - 476' 

Berth 5 - General Cargo - 476' 

Berth 6 - General Cargo - 476' 

6-9 
1,000 linear feet of secondary shallow-draft (16-21 MLW) berth space 

Berth 7 - Liquid - 500' 

Berth 14 - Dockage - 300' 

Berth 15 - Dockage - 300' 

Berth 16 - Dockage - 300' 

460,000 square feet of covered warehouse space in nine buildings 

250,000 square feet of open storage space 

A full range of stevedoring and cargo-handling equipment (note, however, that 

according to the Corps of Engineers (1969) general cargo to and from the port 

is generally handled by ships' tackle ; stevedoring companies at the port had 

truck cranes with lift capacities ranging up to 45 tons). 

Ship-side service from two railroads: Burlington Northern Railroad and CSX 

Transportation System. 

Easy access to the Interstate highway system. 

Port assets in property, plant and equipment in 1996 had a book value, prior to depreciation, 

of $20 .8 million. These facilities were damaged by Hurricanes Opal and Erin in 1995, but 

since have been repaired and upgraded with funds from local option sales taxes, the Florida 

Seaport Transportation and Economic Development Council, and Federal Emergency 

Management Agency. 

Over the past twenty-six years, a total of over 28 million tons have moved through the port. 

Bulk tonnage has ranged from a high of 2.1 million tons in 1978 to a low of 0.08 million tons 

in 1971 . General cargo has ranged from a high of 0.6 million tons in 1980 to a low of 0.02 

million tons in 1970. In the past, the port has primarily served liquid bulk cargoes and 

general cargo, including steel, Nitrate soda, grains, fertilizers, foodstuffs, lumber, paper, 

building materials, Saltcache, chemicals, firewood, fuel oil, and liquid sulfur (Ranelli 1979). 

In recent years, refrigerated meat products have also been exported through the port. 

Tonnage for the past five years has been: 

Bulk General Total 

1992 798,801 574,078 1,372,879 

1993 421,149 595,847 1,016,996 

1994 351,452 366,223 717,675 

1995 318,194 350,555 668,749 

1996 509,161 206,499 715,660 

Source : Information received by fax from Port of Pensacola. 

Thus, in recent years business at the port has been in gradual decline, due primarily to a sharp 

decline in bagged cargo, which has shifted to containers and is shipped to South Atlantic 

ports for export. This is also reflected in operating revenue, which has declined from $3 .6 

million in 1992-93 to $1 .9 million in 1995-96 (information obtained by fax from Pensacola 

6-10 
City Finance Department). The resulting operating deficit is covered by a subsidy from the 

City of Pensacola; in 1995-96 the subsidy totaled $1 .5 million. 

An economic impact study of the port, conducted in 1979, noted that at the 2.5 million tons 

handled in 1978, the port was operating at maximum capacity (Ranelli 1979) . Since this is 

two to three times the tonnage handled in recent years, the Port of Pensacola appears to have 

significant excess capacity to handle additional cargo. An analysis of the prospects for 

development of the port conducted for the National Research Council, however, noted that it 

had the following serious competitive disadvantages relative to Mobile, the port's principal 

competitor : limited waterfront space (the Pensacola Historic District and Government Center 

abut the port), poor location of rail lines (which crossed downtown streets at grade and lacked 

space for marshaling yards), shallower channels (33 feet versus Mobile's 40 feet), lack of 

mobile cranes to handle containers, lack of other specialized facilities available in Mobile 

(large grain elevators, cold storage plant, and rotary railroad car for unloading bulk oars), 

and, importantly, less access to capital (i .e ., City of Pensacola versus State of Alabama) 

(Alexander et al . 1979). The report also noted severe conflicts between truck traffic serving 

the port and the adjacent residential property, historic district, and general urban traffic 

(since solved by improvements to I-110), and environmental conflicts that prevented 

improvements to channel depths (lack of sites to dispose of dredge spoil) . But, it concluded 

there was the potential for the port to handle a much greater volume of trade than it was 

handling at that time (and which has since declined). 

A Port Advisory Committee, created by the Pensacola City Council in 1996, recommended 

that governance of the port change from its current status as a city agency to an autonomous 

regional port authority which would buy the port, using state and city funds, from the city, 

thus retiring the port's $8.7 million mortgage (Jones 1996) . (In fact, the port was operated by 

a port authority from 1945 to 1970). The committee felt this would give the port greater 

autonomy of operation, allow financial participation by other local governments in the 

region, and better take advantage of special powers granted by the Florida legislature to ports 

to help them move cargo, create jobs, and promote international trade. The committee also 

suggested that the port focus on break-bulk commodities such as bagged goods, wood and 

paper products, steel, general cargo, and other manufactured goods (Via Pensacola 1996). 

The committee concluded that the port's current facilities are adequate and that room was 

available at satellite locations to build new facilities when needed. Ideas for new facilities 

included an inland container depot and barge terminals to serve industries located on the 

Escambia and Blackwater rivers . 

The Port of Pensacola (as of 1969) did not provide facilities for making major repairs or drydocking large, deep-draft vessels; the nearest facility was at Mobile. Three waterfront, 

marine repair facilities were equipped to provide repairs to fishing boats, tugs, barges, and 

small craft (Corps of Engineers 1969). 

In addition to the port facilities owned by the City of Pensacola, industries along Pensacola 

Bay are served by barges using the Intracoastal Waterway, which bring in petrochemicals, 

6-11 
coal, and fuel oil. According to the Florida International Handbook (1968), however, only 

two towing companies used Pensacola as a home port. 

In 1969, the Corps of Engineers tallied 26 piers, wharves, and docks on Pensacola Bay 

(excluding facilities used solely for recreational craft), 15 on the north side and the remainder 

along the shores of Bayou Chico. Among these were 7 used for marine services and repairs, 

5 used for seafood, and 6 used for petroleum products (Corps of Engineers 1969). 

The Corps of Engineers has dredged deep-water channels and a mooring basin for aircraft 

carriers in the bay opposite the Pensacola U.S. Naval Air Station. 

Port of Panama City 

The Port of Panama City is located on the northeast side of St. Andrews Bay, approximately 

163 nautical miles east of Mobile and 265 nautical miles northwest of Tampa (Corps of 

Engineers 1969; 1986). From the Gulf of Mexico, deep-draft vessels enter the bay through a 

40-feet deep dredged channel at Lands End. St. Andrews Bay, which is naturally deep and 

nearly landlocked, is 10 miles long and has a maximum width of 3.5 miles between the 

barrier peninsula (Lands End) and the mainland. Federally maintained channels, 38-feet deep, 

lead from the main entrance channel to the Port Authority terminal at Dyers Point and 

eastward to the Bay Harbor terminal . Port authority facilities are approximately 7.5 miles 

from open water in the Gulf (Shepherd 1964). No bridges cross the main channel between the 

Gulf of Mexico and Panama City waterfront. The Gulf Intracoastal Waterway passes through 

St. Andrews Bay. The Corps of Engineers (1986) reports that "Excellent anchorage can be 

found almost anywhere in St. Andrews Bay where the depth is suitable." Anchorage off of 

the wharves of Panama City is 35-feet to 40-feet deep at mean low water. 

The Port of Panama City is operated by the Panama City Port Authority, which is a cityowned agency created by the Florida legislature in 1945 (Etheredge and Berry 1990). In 

1964, the municipally owned docks comprised 17 acres and were available for industrial 

development (Shepherd 1964). Services available included stevedoring, rail and truck 

service, warehousing, electric power, natural gas, dockside gantry cranes, and other cargo 

handling equipment. The port authority facility was subsequently expanded by development 

of a new ship terminal and adjacent 117 acre industrial park. The terminal had 32-foot water 

depth for ocean-going vessels . A 44,000 square-foot warehouse was completed in 1967. The 

facility had 4,600 lineal feet of waterfront and direct access to U.S . Highway 98. The 

terminal handled 97,000 tons of cargo in that year (Panama City Herald 1968) . 

In 1969, the Corps of Engineers tallied 33 piers, wharves, and docks (excluding those used 

exclusively for recreation) on St. Andrews Bay (including 4 for general cargo, 1 for coal for 

plant consumption, 6 for petroleum products, 6 for shell, and 1 for bulk fertilizer, paper 

products, and naval stores). The Panama City Port Authority operated two general cargo 

facilities with 32-feet mean low water depths and Bay Harbor Warehouse Corporation 

operated two others . Four transit sheds at these facilities had 131,450 square feet of cargo 

6-12 
space (Corps of Engineers 1969). Eight waterfront facilities at the port were equipped to 

receive petroleum products . 

As of 1969, general cargo at the port was generally handled by ships' tackle, but crawler and 

truck cranes with a capacity of 125 tons were available from a local rental service (Corps of 

Engineers 1969). The Panama City Port Authority wharves were served by three electric, 

traveling, revolving, full-portal gantry cranes for making heavy lifts and handling cargo 

(Corps of Engineers 1969). 

A more recent (Etheredge and Berry 1990) listing of the Port Authority facilities at Dyers 

Point listed : 

5 deep-water berths 

375,000 square feet of warehousing space 

600 foot barge terminal 

Several industries located within the Port Complex. 

In addition to the development of the port facilities described above, Etheredge and Berry 

(1990) note that the Port Authority has been very active in promoting economic development 

in Bay and surrounding counties . One aspect of this was creation of Foreign Trade Zone #65 

at the port in January, 1981 . The Foreign Trade Zone status allows companies operating 

within the zone to perform certain activities involving imported goods without paying duty 

on them until they enter into the commerce of the United States . These activities can include 

manufacturing, as well as warehousing. The principal tenant in Foreign Trade Zone #65 is 

Berg Steel Pipe Corporation, which manufactures pipe that is used by oil refineries, oil 

companies and pipeline transmission operators for the transmission of all types of petroleum 

products and natural gas. Wellstream, another company in the port free trade zone, 

manufactures high pressure flexible pipe for offshore oil and gas production, among other 

uses (Bay Biz 1992a). 

Current information on the port's operations, similar to those reported for Pensacola above, 

were not available in published sources . However, the following annual cargo movement 

were reported for the port for the 1989-91 era (Etheredge and Berry 1990): 

Forestry 

Iron and steel products 

South Atlantic Services 

Alimenta USA 

400,000 tons 

150,000 tons 

20,000 tons 

50,000 tons 

Like Pensacola, the port saw a sharp decline in bagged cargo as shippers changed to 

containers, which were shipped to South Atlantic ports for export (Etheredge and Berry 

1990). 

In 1990, the port authority was to have purchased a 120 ton capacity gantry crane, which 

would enable it to compete for container cargo (Etheredge and Berry 1990) . Facilities were 

6-13 
not available at the port for making major repairs or dry-docking large, deep-draft vessels; the 

nearest facilities were at Mobile. Four facilities were available for repairs to smaller vessels 

(Corps of Engineers 1969). 

Rail service, as of 1969, was reported to be provided by the Atlanta & St. Andrews Bay 

Railway. One company, as of 1969, provided towing, docking and undocking services, using 

two tugs (Corps of Engineers 1969) . 

In the mid-1980s, a review of alternative sites for onshore OCS facilities noted that Watson 

Bayou, Panama City, contained possibly the largest refined petroleum products receiving 

terminal in West Florida (State of Florida, Department of Community Affairs 1984) . 

Social and Economic History of Pensacola and Panama City 

The potential impacts of OCS activities on the ports of Pensacola and Panama City will be 

mediated by the role of each port in the life of its community. Here we find sharp differences 

between the two. Pensacola is one of the U.S.'s most historic cities (it claims to the oldest 

city in America) and the port played a central role through much of its growth and 

development. Panama City was founded much more recently, and the port in much less 

intimately associated with its growth and development. Thus, most of the attention here is 

given to Pensacola and its port (in part, also, because the literature on the history of the cities, 

West Florida, and Florida in general, is much richer for Pensacola than for Panama City, 

which has been neglected by most historians). 

Pensacola 

The city of Pensacola owes its very existence to its port, which for more than two centuries 

was the mainstay of the local economic base (Ranelli 1979) . Pensacola Bay was first 

explored by the Spanish in the 16`h century, and the Spanish attempted to establish a colony 

there is 1558 . The site changed hands between the Spanish, British and French several times 

before, in 1821, it became a U.S. possession . Between 1821 and the early 1900s, the city 

flourished as a center of Gulf Coast lumber production, which used the port to ship products 

to markets throughout the world. As that industry declined, largely because of the failure to 

provide for reforestation as millions of acres in the surrounding region were harvested, the 

importance of the port also declined . After World War I, Pensacola's economy became 

increasingly dependent on the Pensacola Naval Air Station, and on tourism. It, as well as 

other Florida Panhandle cities, shared only minimally in the economic boom that affected the 

rest of Florida, and the Port of Pensacola languished behind its chief competitor, the Port of 

Mobile, as well as other large Gulf Coast ports, such as New Orleans and Houston. 

6-14 
The Colonial Era 

Pensacola is the United States' oldest port (Alexander et al . 1979). After glowing reports of 

the harbor in 1528 by Pamphilio de Navarez, in 1558 Spain sent a large fleet and some 1500 

soldiers under Don Tristan de Luna to settle the area. After the colony failed in 1562 (the 

settlers had trouble finding enough food and a hurricane in 1561 killed 200 people and 

destroyed the fleet), the Spanish waited for over a century before attempting another 

settlement there in 1696, when a small village was put in place by Don Andres de Arriola as 

a military base to stop French expansion from the west (and it was repeatedly harassed by the 

French, as well as by Indians and the British) (Tebeau 1971) . The choice of Pensacola was 

based on the observations of Gongora, who surveyed the bay in 1693 and wrote, "That bay is 

the finest jewel possessed by his majesty-may God protect him!--not only here in America 

but in all his kingdom" (quoted in Leonard 1967). 

In 1719, the French defeated the Spanish and burned the town (Appleyard 1976). 

Nevertheless, the Spanish returned for a third time in 1722 to establish a permanent colony 

on Pensacola Bay, this time on Santa Rosa Island . This settlement lasted until 1752, when it 

too was destroyed by a hurricane. The survivors moved to the mainland to the site of 

present-day Pensacola and established a small village (it had a population of about 100 in 

1760), but after the Seven Years War between England and France, in 1763 the town was 

ceded to the British by the Treaty of Paris . (Tebeau 1971) By 1770, a visitor from Georgia 

observed that the town contained about 180 timber houses (Romans 1775 ; reprinted 1961) . 

The seaport prospered under twenty years of British rule (during this period the Old City area 

and present-day Historic District were platted), although, as in later years, it never could 

compete effectively with Mobile and New Orleans as a gulf seaport (Fabel 1988). After the 

British lost the Revolutionary War, U.S . ally Spain returned and controlled the town until 

1821 . This final period under the Spanish crown saw the development of an important fur 

trade, managed by the Scottish firm of Panton, Leslie & Company (who established a trading 

post-warehouse on the waterfront in Pensacola, when it was under British rule), in which 

goods were shipped through 

Pensacola to London, Havana, and Nassau. Writing in 1948, the editors of the Nautical 

Gazette noted, 

. . .the city still retains much of the atmosphere of a Spanish town. The names of the 

streets- Alcaniz, Zarragossa, Palofox, Taragona, Intendencia, Moreno, and 

Gonzalez-are a heritage from early Spanish settlers . Many of the descendants of 

those settlers are prominent in the life of the city today. (Nautical Gazette 1948) 

The Port in the Nineteenth Century 

When the U.S. acquired Florida by treaty, signed in Pensacola in 1821 (after two expeditions 

to Pensacola by Andrew Jackson), the government began investing in improvements to make 

Pensacola harbor a naval base from which to enforce the Monroe Doctrine, which had been 

6-15 
declared in 1823. By this time, the town had some 4,000 citizens and the port was active 

shipping the two most important local products-bricks and cotton (Cole and Weddell 1952). 

However, because it lacked significant rivers, trade through Pensacola fell far behind that of 

competing cities such as New Orleans and Mobile (Bowden et al . 1989). 

In 1824, Pensacola (with a population of about 1400) was incorporated as a city. The 

previous year the Florida legislature petitioned Congress to invest in fortifications and a 

naval station. It was successful, and President John Quincy Adams signed legislation 

authorizing a Gulf naval yard in 1825 (Pearce 1980) . This began Pensacola's long-standing 

association with the Navy and also led to economic prosperity in the 1830s, spurred by the 

government's projects and military presence (the West India squadron was stationed in 

Pensacola) and the growing demand for timber, which also led to plans for the first railroad 

serving the port (but the Panic of 1837 scuttled the railroad) . In subsequent years the naval 

facility at Pensacola was important in combating the slave trade and piracy in the Caribbean, 

and the U.S . fleet stationed there played an important role in blockading Mexico during the 

Mexican war, but the naval yard itself saw little business. 

At the start of the Civil War, Pensacola was the largest city in Florida and had significant 

naval facilities, including the "million dollar" Navy Yard (Bowden et al . 1989). Rail access 

was finally provided by 1860, but it was destroyed during the war, along with the rest of the 

city. Union troops recaptured the Navy Yard after retreating Confederate troops had burned 

the city and destroyed the facility, but it was quickly reconstructed and Pensacola served as 

base for outfitting the attack by Admiral Faragut on Mobile Bay. However, evacuations of 

the town by both Confederate and Union forces in 1862 and 1863 resulted in Pensacola being 

". . .a veritable ghost town" (Tebeau 1971). After the war, the naval yard at Pensacola was 

rehabilitated and named as the headquarters of the West Gulf Squadron, but it saw little use 

over the coming decades, in spite of efforts by local leaders to spur Congress and the Navy to 

improve and use the facility (Pearce 1980). It was finally abandoned in 1911 following yet 

another hurricane and the outbreak of yellow fever. 

However, after the war, Pensacolans returned to the city, ". . .hoping port shippers and the 

newly organized workingman's association of stevedores will bring a forest of sailing ships 

into Pensacola's harbor" (Bowden et al . 1989). Their hopes were realized, as during the 

latter half of the nineteenth century the city and port flourished as a center for the finishing 

and export of lumber to western Europe (Pensacola was known as the "Yellow Pine Capital 

of the World") and as a fishing port, as Yankee fisherman worked the Gulf for red snapper. 

According to Appleyard (1976), ". . .Pensacola's whole lifestyle was built around the 

production of lumber . . .and the city's ability to export it ." During this period, the waterfront 

developed adjacent to the downtown and became an integral part of the city's economic base. 

In 1880, Pensacola had a population of 6,845, which, in spite of yellow fever epidemics at 

the turn of the century, increased to 17,747 in 1910 (which ranked it as the number two city 

in Florida) (Tebeau 1971). 

6-16 
By 1882, the port had a draft of 22 feet and shipped something less than one million tons of 

timber, red snapper (commercial shipments of fish began in 1872), and other products (Cole 

and Weddell 1952). It gained permanent rail service in 1882, when a line to Jacksonville was 

completed by the Pensacola and Atlantic Railroad (later the L&N Railroad) . The railroad 

used the port as a coaling station and also invested heavily in docks, a warehouse, and grain 

elevator. In fact, by 1885, ". . .there were 16 wharves along a three mile strip in Pensacola" 

(Alexander et al . 1979). Thereafter until turn of the century the port did a gradually 

increasing business in the export of lumber and other goods (Appleyard 1976; Wooley 1906), 

and experienced brief booms during the Spanish American War and in anticipation of trade 

through the Panama Canal to the Pacific. After the war, however, it went into decline as its 

port facilities were eclipsed by those in Jacksonville, Mobile, and New Orleans and as the 

timber stands that fed the lumber industry were exhausted. This despite the exhortations of 

local boosters such as Frank L. Mayes, editor of The Daily News, who exclaimed, 

"Pensacola's Watchwords, Boost, Boom and Build-That's all." (cited in Bowden et al . 

1989) . Mayes called for boosting Pensacola as the best Gulf Coast port and natural terminus 

of northern railways . 

The port and timber shipping at the turn of the century helped build many Pensacola 

residents' image of the city . Writing about his fifty years in Pensacola, Don McLellan (1945) 

wrote that his initial reason for coming to the city was the port : 

One of the chief points of my attraction was the great collection of ships in the harbor . 

There must have been 350 vessels at anchor or moored to the dozen or more docks, to 

either load cargo or discharge ballast. All of them were sailing vessels, and 

represented almost all of the North Europe countries . . . 

He went on to observe the decline in business at the port, but its legacy lived on through 

institutions such as the waterfront saloons, Norwegian Seamen's Church, and in local lore . 

The Port and Pensacola in the Twentieth Century 

By the start of World War I, Pensacola had again drifted into ". .nature-endowed Florida 

isolation" (Bowden et al . 1989); but, in it woke up in 1914, when the federal government 

established the U.S . Naval Aeronautical Station at the old Navy Yard in Pensacola. This 

facility grew over the years so that it became a mainstay of the local economy. The navy, 

however, has never used the port for ship building or maintenance, and the air station has not 

resulted in much in the way of port-using spin-off industries . The Port of Pensacola, itself, 

benefited for a time from docking of an aircraft carrier at port facilities, but the Navy 

subsequently built its own facilities on the harbor, which it also uses for shipping military 

supplies and equipment. 

Between the world wars, the harbor was dredged from 22 feet to 30 feet, and the St. LouisSan Francisco Railway (Frisco system) provided a second rail service to the port, which 

opened up markets to the west. However, a devastating hurricane in 1926 destroyed most of 

the 16 wharves, which were not immediately replaced as the economy went into decline with 

6-17 
the Great Depression. The port languished (one observer noted "the Port of Pensacola 

became a shadow" (Appleton 1976) until the start of World War II, when it began to be used 

to ship oil and coal. 

As the port declined, another business began to prosper, built around another mode of 

transportation . Cole and Weddell (1952) wrote: 

Meanwhile development of the coastal area here as a summer resort seems certain to 

lead to eventual economic prosperity. It began with the advent of the automobile, 

which led to a road paving program in 1921 and bridges across Pensacola bay and 

Santa Rosa sound in 1932. In 1937 a municipal advertising authority was created to 

promote the city's resort and industrial attractions . . . . 

In addition to tourists, the 1920s saw a speculative land boom throughout Florida, promoting 

the state as the place for a winter home (Gannon 1996). Also, some new industry began to be 

attracted to the Pensacola area as well, including a large paper mill and a plant of the 

Chemstrand Corporation. Thus, from the 1920s Pensacola saw itself as both a prospective 

major industrial center and as a tourist paradise . As newspaper editor John Perry wrote in the 

1920s, Pensacola would be ". . .a future port and manufacturing center of consequence with 

the image of a resort metropolis" (Bowden et al . 1989). 

With the advent of World War II, the Pensacola Shipyard and Engineering Company 

expanded to employ 7,000 workers by early 1942, and the government spent $55 million 

expanding the Naval Air Station and its auxiliary fields . (Gannon 1996). In order to sustain 

the prosperity brought about by the war, the city established a port authority in 1945 . In 1954 

the authority built a 6400 square foot warehouse and bulk material conveyor to meet the 

needs of the nitrate trade from Chile (Alexander et al . 1979). Later in the 1950s, the 

authority built additional warehouse space and purchased land adjacent to its docks from the 

Frisco Railroad. But, disaster struck once again in 1955, when a fire destroyed the only coal 

tipple at the port, which ended coal shipments, since it was never replaced. Another fire in 

1958 destroyed several additional warehouses and the bulk conveyor system. 

A feasibility study was conducted in 1960 to determine how the port should rebuild from the 

fires. The report noted that the port was obsolete : 

Its port facilities, however, are in no way comparable to its competing ports. 

As far as general cargo is concerned, they consisted, at best, of three old piers, 

two built by the L & N and one by the predecessor of the Frisco in the days 

when Pensacola was a leading lumber port. (Coverdale and Colepitts 1960) 

Although exports through the port were only 150,000 tons, business was increasing and 

Coverdale and Colepitts recommended that four new berths and two warehouses be 

constructed. But then a disaster of another sort occurred with the Cuban Revolution and 

subsequent cessation of U.S. trade with Cuba, since a large portion (over 70 percent in 1954) 

of the port's exports were to Cuba (Florida Development Commission 1956). As a result of 

6-18 
the loss of business, the port was unable to raise the capital needed, only two berths and one 

warehouse were actually constructed. 

The port's business expanded in the 1970s with the export of rice (Appleton 1976), which led 

many shippers to complain about delays due to limited dock space. Plans were formulated to 

expand, but again financing was problematic (Alexander et al . 1979). To overcome this 

constraint and make it possible to sell bonds for the needed improvements, the Port Authority 

was integrated into the city government as a division of the Transportation Department 

(Harris 1969). This strategy was successful, and the city was able to add two berths and a 

large warehouse, a new fuel oil terminal, barge terminal, and a liquid sulfur transfer facility . 

These improvements helped the port by the mid-1970s to increase the tonnage exported to 

over 1 million tons (John Appleyard Agency 1976). Over the following two decades, 

however, for a variety of reasons business at the port stagnated, as noted in Part II of this 

report . 

Blanchard (1964) observed that Pensacola was said to have the largest red snapper fishing 

fleet in the world, but that industry has since declined . In 1975, another dimension to the 

fishing industry was added when Vietnamese fishermen and shrimpers began settling in 

Pensacola, where they are reported to have ". . .applied energetic ethnic entrepreneurship to a 

sleepy Gulf Coast industry" (Gannon 1996). 

The 1970s also saw interest in oil expand in Pensacola. The development of the oil field in 

neighboring Santa Rosa County, according to Appleton (1976), led many Pensacolans to ask 

hopefully, "HOW ARE THEY GOING TO GET THE OIL AND ITS BY-PRODUCTS 

OUT?" (caps in original) . One alternative evidently was a pipeline to the Pensacola port and 

out via tankers . Also, during the 1970s oil imports began as a tank farm was built on Bayou 

Chico, importing over 300,000 tons in 1974, and more storage tanks were built on leased 

land in the port, but only "after stormy debate with historical and environmental interests" 

(Appleton 1976). 

The historic character of the port and its vicinity was recognized by many citizens, who in 

1967 petitioned the legislature to create the Pensacola Historic District and Historic 

Pensacola Preservation Board. In the 1970s, the city began efforts to revitalize the downtown 

area adjacent to the port, including the Pitt Slip Marina, 6-story Harborview Office Building, 

and Baylin Street Slip (Bowden et al . 1989). As noted in Part II of this report, some 

observers note that the historic and business character of the area adjacent to the port created 

severe constraints on expansion of the port to respond to the container revolution . 

While the Port of Pensacola's business fluctuated up and down during the post-war years, 

activities associated with the Naval Air Station expanded steadily. In 1965, Chevalier Field 

became a heliport for West Florida's " . . .largest industry, the Naval Air Rework Facility . . . 

(which by the 1980s) . . .employs thirty-six hundred civilian technicians in aircraft repair" 

(Bowden et al . 1989). The Naval Supply Center, established in 1985, " . . .serves as a vital 

home porting pipeline as the ship-supply distribution center for naval facilities along the Gulf 

Coast and throughout the Southeast" (Bowden et al . 1989). In addition, Pensacola became a 

6-19 
retirement center, as former Navy personnel returned to the area for the retirement years 

(Hutchinson 1961). 

Pensacola and the rest of the Florida Panhandle long has been viewed as a "stepchild" in 

Florida, because the region has lagged far behind the rest of the state in economic growth. 

Scott (1968) termed it a "backwater area." After a century-long slide, by 1990 Pensacola had 

slipped from its place as the largest city in Florida in the mid-nineteenth century to tenth 

place among cities in the state. While the port and industrial development were once viewed 

as a way of reversing this situation, now tourism seems to be viewed as the best hope for 

development. As Bowden et al . (1989) have observed, Pensacola's "Ambition . . .(is) to be a 

national tourist-destination city! . . . Saving and preserving its seacoast gifts of nature and 

historical landmarks, Pensacola looks beyond its substantial U.S. Navy economy." Industrial 

development and the port are not mentioned as keys to the area's future economic prosperity. 

Panama City 

The first white settlement on St. Andrews Bay occurred in 1717, when the French, who 

sacked Pensacola in 1719, erected a fort at what is now Mexico Beach (but the Spanish 

occupied the site a year later) . In contrast with Pensacola, however, Panama City's roots do 

not lie in the contest between England, France, Spain, and the United States for West Florida. 

Rather it is the product of real estate speculation. 

Founding of the City and Its Early Years 

In 1887, the St. Andrew's Railroad, Land and Mining Company platted the land where the 

Panama City sits today into small lots, many only 25-feet wide, which were sold for $2 .00 

each. Some 300,000 deeds were recorded! Because the lots were virtually useless, people 

who came in 1888 (most by boat via Pensacola) to build in the new city (then called New St. 

Andrew) were forced to homestead other property or settle in the adjacent Town of St. 

Andrew, which itself had been founded just three years earlier in 1885 . 

About 1900, when what is now Bay County (it was not formally organized as a county until 

1913) had a population of less than 2,000 (Drummond 1928), two of the men who had 

emigrated to the area in 1888 bought up adjacent homesteads and platted another town site, 

initially named Harrison. The town was renamed Panama City in 1907. The town's founders 

intended to bring a railroad to the city and establish a port which could take advantage of the 

soon-to-be-opened Panama Canal. The railroad company received 25 percent of the stock in 

the development company plus beach-front property and was to build, maintain, and operate 

terminal docks. With ice plants constructed by the railroad, the city attracted fishermen from 

Massachusetts, and a thriving fishing industry developed at the new port (fishing was the 

mainstay of the local economy until 1930) (Morgan 1957) . Several hotels were built near the 

bay, and stores moved up Harrison Avenue from the waterfront . However, shipping through 

the port failed to meet expectations, possibly because the channel into St. Andrews Bay was 

not completed until 1914 (Drummond 1928). 

6-20 
Instead, developers began to turn their attention, once again, to real estate speculation. As 

Womack (no date) notes, 

Promoters envisioned all routes leading to Panama City. They were convinced, 

because of its location, that Panama City would become the Gulf's leading port and a 

direct link to the Panama Canal. But the advertising soon changed, and developers 

concentrated on attracting tourists to the beaches . 

During the 1920s, Panama City shared in the Florida real estate boom, and the population 

increased to over 7,000 (Drummond 1928). Buildings and hotels mushroomed. To further 

spur economic growth, in 1926 the Florida legislature approved consolidation of two adjacent 

towns, Millville (settled by the German-American Lumber Company in 1901) and St. 

Andrew, into Panama City. In 1930, the International Paper Company built a mill on St. 

Andrews Bay (which as late as 1970s remained the largest industrial establishment in the 

county), and the Corps of Engineers, in 1933, began construction of New Pass to provide a 

deeper channel from the Gulf into St. Andrews Bay and to the Port of Panama City. The 

natural depth of the entrance to St. Andrews Bay was between twelve and eighteen feet, 

which put it at a disadvantage in comparison with Pensacola Bay (Morgan 1957). The new 

channels and related port facilities led the Chamber of Commerce of Panama City (1935) to 

claim in a promotional brochure, "Panama City is destined to be one of the largest cities in 

the State, and in two years it has, as a port, become one of the largest and mostly widely 

discussed ports in the country." 

But, with the rest of the nation, the economy gradually slid into the Depression. To provide a 

source of income during the Depression, the WPA promoted the shrimp industry on St. 

Andrews Bay along with exploitation of the area's abundant oyster beds (Gannon 1996) . 

This industry grew steadily (and, along with Pensacola, experienced an influx of Vietnamese 

fishermen and shrimpers in the mid-1970s). 

World War II and Post-War Years 

Panama City's fortunes took a turn for the better with the onset of World War II . At the start 

of the war, "Bay County languished in poverty, an isolated wedge supporting 20,000 

residents along Florida's Big Bend. The county population more than doubled by 1945" 

(Gannon 1996). Womack (1984) observed, "World War II changed the Panama City-Bay 

County area forever by introducing thousands of military personnel and shipyard workers to 

the "World's Most Beautiful Beaches." The Army established a gunnery school in Bay 

County (which soon was named Tyndall Field), the Navy established a Naval Section Base, 

and, at Wainwright Shipyard, 102 liberty ships and 6 tankers were built during the war. 

(Womack, 1984) . 

After the war, Tyndall Field continued as an active Air Force installation, and the Navy 

leased, and then in 1965 sold, the shipyard to the Panama City Port Authority, which 

converted it into Port Panama City (Spiva 1981). In its early years the port relied heavily on 

the import of petroleum products for business (90 percent according to Morgan 1957). 

6-21 
Morgan went on to note: "The port is predominantly importing/receiving petroleum products 

from Louisiana and Texas, nitrogenous fertilizer from mainly Chile, and industrial chemicals 

from mainly Germany. . . ." He complained of poor port facilities (". . .the same piers, wharves 

and docks which comprise the main facilities for handling waterborne commerce in 1956 are 

the ones which were used in 1941") . This problem was corrected in the mid-1960s after the 

city purchased the port site . Reflective of its focus on tourism (and in contrast to Pensacola), 

port facilities for large ships were never developed at the site of the original port adjacent to 

the downtown central business district at the foot of Harrison Avenue. Instead, as noted 

above, the city developed municipal port facilities at the site of the old Wainwright shipyard, 

which was more suited to industrial development. Instead, the waterfront site of the original 

port has been used for small boat activities centered on Panama City Marina (Womack 1994). 

Blanchard (1964), in fact, notes that this " . . .once sleeping village. . . (is) now (a) well-known 

sport-fishing center" (Blanchard 1964). 

In the 1980s, the Port of Panama City (St. Andrews Harbor) hosted facilities that supported 

OCS development in the Gulf of Mexico. Risotto and Collins (1986) state that activity had 

declined by 1984, but two drilling mud companies-Barold and Imco-were still 

maintaining a presence in the port. They also noted that Eastern Marine Inc. was planning to 

develop a supply base at the Bay Harbor Shipyard. 

According to one report (Hutchinson 1972), factors contributing to the growth and 

development of Panama City, have included: 

The manufacturing and shipment of lumber and naval stores, 

succeeded by the building of a paper mill at Millville with a capacity 

of 2,000 tons of paper daily. 

The building and operation of a large shipyard. 

The installation of Tyndall Air Force Base. 

The improving of the A & St. A.B. Railroad making the line a first 

class road (the first in the United States to be operated by diesel power 

and the first in freight tonnage per mile). 

The co-operation (sic) of progressive and public-spirited businessmen 

in civic affairs of the town. 

However, a number of factors have also stifled development. Those mentioned by Scott 

(1968) include : geographic isolation, scarcity of mineral deposits, scarcity of high quality 

agricultural land, lack of skilled labor, lack of cultural amenities, scarcity of local capital for 

investment, and the conservative outlook and negative attitudes toward industry of local 

political leaders . However, Scott (1968) observed that "Port-related industry shows perhaps 

the greatest potential for future expansion" (the main problem being finding industries which 

would deem it advantageous to locate along the coast of the central Florida Panhandle) . 

As is evident from the above narrative, the port facilities in Panama City have attracted much 

less attention than those of Pensacola. The port, which is of relatively recent vintage, is 

much less intimately involved in the history and identity of the city, and it has not had to 

6-22 
contend with the conflicting interests faced by Pensacola. As a result, while Pensacola's port 

has gradually declined in business and importance, the Port of Panama City has gradually 

gained prominence. In fact, the Port of Panama City now ranks somewhat higher than 

Pensacola in the dollar value of both imports and exports. 

6-23 
KEY STAKEHOLDERS 

The literature consulted was neither current nor detailed enough to provide information on 

the identity of stakeholders who will be affected by the use of the ports as OCS service or 

support bases. The literature does provide leads, however, on the general types of 

stakeholders that are likely to be affected in either one or both ports and some (though likely 

dated) information on the identity of specific stakeholders . That information is provided in 

this section. 

Harbor Users (Other Than Port Users) 

Pensacola Bay (and adjoining water bodies): 

American Cyanamid Company 

Armstrong Cork Company 

Chemstrand Corporation 

Barge lines 

Commercial and sports fishing interests 

Escambia Chemical Corporation 

Monsanto Chemical 

Oil company terminals 

Warren Petroleum Corporation, Philips Petroleum Company, LaGloria Oil 

and Gas Company, Gulf Oil Company, Chevron Oil Company 

Runyan Machine & Boiler Works Shipyard 

St. Regis Paper Company 

Tenneco Chemicals 

U.S . Naval Air Station on Pensacola Bay 

Weis-Fricker Mahogany Company Conveyor 

St. Andrews Bay: 

Barge lines 

Bay Harbor Shipyard 

Commercial and sports fishing interests 

International Paper Company 

Oil company terminals 

Tyndall Air Force Base 

Port Agencies/Related Establishments 

Bar and pilot services 

Chambers of Commerce 

City of Panama City 

Mayor and city council 

6-24 
City manager 

Planning commission 

City of Pensacola 

Mayor and city council 

City manager 

Planning commission 

Historic District Commission 

County governments 

Pensacola: 

Escambia County (elected officials, manager, planning commission) 

Santa Rosa County (elected officials, manager, planning commission) 

Panama City 

Bay County (elected officials, manager, planning commission) 

Gulf County (elected officials, manager, planning commission) 

Walton County (elected officials, manager, planning commission) 

Export packing and crating companies 

Freight forwarders 

General warehouses 

Port of Pensacola, City of Pensacola Department of Transportation 

Pensacola Port Advisory Committee 

Panama City Port Authority 

Railroads 

Burlington Northern and CSX (Pensacola) 

Atlanta and 5t. Andrews Bay Railway (Panama City) 

Ship chandlers 

Ship repair companies 

Steamship lines and agents 

Stevedore companies 

Tenants of port-owned facilities/port-owned land 

(e.g ., Berg Steel Pipe Company in Panama City Trucking companies 

Federal Agencies 

Corps of Engineers, U.S . Army 

U.S . Bureau of Customs 

U.S. Coast Guard, Department of Commerce 

U.S. Department of Agriculture 

U.S. Environmental Protection Agency 

U.S. Fish and Wildlife Service 

U.S. Immigration and Naturalization Service 

U.S. Maritime Administration 

6-25 
State and Regional Agencies 

Department of Community Affairs 

Department of Environmental Regulation (administers state Coastal Zone 

Management Program) 

Department of Natural Resources 

Environmental Policy Unit, Office of Planning and Budgeting, Executive Office of 

the Governor 

Florida Seaport Transportation and Economic Development Council 

West Florida Regional Planning Council 

6-26 
IMPACTS OF OCS DEVELOPMENT ON PORTS 

Literature that has examined the impacts of OCS development on port facilities was 

consulted to determine whether the ports of Pensacola and Panama City were likely to 

experience any positive or suffer adverse effects from their use as on-shore service or support 

bases. 

A variety of sources describe the likely onshore port facilities that are required to support 

OCS exploration and development (American Society of Planning Officials no date; Brower 

et al . 1981 ; Clark and Terrell 1978; Council on Environmental Quality 1974; New York State 

Department of Environmental Conservation 1977; New England River Basins Commission 

1978; Research and Planning Consultants 1977; Schneider 1977). 

Brower et al . (1981) state that "Existing ports are not always able to readily accommodate 

OCS service facilities," but they provide no evidence in support of the assertion. In fact, in 

the research conducted for the present report, very little was found on the impacts of existing 

OCS development on ports and port facilities . This suggests that such impacts have been 

minimal, since they apparently have attracted little attention. 

The Council on Environmental Quality (Gillman 1977) examined the effects of offshore oil 

development on port communities in Louisiana and Scotland. In Louisiana, the CEQ study 

looked at Morgan City, where it found that the town gradually expanded to serve as an 

offshore oil center. Although there were potential conflicts with deep-water shrimp boats and 

facilities, since the shrimp fleet had relocated there from other southern ports in the 1930s, no 

such conflicts are noted. 

In Scotland, CEQ (Gillman 1977) examined the two ports most affected by North Sea oil, 

Aberdeen and Peterhead, both of which were old fishing ports. The study reported adverse 

effects on housing and problems of job competition, since the offshore work paid more, but 

found little effect on the fishing industries in the ports ("Fishing is surviving. Aberdeen and 

Peterhead are still first and second among Scotland's fishing ports . . .oil has not drawn people 

away from fishing as an occupation . . . . Fishing boats and oil rig work boats have been able to 

share the harbors of Aberdeen and Peterhead too, though overcrowding was a problem until 

dock space was enlarged.") 

The Port O'Connor, Texas was studied for a report by Research and Planning Consultants, 

Inc. (1977). OCS activity had resulted in some development in the port-helicopter pads, 

crew boat and service docks, and three mud companies-but, "The OCS activity has 

apparently not conflicted with commercial fishing activity" (Research and Planning 

Consultants 1977) . 

Thus, it appears that to date ports have been able to accommodate OCS-related development 

with little notable disruption of existing facilities and operations . 

6-27 
OCS DEVELOPMENT AND THE PORTS OF 

PENSACOLA AND PANAMA CITY 

Havran et al. (1982) state that both Pensacola and Panama City have served as onshore 

service and supply bases for previous exploratory facilities in the northeastern Gulf. 

However, the literature reviewed in previous sections of this report made virtually no 

mention of this use of these ports. As reported below, there is some indication that local 

economic leaders might favor increased port activity in support of OCS development, but a 

report in the mid-1980s by the State of Florida, which examined possible sites for onshore 

support facilities, found little interest in accommodating OCS support activities by either the 

Port of Pensacola or Panama City Port Authority, in both cases because they would have had 

to develop new facilities to accommodate the additional business. It is possible, however, 

that downturns in port business in recent years, particularly in Pensacola, may produce a 

different attitude toward OCS support bases. 

Pensacola 

As early as 1964, economic development leaders in Pensacola viewed OCS-related 

development as a potential stimulus to the local economy. In that year, John Hamilton, 

Industrial Development Manager of the Pensacola Chamber of Commerce, is quoted as 

saying that Pensacola "has a promising future in the petrochemicals field because of 

overcrowding elsewhere along the Gulf Coast" (Shepherd 1964). 

However, the State of Florida's evaluation of OCS development in the mid-1980s had this to 

say about Pensacola's potential as an on-shore service base: 

The Port of Pensacola (Escambia County) is an industrial area that has all the 

facilities to meet the requirements for an onshore service base. However, using this 

port to support OCS activities would cause two (2) conflicts: the Port of Pensacola is 

actively using all land available, and accommodating OCS activities would require 

the City of Pensacola to purchase additional expensive waterfront property. Port of 

Pensacola officials have stated that they prefer to use all available facilities for the 

handling of rapid turnover commodities, which produce more revenue than a longterm lease of space to an oil company. According to port officials, as long as needed, 

suitable waterfront facilities can be found elsewhere in the Pensacola Bay vicinity, the 

Port of Pensacola will not consider leasing space to an oil company. (State of Florida, 

Department of Community Affairs 1984) 

6-28 
Panama City 

The State of Florida's evaluation of OCS development in the mid-1980s had this to say about 

Panama City's potential as an on-shore service base: 

The Port of Panama City has one advantage in that oil companies have previously 

leased space for a service base . . .Again, officials at the Panama City Port Authority 

have taken the position that as long as suitable waterfront sites can be found near 

Panama City, the port will not serve as an onshore service base. (emphasis in original) 

(State of Florida, Department of Community Affairs 1984) 

However, the state did note that on Watson Bayou in Panama City the site of the petroleum 

products receiving terminal would be suitable. In the words of the state report : 

All requirements for an onshore service base could be met in Watson Bayou, with 

minimum capital investment . There is a company that builds and operates crew boats 

in the area. Boat repairs, industrial parts, welding services, or even steel fabrication 

services would be readily available in this area . . . . This site is about (9) miles from the 

Gulf of Mexico. (State of Florida, Department of Community Affairs 1984) 

6-29 
CHAPTER 7 

SOCIOECONOMIC BASELINE OF THE FLORIDA PANHANDLE 

This study will consider the demographic and economic baseline and projections for the fivecounty (Okaloosa, Escambia, Santa Rosa, Bay and Walton) study area over a fifty period . 

For the period 1995-2045 the major socioeconomic indicators addressed include population, 

output, employment, and local government finance. 

Population 

Population of the study area is expected to grow steadily throughout the period 1995-2045 

(Table 7.1), with all counties projected to share in this growth. Over the period 1995-2005, 

the population of the 5-county area is projected to increase about 18 percent, which is 

somewhat less than the growth rates recorded during the 1980s and 1990s. 

Population growth in the study area is expected to result from a combination of natural 

increase (i .e ., excess of births over deaths) and net inmigration. During the period 2005-

2045, the area is projected to have annual net inmigration of 4,600 to 6,500 (Table 7 .2) . All 

five counties are expected to experience net inmigration (i .e ., more people move into the area 

than move away). 

While the area's population is concentrated around the three major metropolitan centers 

(Pensacola, Panama City, and Fort Walton Beach-Destin), a substantial proportion of area 

residents reside outside the incorporated cities . In 1997, about two-thirds of the study area 

population lived in unincorporated areas (Table 7.3). This percentage ranged from 41 percent 

in Bay County to 86 percent in Santa Rosa County. 

Regarding the educational attainment of study area residents (Table 7.4), the percentage of 

area residents (age 25 and older) in 1990 who were college graduates ranged from 21 percent 

in Okaloosa County to 12 percent in Walton County. On the other hand, the percentage who 

had not completed high school ranged from 16 percent in Okaloosa County to 33.5 percent in 

Walton County. 

7-1 
Table 7.1 

Area 

Fort Walton Beach 

Okaloosa County 

Walton County 

Panama City 

Bay County 

Pensacola 

Escambia County 

t~.> Santa 

Rosa County 

Total 

1995 2000 2005 

196,122 216,005 235,159 

162,707 178,803 194,199 

33,415 37,202 40,959 

139,173 150,277 162,188 

139,173 150,277 162,188 

377,822 410,086 441,204 

281,162 296,578 316,849 

96,660 113,508 124,354 

713,117 776,368 838,550 

Population in the Florida Panhandle 

Baseline Scenario 

2010 2015 2020 2025 2030 2035 2040 2045 

254,195 274,218 292,374 311,399 329,090 343,428 355,713 367,255 

209,523 225,720 240,693 256,235 270,726 282,836 293,458 303,489 

44,672 48,498 51,681 55,165 58,364 60,592 62,255 63,766 

174,575 187,536 198,341 210,054 218,838 227,033 234,538 241,999 

174,575 187,536 198,341 210,054 218,838 227,033 234,538 241,999 

469,488 502,482 526,239 547,200 567,029 584,973 601,966 618,202 

334,339 352,894 366,819 379,386 390,820 400,920 410,113 418,437 

135,149 149,589 159,420 167,814 176,209 184,053 191,853 199,765 

898,258 964,236 1,016,954 1,068,653 1,114,957 1,155,434 1,192,217 1,227,456 

Sources: RPC; Florida Bureau of Business and Economic Research, personal communication. 
Table 7.2 

Annual Migration in the Florida Panhandle 

Baseline Scenario 

Area 1995 2000 2005 2010 2015 2020 2025 2030 2035 2040 2045 

Fort Walton Beach 0 1,677 1,741 1,842 1,914 1,710 1,881 1,938 1,665 1,567 1,628 

Okaloosa County NA 1,174 1,219 1,290 1,340 1,197 1,317 1,356 1,165 1,097 1,140 

Walton County NA 503 522 553 574 513 564 581 499 470 488 

Panama City 0 638 1,075 1,233 1,250 944 1,142 825 942 958 1,035 

Bay NA 638 1,075 1,233 1,250 944 1,142 825 942 958 1,035 

County 

0 0 2,760 2,461 3,311 2,033 1,761 2,077 2,200 2,454 2,636 

Pensacola 

W 

NA NA 1,518 1,108 1,324 813 704 831 880 982 1,054 

Escambia County 

Santa Rosa County NA NA 1,242 1,354 1,987 1,220 1,056 1,246 1,320 1,472 1,581 

Total 0 2,316 5,576 5,536 6,475 4,688 4,840 4,807 4,979 5,299 

Source : RPC. 
Table 7.3 

Population of Florida Panhandle Living in Unincorporated Areas in 1997 

Unincorparated 

Coun Unincorporated Total as % of Total 

Bay 57,925 144,584 40.75% 

Escambia 228,576 291,135 78 .51% 

Okaloosa 100,768 171,038 58.92% 

Santa Rosa 88,014 102,338 86.00% 

Walton 28,895 36,094 80.05% 

Total 504,178 745,189 67.66% 

Table 7.4 

Educational Attainment for Residents of the Florida Panhandle 

Ages 25 and Older in 1990 

(percentage of total) 

9th to 12th 

grade, Some Graduate or 

No High School College, Associate Bachelor's Professional 

County 9th Grade Diploma Graduate No Degree Degree Dearee Degree Total 

Bay 9.1% 16.2% 30.6% 21 .6% 6.8% 10.4% 53% 82,448 

Escambia 8.0% 15.8% 28.5% 21 .7% 7.8% 12.2% 5 .9% 165,094 

Okaloosa 5.7% 10 .5% 28.8% 26.3% 7.7% 13 .4% 7.6% 90,946 

S a n t a 7 .7% 13 .8% 28.8% 23.4% 7.6% 13 .0% 5.6% 51,922 

Rosa 

Walton 13.7% 19.8% 31.1% 17 .3% 6.2% 7.4% 4.5% 19,510 

Source: U.S. Bureau of the Census. 1990 Census. 

7-4 
Output 

Output by Industry 

Projections of baseline output for the Fort Walton Beach, Panama City, and Pensacola 

metropolitan areas are summarized in Table 7 .5 .1 - 7 .5 .3 respectively . The dominance of 

tourism and federal military activity in the Fort Walton Beach area is evident in Table 7 .5 .1 . 

Hotels, lodging places, and rentals generated a total output of $840 million in 1995 while the 

services sectors accounted for $1,022 million (i .e ., $1 .0 billion) and federal governmentmilitary generated another $458 million. Thus, these three sector had a combined output of 

about $2,321,000,000 or 38 percent of the total output for all sectors. In contrast, commercial 

fishing had a total output of $3 .7 million in 1995, or less than 0.1 percent of total output for 

the area. 

In the Panama City area, the military is relatively less important, accounting for 3 .5 percent 

of total output, compared to 7 .6 percent for Fort Walton Beach (Table 7.5 .2). Hotels, lodging 

places, and rentals accounted for $611 million in 1995, or 12.6 percent of total output, 

compared to 13 .9 percent for Fort Walton Beach. The combination of hotels, lodging places, 

and rentals and the services sectors accounted for 26 .9 percent of output in Panama City, 

compared with 30.9 percent in Fort Walton Beach, suggesting that tourism is also somewhat 

less important to the economy of this area. 

The Pensacola area has a substantially larger total output and a more diversified economy 

that the other two areas (Table 7.5 .3). In 1995, total output for the Pensacola area was $14.5 

billion, compared to $6 .0 billion for Fort Walton Beach and $4.9 billion for Panama City. 

The manufacturing sectors, primarily nondurable manufacturing, were relatively important in 

this area, accounting for 16 percent of total output in 195, compared to about 11 percent of 

total output in the Panama City area and less than 10 percent in the Fort Walton Beach area. 

Military activity was relatively less important in this area, accounting for only 2.7 percent of 

total output in 1995 . 

All three areas are expected to experience substantial growth in (inflation-adjusted) output 

over the study period. During the period 1995-2005, total output is expected to increase 26 

percent in the Fort Walton Beach area, 19 percent in the Pensacola area, and about 13 percent 

in the Panama City area. Most sectors in all three areas are expected to share in the general 

growth. Notable exceptions to this pattern are mining and maintenance and repair of oil and 

gas wells (both projected to be stable or declining in all three areas) . In addition, federal 

military spending is projected to decline slightly in the Panama City area and to be essentially 

stable in the Fort Walton Beach area, while increasing slightly in the Pensacola area. 

7-5 
Table 7.5.1 

Baseline Output by Major Non-Farm Industry for the Florida Panhandle 

Fort Walton Beach (in millions of 1994 dollars) 

Sector 

Agriculture 

Commercial Fishing 

Mining 

Construction 

Maintenance and Repair Oil and Gas Wells 

Non-Durable Manufacturing 

Durable Manufacturing 

TCPU 

Water Transportation 

Air Transportation 

Wholesale Trade 

Retail Trade 

Eating & Drinking 

FIRE Excluding Real Estate Rentals 

Hotels, Lodging Places, and Rentals 

Services 

Equipment Rental and Leasing 

Amusement and Recreation Services, N.E.C. 

Engineering, Architectural Services 

Accounting, Auditing and Bookkeeping 

Research, Development & Testing Services 

Government 

Federal Government - Military 

Total 

1995 2000 2005 

60.02 66.24 74.90 

3.68 4.06 4.60 

4.57 3 .48 3.46 

510.00 565.41 629.80 

0.17 0.13 0.13 

172.64 210.43 226.14 

406.52 402.42 400.44 

308.76 355.72 388.22 

16 .38 18 .87 20.60 

27.81 32.04 34.97 

202.51 239.99 289.08 

417.57 483 .91 534.80 

270.00 312.90 345.80 

562.25 663 .43 75532 

840.41 991 .64 1,129.00 

1,022.29 1,206.24 1,37332 

16 .38 19 .33 22.01 

33.02 38.96 44.36 

55.50 65.48 74.56 

19 .03 22.45 25.56 

73.03 86.17 98.11 

548.55 627.05 660.02 

458.07 462.00 459.72 

6,029.15 6,878.38 7,594.91 

2010 

77.87 

4.78 

3.46 

679.97 

0.13 

234.45 

40031 

410.93 

21.80 

37.01 

301.56 

580.01 

375.04 

837.69 

1,252.12 

1,523.09 

24.41 

49.20 

82.69 

2835 

108.81 

69227 

459.58 

8,185.52 

2015 

83.62 

5.13 

3 .45 

719.85 

0.13 

242.12 

399.15 

432.50 

22.95 

38.95 

313 .21 

611 .77 

395.57 

901 .66 

1,347.73 

1,639.39 

26.28 

52.95 

89.00 

30.51 

117.12 

715 .43 

458.25 

8,646.71 

2020 2025 

83.56 83 .47 

5.13 5.12 

3.45 3.44 

744.01 768.75 

0.13 0.13 

250.15 258.37 

386.60 37432 

443.42 454.48 

23.52 24.11 

39.94 40.94 

325.27 337.69 

629.74 648.03 

407.19 419.02 

943.54 987.12 

1,410.33 1,475 .47 

1,715.54 1,794.77 

27.50 28.77 

55.41 57.97 

93.13 97.44 

31 .93 33 .40 

122.56 128.22 

725.62 735 .74 

457.92 457.46 

8,925.60 9,214.25 

2030 2035 

86.52 89.66 

5.31 5 .50 

3.45 3 .46 

796.51 825 .15 

0.13 0.13 

265.05 271 .86 

381 .14 388.03 

469.20 48433 

24.89 25 .69 

42.26 43 .62 

350.41 363 .55 

671 .15 694.99 

433 .97 44938 

1,027.99 1,070.41 

1,536.57 1,599.97 

1,869.09 1,946.22 

29.96 31 .19 

6037 62 .87 

101 .47 105.66 

34.78 36.22 

133 .53 139.04 

755 .73 776.14 

458.58 459.62 

9,538.07 9,872.68 

2040 2045 

92.91 9626 

5.70 5.91 

3.47 3.48 

854.76 885.25 

0.13 0.13 

278.83 285.92 

395.01 402.04 

499.91 515.88 

26.52 27.37 

45.03 46.46 

377.16 391 .20 

719.63 744.99 

465.31 481 .71 

1,114.55 1,160.28 

1,665.94 1,734.31 

2,026.46 2,109.62 

32.48 33 .81 

65.46 68.14 

110.01 114.53 

37.71 39.26 

144.77 150.71 

797.07 818.38 

460.64 461 .57 

10,219.46 10,577.20 

Source: RPC. 
Table 7.5.2 

v 

Baseline Output by Major Non-Farm Industry for the Florida Panhandle 

Panama City (in millions of 1994 dollars) 

Sector 1995 2000 2005 2010 2015 2020 2025 2030 2035 2040 2045 

Agriculture 13 .29 12.95 13 .99 15 .10 16 .15 16.55 17 .10 17 .34 17 .91 18 .49 19.10 

Commercial Fishing 0.72 0.70 0.76 0.82 0.88 0.90 0.93 0.94 0.97 1.00 1 .04 

Mining 1 .61 1 .52 1 .52 1 .52 1.52 1 .51 1 .51 1 .49 1 .49 1.49 1 .49 

Construction 497.84 442.75 475.13 501 .08 52536 529.40 537.91 545 .18 562.88 581.00 599.72 

Maintenance and Repair Oil and Gas Wells 0.08 0.07 0.07 0.07 0.07 0.07 0.07 0.07 0.07 0.07 0.07 

Non-Durable Manufacturing 261.63 276.90 292.55 293.10 292.67 29035 290.44 289.84 294.65 299.45 304.35 

Durable Manufacturing 254.12 198.96 185.29 17238 172.12 164.06 157.67 155 .24 155 .69 156.11 156.53 

TCPU 32632 371 .15 405.07 429.02 439.96 442.18 448.10 452 .08 464.60 477.36 490.47 

Water Transportation 67.29 76.54 83.53 88.47 90.73 91 .18 92.40 93.22 95 .81 98.44 101 .14 

Air Transportation 21 .54 24.50 26.74 28.32 29.05 29.19 29.58 29.85 30.67 31.52 32.38 

Wholesale Trade 245.03 274.12 299.17 325.42 342.04 351 .83 364.90 369 .27 380.68 392.34 404.37 

Retail Trade 358.66 358.61 392.91 425.28 445.71 454.20 466.70 473 .41 489.19 50536 522.08 

Eating & Drinking 246.41 24637 269.94 292.18 306.21 312.05 320.63 325 .24 336.08 347.19 358 .68 

FIRE Excluding Real Estate Rentals 469.05 504.15 571 .28 628.07 673.17 695 .64 724.85 740.40 770.41 801.44 833 .75 

Hotels, Lodging Places, and Rentals 611.16 656.88 744.35 818.34 877.12 90638 944.45 964.71 1,003 .81 1,044.24 1,08634 

Services 695.18 747.19 846.69 930.85 997.71 1,031 .00 1,07430 1,097 .35 1,141 .82 1,187.81 1,235 .70 

Equipment Rental and Leasing 15 .56 16.72 18 .95 20.83 2233 23 .07 24.04 24.56 25 .55 26.58 27.65 

Amusement and Recreation Services, N.E.C. 50.77 54.57 61 .84 67.98 72.87 75 .30 78.46 80.14 8339 86.75 90.25 

Engineering, Architectural Services 4234 45.51 51 .57 56.70 60.77 62.80 65.43 66 .84 69.55 72.35 75 .26 

Accounting, Auditing and Bookkeeping 23.94 25.73 29.16 32.06 34.36 35 .51 37.00 37.79 39.33 40.91 42.56 

Research, Development & Testing Services 26.83 28.83 32.67 35.92 38.50 39.78 41 .46 4234 44.06 45.84 47 .68 

Government 46039 483 .61 515.21 541.62 558.97 559.91 565.52 570.45 586.17 602.17 618 .62 

Federal Government - Military 168.70 163 .14 162.78 163.09 162.85 161 .56 161 .61 159.11 159.57 160.00 160.43 

Total 4,858.46 5,011 .47 5,481 .19 5,868.23 6,161 .12 6,274.41 6,445.07 6,536.87 6,754.34 6,977.92 7,209.65 

Source : RPC. 
00 

Table 7.5 .3 

Baseline Output by Major Non-Farm Industry for the Florida Panhandle 

Pensacola (in millions of 1994 dollars) 

Sector 1995 2000 2005 2010 2015 2020 2025 2030 

Agriculture 

Commercial Fishing 

Mining 

Construction 

Maintenance & Repair Oil and Gas Wells 

Non-Durable Manufacturing 

Durable Manufacturing 

TCPU 

Water Transportation 

Air Transportation 

Wholesale Trade 

Retail Trade 

Eating & Drinking 

FIRE Excluding Real Estate Rentals 

Hotels, Lodging Places, and Rentals 

Services 

Equipment Rental and Leasing 

Amusement &Recreation Services, 

Engineering, Architectural Services 

Accounting, Auditing and Bookkeeping 

Research, Development & Testing Serv's 

Government 

Federal Government - Military 

Total 

Source : RPC. 

155.60 184.16 198.07 20834 217.14 222.37 227.68 23335 

2.92 3.45 3.71 3.91 4.07 4.17 4.27 438 

18.05 17 .39 17 .23 17 .22 17 .50 17 .50 17 .50 17.54 

1,489.70 1,641 .45 1,757.60 1,875.82 1,980.24 2,022.28 2,064.77 2,130.82 

0.27 0.26 0.26 0.26 0.26 0.26 0.26 0.26 

1,779.63 1,875.19 1,755.84 1,678.29 1,628.93 1,549.39 1,473 .43 1,463 .80 

581 .09 663.75 672.48 671 .99 683 .29 683 .28 683 .12 692.23 

1,140.68 1,133.13 1,166.25 1,209.12 1,244.25 1,244.23 1,243 .94 1,265 .05 

107.02 106.31 109.42 113.44 116.74 116.73 116.71 118 .69 

179.11 177.93 183.13 189.86 19538 19538 19533 198 .64 

748.19 931 .83 986.33 1,048.80 1,104.98 1,117.73 1,13039 1,161 .00 

892.06 1,01638 1,065.59 1,115.13 1,165 .14 1,176.42 1,187.57 1,215 .90 

450.71 513 .52 53839 563.42 588 .68 594.39 600.02 61433 

1,324.12 1,563 .09 1,704.24 1,827.06 1,952.09 2,001 .81 2,052.40 2,117 .58 

800.07 944.46 1,029.74 1,103.95 1,179.50 1,209.54 1,240.11 1,279 .50 

2,711 .97 3,201 .41 3,490.50 3,742.05 3,998 .13 4,099.95 4,203 .57 4,337 .08 

55.46 65.47 71 .38 76.52 81 .76 83 .84 85 .96 88 .69 

31 .26 36.90 4024 43.14 46.09 47.26 48.46 49.99 

148.22 174.97 190.77 204.52 218 .51 224.08 229.74 237.04 

62.62 73 .92 80.59 86.40 92 .32 94.67 97.06 100.14 

24.80 29.27 31 .92 34.22 36.56 37.49 38 .44 39.66 

1,362.61 1,672.24 1,711 .43 1,743.09 1,789.12 1,783 .50 1,777.52 1,807.70 

385.08 422.51 418.56 418.25 425 .29 425 .28 425 .18 426.19 

14,451 .24 16,449 .00 17,223 .67 17,974 .80 18,765 .98 18,951 .55 19,143 .43 19,599.57 

2035 2040 2045 

239.15 245.06 251 .11 

4.48 4.60 4.71 

17.58 17 .62 17.66 

2,198.83 2,268.81 2,340.79 

0.26 0.26 0.26 

1,454.12 1,44439 1,434.58 

701 .40 710.64 719.93 

1,286.42 1,308.04 1,329.90 

120.69 122.72 124.77 

202.00 205 .40 208.83 

1,192.35 1,224.43 1,257.26 

1,244.82 1,274.31 1,30437 

628.94 643 .84 659.03 

2,184.68 2,253 .72 2,324.72 

1,320.04 1,361 .75 1,404.65 

4,474.50 4,615 .90 4,761 .32 

91 .50 9439 9737 

51 .58 53 .21 54.89 

244.55 252 .28 260.22 

103 .31 106.58 109.94 

40.91 42.21 43.54 

1,838.26 1,869.17 1,900.41 

427.17 428.11 429.02 

20,067 .56 20,547.44 21,039.27 
Tourism 

Projected expenditures by tourists in the three metropolitan areas are summarized in Tables 

7.6 .1 through 7.6 .3 . In 1995, tourist expenditures in the Fort Walton Beach area were 

estimated to total $481 million, while tourist spending in the Panama City area was estimated 

at $408 million and that in the Pensacola area at $248 million. Sectors receiving major 

tourist expenditures in each area included hotels and lodging places (about 40% of total 

expenditures), retail trade other than eating and drinking (about 30%), and eating and 

drinking establishments (20%). 

Tourist spending is projected to increase substanstially in each of the three areas between 

1995 and 2045 . In the Fort Walton Beach area, tourist expenditures are projected to more 

than double over the 50-year study period (i .e ., an increase of 103%). During the same 

period, tourist expenditures are projected to increase 75 percent in the Panama City area and 

73 percent in the Pensacola area. While the rates of increase fluctuated somewhat over the 

50-year period, tourist expenditures are projected to increase during each five-year increment 

of the study period in each of the three areas. 

7-9 
Table 7.6 .1 

Projected Expenditures by Tourists in the Fort Walton Beach Area 

(in millions of 1995 dollars) 

Sector 

Transportation, Communication, Utilities 

Retail Trade Other than Eating & Drinking 

Eating & Drinking 

Hotels & Lodging Places 

Amusement and Recreation Services, N.E .C . 

Total 

1995 2000 2005 2010 2015 2020 2025 2030 2035 2040 2045 

9.2 10.8 123 13 .6 14 .6 15 .2 15 .9 

148.9 175 .4 199.4 220.8 237.3 248.0 259.0 

92.5 109.0 123.9 137.2 147.5 154.1 161 .0 

192.1 226.3 257.3 284.9 306.2 319.9 334.1 

383 45 .1 513 56.8 61 .1 63 .8 66.7 

481 .0 566.7 644.2 713 .3 766.6 801 .0 836.7 

16 .6 17.2 17 .9 18.6 

2693 280.0 291 .1 302.6 

167.4 174.0 180.9 188.1 

347.4 361.2 375 .5 390.4 

693 72.1 74.9 77.9 

870.0 904.5 940.4 977.5 

v 

o Source: RPC. 
Table 7.6 .2 

Projected Expenditures by Tourists in the Panama City Area 

(in millions of 1995 dollars) 

Sector 

Transportation, Communication, Utilities 

Retail Trade Other than Eating & Drinking 

Eating & Drinking 

Hotels & Lodging Places 

Amusement and Recreation Services, N.E .C 

Total 

1995 2000 2005 2010 2015 2020 2025 2030 2035 2040 2045 

3.2 3 .5 3 .9 4.3 4.6 4.7 4.9 5.0 5.2 5.4 5 .6 

122.0 131 .0 148 .2 162.7 174.1 179.6 186.9 190.6 198.0 205.7 213 .6 

80.5 86.4 97 .7 107.3 114.8 118.5 123.2 125.7 130.6 135.6 140.9 

161 .7 173 .6 196.4 215.5 230.7 238 .0 247.6 252.5 262.4 272.5 283 .1 

40.5 43 .4 492 54.0 57.7 59.6 62.0 63.2 65.7 68.2 70.9 

408.0 437.8 495.3 543.7 581 .9 600.4 624.6 637.1 661 .9 687.5 714.1 

v 

Source: RPC. 
Table 7.6 .3 

Projected Expenditures by Tourists in the Pensacola Area 

(in millions of 1995 dollars) 

Sector 

Transportation, Communication, Utilities 

Retail Trade Other than Eating & Drinking 

Eating & Drinking 

Hotels & Lodging Places 

Amusement and Recreation Services, N.E .C 

Total 

1995 2000 2005 2010 2015 2020 2025 2030 2035 2040 2045 

8 .4 9.9 10 .8 11 .6 123 12.6 12.9 13 .3 13 .7 14.1 14.5 

74.1 873 95.1 101 .7 108.5 111 .1 113 .8 117.2 120.7 124.4 128.1 

53 .2 62.6 68.2 73.0 77.9 79.7 81 .6 84.1 86.6 89.2 91 .9 

87.1 102.7 111 .8 119 .6 127.6 130.7 133 .8 137.8 141 .9 146.2 150.6 

253 29.9 32.5 34.8 37.1 38.0 38 .9 40.1 41 .3 42.5 43.8 

248 .1 292.4 318.3 340 .7 363.5 372.1 381 .0 392.5 404.3 416.4 428.9 

,r Source : RPC. 

N 
Employment 

Baseline employment by economic sector for the period 1995-2045 for the three areas within 

the Panhandle region is presented in Tables 7 .7 .1 through 7.7 .3 . In 1995, the services sector 

was the largest employer in each region, followed by government (other than military), 

federal government military, retail trade, eating and driking establishments, and construction . 

The order of the latter sectors varied somewhat from area to area. 

Total employment is projected to increase substantially in each area, with Fort Walton Beach 

having the greatest percentage growth (66%), followed by Pensacola (49%), and Panama 

City (45%). Most of the individual sectors are projected to share in the overall growth, with 

the exception of mining and the maintenance and repair of oil and gas wells, which are stable 

or declining in all three regions, and federal military, which was projected as essentially 

stable during the study period . Service sector employment is projected to grow more rapidly 

than the area average in each of the three areas and is responsible for the largest number of 

new jobs created in each area. Retail trade, eating and drinking, and hotels, lodging places, 

and rentals are sectors projected to grow substantially in each region, and will be responsible 

for substantial job creation in each. 

7-13 
Table 7.7 .1 

Baseline Employment by Major Non-Farm Industry for the Florida Panhandle 

Fort Walton Beach (in thousands of workers) 

v 

Sector 1995 2000 2005 2010 2015 2020 2025 2030 2035 2040 2045 

Agriculture 1.265 1.394 1 .574 1.634 1 .752 1 .748 1 .743 1 .804 1.867 1 .931 1 .998 

Commercial Fishing 0.144 0 .159 0.179 0.186 0.199 0.199 0.198 0.205 0.212 0.220 0.227 

Mining 0.035 0 .027 0.027 0.027 0.026 0.026 0.026 0.026 0.026 0 .026 0.026 

Construction 6.619 7.327 8.149 8.784 9.285 9.582 9.885 10.227 10 .578 10 .941 11314 

Maintenance and Repair Oil and Gas Wells 0.015 0.011 0.011 0.011 0.011 0.011 0.011 0.011 0.011 0.011 0.011 

Non-Durable Manufacturing 1 .686 2.052 2.201 2.279 2.349 2.424 2.499 2 .560 2.622 2.685 2.749 

Durable Manufacturing 2.740 2.708 2.690 2.685 2.674 2.585 2.499 2 .541 2.583 2.626 2.668 

TCPU 1 .941 2.233 2.433 2.571 2.702 2.766 2.831 2.918 3.007 3.099 3.193 

Water Transportation 0.080 0.092 0.101 0.106 0.112 0.114 0.117 0.121 0.124 0.128 0.132 

Air Transportation 0.177 0.203 0.221 0.234 0.246 0.252 0.258 0.265 0.274 0.282 0.291 

Wholesale Trade 2.260 2.674 3 .216 3.349 3 .474 3 .602 3 .733 3.868 4.007 4.151 4.299 

Retail Trade 11 .510 13318 14.696 15 .914 16 .759 17.225 17 .698 18 .301 18 .922 19 .563 20.222 

Eating & Drinking 6.855 7.931 8 .752 9.477 9.980 10.258 10 .539 10 .899 11268 11 .650 12 .042 

FIRE Excluding Real Estate Rentals 2.038 2.401 2 .730 3.023 3 .249 3394 3 .545 3.687 3.833 3.985 4.142 

Hotels, Lodging Places, and Rentals 5.716 6.734 7 .654 8.476 9.109 9.518 9 .942 10 .338 10 .748 11 .174 11 .614 

Services 20.097 23.676 26 .914 29.803 32.029 33 .465 34 .957 36348 37.790 39.288 40.838 

Equipment Rental and Leasing 0.212 0.250 0.284 0314 0.338 0.353 0 .369 0.384 0.399 0.415 0.431 

Amusement and Recreation Services, 0.716 0.843 0.958 1 .061 1 .141 1 .192 1 .245 1 .294 1346 1 .399 1 .454 

Engineering, Architectural Services 0.778 0.917 1.042 1 .154 1 .241 1 .296 1354 1 .408 1 .464 1 .522 1 .582 

Accounting, Auditing and Bookkeeping 0.338 0.398 0.452 0.501 0.538 0.562 0.587 0.610 0.635 0.660 0.686 

Research, Development & Testing Services 0.959 1 .129 1 .284 1 .422 1 .528 1 .596 1 .667 1 .734 1 .803 1 .874 1 .948 

Government 14.630 16.697 17 .548 18 .377 18 .962 19 .203 19 .441 19 .938 20.445 20.964 21 .492 

Federal Government - Military 13 .039 13 .130 13 .045 13 .021 12 .963 12 .934 12 .901 12 .913 12.922 12.931 12 .937 

Total 93 .848 106305 116.162 124.410 130.667 134.305 138.048 142.400 146.886 151 .524 156.295 

Source : RPC. 
Table 7.7.2 

Baseline Employment by Major Non-Farm Industry for the Florida Panhandle 

Panama City (in thousands of workers) 

Sector 1995 2000 2005 2010 2015 2020 2025 2030 2035 2040 2045 

Agriculture 0.50 0 .48 0.52 0.56 0.60 0.61 0.63 0.64 0.66 0.68 0.70 

Commercial Fishing 0.03 0.03 0.03 0.04 0.04 0.04 0.04 0.04 0.04 0.04 0.04 

Mining 0.01 0.01 0.01 0.01 0.01 0.01 0.01 0.01 0.01 0.01 0.01 

Construction 5.56 4.94 5 .29 5.57 5.83 5.87 5 .96 6.03 6.21 6 .40 6.60 

Maintenance and Repair Oil and Gas Wells 0.01 0.01 0.01 0.01 0.01 0.01 0.01 0.01 0.01 0.01 0.01 

Non-Durable Manufacturing 1 .28 1 .35 1 .42 1 .42 1 .42 1 .40 1 .40 1 .40 1 .42 1 .44 1 .46 

Durable Manufacturing 1 .52 1 .19 1 .11 1 .03 1 .02 0.97 0.94 0.92 0.92 0 .92 0.92 

TCPU 1 .91 2.17 2.36 2.50 2.56 2.57 2 .60 2.62 2.69 2.76 2 .83 

Water Transportation 031 036 0.39 0.41 0.42 0.42 0.43 0.43 0.44 0.45 0 .46 

Air Transportation 0.15 0.18 0.19 0.20 0.21 0.21 0.21 0.21 0.22 0.22 0.23 

Wholesale Trade 2.49 2.78 3 .03 3 .29 3 .45 3.55 3 .67 3.71 3 .82 3.93 4.05 

Retail Trade 9.67 9.65 10.56 11 .41 11 .94 12.15 12 .46 12.62 13 .03 13 .44 13 .86 

Eating & Drinking 6.20 6.19 6.77 7.31 7.65 7.79 7.99 8.09 835 8.61 8.88 

FIRE Excluding Real Estate Rentals 1.85 1 .98 224 2.46 2.64 2.72 2.83 2.89 3 .00 3.12 3.24 

Hotels, Lodging Places, and Rentals 5.14 5 .52 6 .24 6.85 7.33 7.57 7.87 8.03 8 .34 8.66 9.00 

Services 13 .14 14.10 15 .95 17.51 18 .74 19.33 20.11 20.51 21 .31 22.14 22.99 

Equipment Rental and Leasing 0.16 0.18 0.20 0.22 0.23 0.24 0.25 0.26 0.27 0.28 0.29 

Amusement and Recreation Services, N.E .C . 1.08 1 .15 131 1 .43 1 .53 1 .58 1 .65 1.68 1 .75 1 .81 1 .88 

Engineering, Architectural Services 0.61 0.66 0.74 0.82 0 .87 0.90 0.94 0.96 0.99 1 .03 1 .07 

Accounting, Auditing and Bookkeeping 0.37 0.40 0.45 0.50 0 .53 0.55 0.57 0.58 0.60 0.63 0.65 

Research, Development & Testing Services 0.47 0.51 0.57 0.63 0.67 0.69 0.72 0.74 0.76 0.79 0.82 

Government 11 .60 12 .16 12 .94 13 .58 13 .99 13 .99 14 .11 14 .21 14 .58 14.96 15 .34 

Federal Government - Military 5.00 4.83 4.81 4.81 4.80 4.75 4.75 4.67 4.67 4.68 4.68 

Total 69.06 70.81 77.15 82.58 86.51 87 .93 90.15 91 .25 94.09 97 .01 100.03 

Source : RPC. 
Table 7.7 .3 

Baseline Employment by Major Non-Farm Industry for the Florida Panhandle 

Pensacola (in thousands of workers) 

Sector 1995 2000 2005 2010 2015 2020 2025 2030 2035 2040 2045 

Agriculture 2.661 3 .145 3.377 3.547 3.691 3.774 3 .858 3.948 4.040 4.134 4.229 

Commercial Fishing 0.135 0.159 0.171 0.179 0.187 0 .191 0.195 0.200 0.204 0.209 0.214 

Mining 0.322 0.310 0.307 0306 0311 0 .310 0.309 0310 0.310 0.310 0.310 

Construction 17 .462 19.211 20 .539 21 .886 23.069 23 .522 23 .979 24.709 25.458 26.228 27.019 

Maintenance and Repair Oil and Gas Wells 0.039 0.038 0.038 0.037 0.038 0.038 0.038 0.038 0.038 0.038 0.038 

Non-Durable Manufacturing 7.802 8.208 7 .674 7323 7.097 6 .740 6.400 6.348 6.297 6.245 6.193 

Durable Manufacturing 4338 4.948 5 .005 4.994 5.070 5 .062 5 .053 5 .112 5.172 5.232 5.293 

TCPU 5.869 5.821 5 .982 6.192 6 .362 6353 6341 6 .439 6.538 6.637 6.738 

Water Transportation 0.509 0.505 0.519 0.537 0.552 0.551 0.550 0.559 0.567 0.576 0.585 

Air Transportation 1 .166 1 .156 1 .188 1.230 1 .264 1 .262 1 .260 1 .279 1.299 1318 1 .338 

Wholesale Trade 7.626 9.483 10.022 10.640 11 .193 11 .305 11 .415 11 .706 12 .004 12 .308 12 .619 

Retail Trade 23.426 26.650 27.897 29.149 30.409 30.656 30.899 31 .587 32.289 33 .003 33 .730 

Eating & Drinking 11 .589 13 .183 13 .800 14.419 15 .043 15 .165 15 .285 15 .626 15 .973 16 .326 16 .686 

FIRE Excluding Real Estate Rentals 5.337 6291 6.848 7330 7.820 8.007 8.196 8 .444 8 .698 8 .959 9 .227 

Hotels, Lodging Places, and Rentals 5.071 5.977 6.506 6.965 7.430 7.607 7.787 8 .022 8 .264 8 .512 8 .767 

Services 53.877 63.501 69.128 73 .995 78.937 80.822 82.737 85 .234 87 .800 90.435 93 .141 

Equipment Rental and Leasing 0.575 0.678 0.738 0.790 0.843 0.863 0.884 0.910 0.938 0.966 0.995 

Amusement and Recreation Services, N.E .C . 0.789 0.930 1 .013 1 .084 1 .156 1 .184 1 .212 1 .248 1 .286 1 .325 1 .364 

Engineering, Architectural Services 2.151 2.535 2.759 2.954 3 .151 3 .226 3.303 3 .402 3 .505 3 .610 3 .718 

Accounting, Auditing and Bookkeeping 1.068 1 .259 1371 1 .467 1 .565 1 .603 1 .641 1 .690 1 .741 1 .793 1 .847 

Research, Development & Testing Services 0.545 0.643 0.700 0.749 0.799 0.818 0.838 0.863 0.889 0.916 0.943 

Government 30.804 37.745 38.570 39.223 40.196 40.008 39.813 40.426 41 .047 41 .673 42305 

Federal Government - Military 10.010 10 .966 10 .846 10 .822 10 .987 10 .969 10 .950 10.959 10.967 10.975 10.981 

Total 193.173 223342 234.998 245 .820 257.169 260.036 262.943 269.060 275322 281 .728 288.279 

Source : RPC. 
Local Government Finance 

Local government units of special interest are county and municipal governments. 

County Government Budgets 

County government revenues for FY 1996-97 for the five counties in the study area are 

summarized in Tables 7 .8 .1 through 7.8 .5 . Revenue sources that are important in each 

county include (1) charges for services (e.g ., utilities), (2) ad valorem taxes, (3) other taxes, 

fees, and licenses, and (4) state and other government sources (i .e ., intergovernmental 

transfers). Ad valorem taxes account for 15 to 34 percent of county revenue, with Walton 

County (the county with the smallest population base) having the highest dependence on ad 

valorem taxes. Charges for services range from 12 to 29 percent of total revenues, with Santa 

Rosa County obtaining the highest proportion of its revenues from these charges while 

Walton County had the lowest percentage . 

Table 7.8 .1 

County Government Revenues of Bay County 

FY 1996 - 1997 

Revenue Source Dollars Percentage 

Ad Valorem taxes 24,774,514 19.80% 

Other taxes, fees, and licenses 17,324,516 13.84% 

Federal grants 514,368 0.41% 

State and other govt sources 15,244,857 12.18% 

Charges for services 29,003,403 23.18% 

Fines and forfeits 1,477,214 1 .18% 

Special assessment and impact fees 149,506 0.12% 

Other miscellaneous revenues 9,038,192 7.22% 

Other sources / Interfund transfers 27,608,135 22.06% 

Total 125,134,705 100.00% 

Source: Florida Department of Banking and Finance, personal communication, November 

1998 . 

7-17 
Table 7.8 .2 

County Government Revenues of Escambia County 

FY 1996 - 1997 

Revenue Source Dollars Percentage 

Ad Valorem taxes 50,841,280 23 .19% 

Other taxes, fees, and licenses 46,642,998 21 .28% 

Federal grants 8,430,148 3 .85% 

State and other govt sources 35,518,949 16.20% 

Charges for services 40,156,659 18.32% 

Fines and forfeits 2,402,829 1 .10% 

Special assessment and impact fees 5,462,213 2.49% 

Other miscellaneous revenues 13,733,772 6.26% 

Other sources / Interfund transfers 16,039,504 7.32% 

Total 219,228,352 100.00% 

Source: Florida Department of Banking and Finance, personal communication, November 

1998 . 

Table 7.8 .3 

County Government Revenues of Okaloosa County 

FY 1996 - 1997 

Revenue Source Dollars Percentage 

Ad Valorem taxes 21,471,797 14.78% 

Other taxes, fees, and licenses 7,057,170 4.86% 

Federal grants 4,048,773 2.79% 

State and other govt sources 17,632,392 12.14% 

Charges for services 40,900,772 28 .16% 

Fines and forfeits 116,272 0 .08% 

Special assessment and impact fees 82,200 0 .06% 

Other miscellaneous revenues 16,826,100 11 .58% 

Other sources / Interfund transfers 37,108,784 25 .55% 

Total 145,244,260 100 .00% 

Source: Florida Department of Banking and Finance, personal communication, November 

1998 . 

7-18 
Table 7.8 .4 

County Government Revenues of Santa Rosa County 

FY 1996 -1997 

Revenue Type Dollars Percentage 

Ad Valorem taxes 20,143,797 25 .85% 

Other taxes, fees, and licenses 12,332,627 15 .83% 

Federal grants 485,989 0 .62% 

State and other govt sources 10,720,043 13 .76% 

Charges for services 22,695,672 29.12% 

Fines and forfeits 1,057,731 1 .36% 

Special assessment and impact fees 840,304 1 .08% 

Other miscellaneous revenues 4,122,335 5 .29% 

Other sources / Interfund transfers 5,527,789 7.09% 

Total 77,926,287 100.00% 

Source : Florida Department of Banking and Finance, personal communication, November 

1998. 

Table 7.8 .5 

County Government Budget of Walton County 

FY 1996 -1997 

Revenue Type Dollars Percentage 

Ad Valorem taxes 14,959,773 33 .57% 

Other taxes, fees, and licenses 7,589,193 17.03% 

Federal grants 3,237,898 7.27% 

State and other govt sources 6,668,814 14.96% 

Charges for services 5,272,988 11 .83% 

Fines and forfeits 708,020 1 .59% 

Special assessment and impact fees 365,313 0 .82% 

Other miscellaneous revenues 2,256,359 5 .06% 

Other sources / Interfund transfers 3,506,117 7 .87% 

Total 44,564,475 100 .00% 

Source : Florida Department of Banking and Finance, personal communication, November 

1998 . 

7-19 
County government expenditures in the five counties for FY 1996-97 are summarized in 

Table 7.9 . Total county expenditures ranged from $38 million in Walton County to $208 

million in Escambia County. When county expenditures are compared with county 

population (Table 7.1), the per capita expenditures (based on 1995 population) range from 

$739 for Escambia County to $1,142 for Walton County. 

Table 7.9 

County Government Expenditures 

FY 1996 -1997 

County Dollars 

Bay 115,386,094 

Escambia 207,906,150 

Okaloosa 142,661,764 

Santa Rosa 76,521,782 

Walton 38,144,204 

Source : Florida Department of Banking and Finance, personal communication, November 

1998. 

Municipal Government Budgets 

Municipal government revenues for municipalities within each of the five counties for FY 

1996-97 are summarized in Tables 7.10.1 through 7 .10.5 . Each table represents the sum of 

revenues for all municipalities within the respective county. Charges for services are the 

largest single revenue source for municipalities in each of the five counties . Other major 

revenue sources are (1) other taxes (i .e ., other than ad valorem), fees, and licenses, (2) other 

miscellaneous revenues, and (3) other sources/interfund transfers. State and other 

government sources are a substantial revenue source in Okaloosa and Walton Counties (10% 

of total revenues), but are less important in the other counties . 

7-20 
Table 7.10.1 

Combined Municipal Government Revenues of Bay County 

FY 1996 -1997 

Revenue Name Revenue Amount 

Ad Valorem taxes 5,458,046 

Other taxes, fees and licenses 20,694,195 

Federal grants 4,500,556 

State and other government sources 9,564,415 

Charges for services 42,938,793 

Fines and forfeits 1,108,136 

Special Assessments and impact fees 400,922 

Other Miscellaneous Revenues 13,166,022 

Other Sources/Interfund transfers in 12,352,121 

Total 110,183,206 

Source : Florida Department of Banking and Finance, personal communication, November 

1998. 

7-21 
Table 7.10.2 

Combined Municipal Government Revenues of Escambia County 

FY 1996 -1997 

Revenue Name Revenue Amount 

Ad Valorem taxes 8,158,937 

Other taxes, fees and licenses 20,053,432 

Federal grants 7,351,718 

State and other government sources 8,176,547 

Charges for services 55,711,991 

Fines and forfeits 637,268 

Special Assessments and impact fees 90,166 

Other Miscellaneous Revenues 49,027,353 

Other Sources/Interfund transfers in 51,265,337 

Total 200,472,749 

Source: Florida Department of Banking and Finance, personal communication, November 

1998 . 

Table 7.10.3 

Combined Municipal Government Revenues of Okaloosa County 

FY 1996 -1997 

Revenue Name Revenue Amount 

Ad Valorem taxes 12,170,540 

Other taxes, fees and licenses 18,931,351 

Federal grants 2,774,656 

State and other government sources 11,513,295 

Charges for services 36,930,130 

Fines and forfeits 940,874 

Special Assessments and impact fees 147,720 

Other Miscellaneous Revenues 19,606,591 

Other Sources/Interfund transfers in 9,418,708 

Total 112,433,865 

Source: Florida Department of Banking and Finance, personal communication, November 

1998 . 

7-22 
Table 7.10.4 

Combined Municipal Government Revenues of Santa Rosa County 

FY 1996 -1997 

Revenue Name Revenue Amount 

Ad Valorem taxes 1,050,604 

Other taxes, fees and licenses 1,411,136 

Federal grants 130,002 

State and other government sources 1,654,614 

Charges for services 12,844,891 

Fines and forfeits 320,584 

Special Assessments and impact fees 20,300 

Other Miscellaneous Revenues 4,274,459 

Other Sources/Interfund transfers in 3,867,712 

Total 25,574,302 

Source: Florida Department of Banking and Finance, personal communication, November 

1998. 

Table 7.10.5 

Combined Municipal Government Revenues of Walton County 

FY 1996 -1997 

Revenue Name Revenue Amount 

Ad Valorem taxes 489,106 

Other taxes, fees and licenses 1,823,892 

Federal grants 1,014,119 

State and other government sources 1,100,140 

Charges for services 4,210,478 

Fines and forfeits 159,043 

Special Assessments and impact fees 0 

Other Miscellaneous Revenues 333,830 

Other Sources/Interfund transfers in 1,544,581 

Total 10,675,189 

Source : Florida Department of Banking and Finance, personal communication, November 

1998 . 

7-23 
Combined municipal government expenditures for FY 1996-97 for the five counties are 

summarized in Table 7.11 . Combined expenditures, which reflect a summation of 

expenditures for all municipalities in each county, ranged from $10.4 million in Walton 

County to $169 .6 million in Escambia County. When municipal expenditures are divided by 

the population of each county that lives in incorporated places (see Table 7 .3), the resulting 

per capita costs ranged from $1,144 in Bay County to $2,872 in Escambia County. However, 

this measure should be used with caution as some municipalities likely provide services to 

residents outside their incorporated area. 

Table 7.11 

Combined Municipal Government Expenditures 

FY 1996 - 1997 

Coun Amount 

Bay 93,953,905 

Escambia 169,567,112 

Okaloosa 94,794,446 

Santa Rosa 25,582,052 

Walton 10,360,776 

Source : Florida Department of Banking and Finance, personal communication, November 

1998. 

7-24 
Property Valuation 

The average taxable value of residential property in each of the five counties in 1997 is 

summarized in Table 7 .12. Average taxable value ranged from $36,686 in Escambia County 

to $62,065 in Okaloosa County. 

The value of taxable commercial and industrial property in each of the five counties in 1997 

is summarized in Table 7.13 . The value of taxable commercial and industrial property 

ranged from $188.5 million in Walton County to $1,210 .1 million in Escambia County. 

Industrial property made up only 8 percent of the total in Walton County, but accounted for 

almost 21 percent in Escambia County. 

Table 7.12 

Average Taxable Value of Residential Property in 1997 

Coun Taxable Value 

Bay 47,513 

Escambia 36,686 

Okaloosa 62,065 

Santa Rosa 37,869 

Walton 48,689 

Source: Florida Department of Revenue, Florida Property Valuations and Tax Data, 

December 1997 . 

7-25 
Table 7.13 

Value of Taxable Commercial and Industrial Property in 1997 

(in Millions of dollars) 

Commercial 

Court Commercial Industrial and Industrial 

Bay 732 .4 90.6 823 .0 

Escambia 959 .2 250.9 1,210.1 

Okaloosa 755 .6 84.6 840.2 

Santa Rosa 225 .2 35.5 260.7 

Walton 173 .3 15 .2 188.5 

Source : Florida Department of Revenue, Florida Property Valuations and Tax Data, 

December 1997. 

7-26 
Millage Rates 

Millage rates for county governments in the study area for 1997 are summarized in Table 

7 .14. Millage rates ranged from 4.528 in Okaloosa County to 8.260 in Escambia County. 

None of the counties had a mill levy for debt service. 

Millage rates for school districts in the five counties are presented in Table 7.15 . The millage 

rates for school districts ranged from 8 .5720 in Okaloosa County to 9.5650 in Escambia 

County. Only the Bay County school district had a mill levy for debt service. 

Municipal taxation of real property (ad valorem taxation) in the five Panhandle counties in 

1997 is summarized in Table 7.16. Taxable value of all property taxable by municipalities 

ranged from $3 billion in Okaloosa County to $124.8 million in Walton County. Taxes 

levied on this property by municipalities ranged from $0.5 million in Walton County to $9 .1 

million in Okaloosa County. Average millage varied from 2 .1058 in Santa Rosa County to 

5 .0056 in Escambia County. 

Table 7.14 

Millage Rates for County Governments and Selected Special Districts 

in the Florida Panhandle 

County County 

Government Government 

Coun Operating Debt Service Total 

Bay 5.632 0 .000 5 .632 

Escambia 8 .260 0.000 8.260 

Okaloosa 4 .528 0 .000 4.528 

Santa Rosa 6.972 0 .000 6.972 

Walton 6 .740 0.000 6.740 

Source: Florida Department of Revenue, Florida Property Valuations and Tax Data, 

December 1997. 

7-27 
Table 7.15 

Millage Rates for School Districts in the Florida Panhandle 

Coun Operating Budge t Debt Service Total 

Bay 7.3270 2.0000 9 .3270 

Escambia 9.5650 0.0000 9 .5650 

Okaloosa 8.5720 0.0000 8 .5720 

Santa Rosa 8.8460 0.0000 8 .8460 

Walton 9.3540 0.0000 9 .3540 

Source: Florida Department of Revenue, Florida Property Valuations and Tax Data, 

December 1997. 

Table 7.16 

Municipal Taxation in the Florida Panhandle in 1997 

(in millions of dollars) 

Taxable Value Taxes Average 

Coun of All Property Levied Mi'llage 

Bay 2,509 .6 6 .1 2 .4189 

Escambia 1,663 .5 8 .3 5 .0056 

Okaloosa 3,079 .8 9 .1 2 .9512 

Santa Rosa 498 .9 1 .050 2 .1058 

Walton 124 .8 0 .5 4.2585 

Source: Florida Department of Revenue, Florida Property Valuations and Tax Data, 

December 1997. 

7-28 
School Districts 

Selected information concerning the school districts of the five Panhandle counties is 

summarized in this section. Each of these counties has only one school district. 

Attendance and Number of Teachers 

The number of teachers and students enrolled in the public schools of the five study counties 

in 1996 are summarized in Table 7.17. Enrollment ranged from 5,459 in Walton County to 

45,692 in Escambia County. The number of teachers ranged from 308 in Walton County to 

2,859 in Escambia County. The ratio of teachers to students ranges from 0.056 in Walton 

County to 0.063 in Escambia County, which corresponds to student-teacher ratios of 17.9 to 

15.9, respectively . 

Finance 

School district expenditures per full-time equivalent (FTE) student in 1997 for the five 

counties are summarized in Table 7.18 . Expenditures per FTE ranged from $4,643 in 

Okaloosa County to $5,130 in Walton County. 

School district revenues per FTE student in 1997 are summarized in Table 7.19. Total 

revenues per FTE ranged from $5,378 in Santa Rosa County to $6,118 in Walton County. 

The sources of revenue vary substantially among districts . County revenues (e.g ., local 

property taxes) make up almost 60 percent of total school district revenue in Walton County, 

with state revenues accounting for 32 percent and federal sources for the remaining 8 percent. 

On the other hand, revenues from state sources made up 64 percent of total revenues for the 

Escambia County school district, while county sources accounted for 25 percent and federal 

sources made up 11 percent. 

Table 7.17 

Number of Teachers and Public School Enrollment 

1996 

Teacher to 

Coun Teachers Students Student Ratio 

Escambia 2,859 45,692 0.063 

Bay 1,511 25,665 0.059 

Okaloosa 1,730 30,048 0.058 

Santa Rosa 1,203 20,668 0.058 

Walton 308 5,459 0.056 

Source: Bureau of Business and Economic Research, 1997. 

7-29 
Table 7.18 

School District Expenditures per Full-Time Equivalent (FTE) Student 

(in 1997 dollars) 

Coun Expenditures per FTE 

Bay 4,952 

Escambia 5,069 

Okaloosa 4,643 

Santa Rosa 4,657 

Walton 5,130 

Source: Florida Department of Education, Profiles of Florida School Districts 1996-1997 

Financial Data, June 1998. 

Table 7.19 

School District Revenues per Full-Time Equivalent (FTE) by Source 

(in 1997 dollars) 

Coun Federal State County Total 

Bay 415 3,375 1,747 5,599 

Escambia 591 3,594 1,423 5,608 

Okaloosa 431 3,224 2,247 5,902 

Santa Rosa 399 3,430 1,549 5,378 

Walton 516 1,960 3,642 6,118 

Source: Florida Department of Education, Profiles of Florida School Districts 1996-1997 

Financial Data, June 1998. 

7-30 
Public Services 

Per capita usage rates for selected community services are summarized in Table 7.20. These 

rates are expressed as amount of resources used, waste generated, staff employed, etc. per 

capita or per 1,000 residents. Some service usage rates are quite similar among the five 

counties . For example, residential water use ranges from 83.64 gallons (per person per day) 

in Escambia County to 91 .45 gallons in Santa Rosa County. On the other hand, residential 

wastewater varies from 30.11 gallons (per person per day) in Santa Rosa County to 270.02 

gallons in Bay County. 

Table 7.20 

Baseline Community Service Multipliers for Counties in the Florida Panhandle 

Item Bay Escambi Okaloosa Santa Rosa Walton 

a 

Residential Thousands of 88.46 83 .64 81 .90 91 .45 85.51 

Water Gallons 

per Day 

Residential Thousands of 270.02 71 .39 106.33 30.11 71 .60 

Wastewater Gallons 

per Day 

Solid Waste Tons per Year 1 .78 1 .60 1 .41 0 .74 0.70 

Road & Miles per 1,000 5 .68 3 .74 4.54 7 .09 20.17 

Highway people 

Police per 1,000 residents 2.70 2 .43 1 .95 2 .04 2.22 

Crimes per 1,000 residents 66.76 61 .97 30.60 36 .56 29.60 

Fire per 1,000 residents 1 .08 0.47 1 .04 0 .27 0.70 

Fighters 

Public per 1,000 residents 0.04 0.56 0.03 0 .22 0.17 

Welfare 

Physicians per 1,000 residents 1 .74 2.51 1 .70 1 .27 0.44 

Sources: Bureau of Business and Economic Research, 1997. 

7-31 
CHAPTER 8 

PROJECTED IMPACTS OF OFFSHORE ACTIVITY 

IN THE FLORIDA PANHANDLE 

The projected impacts of OCS activity on Florida Panhandle communities are summarized in 

this chapter, beginning with RPC's summarization of analysis of stakeholder concerns and 

user-conflicts . Then, a brief review of relevant literature concerning economic and social 

effects of OCS development is presented. The results of the MMS Florida Panhandle Model 

are summarized in the third section of the chapter. The model was used to assess the impacts 

of alternative OCS development scenarios on population, output, employment, revenues and 

expenditures of local governments, school enrollments, revenues, and expenditures, and 

demands on selected public services for the Panama City and Pensacola areas. In the final 

section, the model results are discussed and compared with recent and projected levels of 

baseline growth. 

Stakeholder Concerns About and User-Conflicts and Benefits of OCS Activity 

Objective 

An important aspect of the study was an analysis of the possible user-conflicts and benefits of 

a shore base in the Florida Panhandle. This analysis considered the tourism, fishing, and port 

industries as well as military interests. 

Primary data collection was done through selective interviews of local and community and 

business leaders . The interviews were designed to identify baseline projection factors and 

impact issues that were not reflected in the literature review or in secondary data. Interviews 

with representatives of the port, military, tourism, and fishing industries were conducted to 

supplement and confirm the findings of the literature review and secondary data collection 

effort . 

Methodology 

To facilitate the interview process, RPC attempted to get a letter of introduction from 

Governor's Office . While this effort was unsuccessful, the Governor's Office was very 

cooperative in suggesting stakeholders in state government . During its first field trip to the 

Florida Panhandle, RPC attended a focus group sponsored by another MMS study and 

incorporated some of the comments expressed and used this group as another source of leads 

for stakeholders . RPC interviewed stakeholders either in person on field trips to the Florida 

Panhandle or by phone from Austin . RPC sent all stakeholders interview guides that raised 

questions for discussion . 

8-1 
RPC conducted stakeholder interviews and contacted a number of stakeholders in two of the 

key industries in this study (tourism and recreational fishing) as well as municipal, county, 

and state government officials and business leaders. The status of the stakeholders contacted 

is summarized in Table 8 .1 . RPC contacted 50 stakeholders and interviewed 26 of them. 

Response was excellent among the tourism, port, and military stakeholders but weak among 

local and county governments and the fishing industry . 

8-2 
Table 8.1 

Stakeholder Interviews 

Stakeholders or 

Sources of Information Contacted Interviewed 

Business Associations / Chambers 3 1 

Fishing 3 0 

Government 18 7 

Federal 2 2 

State 6 3 

County 5 0 

Municipal 4 1 

Regional Planning Council 1 1 

Military 5 4 

Oil 3 2 

Ports 2 2 

Tourism 16 10 

Charter Boats 2 2 

Committees / Councils 3 2 

Environmental 4 2 

Parks 3 2 

Resident Associations 3 2 

Other 1 0 

Total 50 26 

8-3 
Summary 

Tourism 

Ecotourism is important to the local economies, and its importance is increasing. Direct 

user-conflicts between the tourism industry and an onshore support base seem small, given 

the level of projected drilling activity . A support base in Pensacola would be out of sight of 

tourist areas . 

Perception of the area having "sugar white" beaches and clean water is vital to the ecotourism 

in the area. Stakeholders are worried that even the perception that the Florida Panhandle has 

suffered degradation of the environment or the aesthetics of the area could reduce tourism 

and retiree inmigration. Tourism stakeholders view the benefits of an onshore support base 

as very small compared to their perceived risks from an oil spill or other environmental 

degradation. As a result, some tourist stakeholders are extremely hostile to the idea of any 

offshore oil and gas development and related onshore support bases. Strong peer pressure 

exists in the Florida Panhandle to oppose anything related to OCS development. 

Military 

An onshore support base in the Florida Panhandle could cause potential user conflicts with 

the military. Support boats and helicopters based in the Florida Panhandle would cross the 

aerial operations area of three military installations, while boats and helicopters based in 

Mobile would not. The Coastal Systems Station (in Panama City) has some concerns on how 

additional boat traffic might interfere with operations if the support base grew beyond a 

certain size . The Department of Defense can put stipulations on any oil leases that the MMS 

sells, which would put the onus of any user-conflicts on the oil industry rather than the 

military. 

Fishing 

RPC had no responses from representatives of the fishing industry in Florida. 

Ports 

Panama City and Pensacola have ports for ocean going vessels and have in the past had OCSrelated business . These ports are currently underutilized. Pensacola and Panama City have at 

least three locations for support activities : the port, another shipyard or marina, and the 

airport. Destin does not have a suitable location for either air or water transport. Berg Steel, 

located at the Port of Panama City, currently produces steel pipes for offshore drilling . 

8-4 
Other 

The business sector is favorable to OCS activity, liking the economic benefits. Several 

business stakeholders believe the industry to be clean. A number of stakeholders expressed 

concern that even a small base servicing a few platforms could grow over time and transform 

the aesthetics of the area (e.g ., an onshore base would be "the camel's nose under the tent .") 

The Governor's Office expressed the opinion that the risks of a support base and offshore 

drilling are not worth the benefits. Concerns among stakeholders in the area's tourism 

industry about the risks of offshore oil and gas production have lent support to the Governor 

of Florida's public position that the Federal Government should not to sell new oil and gas 

leases in Florida Federal waters within one hundred miles of the Florida coast. 

A number of stakeholders voiced the desire that an analysis of alternative energy sources for 

meeting U.S . energy needs be included as part of this assessment of the socioeconomic 

impact of OCS activity on the Florida Panhandle. In their view, alternative energy sources, 

such as windmills and solar panels, are becoming more economical as each year passes, and 

may, by 2012, when the current moratorium of leasing in the Eastern Gulf of Mexico ends, 

make the hydrocarbon deposits in the Eastern Gulf of Mexico less important in meeting the 

energy needs of the United States . A detailed analysis, however, of the need for offshore oil 

and gas production in light of alternative energy sources was beyond the scope of this study. 

Based on the findings from stakeholder interviews and the literature review on tourism, the 

State of Florida's desire to forbid new offshore oil and gas production in Florida Federal 

waters within one hundred miles of the Florida shore, and the President's recent extension of 

the moratorium on lease sales in the Eastern Gulf of Mexico (except for Lease Sale 181) until 

2012, this report assumes that the MMS will not lease additional tracts of water during the 

study period that could be better serviced from the Florida Panhandle than from existing 

bases in Mobile or Pascagoula. 

Literature Review 

The purpose of this section is to summarize the findings of relevant literature regarding the 

socioeconomic impacts of offshore petroleum development. The emphasis is placed on 

studies that deal with economic and social effects of OCS development in the Gulf of Mexico 

(GOM) region, but studies dealing with offshore development in other areas (e.g ., North Sea, 

Newfoundland, Alaska, California) also are reviewed. Literature dealing with other types of 

energy or resource development (e.g ., western "boom town" studies) has not been included, 

unless some aspect of the development context seemed particularly applicable to the OCS 

situation. 

8-5 
The socioeconomic impacts of development projects and programs have been categorized in 

a number of ways. One classification of such impacts identifies (1) economic impacts 

(including changes in local business sales, employment, earnings, and income), (2) 

demographic impacts (changes in the size, distribution, and composition of the population), 

(3) public service impacts (changes in the demand for, and availability of, public services and 

facilities), (4) fiscal impacts (changes in revenues and costs among local governmental 

jurisdictions), and (5) social impacts (changes in patterns of interaction, the formal and 

informal relationships resulting from such interactions, and the perceptions of such 

relationships among various groups in a social setting)(Leistritz 1994, Leistritz and Murdock 

1981). The review will follow this classification of impacts . 

Economic Impacts 

A number of studies have addressed the economic impacts of offshore development (see 

Seydlitz, et al . 1995, Seydlitz and Laska 1994, Brabant 1994, McNicoll 1982, and Manuel 

1985, among others). Seydlitz et al . (1995) examined long-term economic effects of 

petroleum development on Louisiana parishes . Their analysis covered four time periods: 

Preboom (1969-73), Boom (1974-81), Transition (1982-85), and Bust (1986-90). The 

parishes were categorized as having minimal or heavy involvement with energy development 

and were further classified according to whether their major involvement was in extraction 

or in related activities (e .g ., refining) . The study focused on five economic measures : (1) per 

capita transfer payments, (2) average per capita income, (3) net migration, (4) per capita sales 

tax collections, and (5) unemployment rates. The findings indicated that the relationships 

between petroleum industry activity and economic indicators were stronger in the highly 

involved parishes than in those that were minimally involved. The findings also 

demonstrated that economic benefits resulting from an increase in petroleum activity tended 

to be transitory . That is, the communities that were highly involved in offshore petroleum 

production, particularly extraction, do not permanently experience improved economic 

situations . Rather, the improvements gained during the boom period tended to be lost during 

the bust (Seydlitz et al . 1995). The communities that experienced substantial growth in 

extraction activity tended to be focal points for inmigrants, which exacerbated unemployment 

and related problems when petroleum activity slowed. 

Seydlitz and Laska (1994) report additional findings from the study of effects on Louisiana 

parishes . They find that per capita income, sales taxes, and net inmigration tended to 

increase within one year of increases in petroleum activity, while unemployment and transfer 

payments decreased. However, in the second, third, and fourth years after an increase in 

petroleum activity, these relationships reversed. 

Seydlitz and Laska (1994) also find that a diversified economy, even a diversified 

involvement in the extractive industry, helps to reduce negative economic effects . One 

means of ensuring a more diversified involvement in the petroleum industry might be for 

local officials to require companies that are extracting the resource to locate processing plants 

in their jurisdiction as well. Another approach that these authors suggest for mitigating some 

8-6 
of the negative impact of downturns would be to set aside money from federal lease sales and 

from sales and severance taxes collected from extraction companies to use for job training 

and employment counseling that may be needed during energy downturns. These resources 

could also be used to mitigate the increase in transfer payments that occurs when 

unemployment increases . 

The petroleum industry has become a very important component of the economy of several 

states bordering the Gulf of Mexico, particularly Louisiana and Texas (Manuel 1985) . The 

economic importance of the petroleum industry increased during the boom period of the 

1970s and early 1980s. By 1982, Louisiana accounted for 34 percent of all U.S. production of 

natural gas and 13 percent of U.S. production of crude oil while Texas produced 35 percent 

of the nation's gas and 29 percent of its crude oil . Louisiana had 11 percent of all U.S . 

drilling rigs working in 1982 while Texas had 32 percent. 

During the period 1976-1982, the number of rigs drilling had a major effect on statewide 

unemployment rates in both Louisiana and Texas, but the effect was substantially greater in 

Louisiana. Manuel (1985) attributes the difference to Louisiana's higher percentage of 

offshore drilling activity, which requires a substantially greater number of personnel per rig 

than drilling onshore. 

While many coastal communities experience direct effects of offshore oil and gas extraction 

and/or processing, Brabant (1994) points out that the ripple effects of offshore oil activity can 

also be substantial. Using data from Ouachita Parish, Louisiana, Brabant (1994) 

demonstrates that the decline in the petroleum sector had substantial effects on this parish, 

even though it is spatially removed from the centers of offshore energy development. These 

effects were manifested particularly through (1) secondary impacts experienced by 

construction, transportation, and warehousing firms, (2) loss of earnings by workers who had 

been commuting from the parish to offshore jobs, and (3) persons who moved back to 

Ouachita Parish from the coast. 

McKenzie et al . (1993) also document the importance of the oil and gas industry to the Gulf 

Coast economy. They define a study area comprising 49 counties and parishes in Alabama, 

Mississippi, Louisiana, and Texas. Mining employment (primarily oil and gas extraction) in 

this region grew from 50,028 jobs in 1960 to 189,262 jobs in 1980 . Oil prices and OCS oil 

and gas production peaked in 1981 . Prices weakened steadily from 1982 until early 1985, 

then in late 1985 the bottom fell out of the market, with the average reported price for 1986 

($12.45) being little more than half that for 1985 ($24.08) . The decrease in oil prices was 

rapidly reflected in employment opportunities and net migration. During a 12-month period 

from 1982 to 1983, 1 in 8 mining jobs in the study area ceased to exist, and from 1982 to 

1986, mining jobs decreased 28.6 percent. In 1981, only 5 of the 49 counties/parishes 

experienced negative net migration, but by 1984, 35 were experiencing out-migration. The 

authors also attempted to develop statistical models to describe the relationship between 

levels of OCS oil and gas activity and various socioeconomic indicators, but concluded that 

". .based on the analysis performed, no theoretically meaningful models relating OCS oil and 

gas activities to socioeconomic conditions are possible" (McKenzie et al . 1993, p. 134). 

8-7 
McNicoll (1982) discusses local economic impacts of offshore oil and gas on Scottish 

communities. He reports that output multipliers for various onshore activities (e.g ., supply 

bases, platform construction, pipecoating yard) ranged from 1 .2 to 1 .4 while income 

multipliers ranged from 1 .2 to 1 .6 . The relatively low values of the multipliers are 

attributable to the high propensities to import exhibited by oil facilities located in these rural 

areas . For example, in 1976 in Shetland 45 percent of oil supply base requirements and 76 

percent of oil construction requirements were directly imported. Also a large percentage of 

the employees were nonresidents (75 percent in Shetland in 1980), whose local expenditures 

would be limited to some subsistence and entertainment expenses . However, this author also 

reports that purchasing patterns do not remain static . The percentage of purchases that the 

Shetland supply base made locally rose from 15 percent in 1974 to 55 percent in 1976, partly 

because of increased "awareness" between the oil and indigenous sectors and partly because 

of adaptation to oil industry requirements by local firms. 

Also discussing the experiences of Scottish communities in coping with North Sea oil and 

gas development, Sewel (1983) points out that offshore petroleum development occurs in 

three sequential, but often overlapping, phases: exploration, development, and production. 

Each of these phases has its own set of offshore and onshore activities . The major onshore 

activities are categorized as (1) servicing -- provision and transport of men and materials 

from supply centers to activity centers onshore and offshore, (2) fabrication of production 

platforms to be used offshore, (3) construction of onshore terminals and primary processing 

facilities, and (4) operation of onshore terminals and primary processing facilities . A unique 

characteristic of offshore development is that the developer has some flexibility in choosing 

where to perform certain activities, particularly fabrication of platforms. 

Harris et al . (1986) analyze not only the aggregate economic effects of North Sea oil 

development on Aberdeen, Scotland, but also the distribution of these effects among male vs. 

female workers, the working class vs. the middle class, and homeowners vs. tenants. They 

report that the oil sector accounted for about 35,600 jobs (25% of total employment) in 

Aberdeen in 1984. They estimate the employment multiplier for the oil sector to be 1 .78. 

However, they also report that some firms in other sectors have been adversely affected 

because of increased demands for labor and for commercial and industrial property. The 

Aberdeen area experienced a substantial rise in average earnings during the period of oil 

sector growth, but the increased earnings were largely confined to workers employed directly 

in the oil sector. As a result, female workers did not share in the increases in average 

earnings to the same extent as their male counterparts . Also, the net employment effect of oil 

development was to offer more jobs to the middle class than to the working class. 

Homeowners who owned their dwellings before development began experienced gains in net 

worth as a result of increased housing prices . On the other hand, tenants living in public 

housing were protected from increased housing costs by a low rents policy that prevailed 

through most of the development period . 

8-8 
Demographic Impacts 

As with any type of resource development project, the effects of development on local 

populations can be expected to be a prime concern to areas facing the prospect of OCS 

development. The extent to which the new project-related jobs are filled by (a) local 

residents, (b) workers relocating from other areas, or (c) commuting workers who maintain a 

permanent residence outside the area, together with the demographic characteristics of the 

relocating workers and accompanying persons, can be expected to have a substantial 

influence on the demographic changes experienced by site area communities . A unique 

feature of OCS development is the prevalence of shift work, particularly for offshore workers 

(Gramling 1989, Gramling and Brabant 1986). The shift workers reside at the job site for 

extended periods (i .e ., 7 days or more), working shifts of 12 hours on and 12 off. The stay at 

the job site is followed by a period of time off, generally of the same length. 

The prevalence of shift work in the offshore oil and gas industry means that the workers can 

choose to maintain residences some distance from their work sites. For instance, in the 

Northern Gulf of Mexico, where the typical work pattern is 7 days on and 7 off, Gramling 

and Brabant (1986) reported that only 30 percent of the offshore workers in their sample 

lived within 100 miles of where they met to go offshore, and 11 .5 percent lived 500 miles or 

more from where they worked. Similarly, Centaur Associates (1986) found that, of the 

estimated 21,847 employees working offshore in waters off Louisiana in 1984, 9.9 percent 

did not reside in the state of Louisiana. 

In addition to the offshore workers, OCS development leads to job opportunities for persons 

involved in constructing onshore facilities (e.g ., terminals or processing plants) and 

fabricating platforms and in operating supply bases and other onshore facilities, as well as 

secondary jobs in a variety of local trade and service activities . These jobs appear to be 

somewhat analogous to the construction, operations, and secondary jobs associated with 

other types of energy development (Murdock and Leistritz 1979). The proportion of these 

jobs that will be filled by commuting workers (whose permanent residence is outside the 

study area), relocating workers (who move into the area in response to OCS-related jobs), 

and local workers will likely differ by job type. Past studies have generally indicated that the 

percentage of commuting workers is likely to be significant only for temporary construction 

jobs (Murdock et al . 1986, Dunning 1981). The percentage of local vs . relocating workers 

hired for the different jobs will likely depend largely on (1) local labor market conditions and 

(2) skills of local workers. Generally, the higher the local unemployment rate, the larger the 

pool of unemployed or underemployed persons, and the greater the similarity of the new jobs 

to those with which area workers are familiar, the higher will be the rate of local hiring 

(Gramling and Brabant 1986, Leistritz and Murdock 1986). 

Leistritz (1986) assembled information on local hiring rates and worker demographics 

relevant to GOM-OCS development. 

8-9 
Public Service Impacts 

Increasing economic activity and population growth resulting from offshore energy 

development typically leads to growing demands on a variety of public services . Gramling 

and Brabant (1986) describe the public service issues associated with petroleum industry 

expansion in coastal Louisiana, using East St. Mary Parish as an example. From 1940 to 

1970, the population of this area increased nearly 200 percent, largely as a result of offshore 

oil and gas activity and increases in associated trade and service activities . The growing 

population led to a housing shortage, exacerbated by limited available land and growing 

competition from the commercial sector for that land. The growth also led to strains on 

utility systems, roads, recreation facilities, and medical facilities . One of the hardest hit 

community services was the public schools ; public school enrollment in the parish increased 

by 115 percent from 1950 to 1970. 

Another problem involved the influx of transients into Southern Louisiana seeking 

employment in the oil and gas industry . The influx of transients was believed by local 

leaders to be associated with an increase in rates of violent crime. From 1974 to 1979, the 

violent crime rate for Morgan City (largest town in East St. Mary Parish) ranged from two to 

three times the average rate for cities of comparable size in the U.S . (Gramling and Brabant 

1986). 

Seydlitz and Laska (1994) also address the impact of OCS activity on education. They found 

that increases in oil and gas activity lead to increases in the percentage of students 

completing high school but also to decreases in the percentage of high school graduates 

entering college . Increased oil and gas activity also led to greater strain on local school 

systems, evidenced by increased numbers of students and increased per capita education 

expenditures . 

Offshore energy development in Southern California has also raised concerns regarding 

increased public service demands (Powers 1988). As a result, Santa Barbara County 

established a program for monitoring and mitigation of such impacts. Emphasis was on 

estimating impacts on wastewater treatment facilities, water supply, and education, police, 

and fire protection services. If impacts are deemed significant, mitigation measures may be 

required of oil companies and service providers . 

McNicoll (1982) comments on public service effects of North Sea development on rural 

Scotland. Service and infrastructure effects fell primarily into two categories: (1) 

transportation -- new/improved roads, seaports, and airports, and (2) provision of new 

housing, schools, and related services required by the increased local population . 

Fiscal Impacts 

Closely related to the public service effects are concerns about fiscal impacts, particularly for 

local governments. Powers (1988) reports that the guiding principle for the mitigation 

8-10 
program developed in Santa Barbara County is to insure that existing residents and taxpayers 

do not subsidize any financial impacts to the county, municipalities, and public service 

providers within the county as a result of oil and gas development. 

Seyfrit (1988) reports that Shetland County in Northern Scotland took measures to insure a 

favorable fiscal outcome for their area. These included (1) the County Council retained 50 

percent of the shares in the company building and operating the major oil terminal, (2) taxes 

were collected on every barrel of oil passing through the terminal, and (3) stockpiling some 

of the funds to minimize impacts as oil activity declines . However, Seyfrit (1988) also points 

out that little research has been done to determine how effective these measures actually 

were . 

Leistritz et al . (1985) discuss some of the fiscal effects of oil development in Alaska. Oil 

development led to substantial increases in the tax base of the North Slope Borough. Oil 

development also had important implications for state revenues, which allowed increases in 

state government spending for a variety of purposes. 

Social Impacts 

Gramling and Brabant (1986) and Seydlitz and Laska (1994) comment on the social impacts 

of oil and gas development in Southern Louisiana. These impacts are seen to arise in part 

because (1) the area economy has developed an extreme degree of dependence on the oil and 

gas industry, which enhanced its vulnerability to industry fluctuations and (2) increases in oil 

activity led to an influx of migrants hopeful of finding employment in the industry, an influx 

which often exceeded the number of job opportunities. As a result, the coastal communities 

were seen as experiencing an economic roller-coaster, or a series of boom-bust cycles . 

Seydlitz and Laska (1994) found these cycles of energy industry activity to be related to rates 

of criminal cases, homicides, and suicides. Gramling and Brabant (1986) reported that the 

influx of transients searching for oil-related jobs was believed to lead to high rates of violent 

crime in coastal communities. 

Freudenberg and Gramling (1993) examine factors affecting opposition and support for 

offshore petroleum development, examining the very different responses to offshore oil 

development in Southern Louisiana vs. Northern California. Among key factors they 

identified as contributing to the difference in response were (1) the time period when offshore 

activity began, (2) the fact that offshore energy development in Louisiana preceded most 

other coastal development, (3) the fact that Louisiana offshore development occurred as a 

progression from onshore drilling, to development in the marshes, to OCS activity, (4) less 

access to the coast by Louisiana residents, and (5) differences in social factors such as 

education, social networks, and a tradition of extractive uses of other coastal resources in 

Louisiana. 

8-11 
Adjustments for Commuting Offshore Workers in the MMS Model 

As stated above, Gramling and Brabant (1986) estimate that 70 percent of offshore workers 

live more than 100 miles from where they meet to go offshore (i .e ., an onshore support base) . 

If an onshore base were located in Panama City or Pensacola, these commuting workers and 

their families would not spend their incomes in the Florida Panhandle . As shown in Table 

8.2, RPC adjusted for these commuting workers by lowering projected expenditures in SIC 

category 1389 "Other Oil and Gas Services" by half when compared to Table 2 .6 in Chapter 

2.' 

'In its impact study on Destin Dome, Chevron (1997) does not appear to adjust for 

commuting offshore workers or assumes that all offshore workers are local . This assumption 

might be consistent with an effort to show the maximum potential economic impact of the 

project on Mobile, Alabama. 

8-12 
Table 8.2 

Industries Associated with Operation and Maintenance 

of Offshore Oil and Ga s Platfo rms 

Adjusted for Commuting Patterns of Offshore Workers 

Code Number Operation and Maintenance Spending 

Typical Florida 

Supply Percent of Panhandle Percent of 

SIC IMPLAN Description in Destin Dome Base Total Supply Base Total 

132 39 Oil & gas operations X 36.3% 0.0% 

1389 57 Other oil and gas services excl . X 9.2% X 17 .5% 

commuting workers 

1389 57 Other oil and gas services : commuting 9.2% 17 .5% 

offshore workers only 

2899 209 Chemical, not elsewhere classified X 0.9% 0.0% 

291 210 Petroleum fuel X 4.4% 0.0% 

324 232 Hydraulic cement X 0.7% 0.0% 

3559 331 Special industry machinery, not X 5.1% 0.0% 

elsewhere classified 

44 436 Water transportation X 4.0% X 7.6% 

45 437 Air transportation X 3.8% X 7.2% 

58 454 Eating and drinking places X 1 .7% X 3.2% 

7359 473 Miscellaneous equipment rent / lease X 1 .4% X 2.7% 

871 506 Environmental and engineering X 14.7% X 27.9% 

services 

872 507 Accounting / miscellaneous business X 4.2% X 8.0% 

services 

873 509 Test / research services X 4 .5% X 8.6% 

Total for a typical onshore base 100.0% 

Total for Florida Panhandle 52.6% 100.0% 

onshore base 

* Assumes no more than 30 % of offshore workers are locals . 

Sources: RPC; Chevron, Destin Dome Unit 56, Development and Production Plan, July 1997. 

Results of the MMS Florida Panhandle Model 

The MMS Florida Panhandle Model was developed by RPC to enable users to prepare 

plausible quantitative projections of the implications of various OCS development scenarios 

for selected counties and communities. The model is structured as a set of three economicdemographic submodels, each representing one of the metropolitan areas within the Florida 

Panhandle (Fort Walton Beach, Panama City, and Pensacola) . Each economic-demographic 

8-13 
model projects both baseline and impact-related economic activity, population, and related 

indicators through the interaction of local output and labor force. An assumption inherent in 

the model design is that the socioeconomic impacts of OCS activity will occur only in the 

metro area where the support activity occurs (i .e ., where onshore support facilities are 

located). 

Some stakeholders have expressed concerns that locating an onshore support base in the 

Florida Panhandle could negatively affect the region's military or tourism industries . 

Findings of RPC's research indicate that the level of proposed OCS activity that might be 

serviced by an onshore base in the Florida Panhandle probably would not affect the level of 

military or tourism activity in the region . Nevertheless, the option of quantifying the 

implications of negative effects on the military and tourism sectors has been incorporated 

into the model (although the RPC team does not agree with the premise that such negative 

impacts would occur) . For a more detailed description of the model, see MMS 

Socioeconomic . . Model. . User's Guide. 

The model was used to assess the implications of three OCS development scenarios . The 

first two involve alternative levels of OCS production from Lease Sale 181, a minimum 

threshold level (i .e ., a lower level would not justify development of the field) and a 

reasonable maximum level . The third scenario assumes that Chevron's Destin Dome project 

will be supported in part by facilities located in the Panhandle . Each of these scenarios is 

analyzed assuming that the onshore support base will be located in the Panama City area or, 

alternatively, in the Pensacola area. (As previously discussed, the Fort Walton Beach area 

lacks a deep water port and hence was deemed unsuitable as a location for OCS support 

facilities.) The three scenarios and their underlying rationale are discussed in detail in 

Chapter 2 of this report. Results of the analyses of these scenarios are summarized in the 

sections that follow . 

Panama City 

Lease Sale 181 

Key parameters of the minimum threshold scenario and the resulting impacts for the Panama 

City area are summarized in Table 8 .3 .1 . Under the minimum threshold scenario, oil 

production from Lease Sale 181 begins in 2010, peaks in 2020 at 1 .7 million barrels, and 

ends by 2040 . Natural gas production follows the same time pattern, with a peak production 

of 25 .0 billion cubic feet in 2020 (Table 8.3 .1). Under this scenario, OCS expenditures in the 

impact area peak at $6.5 million annually in 2020. Throughout the period of oil and gas 

production (2010 through 2035), OCS support is estimated to require 288 boat trips and 1248 

helicopter flights annually from the support base. The estimated OCS impact on the 

population of the Panama City area is projected to peak 

at 341 persons in the year 2025 (which is only 0.2 percent of the area's projected baseline 

population for~that year). The area would have a net increase of 136 households in the year 2025 

8-14 
as a result of OCS activity (Table 8.3 .2). It should be noted that, while OCS production and 

resulting economic impacts end in 2035, some population impacts and related socioeconomic 

effects continue through year 2045 . 

The impacts of the OCS minimum threshold level of development on total output in the Panama 

City area are estimated to peak at $8 .9 million in the year 2020, while the impact on employment 

peaks at 229 jobs in the same year. The peak impact on area output represents about one seventh 

of a percent (0.14 percent) of the area's projected baseline output, and a little more than that 

(0.16 percent) of output excluding government (Table 8 .3 .3). The peak employment impact 

represents about one quarter of a percent (.26 of a percent) of projected baseline employment. 

The net fiscal impacts of the OCS minimum threshold level of development on Bay County and 

its municipalities are summarized in Table 8.3 .4 . Additional expenditures by county government 

resulting from OCS activity are projected to peak in 2025, at $272,168 . Additional ad valorem 

taxes are projected to contribute $44,812 to county revenues, which results in $227,356 being 

required from other sources to balance the budget. Additional expenditures by municipal 

governments in Bay County (i .e ., all municipal governments combined) are projected to peak at 

$221,633, also in 2025 . Additional ad valorem tax revenues were estimated to contribute about 

$11,404 while other taxes, fees, and licenses would add about $152,721 to municipal revenues, 

leaving $57,508 required from all other sources to balance the budget. 

The estimated impacts of the OCS minimum threshold level of development on school 

enrollments in Bay County are summarized in Table 8.3 .5 . The number of school age children 

peaks at 56 in year 2030. This represents about one seventh of a percent (0.15 of a percent) of 

the projected baseline population in this age group. The additional expenditures by the Bay 

County school district are estimated to peak at $259,980 (in 2030), or about $4,640 per 

additional student. Total additional school district revenues are estimated to total about 

$257,930, including about $177,200 in added state revenues, $71,100 in additional ad valorem 

taxes, and $21,800 in extra federal revenues. 

The projected impacts of the OCS minimum threshold level of development on selected public 

services in Bay County are summarized in Table 8 .3 .6 . Most impacts peak in 2025, when 

population impacts are greatest. 

8-15 
Table 8.3 .1 

Impact Area 

Report Area 

Production Scenario in Lease Sale 181: 

Item 

Oil and Gas Production in Eastern Gulf of Mexico 

Lease Sale 181 

Oil Production (Millions of Barrels) 

Gas Production (Billions of Cubic Feet) 

Destin Dome 

Oil Production (Millions of Barrels) 

Gas Production (Billions of Cubic Feet) 

OCS Expenditures in Impact Area 

Lease Sale 181 

Destin Dome 

Scenario Impact on Key Industries 

Tourism 

Percentage Change in Level 

Percentage Change in Growth Rate 

Military 

Percentage Change in Level 

OCS-Related Activities 

Boat Trips from Service Base 

Helicopter Trips from Service Base 

MMS Florida Panhandle Model - Panama City 

OCS Scenario Report - Minimum Threshold 

Panama City Scenario Name: PC: Min Threshold 

Bay County Date: September 18, 2001 

Minimum Threshold Destin Dome : Not Serviced in Florida 

1995 2000 2005 2010 2015 2020 2025 2030 2035 2040 2045 

0.0 0.0 0.0 03 0.9 1 .7 1 .4 1 .2 0.8 0.0 0.0 

0.0 0.0 0.0 5.0 17 .5 25.0 22.5 20.0 15 .0 0.0 0 .0 

0. 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0 .0 

0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0 .0 

0.0 0.0 0.0 1.3 4.3 6.5 5.7 5.1 3 .6 0.0 0.0 

0.0 0.0 0.0 1 .3 4.3 6.5 5 .7 5 .1 3 .6 0.0 0.0 

0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 

.00% 0.00% 0 .00% 0 .00% 0.00% 0.00% 0 .00% 0 .00% 0 .00% 0.00% 0 . 

.00% 0.00% 0 .00% 0 .00% 0 .00% 0.00% 0 .00% 0 .00% 0 .00% 0.00% 0 .00% 

0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 

0 0 0 288 288 288 288 288 288 0 0 

0 0 0 1248 1248 1248 1248 1248 1248 0 0 
Table 8.3 .2 

MMS Florida Panhandle Model - Panama City 

Population Report - Minimum Threshold 

Impact Area 

Report Areas 

00 

Bay County 

Total Population 

Scenario 

Baseline 

Net Change in Population 

Net Change in Households 

Panama City 

Bay County 

Scenario Name: PC: Min Threshhold 

Date: September 18, 2001 

1995 2000 2005 2010 2015 2020 2025 2030 2035 2040 2045 

139,173 150,277 162,188 174,625 187,729 198,669 210,395 219,170 227,314 234,659 242,076 

139,173 150,277 162,188 174,575 187,536 198,341 210,054 218,838 227,033 234,538 241,999 

0 0 0 50 193 328 341 333 281 121 77 

0 0 0 20 77 131 136 133 112 48 31 
Table 8.3 .3 

MMS Florida Panhandle Model - Panama City 

Output and Employment Report - Minimum Threshold 

00 

00 

Impact Area 

Report Area 

Total Output (in $ Millions 

Scenario 

Baseline 

Net Impact 

Output Excl. Government 

Scenario 

Baseline 

Net Impact 

Employment 

Scenario 

Baseline 

Net Impact 

Panama City Scenario Name: 

Bay County Date: 

1995 2000 2005 2010 2015 2020 2025 2030 2035 

4,858.5 5,011.5 5,481 .2 5,869.8 6,166.9 6,2833 6,452.9 6,543.8 6,759.3 

4,858.5 5,011 .5 5,481 .2 5,868.2 6,161 .1 6,274.4 6,445.1 6,536.9 6,754.3 

0.0 0.0 0.0 1 .6 5.8 8.9 7.8 6.9 4.9 

1995 2000 2005 2010 2015 2020 2025 2030 2035 

4,229.4 4,364.7 4,803 .2 5,165.1 5,445.0 5,561.7 5,725.6 5,814.1 6,013.4 

4,229.4 4,364.7 4,803 .2 5,163 .5 5,439 .3 5,552 .9 5,717.9 5,807 .3 6,008.6 

0.0 0.0 0.0 1 .5 5.7 8.8 7.7 6.8 4.9 

1995 2000 2005 2010 2015 2020 2025 2030 2035 

69,060 70,811 77,151 82,617 86,659 88,164 90,350 91,426 94,219 

69,060 70,811 77,151 82,575 86,509 87,935 90,150 91,248 94,092 

0 0 0 42 150 229 201 178 127 

PC: Min Threshold 

September 18, 2001 

2040 2045 

6,977 .9 7,209.7 

6,977 .9 7,209.7 

0.0 0.0 

2040 2045 

6,215 .7 6,430.6 

6,215 .7 6,430.6 

0.0 0.0 

2040 2045 

97,009 100,028 

97,009 100,028 

0 0 
Table 8.3 .4 

MMS Florida Panhandle Model - Panama City 

Fisc al Balance Report - M inimum Threshold 

Impact Area Panama City Scenario Name: PC: Min Threshold 

Report Area Bay County Date : September 18, 2001 

Item 1995 2000 2005 2010 2015 2020 2025 2030 2035 2040 2045 

Scenario Population 139,173 150,277 162,188 174,625 187,729 198,669 210,395 219,170 227,314 234,659 242,076 

Baseline Population 139,173 150,277 162,188 174,575 187,536 198,341 210,054 218,838 227,033 234,538 241,999 

Net Change in Population 0 0 0 50 193 328 341 333 281 121 77 

Net Change in Households 0 0 0 20 77 131 136 133 112 48 31 

County Government 

Revenues 0 0 0 40,092 153,866 261,838 272,168 265,424 224,432 96,674 61,210 

Ad Valorem Taxes 0 0 0 7,037 26,814 44,612 44,812 42,962 35,333 12,966 8,210 

Residential 0 0 0 5,377 20,637 35,118 36,504 35,599 30,101 12,966 8,210 

Commercial and Industrial 0 0 0 1,660 6,177 9,494 8,308 7,363 5,232 0 0 

Other Taxes, Fees, Licences, etc . 0 0 0 0 0 0 0 0 0 0 0 

From All Other Sources to Balance Budget 0 0 0 33,055 127,052 217,226 227,356 222,462 189,099 83,708 53,001 

Expenditures 0 0 0 40,092 153,866 261,838 272,168 265,424 224,432 96,674 61,210 

Municipal Government 

Revenues 0 0 0 32,648 125,297 213,221 221,633 216,141 182,760 78,724 49,845 

Ad Valorem Taxes 0 0 0 1,791 6,823 11,353 11,404 10,933 8,991 3,300 2,089 

Residential 0 0 0 1,368 5,252 8,937 9,289 9,059 7,660 3,300 2,089 

Commercial and Industrial 0 0 0 422 1,572 2,416 2,114 1,874 1,331 0 0 

Other Taxes, Fees, Licences, etc . 0 0 0 22,497 86,339 146,925 152,721 148,937 125,935 54,247 34,347 

From All Other Sources to Balance Budget 0 0 0 8,360 32,135 54,943 57,508 56,271 47,834 21,178 13,409 

Expenditures 0 0 0 32,648 125,297 213,221 221,633 216,141 182,760 78,724 49,845 
Table 8.3 .5 

MMS Florida Panhandle Model - Panama City 

Schools Report - Minimum Threshold 

Impact Area Panama City Scenario Name: PC: Min Threshold 

Report Area Bay County Date: September 18, 2001 

Number of School-AQe Children 1995 2000 2005 2010 2015 2020 2025 2030 2035 2040 2045 

Scenario 27,310 29,495 30,868 31,517 32,877 34,626 36,863 38,353 39,419 40,363 41,715 

°° Baseline 27,310 29,495 30,868 31,510 32,851 34,582 36,814 38,298 39,368 40,337 41,698 

N 

o Net Change 0 0 0 7 26 44 49 56 51 26 17 

Net Change in Households 0 0 0 20 77 131 136 133 112 48 31 

Fiscal Impact of Net Change 

Total Revenues 0 0 0 34,074 127,164 215,265 235,900 257,930 232,547 114,929 73,911 

Local Ad Valorem Taxes 0 0 0 11,654 44,406 73,881 74,212 71,148 58,514 21,473 13,596 

Residential Property 0 0 0 8,905 34,176 58,159 60,453 58,955 49,850 21,473 13,596 

Commerical Property 0 0 0 2,749 10,230 15,722 13,759 12,193 8,664 0 0 

State Revenues 0 0 0 22,413 82,806 139,904 156,235 177,187 162,692 83,222 53,710 

Federal Revenues 0 0 0 2,756 10,182 17,203 19,211 21,787 20,005 10,233 6,604 

Expenditures 0 0 0 32,886 121,497 205,275 229,238 259,980 238,712 122,109 78,807 
Table 8.3 .6 

MMS Florida Panhandle Model - Panama City 

Public Services Report - Minimum Threshold 

N 

Impact Area 

Report Area 

Population 

Scenario 

Baseline 

Net Impact 

Public Services Impact 

Residential Water (thousands of 

gallons per day) 

Residential Wastewater (thousands 

of gallons per day) 

Solid Waste (tons per year) 

Road & Highway (miles) 

Police Protection 

Crimes 

Fire Protection 

Public Welfare 

Physicians 

Panama City Scenario Name: PC: Min Threshold 

Bay County Date: September 18, 2001 

1995 2000 2005 2010 2015 2020 2025 2030 2035 2040 2045 

139,173 15 0,277 162,188 174,625 187,729 198,669 210,395 219,170 227,314 234,659 242,076 

139,173 15 0,277 162,188 174,575 187,536 198,341 210,054 218,838 227,033 234,538 241,999 

0 0 0 50 193 328 341 333 281 121 77 

0.0 0.0 0.0 4.4 17.1 29.0 30.2 29.4 24.9 10 .7 6.8 

0.0 0.0 0.0 13 .6 52 .1 88 .6 92 .1 89 .8 75 .9 32 .7 20.7 

0.0 0.0 0.0 89 .4 343 .2 584.0 607.0 592.0 500.6 215.6 136.5 

0.0 0.0 0.0 03 1 .1 1 .9 1 .9 1 .9 1 .6 0.7 0.4 

0 0 0 0 1 1 1 1 1 0 0 

0.0 0.0 0.0 3.4 12 .9 21 .9 22 .8 22 .2 18 .8 8.1 5 .1 

0 0 0 0 0 0 0 0 0 0 0 

0 0 0 0 0 0 0 0 0 0 0 

0 0 0 0 0 1 1 1 0 0 0 
Key parameters of the OCS reasonable maximum scenario and the resulting impacts for the 

Panama City area are summarized in Table 8 .4 .1 . Under the reasonable maximum scenario, oil 

production from Lease Sale 181 begins in 2010, peaks in 2020 at 3 .3 million barrels, and ends by 

2040 . Natural gas production follows the same time pattern, with a peak production of 40.5 

billion cubic feet in 2020 (Table 8.4 .1). Under this scenario, OCS expenditures in the impact 

area peak at $11 .2 million annually in 2020. Throughout the period of oil and gas production 

(2010 through 2035), OCS support is 

estimated to require 288 boat trips and 1248 helicopter flights annually from the support base 

(i .e ., the same number of trips as in the minimum threshold scenario). 

The estimated OCS impact, assuming a reasonable maximum scenario, on the population of the 

Panama City area is projected to peak at 589 persons in the year 2025 (which is only about one 

third of a percent of the area's projected baseline population for that year). The area would have 

a net increase of 236 households in the year 2025 as a result of OCS activity (Table 8.4 .2). It 

should be noted that, while OCS production and resulting economic impacts end in 2035, some 

population impacts and related socioeconomic effects continue through year 2045 . 

The impacts of the OCS reasonable maximum level of development on total output in the 

Panama City area are estimated to peak at $15.5 million in the year 2020, while the impact on 

employment peaks at 397 jobs in the same year. The peak impact on area output represents about 

one quarter of a percent (0.25 percent) of the area's projected baseline output, or little more than 

that (0.28 percent) of output excluding government (Table 8 .4 .3) . The peak employment impact 

represents about one half of a percent (0.45 percent) of projected baseline employment. 

The net fiscal impacts of the OCS reasonable maximum level of development on Bay County 

and its municipalities are summarized in Table 8.4 .4 . Additional expenditures by county 

government resulting from OCS activity are projected to peak in 2025, at $470,407. Additional 

ad valorem taxes are projected to contribute $77,509 to county revenues, which results in 

$392,898 being required from other sources to balance the budget. Additional expenditures by 

municipal governments in Bay County (i .e ., all municipal governments combined) are projected 

to peak at $383,064, also in 2025 . Additional ad valorem tax revenues were estimated to 

contribute about $19,724 while other taxes, fees, and licenses would add about $268,959 to 

municipal revenues, leaving about $99,381 required from all other sources to balance the budget. 

The estimated impacts of the OCS reasonable maximum level of development on school 

enrollments in Bay County are summarized in Table 8 .4 .5 . The number of school age children 

peaks at 96 in year 2030. This represents about one quarter of a percent (0.25 percent) of the 

projected baseline population in this age group . The additional expenditures by the Bay County 

school district are estimated to peak at $449,612 (in 2030), or about $4,650 per additional 

student. Total additional school district revenues are estimated to total about $446,000, 

including about $306,400 in added state revenues, $123,100 in additional ad valorem taxes, and 

$37,700 in extra federal revenues. 

8-22 
The projected impacts of the OCS reasonable maximum level of development on selected public 

services in Bay County are summarized in Table 8 .4 .6 . Most impacts peak in 2025, when 

population impacts are greatest. 

8-23 
Table 8.4 .1 

MMS Florida Panhandle Model - Panama City 

OCS Scenario Report - Reasonable Maximum 

N 

Impact Area 

Report Area 

Production Scenario in Lease Sale 181 : 

Item 

Oil and Gas Production in Eastern Gulf of Mexico 

Lease Sale 181 

Oil Production (Millions of Barrels) 

Gas Production (Billions of Cubic Feet) 

Destin Dome 

Oil Production (Millions of Barrels) 

Gas Production (Billions of Cubic Feet) 

OCS Expenditures in Impact Area 

Lease Sale 181 

Destin Dome 

Scenario Impact on Key Industries 

Tourism 

Percentage Change in Level 

Percentage Change in Growth Rate 

Military 

Percentage Change in Level 

OCS-Related Activities 

Boat Trips from Service Base 

Helicopter Trips from Service Base 

Panama City Scenario Name: PC: Reason Max 

Bay County Date: September 18, 2001 

Reasonable Maximum Destin Dome : Not Serviced in Florida 

1995 2000 2005 2010 2015 2020 2025 2030 2035 2040 2045 

0.0 0.0 0.0 0.6 1.8 3.3 2.7 2.4 1 .5 0.0 0.0 

0 .0 0.0 0.0 8.1 28.4 40.5 36.5 32.4 24.3 0.0 0.0 

0-0 0-0 0-0 0-0 0-0 0-0 0-0 0-0 0-0 0-0 0-0 

0 .0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 

0-0 0-0 0-0 2-2 7-3 11 .2 9-8 8-7 6-2 0-0 0-0 

0 .0 0.0 0.0 2.2 73 11 .2 9.8 8.7 6.2 0.0 0.0 

0 .0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 

0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 

0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 

0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 

0 0 0 288 288 288 288 288 288 0 0 

0 0 0 1248 1248 1248 1248 1248 1248 0 0 
Table 8.4 .2 

MMS Florida Panhandle Model - Panama City 

Population Report - Reasonable Maximum 

Impact Area Panama City Scenario Name: PC: Reason Max 

Report Areas Bay County Date: September 18, 2001 

vN, Bay County 

Total Population 1995 2000 2005 2010 2015 2020 2025 2030 2035 2040 2045 

Scenario 139,173 150,277 162,188 174,665 187,868 198,909 210,644 219,413 227,517 234,747 242,132 

Baseline 139,173 150,277 162,188 174,575 187,536 198,341 210,054 218,838 227,033 234,538 241,999 

Net Change in Population 0 0 0 89 332 568 589 575 485 209 132 

Net Change in Households 0 0 0 36 133 227 236 230 194 84 53 
Table 8.4 .3 

MMS Florida Panhandle Model - Panama City 

Output and Employment Report - Reasonable Maximum 

00 

N 

Impact Area 

Report Area 

Total Output (in $ Millions 

Scenario 

Baseline 

Net Impact 

Output Excl. Government 

Scenario 

Baseline 

Net Impact 

Employment 

Scenario 

Baseline 

Net Impact 

Panama City 

Bay County 

Scenario Name: 

Date: 

1995 2000 2005 2010 2015 2020 2025 2030 2035 

4,858.5 5,011 .5 5,481 .2 5,871 .1 6,171 .2 6,289 .9 6,458.6 6,548.9 6,762 .9 

4,858.5 5,011 .5 5,481 .2 5,868.2 6,161 .1 6,274.4 6,445.1 6,536.9 6,754.3 

0.0 0.0 0.0 2.8 10 .1 15 .5 13 .6 12 .0 8 .5 

PC: Reason Max 

September 18, 2001 

2040 2045 

6,977.9 7,209.7 

6,977.9 7,209.7 

0.0 0.0 

1995 2000 2005 2010 2015 2020 2025 2030 2035 2040 2045 

4,229.4 4,364.7 4,803 .2 5,166.3 5,449.2 5,568 .3 5,7313 5,819.2 6,017.0 6,215.7 6,430.6 

4,229.4 4,364.7 4,803 .2 5,163.5 5,439.3 5,552 .9 5,717.9 5,807.3 6,008 .6 6,215.7 6,430.6 

0.0 0.0 0.0 2.8 9.9 153 13 .4 11 .9 8 .4 0.0 0.0 

1995 2000 2005 2010 2015 2020 2025 2030 2035 2040 2045 

69,060 70,811 77,151 82,650 86,767 88,332 90,496 91,556 94,310 97,009 100,028 

69,060 70,811 77,151 82,575 86,509 87,935 90,150 91,248 94,092 97,009 100,028 

0 0 0 75 258 397 347 308 219 0 0 
Table 8.4 .4 

MMS Florida Panhandle Model - Panama City 

Fiscal Balance Report - Reasonable Maximum 

Impact Area Panama City Scenario Name: PC: Reason Max 

Report Area Bay Cou nty Date: September 18, 2001 

Item 1995 2000 2005 2010 2015 2020 2025 2030 2035 2040 2045 

Scenario Population 139,173 150,277 162,188 174,665 187,868 198,909 210,644 219,413 227,517 234,747 242,132 

Baseline Population 139,173 150,277 162,188 174,575 187,536 198,341 210,054 218,838 227,033 234,538 241,999 

Net Change in Population 0 0 0 89 332 568 589 575 485 209 132 

Net Change in Households 0 0 0 36 133 227 236 230 194 84 53 

Net Change in Area Output Excluding 0 0 0 3 10 15 13 12 8 0 0 

Govt (in Millions of Dollars) 

00 County Government 

Revenues 0 0 0 71,311 265,313 453,422 470,407 458,889 386,769 166,823 105,679 

Ad Valorem Taxes 0 0 0 12,590 46,279 77,332 77,509 74,343 60,933 22,375 14,174 

Residential 0 0 0 9,564 35,584 60,814 63,092 61,547 51,875 22,375 14,174 

Commercial and Industrial 0 0 0 3,025 10,694 16,517 14,416 12,796 9,059 0 0 

Other Taxes, Fees, Licences, etc. 0 0 0 0 0 0 0 0 0 0 0 

From All Other Sources to 0 0 0 58,721 219,034 376,090 392,899 384,546 325,836 144,448 91,505 

Balance Budget 

Expenditures 0 0 0 71,311 265,313 453,422 470,407 458,889 386,769 166,823 105,679 

Municipal Government 

Revenues 0 0 0 58,070 216,050 369,232 383,064 373,684 314,955 135,848 86,057 

Ad Valorem Taxes 0 0 0 3,204 11,777 19,679 19,724 18,918 15,506 5,694 3,607 

Residential 0 0 0 2,434 9,055 15,476 16,055 15,662 13,201 5,694 3,607 

Commercial and Industrial 0 0 0 770 2,721 4,203 3,669 3,256 2,305 0 0 

Other Takes, Fees, Licences, etc. 0 0 0 40,015 148,875 254,428 263,959 257,496 217,027 93,609 59,300 

From All Other Sources to 0 0 0 14,852 55,399 95,125 99,381 97,270 82,422 36,545 23,151 

Balance Budget 

Expenditures 0 0 0 58,070 216,050 369,232 383,064 373,684 314,955 135,848 86,057 
Table 8.4 .5 

MMS Florida Panhandle Model - Panama City 

Schools Report - Reasonable Maximum 

00 

N 00 

Impact Area 

Report Area 

Number of School-Age Children 

Scenario 

Baseline 

Net Change 

Net Change in Households 

Fiscal Impact of Net Change 

Total Revenues 

Local Ad Valorem Taxes 

Residential Property 

Commerical Property 

State Revenues 

Federal Revenues 

Expenditures 

Panama City Scenario Name: PC: Reason Max 

Bay County Date: September 18, 2001 

1995 2000 2005 2010 2015 2020 2025 2030 2035 2040 2045 

27,310 29,495 30,868 31,523 32,896 34,658 36,899 38,394 39,456 40,382 41,727 

27,310 29,495 30,868 31,510 32,851 34,582 36,814 38,298 39,368 40,337 41,698 

0 0 0 13 45 76 85 96 88 45 29 

0 0 0 36 133 227 236 230 194 84 53 

0 0 0 60,607 219,074 373,184 407,723 446,036 400,800 198,527 127,527 

0 0 0 20,850 76,641 128,067 128,360 123,117 100,910 37,054 23,473 

0 0 0 15,839 58,930 100,713 104,485 101,927 85,908 37,054 23,473 

0 0 0 5,010 17,711 27,354 23,875 21,190 15,002 0 0 

0 0 0 39,866 142,608 242,636 270,034 306,430 280,411 143,792 92,660 

0 0 0 4,902 17,536 29,835 33,204 37,680 34,480 17,681 11,394 

0 0 0 58,493 209,243 356,010 396,210 449,612 411,436 210,980 135,956 
Table 8.4 .6 

MMS Florida Panhandle Model - Panama City 

Public Services Report - Reasonable Maximum 

00 

N 110 

Impact Area Panama City Scenario Name: PC: Reason Max 

Report Area Bay County Date: September 18, 2001 

Population 1995 2000 2005 2010 2015 2020 2025 2030 2035 2040 2045 

Scenario 139,173 150,277 162,188 174,665 187,868 198,909 210,644 219,413 227,517 234,747 242,132 

Baseline 139,173 150,277 162,188 174,575 187,536 198,341 210,054 218,838 227,033 234,538 241,999 

Net Impact 0 0 0 89 332 568 589 575 485 209 132 

Public Services Impact 

Residential Water (thousands of 0.0 0.0 0.0 7.9 29.4 503 52.1 50.9 42 .9 18.5 11 .7 

gallons per day) 

Residential Wastewater 0.0 0.0 0.0 24.1 89.8 153.4 159 .2 155.3 130.9 56.4 35 .8 

(thousands of gallons per day) 

Solid Waste (tons per year) 0.0 0.0 0.0 159.1 591.8 1,011 .3 1,049 .2 1,023.5 862 .7 372.1 235 .7 

Road & Highway (miles) 0.0 0.0 0.0 0.5 1 .9 3.2 3 .4 3.3 2 .8 1 .2 0.8 

Police Protection 0 0 0 0 1 2 2 2 1 1 0 

Crimes 0.0 0.0 0.0 6.0 22 .2 37.9 393 38.4 32.4 14.0 8.8 

Fire Protection 0 0 0 0 0 1 1 1 1 0 0 

Public Welfare 0 0 0 0 0 0 0 0 0 0 0 

Physicians 0 0 0 0 1 1 1 1 1 0 0 
Destin Dome 

Key parameters of the scenario in which Destin Dome development is supported by a facility near 

Panama City and the resulting impacts for the Panama City area are summarized in Table 8.5 .1 . 

Under the Destin Dome scenario, natural gas production begins in the year 2000, peaks in 2005 at 

109 .5 billion cubic feet, and drops to zero by 2025 (Table 8 .5 .1). Under this scenario, OCS 

expenditures in the impact area peak at $20.7 million annually in 2005. Throughout the period of 

oil and gas production (2000 through 2020), OCS support is estimated to require 288 boat trips 

and 1248 helicopter flights annually from the support base (i .e ., the same number of trips as in the 

other scenarios). 

Estimated Destin Dome impact on the population of the Panama City area is projected to peak at 

968 persons in the year 2005 (which is only 0.6 percent of the area's projected baseline population 

for that year). The area would have a net increase of 387 households in the year 2005 as a result 

of OCS-Destin Dome activity (Table 8 .5 .2). While OCS production and resulting economic 

impacts end in 2020, some population impacts and related socioeconomic effects continue 

through year 2045 . 

Impacts of the Destin Dome scenario on total output in the Panama City area are estimated to 

peak at $28.7 million in the year 2005, while the impact on employment peaks at 735 jobs in the 

same year. The peak impact on area output represents about 0.5 percent of the area's projected 

baseline output, or 0.6 percent of output excluding government (Table 8.5 .3). The peak 

employment impact represents about 1 .0 percent of projected baseline employment. 

Net fiscal impacts of the Destin Dome scenario on Bay County and its municipalities are 

summarized in Table 8 .5 .4 . Additional expenditures by county government resulting from OCSDestin Dome activity are projected to peak in 2005, at $772,795 . Additional ad valorem taxes are 

projected to contribute $134,224 to county revenues, and other taxes, fees, and licenses contribute 

$320,174, which results in $318,397 being required from other sources to balance the budget. 

Additional expenditures by municipal governments in Bay County (i .e ., all municipal 

governments combined) are projected to peak at $629,305, also in 2005. Additional ad valorem 

tax revenues were estimated to contribute about $34,160 while other taxes, fees, and licenses 

would add about $433,600 to municipal revenues, leaving about $161,510 required from all other 

sources to balance the budget. 

Estimated impacts of the Destin Dome scenario on school enrollments in Bay County are 

summarized in Table 8.5 .5 . The number of school age children peaks at 129 in year 2005 . This 

represents about 0.4 percent of the projected baseline population in this age group. The additional 

expenditures by the Bay County school district are estimated to peak at $603,137 (in 2005), or 

about $4,675 per additional student. 

8-30 
Total additional school district revenues are estimated to total about $663,260, including about 

$411,060 in added state revenues, $222,285 in additional ad valorem taxes, and $50,550 in extra 

federal revenues. 

The projected impacts of the Destin Dome scenario on selected public services in Bay County are 

summarized in Table 8 .5 .6 . Most impacts peak in 2005, when population impacts are greatest. 

8-31 
Table 8.5.1 

00 

W 

N 

MMS Florida Panhandle Model - Panama City 

OCS Scenario Report - Destin Dome 

Impact Area Panama City Scenario Name: 

Report Area Bay County Date: 

Production Scenario in Lease Sale 181 : Not Serviced in Florida Destin Dome: 

Item 1995 2000 2005 2010 2015 2020 2025 2030 2035 

Oil and Gas Production in Eastern Gulf of Mexico 

Lease Sale 181 

Oil Production (Millions of Barrels) 

Gas Production (Billions of Cubic Feet) 

Destin Dome 

Oil Production (Millions of Barrels) 

Gas Production (Billions of Cubic Feet) 

OCS Expenditures in Impact Area 

Lease Sale 181 

Destin Dome 

Scenario Impact on Key Industries 

Tourism 

Percentage Change in Level 

Percentage Change in Growth Rate 

Military 

Percentage Change in Level 

OCS-Related Activities 

Boat Trips from Service Base 

Helicopter Trips from Service Base 

PC: Destin Dome 

September 18, 2001 

Serviced in Florida 

5 2040 2045 

0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 

0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 

0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 

0.0 54.8 109.5 71 .2 42.0 25.6 0.0 0.0 0.0 0.0 0.0 

0.0 7.9 20.7 14 .2 7.9 4.5 0.0 0.0 0.0 0.0 0.0 

0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 

0.0 7.9 20.7 14 .2 7.9 4.5 0.0 0.0 0.0 0.0 0.0 

0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 

0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 

0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 

0 288 288 288 288 288 

0 1248 1248 1248 1248 1248 

0 0 0 0 0 

0 0 0 0 0 
Table 8.5 .2 

90 

W 

w 

Impact Area Panama City 

Report Areas Bay County 

Bay County 

Total Population 1995 

MMS Florida Panhandle Model - Panama City 

Population Report - Destin Dome 

Scenario Name: PC: Destin Dome 

Date: September 18, 2001 

2000 2005 2010 2015 2020 2025 2030 2035 2040 2045 

Scenario 139,173 

Baseline 139,173 

Net Change in Population 0 

Net Change in Households 0 

150,608 163,156 175,449 188,164 198,790 210,284 218,989 227,133 234,606 242,040 

150,277 162,188 174,575 187,536 198,341 210,054 218,838 227,033 234,538 241,999 

331 968 874 629 449 229 151 100 68 41 

133 387 350 251 180 92 60 40 27 16 
Table 8.5 .3 

MMS Florida Panhandle Model - Panama City 

Output and Employment Report - Destin Dome 

00 

W 

-P 

Impact Area Panama City 

Report Area Bay County 

Total Output (in $ Millions) 1995 2000 2005 2010 2015 

Scenario 4,858.5 5,022.2 5,509.9 5,887.8 6,171 .8 

Baseline 4,858.5 5,011 .5 5,481 .2 5,868.2 6,161 .1 

Net Impact 0.0 10.7 28.7 19.6 10 .7 

Output Excl. Government 1995 2000 2005 2010 2015 

Scenario 4,229.4 4,3753 4,831 .5 5,182.8 5,449.8 

Baseline 4,229.4 4,364.7 4,803.2 5,163.5 5,439.3 

Net Impact 0.0 10.5 28.3 193 10 .5 

Employment 1995 2000 2005 2010 2015 

Scenario 69,060 71,547 77,653 82,852 86,664 

Baseline 69,060 70,811 77,151 82,575 86,509 

Net Impact 0 276 735 502 276 

Scenario Name: PC: Destin Dome 

Date: September 27, 2001 

2020 2025 2030 2035 2040 2045 

6,280.3 6,445.1 6,536.9 6,754.3 6,977.9 7,209.7 

6,274.4 6,445.1 6,536.9 6,7543 6,977.9 7,209.7 

5.9 0.0 0.0 0.0 0.0 0 .0 

2020 2025 2030 2035 2040 2045 

5,558.7 5,717.9 5,807.3 6,008.6 6,215.7 6,430.6 

5,552.9 5,717.9 5,807.3 6,008.6 6,215.7 6,430.6 

5.8 0.0 0.0 0.0 0.0 0.0 

2020 2025 2030 2035 2040 2045 

87,935 90,150 91,248 94,092 97,009 100,028 

87,935 90,150 91,248 94,092 97,009 100,028 

154 0 0 0 0 0 
Table 8.5 .4 

W 

Impact Area 

Report Area 

Item 

Scenario Population 

Baseline Population 

Net Change in Population 

Net Change in Households 

Net Change in Area Output Excluding Govt 

(in Millions of Dollars) 

County Government 

Revenues 

Ad Valorem Taxes 

Residential 

Commercial and Industrial 

Other Taxes, Fees, Licences, etc. 

From All Other Sources to Balance Budget 

Expenditures 

Municipal Government 

Revenues 

Ad Valorem Taxes 

Residential 

Commercial and Industrial 

Other Taxes, Fees, Licences, etc. 

From All Other Sources to Balance Budget 

Expenditures 

MMS Florida Panhandle Model - Panama City 

Fiscal Balance Report - Destin Dome 

Panama City 

Bay County 

Scenario Name: PC: Destin Dome 

Date: September 18, 2001 

1995 2000 2005 2010 2015 2020 2025 2030 2035 2040 2045 

139,173 150,608 163,156 175,449 188,164 198,790 210,284 218,989 227,133 234,606 242,040 

139,173 150,277 162,188 174,575 187,536 198,341 210,054 218,838 227,033 234,538 241,999 

0 331 968 874 629 449 229 151 100 68 41 

0 133 387 350 251 180 92 60 40 27 16 

0 11 28 19 11 6 0 0 0 0 0 

0 264,361 772,795 697,552 501,611 358,633 182,971 120,366 

0 46,822134,224114,377 78,642 54,363 24,541 16,144 

0 35,457 103,649 93,557 67,277 48,101 24,541 16,144 

0 11,365 30,575 20,820 11,365 6,262 0 0 

0 109,526 320,174 109,526 109,526 109,526 109,526 109,526 

0 108,013 318,398 473,649 313,443 194,744 48,904 -5,304 

0264,361 772,795 697,552 501,611 358,633 182,971 120,366 

79,866 54,209 32,498 

10,712 7,271 4,359 

10,712 7,271 4,359 

0 0 0 

109,526 109,526 109,526 

-40,372 -62,588 -81,387 

79,866 54,209 32,498 

0 215,275 629,305 568,033 408,474 292,043 148,997 98,017 65,037 44,143 26,464 

0 11,915 34,157 29,106 20,012 13,834 6,245 4,108 2,726 1,850 1,109 

0 9,023 26,376 23,808 17,120 12,240 6,245 4,108 2,726 1,850 1,109 

0 2,892 7,780 5,298 2,892 1,594 0 0 0 0 0 

0 148,340 433,638 391,416 281,469 201,239 102,670 67,541 44,815 30,418 18,236 

0 55,020 161,511 147,511 106,993 76,970 40,082 26,368 17,496 11,875 7,119 

0 215,275 629,305 568,033 408,474 292,043 148,997 98,017 65,037 44,143 26,464 
Table 8.5 .5 

MMS Florida Panhandle Model - Panama City 

Schools Report - Destin Dome 

Impact Area 

Report Area 

Panama City 

Bay County 

Scenario Name: PC : Destin Dome 

Date: September 18, 2001 

Number of School-Aize Children 1995 2000 2005 2010 2015 2020 2025 2030 2035 2040 2045 

Scenario 27,310 29,541 30,997 31,625 32,964 34,685 36,873 38,320 39,371 40,348 41,723 

00 

W Baseline 27,310 29,495 30,868 31,510 32,851 34,582 36,814 38,298 39,368 40,337 41,698 

Net Change 0 46 129 115 113 103 59 22 3 11 25 

Net Change in Households 0 133 387 350 251 180 92 60 40 27 16 

Fiscal Impact of Net Chanee 

Total Revenues 0 224,680 633,260 567,520 514,687 449,702 252,818 105,258 27,410 51,234 96,868 

Local Ad Valorem Taxes 0 77,540 222,285 189,417 130,237 90,029 40,641 26,735 17,740 12,041 7,218 

Residential Property 0 58,719 171,651 154,938 111,416 79,658 40,641 26,735 17,740 12,041 7,218 

Commerical Property 0 18,821 50,634 34,479 18,821 10,371 0 0 0 0 0 

State Revenues 0 147,788 411,064 367,404 359,113 329,524 188,944 69,924 8,611 34,901 79,833 

Federal Revenues 0 18,172 50,546 45,177 44,158 40,519 23,233 8,598 1,059 4,292 9,816 

Expenditures 0 216,844 603,137 539,078 526,911 483,497 277,229 102,597 12,635 51,209 117,135 
Table 8.5.6 

MMS Florida Panhandle Model - Panama City 

Public Services Report - Destin Dome 

w 

v 

Panama City Scenario Name: PC: Destin Dome 

Report Area Bay County Date: September 18, 2001 

Population 1995 2000 2005 2010 2015 2020 2025 2030 2035 2040 2045 

Scenario 139,173 150,608 163,156 175,449 188,164 198,790 210,284 218,989 227,133 234,606 242,040 

Baseline 139,173 150,277 162,188 174,575 187,536 198,341 210,054 218,838 227,033 234,538 241,999 

Net Impact 0 331 968 874 629 449 229 151 100 68 41 

Public Services Impact 

Residential Water (thousands of 0.0 29.3 85 .7 773 55.6 39.8 203 133 8.9 6.0 3.6 

gallons per day) 

Residential Wastewater 0.0 89.4 261 .5 236.0 169.7 1213 61 .9 40.7 27.0 183 11 .0 

(thousands of gallons per day) 

Solid Waste (tons per year) 0.0 589 .6 1,723 .7 1,555.8 1,118.8 799.9 408.1 268.5 178.1 120.9 72.5 

Road & Highway (miles) 0.0 1 .9 5 .5 5.0 3.6 2.6 1 .3 0.9 0.6 0.4 0.2 

Police Protection 0 1 3 2 2 1 1 0 0 0 0 

Crimes 0.0 22 .1 64.6 58.3 42.0 30.0 15 .3 10.1 6.7 4.5 2.7 

Fire Protection 0 0 1 1 1 0 0 0 0 0 0 

Public Welfare 0 0 0 0 0 0 0 0 0 0 0 

Physicians 0 1 2 2 1 1 0 0 0 0 0 
Pensacola 

Lease Sale 181 

Key parameters of the minimum threshold scenario and the resulting impacts for the Pensacola 

area are summarized in Table 8 .6 .1 . The assumptions of the minimum threshold scenario are the 

same as were discussed for the Panama City area; oil production from Lease Sale 181 begins in 

2010, peaks in 2020 at 1 .7 million barrels, and ends by 2040. Natural gas production follows the 

same time pattern, with a peak production of 25 .0 billion cubic feet in 2020 (Table 8 .6 .1). Under 

this scenario, OCS expenditures in the impact area peak at $6.5 million annually in 2020. 

Throughout the period of oil and gas production (2010 through 2035), OCS support is estimated 

to require 288 boat trips and 1248 helicopter flights annually from the support base . 

Estimated OCS impact on the population of the Pensacola area is projected to peak at 499 

persons in the year 2025 (which is only 0 .1 percent of the area's projected baseline population for 

that year). The area would have a net increase of 200 households in the year 2025 as a result of 

OCS activity (Table 8 .6.2). While OCS production and resulting economic impacts end in 2035, 

some population impacts and related socioeconomic effects continue through year 2045 . The 

population impacts are divided between Escambia and Santa Rosa Counties, with Escambia 

County recording its greatest population impact in 2030 (216 persons) and Santa Rosa reaching 

its peak impact in 2025 (290 persons) . 

Impacts of the OCS minimum threshold level of development on total output in the Pensacola 

area are estimated to peak at $10.1 million in the year 2020, while the impact on employment 

peaks at 337 jobs in the same year. The peak impact on area output represents about 0.1 percent 

of the area's projected baseline output, or 0 .1 percent of output excluding government (Table 

8.6 .3). The peak employment impact represents about 0.1 percent of projected baseline 

employment. 

Net fiscal impacts of the OCS minimum threshold level of development on Escambia and Santa 

Rosa Counties and their municipalities are summarized in Table 8 .6 .4 . Additional expenditures 

by Escambia County government resulting from OCS activity are projected to peak in 2030, at 

$154,370 . Additional ad valorem taxes are projected to contribute $31,882 to county revenues, 

and other taxes, licenses, and fees add $66,233, which results in $56,255 being required from 

other sources to balance the budget . Additional expenditures by municipal governments in 

Escambia County (i .e ., all municipal governments combined) are projected to peak at $125,915, 

also in 2030. Additional ad valorem tax revenues were estimated to contribute about $4,150 

while other taxes, fees, and licenses would add about $56,700 to municipal revenues, leaving 

about $65,065 required from all other sources to balance the budget. Fiscal impacts for local 

governments in Santa Rosa County exhibit similar patterns except the impacts peak in 2025 

(Table 8.6 .4). 

8-38 
Estimated impacts of the OCS minimum threshold level of development on school enrollments 

in Escambia and Santa Rosa Counties are summarized in Table 8.6 .5 . The number of school age 

children net change in Santa Rosa County peaks at 52 in year 2030. This represents about 0 .2 

percent of the projected baseline population in this age group. The additional expenditures by 

the Santa Rosa County school district are estimated to peak at $228,034 (in 2030), or about 

$4,385 per additional student. Total additional school district revenues are estimated to total 

about $224,600, including about $167,950 in added state revenues, $38,400 in additional ad 

valorem taxes, and $19,500 in extra federal revenues . Impacts in Escambia County follow a 

similar pattern, except that the number of school age children net change peaks in 2035 . 

Projected impacts of the OCS minimum threshold level of development on selected public 

services in Escambia and Santa Rosa Counties are summarized in Table 8 .6 .6 . Most impacts 

peak in 2030 in Escambia County and in 2025 in Santa Rosa County, the years when population 

impacts are greatest. 

8-39 
Table 8.6 .1 

MMS Florida Panhandle Model - Pensacola 

OCS Scenario Report - Minimum Threshold 

00 

41 0 

Impact Area Pensacola Scenario Name: PEN: Mm Threshold 

Report Area Pensacola Date: September 18, 2001 

Production Scenario in Lease Sale 181 : Minimum Threshold Destin Dome : Not Serviced in Florida 

Item 1995 2000 2005 2010 2015 2020 2025 2030 2035 2040 2045 

Oil and Gas Production in Eastern Gulf of Mexico 

Lease Sale 181 

Oil Production (Millions of Barrels) 

Gas Production (Billions of Cubic Feet) 

Destin Dome 

Oil Production (Millions of Barrels) 

Gas Production (Billions of Cubic Feet) 

OCS Expenditures in Impact Area 

Lease Sale 181 

Destin Dome 

Scenario Impact on Key Industries 

Tourism 

Percentage Change in Level 

Percentage Change in Growth Rate 

Military 

Percentage Change in Level 

OCS-Related Activities 

Boat Trips from Service Base 

Helicopter Trips from Service Base 

0.0 0.0 0.0 03 0.9 1.7 1.4 1 .2 0.8 0.0 0 

0.0 0.0 0.0 5.0 17 .5 25.0 22.5 20.0 15 .0 0.0 0.0 

0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 

0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 

0.0 0.0 0.0 1 .3 43 6.5 5.7 5.1 3.6 0.0 0.0 

0.0 0.0 0.0 1 .3 43 6.5 5.7 5.1 3.6 0.0 0.0 

0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 

0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 

0.00% 0.00% 0.00% 0.00% 0 .00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 

0.00% 0.00% 0.00% 0.00% 0.00% 0 .00% 0.00% 0.00% 0.00% 0.00% 0.00% 

0 0 0 288 288 288 288 288 288 0 0 

0 0 0 1248 1248 1248 1248 1248 1248 0 0 
Table 8.6 .2 

MMS Florida Panhandle Model - Pensacola, Escambia, Santa Rosa 

Population Report - Minimum Threshold 

00 

Impact Area Pensacola, Escambia, Santa Rosa 

Report Areas Pensacola, Escambia, Santa Rosa 

Pensacola Area 

Scenario Name 

Date: 

Total Population 1995 2000 2005 2010 2015 2020 2025 2030 2035 

Scenario 377,822 410,086 441,204 469,561 502,761 526,715 547,699 567,523 585,392 

Baseline 377,822 410,086 441,204 469,488 502,482 526,239 547,200 567,029 584,973 

Net Change in Population 0 0 0 73 279 477 499 493 419 

Net Change in Households 0 0 0 29 112 191 200 197 168 

Escambia 

Total Population 1995 2000 2005 2010 2015 2020 2025 2030 2035 

Scenario 281,162 296,578 316,849 334,371 353,006 367,011 379,594 391,036 401,114 

Baseline 281,162 296,578 316,849 334,339 352,894 366,819 379,386 390,820 400,920 

Net Change in Population 0 0 0 32 113 192 208 216 194 

Net Change in Households 0 0 0 13 45 77 83 86 77 

Santa Rosa 

Total Population 1995 2000 2005 2010 2015 2020 2025 2030 2035 

Scenario 96,660 113,508 124,354 135,190 149,755 159,704 168,104 176,486 184,279 

Baseline 96,660 113,508 124,354 135,149 149,589 159,420 167,814 176,209 184,053 

Net Change in Population 0 0 0 41 167 284 290 277 225 

Net Change in Households 0 0 0 16 67 114 116 111 90 

PEN: Min Threshold 

September 18, 2001 

2040 2045 

602,143 618,303 

601,966 618,202 

177 102 

71 41 

2040 2045 

410,214 418,506 

410,113 418,437 

101 70 

40 28 

2040 2045 

191,928 199,797 

191,853 199,765 

76 32 

30 13 
Table 8.6 .3 

MMS Florida Panhandle Model - Pensacola 

Output and Employment Report - Minimum Threshold 

N 

Impact Area 

Report Area 

Total Output (in $ Millions) 

Scenario 

Baseline 

Net Impact 

Output Excl. Government 

Scenario 

Baseline 

Net Impact 

Employment 

Scenario 

Baseline 

Net Impact 

Pensacola Scenario Name: PEN: Min Threshold 

Pensacola Date: September 18, 2001 

1995 2000 2005 2010 2015 2020 2025 2030 2035 2040 2045 

14,451 .2 16,449.0 17,223.7 17976.5 18,772.5 18,961 .6 19,152 .2 19,607.4 20,073 .1 20,547.4 21,0393 

14,451 .2 16,449.0 17,223.7 17974.8 18,766.0 18,951 .6 19,143 .4 19,599.6 20,067.6 20,547.4 21,039.3 

0.0 0.0 0.0 1 .7 6.5 10.1 8.8 7.8 5.5 0.0 0.0 

1995 2000 2005 2010 2015 2020 2025 2030 2035 2040 2045 

12,703 .5 14,354 .2 15,093.7 15,815.1 16,558.0 16,752 .7 16,949.4 17,373 .4 17,807.6 18,250.2 18,709 .8 

12,703 .5 14,354 .2 15,093.7 15,813.5 16,551.6 16,742 .8 16,940.7 17,365 .7 17,802.1 18,250.2 18,709 .8 

0.0 0.0 0.0 1 .7 6.4 9.9 8.7 7.7 5.4 0.0 0.0 

1995 2000 2005 2010 2015 2020 2025 2030 2035 2040 2045 

193,173 223,342 234,998 245,882 257,389 260,374 263,239 269,323 275,509 281,728 288,279 

193,173 223,342 234,998 245,820 257,169 260,036 262,943 269,060 275,322 281,728 288,279 

0 0 0 62 221 337 296 263 188 0 0 
Table 8.6.4 

Oil 

w 

Impact Area 

Report Area 

Item 

MMS Florida Panhandle Model - Pensacola 

Fiscal Balance Report- Minimum Threshold 

Pensacola 

Escambia County 

Scenario Name: PEN: Min Threshold 

Date: September 18, 2001 

1995 2000 2005 2010 2015 2020 2025 2030 2035 2040 2045 

Scenario Population 281,162 296,578 316,849 334,371 353,006 367,011 379,594 391,036 401,114 410,214 418,506 

Baseline Population 281,162 296,578 316,849 334,339 352,894 366,819 379,386 390,820 400,920 410,113 418,437 

Net Change in Population 0 0 0 32 113 192 208 216 194 101 70 

Net Change in Households 0 0 0 13 45 77 83 86 77 40 28 

Net Change in Area Output Excluding Govt 0 0 0 2 6 10 9 8 5 0 0 

(in Millions of Dollars) 

County Government 

Revenues 

Ad Valorem Taxes 

Residential 

Commercial and Industrial 

Other Taxes, Fees, Licences, etc . 

From All Other Sources to Balance Budget 

Expenditures 

Municipal Government 

Revenues 

Ad Valorem Taxes 

Residential 

Commercial and Industrial 

Other Taxes, Fees, Licences, etc . 

From All Other Sources to Balance Budget 

Expenditures 

0 0 0 22,809 80,522 137,279 148,793 154,370 138,300 72,062 49,826 

0 0 0 5,122 18,426 30,635 31,669 31,882 27,499 12,231 8,457 

0 0 0 3,871 13,667 23,301 25,255 26,202 23,474 12,231 8457 

0 0 0 1,251 4,759 7,335 6,414 5,680 4,025 0 0 

0 0 0 9,786 34,548 58,900 63,840 66,233 59,338 30,918 21,378 

0 0 0 7,900 27,548 47,744 53,284 56,256 51,463 28,912 19,991 

0 0 0 22,809 80,522 137,279 148,793 154,370 138,300 72,062 49,826 

0 0 0 18,605 65,679 111,974 121,367 125,915 112,808 58,779 40,642 

0 0 0 667 2,400 3,990 4,124 4,152 3,581 1,593 1,101 

0 0 0 504 1,780 3,034 3,289 3,412 3,057 1,593 1,101 

0 0 0 163 620 955 835 740 524 0 0 

0 0 0 8,383 29,593 50,453 54,685 56,734 50,828 26,484 18,312 

0 0 0 9,555 33,686 57,532 62,558 65,029 58,398 30,702 21,228 

0 0 0 18,605 65,679 111,974 121,367 125,915 112,808 58,779 40,642 
Table 8.6.5 

MMS Florida Panhandle Model - Pensacola 

Schools Report - Minimum Threshold 

Impact Area Pensacola Scenario Name: PEN: Min Threshold 

Report Area Escambia C ounty Date: September 18, 2001 

Number of School-Age Children 1995 2000 2005 2010 2015 2020 2025 2030 2035 2040 2045 

00 Scenario 55,401 59,473 57,103 59,505 64,227 67,296 68,557 68,632 68,544 69,699 71,885 

Baseline 55,401 59,473 57,103 59,494 64,200 67,264 68,534 68,593 68,496 69,672 71,857 

Net Change 0 0 0 10 28 32 23 39 48 27 28 

Net Change in Households 0 0 0 13 45 77 83 86 77 40 28 

Fiscal Impact of Net Change 

Total Revenues 0 0 0 45,440 124,565 153,244 120,122 186,054 217,823 120,510 120,682 

Local Ad Valorem Taxes 0 0 0 5,931 21,337 35,476 36,673 36,918 31,843 14,164 9,793 

Residential Property 0 0 0 4,483 15,827 26,982 29,245 30,341 27,183 14164 9,793 

Commerical Property 0 0 0 1,448 5,511 8,494 7,427 6,577 4,661 0 0 

State Revenues 0 0 0 35,173 93,382 108,431 78,044 133,723 163,718 91,329 95,230 

Federal Revenues 0 0 0 5,784 15,356 17,830 12,834 21,990 26,922 15,018 15,660 

Expenditures 0 0 0 49,608 131,707 152,932 110,073 188,604 230,910 128,810 134,312 
Table 8.6 .5 (continued) 

MMS Florida Panhandle Model - Pensacola 

Schools Report - Minimum Threshold 

Impact Area 

Report Area 

Number of School-Age Children 

Scenario 

°° Baseline 

Net Change 

Net Change in Households 

Fiscal Impact of Net Change 

Total Revenues 

Local Ad Valorem Taxes 

Residential Property 

Commerical Property 

State Revenues 

Federal Revenues 

Expenditures 

Pensacola Scenario Name: PEN: Min Threshold 

Santa Rosa County Date: September 18, 2001 

1995 2000 2005 2010 2015 2020 2025 2030 2035 2040 2045 

19,462 21,262 22,059 23,041 24,675 26,046 27155 28,177 29,010 29,927 31,249 

19,462 21,262 22,059 23,036 24,656 26,008 27,108 28,125 28,969 29,913 31,249 

0 0 0 5 20 37 47 52 41 14 0 

0 0 0 16 67 114 116 111 90 30 13 

0 0 0 22,401 93,472 173,644 209,981 224,617 179,856 62,086 4,495 

0 0 0 5,778 23,426 39,800 40,399 38,438 31,129 10,172 4,269 

0 0 0 5,490 22,328 38,108 38,919 37,127 30,200 10,172 4,269 

0 0 0 289 1,098 1,692 1,480 1,310 929 0 0 

0 0 0 15,149 63,730 121,412 153,237 167,953 134,061 46,504 202 

0 0 0 1,762 7,413 14,123 17,825 19,537 15,595 5,410 24 

0 0 0 20,568 86,528 164,845 208,053 228,034 182,019 63,140 275 
Table 8.6 .6 

MMS Florida Panhandle Model - Pensacola 

Public Services Report - Minimum Threshold 

00 

41 

Impact Area Pensacola Scenario Name: PEN: Min Threshold 

Report Area Escambia County Date: September 18, 2001 

Population 1995 2000 2005 2010 2015 2020 2025 2030 2035 2040 2045 

Scenario 281,162 296,578 316,849 334,371 353,006 367,011 379,594 391,036 401,114 410,214 418,506 

Baseline 281,162 296,578 316,849 334,339 352,894 366,819 379,386 390,820 400,920 410,113 418,437 

Net Impact 0 0 0 32 113 192 208 216 194 101 70 

Public Services Impact 

Residential Water (thousands of 0.0 0.0 0.0 2.7 9.4 16.1 17 .4 18 .1 16 .2 8.4 5 .8 

gallons per day) 

Residential Wastewater 0.0 0.0 0.0 23 8 .1 13 .7 14 .9 15 .4 13 .8 7.2 5 .0 

(thousands of gallons per day) 

Solid Waste (tons per year) 0.0 0.0 0.0 51.1 180.4 307.6 333.4 345 .9 309.9 161 .5 111 .6 

Road & Highway (miles ) 0.0 0.0 0.0 0.1 0.4 0.7 0.8 0.8 0.7 0.4 0.3 

Police Protection 0 0 0 0 0 0 1 1 0 0 0 

Crimes 0.0 0.0 0.0 2.0 7.0 11 .9 12.9 13 .4 12.0 63 4.3 

Fire Protection 0 0 0 0 0 0 0 0 0 0 0 

Public Welfare 0 0 0 0 0 0 0 0 0 0 0 

Physicians 0 0 0 0 0 0 1 1 0 0 0 
Table 8.6 .6 (continued) 

MMS Florida Panhandle Model - Pensacola 

Public Services Report - Minimum Threshold 

v 

Impact Area Pensacola Scenario Name: PEN: Min Threshold 

Report Area Santa Rosa County Date: September 18, 2001 

Population 1995 2000 2005 2010 2015 2020 2025 2030 2035 2040 2045 

Scenario 96,660 113,508 124,354 135,190 149,755 159,704 168,104 176,486 184,279 191,928 199,797 

Baseline 96,660 113,508 124,354 135,149 149,589 159,420 167,814 176,209 184,053 191,853 199,765 

Net Impact 0 0 0 41 167 284 290 277 225 76 32 

Public Services Impact 

Residential Water (thousands 0.0 0.0 0.0 3 .7 15 .2 26.0 26.6 253 20.6 6.9 2.9 

of gallons per day) 

Residential Wastewater 0.0 0.0 0.0 1 .2 5 .0 8.6 8.7 8.3 6.8 23 1.0 

(thousands of gallons per day) 

Solid Waste (tons per year) 0 0 0 30 123 210 215 205 167 56 24 

Road & Highway (miles) 0.0 0.0 0.0 03 1 .2 2.0 2.1 2.0 1 .6 0.5 0 .2 

Police Protection 0 0 0 0 0 1 1 1 0 0 0 

Crimes 0 0 0 1 6 10 11 10 8 3 1 

Fire Protection 0 0 0 0 0 0 0 0 0 0 0 

Public Welfare 0 0 0 0 0 0 0 0 0 0 0 

Physicians 0 0 0 0 0 0 0 0 0 0 0 
Key parameters of the reasonable maximum scenario and the resulting impacts for the Pensacola 

area are summarized in Table 8.7 .1 . The assumptions of the reasonable maximum scenario are 

the same as were discussed for the Panama City area; oil production from Lease Sale 181 begins 

in 2010, peaks in 2020 at 3 .3 million barrels, and ends by 2040. Natural gas production follows 

the same time pattern, with a peak production of 40.5 billion cubic feet in 2020 (Table 8 .7 .1) . 

Under this scenario, OCS expenditures in the impact area peak at $11 .2 million annually in 2020 . 

Throughout the period of oil and gas production (2010 through 2035), OCS support is estimated 

to require 288 boat trips and 1248 helicopter flights annually from the support base. 

Estimated OCS impact on the population of the Pensacola area is projected to peak at 862 

persons in the year 2025 (which is only 0 .2 percent of the area's projected baseline population for 

that year) . The area would have a net increase of 345 households in the year 2025 as a result of 

OCS activity (Table 8.7 .2). While OCS production and resulting economic impacts end in 2035, 

some population impacts and related socioeconomic effects continue through year 2045 . The 

population impacts are divided between Escambia and Santa Rosa Counties, with Escambia 

County recording its greatest population impact in 2035 (374 persons) and Santa Rosa reaching 

its peak impact in 2025 (502 persons) . 

Impacts of the OCS reasonable maximum level of development on total output in the Pensacola 

area are estimated to peak at $17.5 million in the year 2020, while the impact on employment 

peaks at 584 jobs in the same year. The peak impact on area output represents about 0.1 percent 

of the area's projected baseline output, or 0 .1 percent of output excluding government (Table 

8.7.3). The peak employment impact represents about 0.2 percent of projected baseline 

employment. 

Net fiscal impacts of the OCS reasonable maximum level of development on Escambia and Santa 

Rosa Counties and their municipalities are summarized in Table 8 .7 .4 . Additional expenditures 

by Escambia County government resulting from OCS activity are projected to peak in 2030, at 

$266,923. Additional ad valorem taxes are projected to contribute about $55,200 to county 

revenues, and other taxes, licenses, and fees add $114,500, which results in about $97,194 being 

required from other sources to balance the budget . Additional expenditures by municipal 

governments in Escambia County (i .e ., all municipal governments combined) are projected to 

peak at $217,721, also in 2030. Additional ad valorem tax revenues were estimated to contribute 

about $7,200 while other taxes, fees, and licenses would add about $98,100 to municipal 

revenues, leaving about $112,432 required from all other sources to balance the budget. Fiscal 

impacts for local governments in Santa Rosa County exhibit similar patterns except the impacts 

peak in 2025 (Table 8.7 .4). 

Estimated impacts of the OCS reasonable maximum level of development on school enrollments 

in Escambia and Santa Rosa Counties are summarized in Table 8.7 .5 . The number of school age 

children net change in Santa Rosa County peaks at 90 in year 2030. This represents about 0.3 

percent of the projected baseline population in this age group. The additional expenditures by 

the Santa Rosa County school district are estimated to peak at $393,837 in 2030. Total 

additional school district revenues are estimated to total about $387,936, including about 

8-48 
$290,100 in added state revenues, $66,400 in additional ad valorem taxes, and $33,700 in extra 

federal revenues. Impacts in Escambia County follow a similar pattern, except that the number 

of school age children net change peaks in 2035 . 

Projected impacts of the OCS reasonable maximum level of development on selected public 

services in Escambia and Santa Rosa Counties are summarized in Table 8.7 .6 . Most impacts 

peak in 2030 in Escambia County and in 2025 in Santa Rosa County, the years when population 

impacts are greatest. 

8-49 
Table 8.7 .1 

MMS Florida Panhandle Model - Pensacola 

OCS Scenario Report - Reasonable Maximum 

Impact Area Pensacola Scenario Name: PEN: Reason Mac 

Report Area Pensaco la Date: September 18, 2001 

Production Scenario in Lease Sale 181: Reasona ble Maxi mum Destin Dome : Not Serv iced in Florida 

Item 1995 2000 2005 2010 2015 2020 2025 2030 2035 2040 2045 

Oil and Gas Production in Eastern Gulf of Mexico 

Lease Sale 181 

Oil Production (Millions of Barrels) 0.0 0.0 0.0 0.6 1 .8 3.3 2.7 2.4 1 .5 0.0 0.0 

Gas Production (Billions of Cubic Feet) 0.0 0.0 0.0 8.1 28 .4 40.5 36.5 32.4 24.3 0.0 0.0 

°° Destin Dome 

o Oil Production (Millions of Barrels) 0.0 0.0 0.0 0.0 0 .0 0.0 0.0 0.0 0.0 0.0 0.0 

Gas Production (Billions of Cubic Feet) 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 

OCS Expenditures in Impact Area 0 .0 0.0 0.0 2.2 7 .3 11 .2 9.8 8.7 6.2 0.0 0.0 

Lease Sale 181 0 .0 0.0 0.0 22 7 .3 11 .2 9.8 8.7 6.2 0.0 0.0 

Destin Dome 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 

Scenario Impact on Key Industries 

Tourism 

Percentage Change in Level 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 

Percentage Change in Growth Rate 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 

Military 

Percentage Change in Level 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 

OCS-Related Activities 

Boat Trips from Service Base 0 0 0 288 288 288 288 288 288 0 0 

Helicopter Trips from Service Base 0 0 0 1248 1248 1248 1248 1248 1248 0 0 
Table 8.7 .2 

MMS Florida Panhandle Model - Pensacola, Escambia, Santa Rosa 

Population Report - Reasonable Maximum 

Impact Area Pensacola, Escambia, Santa Rosa 

Report Areas Pensacola, Escambia, Santa Rosa 

Pensacola Area 

Scenario Name: PEN: Reason Max 

Date: September 18, 2001 

Total Population 1995 2000 2005 2010 2015 2020 2025 2030 2035 2040 2045 

Scenario 377,822 410,086 441,204 469,617 502,964 527,064 548,062 567,882 585,695 602,271 618,377 

Baseline 377,822 410,086 441,204 469,488 502,482 526,239 547,200 567,029 584,973 601,966 618,202 

Net Change in Population 0 0 0 129 481 825 862 852 722 305 175 

Net Change in Households 0 0 0 52 193 330 345 341 289 122 70 

Escambia 

Total Population 1995 2000 2005 2010 2015 2020 2025 2030 2035 2040 2045 

Scenario 281,162 296,578 316,849 334,395 353,088 367,152 379,746 391,194 401,254 410,288 418,557 

Baseline 281,162 296,578 316,849 334,339 352,894 366,819 379,386 390,820 400,920 410,113 418,437 

Net Change in Population 0 0 0 57 195 333 360 374 334 174 121 

Net Change in Households 0 0 0 23 78 133 144 150 134 70 48 

Santa Rosa 

Total Population 1995 2000 2005 2010 2015 2020 2025 2030 2035 2040 2045 

Scenario 96,660 113,508 124,354 135,222 149,875 159,912 168,316 176,688 184,441 191,983 199,820 

Baseline 96,660 113,508 124,354 135,149 149,589 159,420 167,814 176,209 184,053 191,853 199,765 

Net Change in Population 0 0 0 73 287 492 502 479 388 131 55 

Net Change in Households 0 0 0 29 115 197 201 191 155 52 22 
Table 8.7 .3 

MMS Florida Panhandle Model - Pensacola 

Output and Employment Report - Reasonable Maximum 

00 

N 

Impact Area 

Report Area 

Total Output (in $ Millions 

Scenario 

Baseline 

Net Impact 

Output Excl. Government 

Scenario 

Baseline 

Net Impact 

Employment 

Scenario 

Baseline 

Net Impact 

Pensacola Scenario Name: PEN: Reason Max 

Pensacola Date: September 18, 2001 

1995 2000 2005 2010 2015 2020 2025 2030 2035 2040 2045 

14,4512 16,449 .0 17,223 .7 17,978 .0 18,777 .3 18,969 .1 19,158 .7 19,613 .1 20,077 .1 20,547.4 21,039.3 

14,451 .2 16,449 .0 17,223 .7 17,974.8 18,766 .0 18,951 .6 19,143 .4 19,599 .6 20,067 .6 20,547.4 21,039.3 

0.0 0.0 0.0 3 .2 11 .3 17 .5 153 13 .6 9.6 0.0 0.0 

1995 2000 2005 2010 2015 2020 2025 2030 2035 2040 2045 

12,703 .5 14,354 .2 15,093 .7 15,816 .6 16,562 .8 16,760.1 16,955 .8 17,379 .1 17,811 .6 18,250 .2 18,709.8 

12,703 .5 14,354 .2 15,093 .7 15,813 .5 16,551 .6 16,742 .8 16,940 .7 17,365 .7 17,802 .1 18,250 .2 18,709.8 

0.0 0.0 0.0 3 .1 11 .2 17 .3 15 .1 13 .4 9 .5 0.0 0.0 

1995 2000 2005 2010 2015 2020 2025 2030 2035 2040 2045 

193,173 223,342 234,998 245,930 257,548 260,621 263,454 269,514 275,644 281,728 288,279 

193,173 223,342 234,998 245,820 257,169 260,036 262,943 269,060 275,322 281,728 288,279 

0 0 0 110 380 584 511 454 322 0 0 
Table 8.7.4 

MMS Florida Panhandle Model - Pensacola 

Fiscal Balance Report - Reasonable Maximum 

00 

to 

w 

Impact Area 

Report Area 

Item 

Scenario Population 

Baseline Population 

Net Change in Population 

Net Change in Households 

Net Change in Area Output Excluding Govt 

(in Millions of Dollars) 

County Government 

Revenues 

Ad Valorem Taxes 

Residential 

Commercial and Industrial 

Other Taxes, Fees, Licences, etc . 

From All Other Sources to Balance Budget 

Expenditures 

Municipal Government 

Revenues 

Ad Valorem Taxes 

Residential 

Commercial and Industrial 

Other Taxes, Fees, Licences, etc . 

From All Other Sources to Balance Budget 

Expenditures 

Pensacola 

Escambia County 

1995 2000 2005 

281,162 296,578 316,849 

281,162 296,578 316,849 

0 0 0 

0 0 0 

0 0 0 

Scenario Name 

Date : 

2010 2015 2020 2025 2030 2035 

334,395 353,088 367,152 379,746 391,194 401,254 

334,339 352,894 366,819 379,386 390,820 400,920 

57 195 333 360 374 334 

23 78 133 144 150 134 

3 11 17 15 13 9 

PEN: Reason Max 

September 18, 2001 

2040 2045 

410,288 418,557 

410,113 418,437 

174 121 

70 48 

0 0 

0 0 0 40,484 138,905 237,812 257,273 266,923 238,500 124,487 86,165 

0 0 0 9,183 31,844 53,154 54,825 55,205 47,478 21,130 14,625 

0 0 0 6,871 23,577 40,365 43,668 45,306 40,481 21,130 14,625 

0 0 0 2,311 8,267 12,789 11,158 9,899 6,997 0 0 

0 0 0 17,370 59,598 102,033 110,383 114,524 102,329 53,411 36,969 

0 0 0 13,931 47,464 82,624 92,064 97,195 88,693 49,946 34,571 

0 0 0 40,484 138,905 237,812 257,273 266,923 238,500 124,487 86,165 

0 0 0 33,021 113,301 193,976 209,850 217,721 194,538 101,541 70,282 

0 0 0 1,196 4,147 6,922 7,140 7,189 6,183 2,752 1,905 

0 0 0 895 3,070 5,257 5,687 5,900 5,272 2,752 1,905 

0 0 0 301 1,077 1,666 1,453 1,289 911 0 0 

0 0 0 14,879 51,051 87,401 94,553 98,100 87,654 45,752 31,668 

0 0 0 16,947 58,103 99,653 108,157 112,432 100,701 53,037 36,710 

0 0 0 33,021 113,301 193,976 209,850 217,721 194,538 101,541 70,282 
Table 8.7.4 (continued) 

MMS Florida Panhandle Model - Pensacola 

Fiscal Balance Report - Reasonable Maximum 

Impact Area 

Report Area 

Pensacola 

Santa Rosa County 

Scenario Name: PEN: Reason Max 

Date : September 18, 2001 

Item 

Scenario Population 

Baseline Population 

Net Change in Population 

Net Change in Households 

Net Change in Area Output Excluding Govt 

(in Millions of Dollars) 

1995 2000 2005 2010 2015 2020 2025 2030 2035 2040 2045 

96,660 113,508 124,354 135,222 149,875 159,912 168,316 176,688 184441 191,983 199,820 

96,660 113,508 124,354 135,149 149,589 159,420 167,814 176,209 184,053 191,853 199,765 

0 0 0 73 287 492 502 479 388 131 55 

0 0 0 29 115 197 201 191 155 52 22 

County Government 00 

Revenues 0 0 0 54,374 214,533 367,914 375,045 357,817 289,971 97,608 40,901 

AdValoremTaxes 0 0 0 8,100 31,804 54,289 55,000 52,338 42,227 13,786 5,777 

Residential 0 0 0 7,680 30,300 51,964 52,971 50,538 40,955 13,786 5,777 

Commercial and Industrial 0 0 0 420 1,503 2,326 2,029 1,800 1,272 0 0 

Other Taxes, Fees, Licences, etc . 0 0 0 25,642 101,169 173,500 176,863 168,739 136,744 46,030 19,288 

From All Other Sources to Balance 0 0 0 20,632 81,560 140,124 143,182 136,741 110,999 37,792 15,836 

Budget 

Expenditures 0 0 0 54,374 214,533 367,914 375,045 357,817 289,971 97,608 40,901 

Municipal Government 

Revenues 0 0 0 18,182 71,737 123,026 125,411 119,650 96,963 32,639 13,677 

Ad Valorem Taxes 0 0 0 343 1,345 2,296 2,326 2,213 1,786 583 244 

Residential 0 0 0 325 1,281 2,197 2,240 2,137 1,732 583 244 

Commercial and Industrial 0 0 0 18 64 98 86 76 54 0 0 

Other Takes, Fees, Licences, etc . 0 0 0 10,360 40,876 70,100 71,459 68,176 55,249 18,598 7,793 

From All Other Sources to Balance 0 0 0 7,479 29,517 50,630 51,626 49,260 39,928 13,458 5,639 

Budget 

Expenditures 0 0 0 18,182 71,737 123,026 125,411 119,650 96,963 32,639 13,677 
Table 8.7 .5 

MMS Florida Panhandle Model - Pensacola 

Schools Report - Reasonable Maximum 

00 

Impact Area 

Report Area 

Number of School-Age Children 

Scenario 

Baseline 

Net Change 

Net Change in Households 

Fiscal Impact of Net Change 

Total Revenues 

Local Ad Valorem Taxes 

Residential Property 

Commerical Property 

State Revenues 

Federal Revenues 

Expenditures 

Pensacola 

Escambia County 

1995 2000 

55,401 59,473 

55,401 59,473 

0 0 

0 0 

2005 

57,103 

57,103 

0 

0 

2010 2015 

59,513 64,247 

59,494 64,200 

18 47 

23 78 

Scenario Name: PEN: Reason Max 

Date: September 18, 2001 

2020 2025 2030 2035 2040 2045 

67,319 68,574 68,661 68,579 69,718 71,906 

67,264 68,534 68,593 68,496 69,672 71,857 

56 40 68 83 47 48 

133 144 150 134 70 48 

0 0 0 80,652 213,095 266,657 207,706 322,182 375,211 208,771 208,369 

0 0 0 10,634 36,875 61,552 63,487 63,926 54,979 24,468 16,936 

0 0 0 7,957 27,302 46,742 50,567 52,464 46,877 24,468 16,936 

0 0 0 2,677 9,573 14,810 12,920 11,463 8,102 0 0 

0 0 0 62,429 159,556 188,859 134,948 231,629 281,967 158,276 164,399 

0 0 0 10,266 26,237 31,056 22,191 38,089 46,367 26,027 27,034 

0 0 0 88,050 225,038 266,368 190,332 326,692 397,688 223,233 231,870 
Table 8.7 .5 (continued) 

MMS Florida Panhandle Model - Pensacola 

Schools Report - Reasonable Maximum 

Impact Area 

Report Area 

Number of School-Age Children 

Scenario 

Baseline 

Net Change 

Net Change in Households 

Fiscal Impact of Net Change 

Total Revenues 

Local Ad Valorem Taxes 

Residential Property 

Commerical Property 

State Revenues 

Federal Revenues 

Expenditures 

Pensacola Scenario Name: PEN: Reason Max 

Santa Rosa County Date: September 18, 2001 

1995 2000 2005 2010 2015 2020 2025 2030 2035 2040 2045 

19,462 21,262 22,059 23,045 24,690 26,073 27,190 28,215 29,040 29,938 31,249 

19,462 21,262 22,059 23,036 24,656 26,008 27,108 28,125 28,969 29,913 31,249 

0 0 0 8 34 65 82 90 71 25 0 

0 0 0 29 115 197 201 191 155 52 22 

0 0 0 39,759 161,066 300,724 362,498 387,936 309,573 106,932 7,302 

0 0 0 10,277 40,352 68,882 69,783 66,405 53,578 17,492 7,329 

0 0 0 9,744 38,445 65,931 67,209 64,122 51,963 17,492 7,329 

0 0 0 533 1,907 2,951 2,574 2,284 1,614 0 0 

0 0 0 26,887 109,843 210,326 264,519 290,071 230,766 80,120 -25 

0 0 0 3,128 12,778 24,467 30,771 33,743 26,844 9,320 -3 

0 0 0 36,506 149,137 285,565 359,144 393,837 313,316 108,782 -34 
Table 8.7 .6 

MMS Florida Panhandle Model - Pensacola 

Public Services Report - Reasonable Maximum 

00 

J 

Impact Area Pensacola Scenario Name: PEN: Reason Max 

Report Area Escambia County Date: September 18, 2001 

Population 1995 2000 2005 2010 2015 2020 2025 2030 2035 2040 2045 

Scenario 281,162 296,578 316,849 334,395 353,088 367,152 379,746 391,194 401,254 410,288 418,557 

Baseline 281,162 296,578 316,849 334,339 352,894 366,819 379,386 390,820 400,920 410,113 418,437 

Net Impact 0 0 0 57 195 333 360 374 334 174 121 

Public Services Impact 

Residential Water (thousands of 0 .0 0.0 0.0 4.7 163 27.9 30.1 31 .3 27.9 14 .6 10.1 

gallons per day) 

Residential Wastewater 0.0 0.0 0.0 4.0 13 .9 23 .8 25.7 26.7 23.8 12 .4 8 .6 

(thousands of gallons per day) 

Solid Waste (tons per year) 0.0 0.0 0.0 90.7 311.2 532.8 576.4 598.0 534.4 278.9 193 .1 

Road & Highway (miles) 0.0 0.0 0.0 0.2 0.7 1 .2 1.3 1 .4 1 .2 0.7 0.5 

Police Protection 0 0 0 0 0 1 1 1 1 0 0 

Crimes 0.0 0.0 0.0 3.5 12 .1 20.6 22.3 23 .2 20.7 10 .8 7.5 

Fire Protection 0 0 0 0 0 0 0 0 0 0 0 

Public Welfare 0 0 0 0 0 0 0 0 0 0 0 

Physicians 0 0 0 0 0 1 1 1 1 0 0 
Table 8.7 .6 (continued) 

MMS Florida Panhandle Model - Pensacola 

Public Services Report - Reasonable Maximum 

00 

Impact Area 

Report Area 

Population 

Scenario 

Baseline 

Net Impact 

Public Services Impact 

Residential Water (thousands of 

gallons per day) 

Residential Wastewater 

(thousands of gallons per day) 

Solid Waste (tons per year) 

Road & Highway (miles) 

Police Protection 

Crimes 

Fire Protection 

Public Welfare 

Physicians 

Pensacola 

Santa Rosa County 

1995 2000 2005 

96,660 113,508 124,354 

96,660 113,508 124,354 

0 0 0 

Scenario 

Date: 

2010 2015 2020 2025 2030 

135,222 149,875 159,912 168,316 176,688 

135,149 149,589 159,420 167,814 176,209 

73 287 492 502 479 

Vame: PEN: Reason Max 

September 18, 2001 

2035 2040 2045 

184,441 191,983 199,820 

184,053 191,853 199,765 

388 131 55 

0.0 0.0 0.0 6.7 26.2 45 .0 45.9 43 .8 35.5 11 .9 5 .0 

0.0 0.0 0.0 2.2 8.6 14.8 15 .1 14.4 11 .7 3.9 1 .6 

0 0 0 54 212 364 371 354 287 97 40 

0.0 0.0 0.0 0.5 2.0 3 .5 3.6 3 .4 2 .7 0.9 0.4 

0 0 0 0 1 1 1 1 1 0 0 

0 0 0 3 10 18 18 17 14 5 2 

0 0 0 0 0 0 0 0 0 0 0 

0 0 0 0 0 0 0 0 0 0 0 

0 0 0 0 0 1 1 1 0 0 0 
Destin Dome 

Key parameters of the Destin Dome scenario and the resulting impacts for the Pensacola area are 

summarized in Table 8.8 .1 . The assumptions of this scenario are the same as were discussed for 

the Panama City area; natural gas production begins in the year 2000, peaks in 2005 at 109 .5 

billion cubic feet, and drops to zero by 2025 (Table 8 .8 .1). Under this scenario, OCS 

expenditures in the impact area peak at $20.7 million annually in 2005. Throughout the period 

of gas production (2005 through 2020), OCS support is estimated to require 288 boat trips and 

1248 helicopter flights annually from the support base. 

Estimated OCS impact on the population of the Pensacola area is projected to peak at 1,394 

persons in the year 2005 (which is only 0 .3 percent of the area's projected baseline population for 

that year) . The area would have a net increase of 558 households in the year 2005 as a result of 

OCS activity (Table 8.8 .2). While OCS production and resulting economic impacts end by 2025, 

some population impacts and related socioeconomic effects continue through year 2045 . The 

population impacts are divided between Escambia and Santa Rosa Counties, with Escambia 

County recording its greatest population impact in 2005 (805 persons) and Santa Rosa also 

reaching its peak impact in 2005 (589 persons) . 

Impacts of the Destin Dome scenario on total output in the Pensacola area are estimated to peak 

at $32.7 million in the year 2005, while the impact on employment peaks at 1,087 jobs in the 

same year. The peak impact on area output represents about 0.2 percent of the area's projected 

baseline output, or 0 .2 percent of output excluding government (Table 8 .8 .3) . The peak 

employment impact represents about 0.5 percent of projected baseline employment. 

Net fiscal impacts of the Destin Dome scenario on Escambia and Santa Rosa Counties and their 

municipalities are summarized in Table 8.8 .4 . Additional expenditures by Escambia County 

government resulting from OCS activity are projected to peak in 2005, at $57,542 . Additional 

ad valorem taxes are projected to contribute about $121,388 to county revenues, and other taxes, 

licenses, and fees add $246,508, which results in about $206,646 being required from other 

sources to balance the budget. Additional expenditures by municipal governments in Escambia 

County (i .e ., all municipal governments combined) are projected to peak at $468,637, also in 

2005 . Additional ad valorem tax revenues were estimated to contribute about $15,800 while 

other taxes, fees, and licenses would add about $211,156 to municipal revenues, leaving about 

$241,673 required from all other sources to balance the budget. Fiscal impacts for local 

governments in Santa Rosa County exhibit similar patterns with the impacts also peaking in 2005 

(Table 8.8 .4). 

Estimated impacts of the Destin Dome scenario on school enrollments in Escambia and Santa 

Rosa Counties are summarized in Table 8.8 .5 . The number of school age children net change in 

Escambia County peaks at 192 in year 2020 . This represents about 0 .3 percent of the projected 

baseline population in this age group. The additional expenditures by the Escambia County 

school district are estimated to peak at $920,857 in 2020, or about $4,795 per additional student. 

Total additional school district revenues are estimated to total about $852,352, including about 

8-59 
$652,900 in added state revenues, $97,860 in additional ad valorem taxes, and $107,360 in extra 

federal revenues. Impacts in Santa Rosa County follow a similar pattern, except that the number 

of school age children net change peaks in 2005 . 

Projected impacts of the OCS reasonable maximum level of development on selected public 

services in Escambia and Santa Rosa Counties are summarized in Table 8.8 .6 . Most impacts 

peak in 2005 in both counties, coinciding with the years when population impacts are greatest. 

8-60 
Table 8.8 .1 

MMS Florida Panhandle Model - Pensacola 

OCS Scenario Report - Destin Dome 

00 

Impact Area 

Report Area 

Production Scenario in Lease Sale 181 : 

Item 

Oil and Gas Production in Eastern Gulf of Mexico 

Lease Sale 181 

Oil Production (Millions of Barrels) 

Gas Production (Billions of Cubic Feet) 

Destin Dome 

Oil Production (Millions of Barrels) 

Gas Production (Billions of Cubic Feet) 

OCS Expenditures in Impact Area 

Lease Sale 181 

Destin Dome 

Scenario Impact on Key Industries 

Tourism 

Percentage Change in Level 

Percentage Change in Growth Rate 

Military 

Percentage Change in Level 

OCS-Related Activities 

Boat Trips from Service Base 

Helicopter Trips from Service Base 

Pensacola Scenario Name: PEN: Destin Dome 

Pensacola Date: September 18, 2001 

Not Serviced in Florida Destin Dome : Serviced in Florida 

1995 2000 2005 2010 2015 2020 2025 2030 2035 2040 2045 

0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 

0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 

0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 

0.0 54.8 109.5 71.2 42.0 25 .6 0.0 0.0 0.0 0.0 0.0 

0.0 7.9 20.7 14.2 7.9 4.5 0.0 0.0 0.0 0.0 0.0 

0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 

0.0 7.9 20.7 14.2 7.9 4.5 0.0 0.0 0.0 0.0 0.0 

0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 

0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 

0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 

0 288 288 288 288 288 0 0 0 0 0 

0 1248 1248 1248 1248 1248 0 0 0 0 0 
Table 8.8 .2 

MMS Florida Panhandle Model - Pensacola, Escambia, Santa Rosa 

Population Report - Destin Dome 

N 

Impact Area Pensacola, Escambia, Santa Rosa 

Report Areas Pensacola, Escambia, Santa Rosa 

Pensacola Area 

Scenario Name: PEN: Destin Dome 

Date: September 18, 2001 

Total Population 1995 2000 2005 2010 2015 2020 2025 2030 2035 2040 2045 

Scenario 377,822 410,566 442,598 470,757 503,442 526,974 547,568 567,203 585,017 601,995 618,282 

Baseline 377,822 410,086 441,204 469,488 502,482 526,239 547,200 567,029 584,973 601,966 618,202 

Net Change in Population 0 480 1,394 1,270 959 736 368 173 43 29 81 

Net Change in Households 0 192 558 508 384 294 147 69 17 11 32 

Escambia 

Total Population 1995 2000 2005 2010 2015 2020 2025 2030 2035 2040 2045 

Scenario 281,162 296,884 317,654 335,120 353,606 367,475 379,896 391,238 401,278 410,472 418,826 

Baseline 281,162 296,578 316,849 334,339 352,894 366,819 379,386 390,820 400,920 410,113 418,437 

Net Change in Population 0 306 805 782 713 656 511 418 358 358 389 

Net Change in Households 0 123 322 313 285 262 204 167 143 143 156 

Santa Rosa 

Total Population 1995 2000 2005 2010 2015 2020 2025 2030 2035 2040 2045 

Scenario 96,660 113,681 124,944 135,637 149,835 159,499 167,672 175,965 183,739 191,523 199,457 

Baseline 96,660 113,508 124,354 135,149 149,589 159,420 167,814 176,209 184,053 191,853 199,765 

Net Change in Population 0 173 589 488 247 79 -142 -245 -314 -330 -309 

Net Change in Households 0 69 236 195 99 32 -57 -98 -126 -132 -123 
Table 8.8 .3 

MMS Florida Panhandle Model - Pensacola 

Output and Employment Report - Destin Dome 

00 

w 

Impact Area 

Report Area 

Total Output (in $ Millions 

Scenario 

Baseline 

Net Impact 

Output Excl. Government 

Scenario 

Baseline 

Net Impact 

Employ 

Scenario 

Baseline 

Net Impact 

'ensacola Scenario Name: PEN: Destin Dome 

'ensacola Date: September 18, 2001 

1995 2000 2005 2010 2015 2020 2025 2030 2035 2040 2045 

14,451 .2 16,4613 17,256 .4 17,997 .1 18,778 .3 18,958 .4 19,143 .4 19,599 .6 20,067.6 20,547 .4 21,039.3 

14,451 .2 16,449.0 17,223 .7 17,974 .8 18,766 .0 18,951 .6 19,143 .4 19,599 .6 20,067.6 20,547 .4 21,039.3 

0.0 123 32.7 22.3 12.3 6.8 0.0 0.0 0.0 0.0 0.0 

1995 2000 2005 2010 2015 2020 2025 2030 2035 2040 2045 

12,703 .5 14,366.4 15,126 .0 15,835 .5 16,563 .7 16,749 .5 16,940 .7 17,365 .7 17,802.1 18,250.2 18,709 .8 

12,703 .5 14,354.2 15,093 .7 15,813 .5 16,551 .6 16,742 .8 16,940 .7 17,365 .7 17,802.1 18,250.2 18,709 .8 

0.0 12.1 323 22.1 12.1 6.8 0.0 0.0 0.0 0.0 0.0 

1995 2000 2005 2010 2015 2020 2025 2030 2035 2040 2045 

193,173 223,754 236,085 246,564 257,580 260,268 262,943 269,060 275,322 281,728 288,279 

193,173 223,342 234,998 245,820 257,169 260,036 262,943 269,060 275,322 281,728 288,279 

0 412 1,087 744 412 232 0 0 0 0 0 
Table 8.8 .4 

MMS Florida Panhandle Model - Pensacola 

Fiscal Balance Report - Destin Dome 

Impact Area Pensacola Scenario Name: PEN: Destin Dome 

Report Area Escambia County Date: September 18, 2001 

Item 1995 2000 2005 2010 2015 2020 2025 2030 2035 2040 2045 

Scenario Population 281162 296884 317,654 335,120 353,606 367,475 379,896 391238 401278 410472 418826 

Baseline Population 281,162 296,578 316,849 334,339 352,894 366,819 379,386 390,820 400,920 410,113 418,437 

Net Change in Population 0 306 805 782 713 656 511 418 358 358 389 

Net Change in Households 0 123 322 313 285 262 204 167 143 143 156 

Net Change in Area Output Excluding Govt 0 12 32 22 12 7 0 0 0 0 0 

(in Millions of Dollars) 

°° County Government 

Revenues 0 218,796 574,542 558,243 508,937 468,513 364,574 298,540 255,499 255,861 277,956 

Ad Valorem Taxes 0 46,087 121,388 111,045 95,334 84,510 61,880 50,672 43,367 43,428 47,178 

Residential 0 37,137 97,519 94,753 86,384 79,522 61,880 50,672 43,367 43,428 47,178 

Commercial and Industrial 0 8,950 23,869 16,293 8,950 4,987 0 0 0 0 0 

Other Taxes, Fees, Licences, etc. 0 93,875 246,508 239,515 218,360 201,016 156,421 128,089 109,622 109,778 119,258 

FromAll Other Sources to Balance 0 78,834 206,646 207,683 195,243 182,987 146,272 119,779 102,510 102,655 111,520 

Budget 

Expenditures 0 218,796 574,542 558,243 508,937 468,513 364,574 298,540 255,499 255,861 277,956 

Municipal Government 

Revenues 0 178,466 468,637 455,343 415,125 382,153 297,372 243,510 208,403 208,698 226,721 

Ad Valorem Taxes 0 6,002 15,808 14,461 12,415 11,006 8,059 6,599 5,648 5,656 6,144 

Residential 0 4,836 12,700 12,340 11,250 10,356 8,059 6,599 5,648 5,656 6,144 

Commercial and Industrial 0 1,166 3,108 2,122 1,166 650 0 0 0 0 0 

Other Taxes, Fees, Licences, etc. 0 80,412 211,156 205,166 187,045 172,189 133,989 109,720 93,901 94,034 102,155 

From All Other Sources to Balance 0 92,052 241,673 235,715 215,665 198,959 155,325 127,192 108,854 109,008 118,422 

Budget 

Expenditures 0 178,466 468,637 455,343 415,125 382,153 297,372 243,510 208,403 208,698 226,721 
Table 8.8 .4 (continued) 

MMS Florida Panhandle Model - Pensacola 

Fiscal Balance Report - Destin Dome 

00 

Impact Area 

Report Area 

Item 

Scenario Population 

Baseline Population 

Net Change in Population 

Net Change in Households 

Net Change in Area Output Excluding 

Govt (in Millions of Dollars) 

County Government 

Revenues 

Ad Valorem Taxes 

Residential 

Commercial and Industrial 

Other Taxes, Fees, Licences, etc. 

From All Other Sources to 

Balance Budget 

Expenditures 

Municipal Government 

Revenues 

Ad Valorem Taxes 

Residential 

Commercial and Industrial 

Other Taxes, Fees, Licences, etc. 

From All Other Sources to 

Balance Budget 

Expenditures 

Pensacola Scenario Name: PEN: Destin Dome 

Santa Rosa County Date: September 18, 2001 

1995 2000 2005 2010 2015 2020 2025 2030 2035 2040 2045 

96,660 113,681 124,944 135,637 149,835 159,499 167,672 175,965 183,739 191,523 199,457 

96,660 113,508 124,354 135,149 149,589 159,420 167,814 176,209 184,053 191,853 199,765 

0 173 589 488 247 79 -142 -245 -314 -330 -309 

0 69 236 195 99 32 -57 -98 -126 -132 -123 

0 129,466 

0 19,913 

0 18,286 

0 1,628 

0 61,053 

0 48,500 

440,764 

66,593 

62,253 

4,340 

207,855 

166,316 

364,780 184,499 

54,484 27,686 

51,521 26,058 

2,963 1,628 

172,022 87,006 

138,274 69,807 

59,398 -106,237 -183,001 -235,106 -246,510 -230,728 

9,296 -15,005 -25,847 -33,206 -34,817 -32,588 

8,389 -15,005 -25,847 -33,206 -34,817 -32,588 

907 0 0 0 0 0 

28,011 -50,099 -86,299 -110,871 -116,249 -108,806 

22,091 -41,133 -70,855 -91,029 -95,444 -89,334 

0 129,466 440,764 364,780 184,499 59,398 -106,237 -183,001 -235,106 -246,510 -230,728 

0 43,292 147,386 121,978 61,694 19,862 -35,524 -61,193 -78,617 -82,430 -77,153 

0 842 2,816 2,304 1,171 393 -634 -1,093 -1,404 -1,472 -1,378 

0 773 2,632 2,179 1,102 355 -634 -1,093 -1,404 -1,472 -1,378 

0 69 184 125 69 38 0 0 0 0 0 

0 24,668 83,981 69,503 35,153 11,317 -20,242 -34,868 -44,796 -46,968 -43,962 

0 17,782 60,590 50,171 25,370 8,152 -14,648 -25,233 -32,417 -33,989 -31,813 

0 43,292 147,386 121,978 61,694 19,862 -35,524 -61,193 -78,617 -82,430 -77,153 
Table 8.8 .5 

MMS Florida Panhandle Model - Pensacola 

Schools Report - Destin Dome 

Impact Area 

Report Area 

Pensacola 

Escambia County 

Scenario Name: PEN: Destin Dome 

Date: September 18, 2001 

Number of School-Age Children 1995 2000 2005 2010 2015 

°° Scenario 55,401 59,573 57,277 59,535 64,292 

Baseline 55,401 59,473 57,103 59,494 64,200 

Net Change 0 99 174 41 92 

Net Change in Households 0 123 322 313 285 

Fiscal Impact of Net Change 

Total Revenues 

Local Ad Valorem Taxes 

Residential Property 

Commerical Property 

State Revenues 

Federal Revenues 

Expenditures 

0 435,889 801,144 270,897 

0 53,368 140,566 128,589 

0 43,004 112,926 109,722 

0 10,364 27,640 18,867 

0 337,402 591,028 138,414 

0 55,483 97,189 22,761 

0 475,873 833,590 195,219 

462,997 

110,396 

100,031 

10,364 

311,708 

51,258 

439,635 

2020 2025 2030 2035 2040 2045 

67,456 68,723 68,713 68,518 69,663 71,883 

67,264 68,534 68,593 68,496 69,672 71,857 

192 189 120 22 -9 26 

262 204 167 143 143 156 

852,352 

97,862 

92,086 

5,775 

652,902 

107,364 

920,857 

817,353 534,695 

71,657 58,678 

71,657 58,678 

0 0 

640,390 408,795 

105,306 67,223 

903,210 576,567 

138,480 

50,218 

50,218 

0 

75,797 

12,464 

106,905 

14,656 158,088 

50,289 54,632 

50,289 54,632 

0 0 

-30,601 88,846 

-5,032 14,610 

-43,160 125,309 
Table 8.8 .5 (continued) 

MMS Florida Panhandle Model - Pensacola 

Schools Report - Destin Dome 

Impact Area Pensacola Scenario Name: PEN: Destin Dome 

Report Area Santa Rosa County Date: September 18, 2001 

Number of School-Age Children 1995 2000 2005 2010 2015 2020 2025 2030 2035 2040 2045 

Scenario 19,462 21,282 22,129 23,112 24,726 26,046 27,086 28,062 28,900 29,866 31,218 

00 Baseline 19,462 21,262 22,059 23,036 24,656 26,008 27,108 28,125 28,969 29,913 31,249 

Net Change 0 20 70 75 70 38 -22 -63 -69 -47 -30 

Net Change in Households 0 69 236 195 99 32 -57 -98 -126 -132 -123 

Fiscal Impact of Net Change 

Total Revenues 0 94,667 332,360 337,090 286,850 148,064 -97,299 -260,070 -290,350 -215,281 -151,462 

Local Ad Valorem Taxes 0 25,266 84,493 69,128 35,128 11,795 -19,038 -32,794 -42,132 -44,175 -41,347 

Residential Property 0 23,201 78,986 65,369 33,063 10,644 -19,038 -32,794 -42,132 -44,175 -41,347 

Commerical Property 0 2,065 5,507 3,759 2,065 1,151 0 0 0 0 0 

State Revenues 0 64,019 226,971 243,406 227,341 123,100 -70,106 -203,593 -222,353 -153,276 -98,641 

Federal Revenues 0 7,447 26,403 28,315 26,446 14,320 -8,155 -23,683 -25,866 -17,830 -11,475 

Expenditures 0 86,921 308,164 330,479 308,667 167,136 -95,185 -276,423 -301,894 -208,107 -133,927 
Table 8.8.6 

MMS Florida Panhandle Model - Pensacola 

Public Services Report - Destin Dome 

o1~ 

00 

Impact Area Pensacola Scenario Name: PEN: Destin Dome 

Report Area Escambia County Date: September 18, 2001 

Population 1995 2000 2005 2010 2015 2020 2025 2030 2035 2040 2045 

Scenario 281,162 296,884 317,654 335,120 353,606 367,475 379,896 391,238 401,278 410,472 418,826 

Baseline 281,162 296,578 316,849 334,339 352,894 366,819 379,386 390,820 400,920 410,113 418,437 

Net Impact 0 306 805 782 713 656 511 418 358 358 389 

Public Services Impact 

Residential Water (thousands 0.0 25 .6 673 65 .4 59.6 54.9 42.7 35.0 29.9 30.0 32.6 

of gallons per day) 

Residential Wastewater 0.0 21 .9 57.4 55 .8 50.9 46.8 36.4 29.8 25 .5 25.6 27.8 

(thousands of gallons per day) 

Solid Waste (tons per year) 0.0 490.2 1,287.3 1,250.7 1,140.3 1,049.7 816 .8 668.9 572.4 5733 622.8 

Road & Highway (miles) 0.0 1 .1 3 .0 2.9 2.7 2.5 1.9 1.6 13 1 .3 1 .5 

Police Protection 0 1 2 2 2 2 1 1 1 1 1 

Crimes 0.0 19.0 49.9 48.4 44.2 40.7 31 .6 25.9 22.2 22.2 24.1 

Fire Protection 0 0 0 0 0 0 0 0 0 0 0 

Public Welfare 0 0 0 0 0 0 0 0 0 0 0 

Physicians 0 1 2 2 2 2 1 1 1 1 1 
Impact Significance 

While the magnitude of economic and demographic impacts resulting from the different 

scenarios was projected to differ somewhat over time and between areas, the impacts resulting 

from each of the scenarios were quite small relative to baseline levels of the respective 

indicators . For example, the employment impacts of the three scenarios never exceeded 1 

percent of the forecasted baseline employment levels in the Panama City area, while in the 

Pensacola area the largest relative employment impact amounted to about 0 .5 percent (i .e ., onehalf of one percent) of the baseline employment level (Table 8.9). 

Another perspective on the significance of OCS impacts can be gained by comparing the 

projected employment effects associated with the OCS scenarios to the employment associated 

with the tourism and military sectors. In the Panama City area, the largest employment impact 

associated with OCS development is 735 jobs in 2005 under the Destin Dome scenario . By 

comparison, tourism is estimated to generate 10,617 jobs and military activity is expected to 

create 4,810 jobs . Thus, the maximum OCS impact would amount to only about 15 percent of 

the impact of military activity or 7 percent of the impact of tourism. In the Pensacola area, the 

maximum OCS impact is 1,087 jobs in 2005 under the Destin Dome scenario . Tourism is 

estimated to create 6,756 jobs and military activity is projected to generate 10,846 jobs in the 

Pensacola area in 2005 . Thus, the maximum OCS impact would amount to about 16 percent of 

the impact of tourism or 10 percent of the impact of military activity . 

8-69 
Table 8.9 

Employment Impacts of OCS Scenarios, Compared to Baseline Levels 

Year 

Area/Scenario 2000 2005 2010 2015 2020 2025 2030 2035 

-------------------------percent of baseline---------------------- 

Panama City: 

Minimum threshold 0 0 0.1 0.2 0.3 0.2 0.2 0.1 

Maximum reasonable 0 0 0.1 0.3 0.5 0.4 0.3 0.2 

Destin Dome 0 .4 1 .0 0.6 0.3 0.2 0 0 0 

Pensacola: 

Minimum threshold 0 0 0.0 0.1 0.1 0.1 0.1 0.1 

Maximum reasonable 0 0 0.0 0.1 0.2 0.2 0 .2 0.1 

Destin Dome 0.2 0.5 0.3 0.2 0.1 0 0 0 

8-70 
Given the projected size of an onshore support base in the Florida Panhandle, the level of OCSrelated increases in employment would be small. Because the economy of the Florida Panhandle 

is projected to be at or near full-employment, however, those jobs not taken by commuters from 

outside the region would require additional net inmigration into the Florida Panhandle. This 

inmigration would, however, be only a fraction of the annual population growth projected for the 

area under baseline conditions . For example, the maximum population impact from OCS 

development in the Panama City area (Destin Dome scenario, 2005) is 968 persons . This is 23 

percent of the baseline inmigration population growth projected for the Panama City area for the 

period 2000-2005 . In the Pensacola area, the maximum population impact is 1,394 persons 

(Destin Dome, 2005), which represents only 8 percent of the projected baseline inmigration 

population growth for the area. 

Our estimates suggest that in the long term, even if both the Lease Sale 181 and the Destin Dome 

project are supported by a base in the Florida Panhandle, the increase in the population due to 

this support will be less than two percent of the increase due to inmigration from 2000 to 2035 . 

During the period 2010 to 2035 the Lease Sale 181 project would increase the population of the 

area by less then one third of a percent of the baseline population of Panama City, or up to one 

sixth of a percent of the baseline population of Pensacola. 

The peak year is 2020, in term of the number of cumulative persons added to the population due 

to the sum effect of both projects . In that year we estimate that the reasonable maximum effect 

would be that a cumulation between 1,018 and 1,561 persons because of both projects. The 

cumulation would start in 2000. At 2020 this increase would be at most between 2.7% and 4.6% 

of the cumulative baseline inmigration. By 2035, the cumulative effect of additional persons 

would be less than 2% of the cumulative baseline inmigration. This assumes both the OCS 

activity at a reasonable maximum scenario for Lease Sale 181 and it assumes the Destin Dome 

scenario . Impacts on public services and infrastructure of Florida Panhandle communities 

resulting from OCS development also will be small relative to the increases in demands 

associated with projected baseline growth in the regions's economy and population . 

8-71 
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Wulff, L., ed. 1968. The Sportsman Companion. Harper & Row. New York, NY. 413 pp. 

9-24 
P The Department of the Interior Mission 

As the Nation's principal conservation agency, the Department of the Interior has responsibility 

` 

for most of our nationally owned public lands and natural resources. This includes fostering 

sound use of our land and water resources ; protecting our fish, wildlife, and biological diversity; 

preserving the environmental and cultural values of our national parks and historical places; 

and providing for the enjoyment of life through outdoor recreation . The Department assesses 

our energy and mineral resources and works to ensure that their development is in the best 

interests of all our people by encouraging stewardship and citizen participation in their care . 

The Department also has a major responsibility for American Indian reservation communities 

and for people who live in island territories under U.S . administration . 

The Minerals Management Service Mission 

Moreover, i n working to meet its responsibilities, the Offshore Minerals Management Program 

administers the OCS competitive leasing program and oversees the safe and environmentally 

sound exploration and production of our Nation's offshore natural gas, oil and other mineral 

resources. The MMS Minerals Revenue Management meets its responsibilities by ensuring the 

efficient, timely and accurate collection and disbursement of revenue from mineral leasing and 

production due to Indian tribes and allottees, States and the U.S . Treasury . 

a As a bureau of the Department of the Interior, the Minerals Management Service's (MMS) 

primary responsibilities are to manage the mineral resources located on the Nation's Outer 

Continental Shelf (OCS), collect revenue from the Federal OCS and onshore Federal and Indian 

--= lands, and distribute those revenues. 

The MMS strives to fulfill its responsibilities through the general guiding principles of : (1) being 

responsive to the public's concerns and interests by maintaining a dialogue with all potentially 

affected parties and (2) carrying out its programs with an emphasis on working to enhance the 

quality of life for all Americans by lending MMS assistance and expertise to economic 

development and environmental protection .