Tackling Hypocrisy Head On in the Outdoor Recreation Industry

The COBRT hosts a panel at the Commons on Champa, moderated by Jim Ogsbury, executive director of the Western Governors' Association. The panel consists of [left to right] Kathleen Sgamma, president of the Western Energy Alliance; Amy Roberts, executive director of the Outdoor Industry Association; and Nathan Fey, director of the Colorado Office of Economic Development and International Trade. 

As the outdoor industry continues to grow in Colorado and across the country, it is facing new challenges and dichotomies surrounding preservation, promoting environmental stewardship, energy usage and ultimately, profit. Because, while much of outdoor recreation is about getting outside, exploring the unknown and maintaining the environment, at the end of the day the industry is driven by manufacturing processes, transportation and revenue just like any other U.S. industry.

Last week, the Colorado Business Roundtable (COBRT) brought together industry stakeholders to discuss the issues surrounding outdoor recreation. It’s time for these stakeholders, says Jeff Wadsen, president of COBRT, to collaborate, align on these issues and “roll our sleeves up and get to work.” The panel discussion included members from the Outdoor Industry Association, Colorado’s Office of Economic Development and International Trade (OEDIT), the Western Governor’s Association and the Western Energy Alliance — all of which call Colorado home.

One of the reasons these issues are so important is that outdoor recreation represents a large part of Colorado’s economy. According to the Outdoor Industry Association (OIA) — which moved its headquarters to Colorado in 2018 — outdoor recreation contributes 229,000 direct jobs, $28 billion in consumer spending, $9.7 billion in wages and salaries and $2 billion in state and local tax revenue to the Colorado economy. Not only does this industry bring in tourism spending, but the report found that 71% of residents participate in some form of outdoor recreation.

This is an industry that crosses a number of other market verticals — education, health and wellness, tourism and more — and thus it’s impact, leadership and stewardship are far-reaching in the business ecosystem.

With OIA moving to Colorado, a new governor and administration, the Bureau of Land Management's (BLM) plans to relocate to the state and a new overall focus on the outdoors, there has never been a better time for a conversation like the one at the COBRT panel. “[These components have] created a different dynamic around energy, around outdoor rec, around tourism, around establishing economic clusters, around really creating an industry that really is driving around outdoor rec and opportunities for folks to recreate,” says Wasden. “Look at how it's transforming communities like Grand Junction.”

The Collision of Energy and the Outdoors

One of the greatest dichotomies that the outdoor industry must face head-on is its reliance on fossil fuels down the supply chain. While environmental stewardship and the protection of public lands are large driving emotional factors for many of the industry members and the OIA in particular, this often collides with energy, particularly oil and natural gas.

“Everybody bears its own responsibility, its own impact, its own ability to impact the positive change that we're looking for around creating the kind of changes and sustainable factors in keeping Colorado as that state to recreate,” says Wasden.

Often oil and gas and outdoor recreation get put at opposite ends of the table as “enemies.” However, at last week’s conversation, Kathleen Sgamma, president of the Western Energy Alliance (WEA), says “there isn’t a competition between the two industries, we see a synergy,” adding that “the outdoor industry doesn’t exist without oil and natural gas.”

Amy Roberts, executive director of the OIA, did not shy away from this fact, instead pointing to the areas of impact and how the industry is moving to reduce these.

“The most impact is at the product level,” Roberts says, adding that apparel and footwear require the most energy to produce. However, she says it is a priority of OIA and its members to rethink the whole product lifecycle and its processes to mitigate their impact, noting that reducing water use and fresh water pollution are one of the main issues it is looking into. Many companies are starting to do this, using renewable energy to power its plants, using recycled fabrics to create its products and more.

According to Sgamma, oil and gas is also doing its best to remediate the environmental impacts of its industry. “We are the No.1 reason that the U.S. has reduced greenhouse gases,” she says.

With the advent of new drilling techniques, including hydraulic fracturing and directional and horizontal drilling, Sgamma says the industry has also consistently reduced its footprint on public lands. She says that the footprint of surface disturbance from oil and gas is less than 10% on non-park, non-wilderness, non-special recreation lands. It was also noted that a large part of the WEA’s work is reclamation and restoration work on these drilling sites a when they're deemed inactive.

Another way that OIA is focusing on this issue is by driving transparency and helping consumers make better decisions. Roberts says that the organization is working to create a consumer label that will highlight a product’s greenhouse gas impact and use of recycled materials. In driving this transparency, the hope is that the bigger impact will be bigger brands identifying and reducing overall impact.

“It's incumbent upon business communities to start to take a more active role and lead, instead of being on the sidelines and expecting an NGO and nonprofit or government to lead in that respect,” says Wasden. “We're excited that corporate America, and certainly here in Colorado, understand that charge and understand that mission, and [are] really rolling up their sleeves and taking a more active role, and I think Colorado can be a leader in that.”

Looking for Funding

Another main topic of discussion at the panel was funding, and how transparent and consistent funding is required to preserve, protect and restore both public lands as well as national, state and local parks. According to Roberts, federal spending on public lands and parks has declined based on the discretionary budget being reduced to 1%, leaving a large burden on state and local governments to create their own funding streams for the outdoor economy.

Currently, the oil and natural gas industry does pay royalty revenues back to local, state and federal governments. For every dollar spent, oil and gas companies return $16.14 in royalties and leasing revenue to the government. This amounts to $12 billion in local, state and federal taxes annually.

Current WEA is backing a bipartisan bill before Congress called Restore Our Parks, which would allocate federal fossil fuel royalties directly to maintaining and restoring federal lands.

According to the panel, a large problem with current royalties paid is that the federal government controls the allocation of these fees, and thus the outdoor and oil/gas industries, as well as parks and forest services, do not have control over how this money is spent. The Restore Our Parks seeks to change this by taking these royalties directly out of the general treasury and directly to the parks. In the past, Congress has not, according to Sgamma, kept their promises when it comes to general fund allocation to conservation in the last.

Roberts highlighted a similar issue with the outdoor recreation industry’s taxes.”We haven’t seen congress keep its commitment to spending the money how it said it would,” Roberts says. “We’d like to see that the money we’re paying in tariffs and taxes are actually being put toward the parks and public lands and not just mis-allocated.”

Every member of the panel said that the biggest change for funding would come from citizens pressuring their state and local governments to find and establish new revenue streams for conservation and preservation efforts. One such program that Colorado has implemented, that the panelists called attention to, is Great Outdoors Colorado (GOCO), which invests a portion of the Colorado Lottery proceeds to preserving and enhancing the state’s parks, trails, wildlife, rivers and open spaces.

Conservation Versus Usage

The last dichotomy that the panel addressed is balancing the conservation of Colorado’s natural environments with promoting Coloradans to get outdoors and recreate. With the influx of tourism and residents in the state, popular recreation spots have seen immense damage inflicted on the area itself as well as to wildlife.

One effort that Nathan Fey, director of OEDIT, says the state administration is working on is encouraging recreation outside of the front range through the economic development of rural cities and towns. “Rural Colorado is often left behind,” says Fey, “We are looking to grow the industry throughout all of Colorado, especially rural areas.”

A specific OEDIT program is its Rural Technical Assistance Program (RTAP), which pairs rural governments with industry experts to develop new economic development strategies. The program itself has smaller, specific programs, one of which is its “Grow your outdoor recreation industry,” ran in partnership with the University of Colorado-Boulder’s masters of the environment (MENV) and MBA programs.

In addition to, encouraging recreation outside of the front-range and I-70 corridor, Roberts noted that there are organizations in Colorado discussing permitting options to disperse the impact on popular areas. As an example, she pointed to the Forest Service of Glenwoods Springs’ new reservation and shuttle system that was implemented at Hanging Lake this year. This was implemented after the area’s ecosystem was threatened by an increase in foot and car traffic on the weekends.