Around lunchtime on the first Sunday in August, a few thousand hungry people converge on Dorset, Minnesota, population 22, which, with four local dining establishments—one for every 5.5 residents—has declared itself the Restaurant Capital of the World. That’s when the tiny community near Park Rapids celebrates Taste of Dorset, where visitors can sample local specialties, play kids’ games, and take a chance on being elected mayor: Anyone with a dollar can enter; the winner is drawn from a hat.

0613_10000-festivals_p1.jpgIrish Fair
Up to 100,000 fans of the Ould Sod flood St. Paul’s Harriet Island to enjoy traditional dancing and music, and sip Irish brews.

Last year, 3-year-old Robert Tufts was elected; past winners include a parrot and a St. Bernard. As restaurant owner Jeannette Dudley notes, “You don’t have to be human to win.”

It’s all tongue in cheek, but the impact on Dorset is undeniable. Most area businesses rake in their best day of the year. Last year, Dudley and her crew of 30-plus served more than 1,300 slices of the Dorset House Family Restaurant’s homemade pepperoni, sausage, and cheese pizzas at $2 each.

Down the street, Compañeros calls in 50 employees for the day to sell tacos, virgin strawberry margaritas, and Mexican mud balls (ice cream, crushed Oreos, strawberries, amaretto, and whipped cream). At 75 cents for a 7 ounce margarita, profits are not really the point, says restaurant owner Rick Kempnich. “We make a little, but it’s not the motivator,” he says. “It’s just a great event. It gives us exposure, and people come back.”

All over Minnesota, communities are making similar calculations. From Kandi is Dandy Days in Kandiyohi, Sinclair Lewis Days in Sauk Centre to Corn on the Cob Days in Plainview and Potato Days in Barnesville, it seems there’s a half-dozen celebrations for every summer weekend.

OK, maybe “Land of 10,000 Festivals” exaggerates a little. But you could add New Ulm’s Bavarian Blast; Uff Da! Days in Nevis; a few dozen art fairs, from Edina to Uptown to Ely; music festivals from the Bayfront Blues Fest in Duluth to the Rock Bend Folk Festival in Mankato to WE Fest’s country in Detroit Lakes and Twin Cities Jazz in St. Paul, and still only scratch the surface of festival culture here.

What is it about Minnesota and festivals? And what do they contribute to our economy?

A Frenzy of Festivals

Despite our affinity for festivals, no comprehensive list of the state’s celebrations exists. Explore Minnesota Tourism, a state agency, lists about 600 festivals in its database, but it relies on self-reporting by festival organizers, according to research analyst Patrick Simmons. The Tourism Center at the University of Minnesota puts the count in the ballpark of 1,500, but director Ingrid Schneider says there are no good estimates of festivals nationwide, so it would be difficult to say how that compares with other states.

Festival Facts

The Tourism Center at the University of Minnesota estimates the state has 1,500 festivals.

Explore Minnesota lists about 600 festivals.

The Minnesota State Arts Board granted $608,800 to 18 arts and cultural festivals for 2013, including $69,000 for Irish Fair. 

What all this festivity adds up to in total economic activity is similarly uncharted territory. While a few individual festivals have gathered data on their economic impact, thus far no one has put together an overall picture. Presumably, festival spending accounts for some portion of the $10 billion spent by travelers in Minnesota in 2011, according to a study by research firm Tourism Economics. That $10 billion in turn generated $17 billion in total business sales and $1.1 billion in taxes to state and local governments. How many millions or billions depends in part how far festivalgoers traveled, and how many booked hotel rooms, cabins, or camping sites, as overnight visits significantly drive up spending.

Such studies consider three prongs of impact, says Neil Linscheid, an extension educator in community economics at the U of M. The first is “direct impact”—spending at the event; the second is “indirect impact,” from business-to-business transactions (in Dorset, that could include vendors buying ingredients for all those pizzas and margaritas). The third is “induced impact,” as the kitchen and wait staff called in to work at Taste of Dorset spend some of their windfall down the street.

Studies of the economic impact of travel and tourism also usually exclude local spending, reasoning that the same money would have been spent locally anyway, just on something else. But we’re not so worried about the tourism part. With festivals such a big part of summer in Minnesota, we were curious about how much people chose to spend on festivals, as opposed to Twins games, golf or going to the mall. We looked at a sampling of festivals between Memorial Day and Labor Day, and tracked at least $66 million.

St. Paul Stories

On the first Sunday in June, traffic shuts down, and 250,000 people descend on St. Paul’s Grand Avenue for Grand Old Day to people-watch, enjoy live bands tucked into parking lots, and graze at some of the 150 food stands along the way. The free event started 40 years ago to raise money for the Grand Avenue Business Association, but the impact goes far beyond the day itself.

Irish Fair of Minnesota

Attendance: 80,00 to 100,000

Food and drink:
$2.4 million (77 percent of attendees spend an average of $34)

$1.1 million (30 percent buy souvenirs at an average of $40 each)

$486,000 (a little more than half pay $10)

$306,000 (2 percent spend an average of $170)

Total spending:
$4.2 million

“We have a lot of businesses that say that their sales spike in June—for the whole month,” says Sue Evens, executive director of the Grand Avenue Business Association. “Not just on Grand Old Day, but even those that are closed on Grand Old Day. They say people come and want to come back.”

More than 73 percent are repeat visitors, Evens says, some from as far away as Wisconsin and the Dakotas, according to a 2006 survey by the Tourism Center at the U of M. A combination of wristband fees to beer gardens, sponsorships and vendor fees raised more than $100,000 for the Grand Avenue Business Association, but the vendors could do pretty well themselves. Three-quarters of the attendees surveyed said they bought something to eat or drink, spending an average of $23.22. Multiply that figure by 0.77 by 250,000, and that translates to $4.3 million.

Another St. Paul tradition, the Irish Fair of Minnesota, brings out a comparatively modest 80,000 to 100,000 people over three days, says Michael Gibbons, president of the fair’s board.

But between watching step-dancing, listening to groups like Gaelic Storm and Boiled in Lead, and admiring men in kilts, about 77 percent of visitors to Harriet Island purchased a pint or something to eat at the fair, according to a 2011 Tourism Center study, spending a average of $34. If we take the midpoint of attendance, 90,000, multiply it by 0.77 by $34, that adds up to $2.4 million.

The Irish Fair has no admission fee, but the survey concluded that patrons would only be willing to pay $5. “We don’t want that admission fee to be a barrier to people coming out,” says Gibbons. “We are about sharing the culture with people. We are not about being a profit-generating organization. We do have bills to pay, so we have to come up with some revenue.” The fair does charge food vendors a fee for their space, and takes a cut of their sales.

0613_10000-festivals_p2.jpgGrand Celebration Powwow
Hundreds of American Indian dancers gather for three days of competition in Hinckley.

In return, the fair’s profits go to support immigrant populations in the community. That’s something Finnegan’s CEO Jacquie Berglund can get behind. Minneapolis-based Finnegan’s is one of three beer options at the fair, along with Harp and Guinness, but Finnegan’s is the only one that donates 100 percent of its profits to organizations that fight hunger. The Irish Fair is the only sponsorship the local brewer buys all year, says Berglund. “It’s a great demographic for us.” And last year Finnegan’s sold 182 kegs over the weekend.

The Tourism Center survey found that three out of 10 fair attendees bought some kind of souvenir, spending an average of $40; that’s another $1.1 million. Add about half the attendees paying $10 for parking, 2 percent paying an average of $170 for lodging, and we’re up to $4.2 million. Now that’s thinking green.

The State of Minnesota has a stake in the success of such events, essentially contributing seed money to a small group of festivals that celebrate the arts and build community. In November the Minnesota State Arts Board awarded nearly $609,000 (some of it state taxpayer money) in grants to 18 groups and 2,700 artists across the state, including $69,000 to the Irish Fair, $59,240 to Twin Cities Pride in Minneapolis, and $40,535 to the Grand Marais Art Colony. The board estimates that 500,000 people participated in the 18 events funded.

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