Economics and operational characteristics of recreational leasing in the Edwards Plateau and Rio Grande Plains of Texas

Abstract

The objectives of this study were to: (1) describe the various types of leasing enterprises in the Rio Grande Plains and Edwards Plateau resource regions of Texas used to market recreational ranch resources, (2) determine the costs and returns of each of the various types of leasing enterprises described, and (3) determine landowner/manager opinion of constraints and values in operating recreational leasing operations. Based on a survey of 89 landowners/managers operating separate hunting lease divisions, 9 types of leasing operations were categorized. Enterprise budgets were determined for 6 randomly selected lease types and 4 case histories of leasing operations. Landowners in these 2 regions of Texas indicated the value of private ownership rights was important but that income from leasing recreational ranch resources was more important. There were other concerns of obtaining quality persons to lease these property rights. There were regional differences as to the reasons for leasing. Biological constraints such as high deer densities in the Edwards Plateau and trophy deer hunting in the Rio Grande Plains influenced leasing in those areas. The most common advertising method used to market hunting was referrals of other hunters to landowners. Eighty-five percent of the divisions within the Edwards Plateau were grouped into 5 types of similar operations and 65% of the divisions in the Rio Grande Plains were clustered in four groups, with about 85% of the variables being similar in both. Break-even cost analyses indicated low-cash costs in most enterprises. However, in most that had negative net incomes, the non-cash cost was related to this loss. High opportunity-grazing costs were a decisive factor in the Edwards Plateau. Deer-proof fencing in some of the case histories contributed to the high depreciation cost. Size of the ranch was the only factor that seemed to affect the gross income.