KITTITAS COUNTY Population Projection Review and Analysis July 22, 2016

KITTITAS COUNTY POPULATION PROJECTION REVIEW AND ANALYSIS

Contents

1.0

Introduction ...................................................................................................................................... 3

2.0

Review of OFM Projections ............................................................................................................... 3

3.0

Analysis of Trends Which may Impact future Population Growth ................................................... 7

3.1

The Emergence of Kittitas County as a Retirement Destination .................................................. 7

3.2

Central Washington University Enrollment .................................................................................. 9

3.3

Access to Water ............................................................................................................................ 9

3.4

Kittitas County Employment Growth .......................................................................................... 11

3.5

Long Distance Commuting .......................................................................................................... 14

3.6

Improvements on I-90................................................................................................................. 20

3.7

Teleworking and Working From Home ....................................................................................... 21

3.8

New Transportation Technologies .............................................................................................. 22

3.9

Impacts of Climate Change on Recreational Activity and Employment ..................................... 22

4.0

Summary of Findings....................................................................................................................... 23

5.0

Proposed Growth Projections for 20-Year Comprehensive Plan Update ....................................... 25

References .................................................................................................................................................. 26

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1.0 INTRODUCTION Kittitas County asked BERK Consulting to review population growth projections provided by the Washington State Office of Financial Management (OFM) and conduct additional research to inform the County’s 20-Year Comprehensive Plan Update, as well as OFM’s next round of projections (expected to be released in 2017). In 2012 OFM released three separate population growth projections for Kittitas County: Low, Medium, and High. The Medium projection is considered to be the most likely outcome based on historic trends. The Washington State Growth Management Act (GMA) requires counties to consider a 20-year population allocation in the range of the Low, Medium, and High projections in their comprehensive plans. BERK’s analysis takes into account newly available Census data on population growth, employment growth, and commuting patterns. It also considers the potential impacts of several issues that could influence net migration to Kittitas County in the future, such as constraints and costs to accessing water for new homes, highway improvements on I-90, growth in telecommuting and long distance commuting, the potential impacts of new transportation technologies, and the predicted impacts of climate change. The findings of this analysis can be used by the County to help select one or more population growth projections for consideration in the 20-Year Comprehensive Plan Update. Due to the level of uncertainty about future growth in the County, BERK recommends that the County consider analyzing two separate alternatives for population growth between the years 2015 and 2037, both within the range of OFM’s projections.

2.0 REVIEW OF OFM PROJECTIONS OFM develops population growth projections for all counties in Washington State. The projections are developed using what OFM describes as a “top-down” method, which begins with statewide projections and then allocates shares of statewide population growth to individual counties. The most recent projections were prepared in 2011 and released in 2012. The general method and assumptions used to develop the county projections are detailed in a 2012 report (OFM, 2012). BERK reviewed this document and interviewed the lead demographer at OFM for additional insights into the specific assumptions used for developing projections for Kittitas County. Below we review the assumptions and data used in OFM’s Kittitas County projects. Exhibit 1 shows Kittitas County Population between 1960 and 2011 along with OFM’s High, Medium, and Low growth projections. The High and Low projections are based on the historical highest and lowest decade migration rates into the county and “on current factors affecting the economic base and attractiveness of specific areas in the state” (OFM, 2012, p. 6). Factors considered in the attractiveness of particular areas include:

•

large metropolitan urban centers with good access to transportation routes;

•

sustained growth due to retirement and telecommuting migration; and

•

large immigrant populations.

The range between Low and High projections for Kittitas is particularly wide, compared to other counties, due to uncertainty with regards to enrollment at Central Washington University.

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KITTITAS COUNTY POPULATION PROJECTION REVIEW AND ANALYSIS

Exhibit 1. Kittitas County Population and Projected Growth

Source: Washington State Office of Financial Management, 2012

Historic and projected rates of average annual population growth are shown in Exhibit 2. OFM’s High projection assumes an average annual growth rate of 2.13% between 2015 and 2037. This is higher than the rate of growth experienced during any period ending in 2015 and roughly equivalent to the fastest period of sustained growth in recent history (1990 – 2010). The OFM Medium projection assumes a growth rate of 1.08%, higher than experienced in the county between 2010 and 2015 (0.84%), but lower than the historic growth rate for all other time periods ending in 2015.

Exhibit 2. Kittitas County Average Annual Rate of Population Growth Period

Average Annual Growth Rate

1960 - 2015 1970 - 2015 1980 - 2015 1990 - 2015 2000 - 2015 2010 - 2015

1.34% 1.15% 1.55% 1.89% 1.65% 0.84%

OFM Projections (2015* - 2037) OFM High OFM Medium OFM Low

Average Annual Growth Rate 2.13% 1.08% 0.00%

* Population growth rates calculated by comparing estimated 2015 population to OFM projected 2037 population. Source: Washington State Office of Financial Management, 2015 and 2012

OFM population projections are based on an analysis of three components of change: births, deaths, and migration. Exhibit 3 shows estimates for each component between the years 1960 and 2015. While 8/3/2016

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KITTITAS COUNTY POPULATION PROJECTION REVIEW AND ANALYSIS

births and deaths have remained fairly stable, net migration has been quite volatile and reflects periods of statewide economic growth and recession.

Exhibit 3. Kittitas County Components of Population Change, 1960 - 2015

Source: Washington State Office of Financial Management, 2015

Exhibit 4 summarizes the same components of change by 5-year intervals and also includes OFM’s Medium Projection for births, deaths, and net migration through 2040. It shows the number of deaths increasing over time at a rate slightly higher that births, reflecting the aging of population anticipated in the county and state. Net migrations are projected to increase significantly between 2015 and 2020, then level off at approximately 2,000 per 5-year interval or 400 per year. According to OFM (2012, p. 8), counties are projected to see positive net migration if they: • • •

have large amounts of employment; serve as a retirement destination; or serve as a bedroom community for an employment center.

Kittitas County has moderate to low employment compared to other counties and is neither considered a retirement destination nor bedroom community in OFM’s projection model. A major factor OFM considers in determining net migration for Kittitas is historic trends. OFM’s projected rate of migration from 2020-2040 is slightly higher than the county average between 1980 and 2015, but lower than experienced between 1990 and 2015. Overall, year-over-year population growth is expected to slowly diminish after 2025 due to the increasing death rate associated with an aging baby-boomer population.

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Exhibit 4. Components of Change: Historic and OFM Medium Projection

Source: Washington State Office of Financial Management, 2012 and 2015

Exhibit 5 compares estimated change in population between 2010 and 2015 to the change that had been projected by OFM in 2012. Estimated population growth slightly exceeded the Medium projection, but fell far short of the High projection. Comparison of components of change indicate that the majority of difference can be attributed to natural increases in population (births – deaths) exceeding projections.

Exhibit 5. Kittitas County Population Change and Components of Change, 2010 - 2015

Net Migration Births Deaths Total Change

Estimated 1,101 2,021 1,367 1,755

Medium Projection 1,072 2,114 1,509 1,677

High Projection

Low Projection

Components of change not provided for High and Low projections.

6,843

-877

Note: OFM only provides components of change for the Medium Projection. Source: Washington State Office of Financial Management, 2015 and 2012

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3.0 ANALYSIS OF TRENDS WHICH MAY IMPACT FUTURE POPULATION GROWTH 3.1

The Emergence of Kittitas County as a Retirement Destination

The population of Washington State is projected to get older over the coming decades as the baby boomer generation enters their retirement years. This trend will impact Kittitas County as its current population ages. One key uncertainty with regards to population projection is the number of new retirees who will choose to move to Kittitas County in the coming years. The ongoing development of Suncadia and other new rural communities marketed towards retirees could result in population growth and demographic changes that differ from historic trends. Between 2008 and November 2015, 319 permits have been issued for new single family homes in the Suncadia resort. Suncadia’s managing director guesses that only about 50 homes in the resort are occupied by full time residents. He presumes that most of those are retired couples or people who can work from home most of the time. The majority of housing units in Suncadia are used as second homes. These may be seasonal residences, vacation homes, rental properties, or some combination of the three. Anecdotally, he has heard from a number of buyers that they are planning to retire in Suncadia full time in the coming years and in the meantime will use it as a seasonal or vacation getaway. OFM’s Medium projection does already anticipate significant growth in population of those over 65 due primarily to the aging of the current population. Exhibit 6 shows the age distribution 1 of Kittitas County in 2000 and 2010 compared to the distribution projected by OFM for 2035. It shows a significantly larger share of people 75 years or older as well as growth in share among those aged 65-74.

Exhibit 6. Kittitas County Age Distribution: Historic and OFM Medium Projection

Source: U.S. Census Bureau 2000 and 2010; Washington State Office of Financial Management 2012

1

Note that this chart compares the percentage share distribution of age group across three different years. It does not compare the total population within each age group. So, for instance, OFM’s projections assume the total number of people age 45-54 will continue to grow. However the percentage share of this age group among the total population is expected to decline.

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KITTITAS COUNTY POPULATION PROJECTION REVIEW AND ANALYSIS

Census data provides some limited insight into the number of residents who may be retired. While the Census does not directly ask whether or not an individual is retired, it does provide statistics regarding the percentage of total population age 16 or older who are in the labor force. This includes people who are employed, unemployed, or in the military. People who are not seeking work, such as those who are retired or full time students, are considered by the census to not be in the labor force. Therefore Census data about employment status mixes two important groups in Kittitas County: Retirees and college students. Exhibit 7 compares Kittitas County and Washington State as a whole with regards to the share of total adult (16 and over) population who are not in the labor force. Both show an increase between 2000 and 2013, with Kittitas County starting and ending with a greater share than statewide. Additionally, the total percentage change in share between the two dates reveals that Kittitas County’s population not in the labor force is growing faster than it is statewide (7.5% change compared to 4.2% change). This could mean that Kittitas County is attracting more new retirees than the statewide average. Or the growth could be due to full-time enrollment at Central Washington University.

Exhibit 7. Share of Population Age 16 and Older Not in the Labor Force 2000 2009 - 2013 Percentage change in share of total adult population

Kittitas County 37.7% 40.5%

Washington State 33.5% 34.9%

7.4%

4.2%

Source: U.S. Census Bureau, 2000 and American Community Survey 5-Year Estimate, 2009 – 2013

In order to isolate the population who are most likely to be retirees, BERK obtained historic full-time enrollment counts from Central Washington University (CWU). The findings are shown in Exhibit 8. Subtracting full-time CWU student enrollment from the total population of those not in the labor force results in a count of individuals who are more likely to describe themselves as “retired”. Full-time enrollment at CWU as a percentage share of total adult population in Kittitas County did not change significantly between 2000 and 2013. However there was significant growth in the remaining, potentially retired population. As a share of total adult population this group grew from 10.3% to 13.2%.

Exhibit 8. Breakdown of Kittitas County Population Not in the Labor Force 2000 Count Total population age 16 and older Not in labor force Full-time CWU students* Other not in labor force

27,431 10,348 7,529 2,819

2013

Percent of total

Count

Percent of total

37.7% 27.4% 10.3%

34,666 14,030 9,458 4,572

40.5% 27.3% 13.2%

* Note: Data for 2000 was not available. 2001 enrollment counts used as a proxy. Source: U.S. Census Bureau, 2000 and American Community Survey 5-Year Estimate, 2009 – 2013; Central Washington University 2015

These findings indicate that the retirement population in Kittitas County is likely to be growing at a rate faster than Washington State as a whole. However, the 2012 OFM projections do not assume that Kittitas County will be a destination for an increasing number of new retirees (Zhao, 2015). OFM maintains a list of rural counties assumed to be retirement destinations and Kittitas County is not included. OFM may wish to reconsider this assumption in light of recent trends.

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There remains a great deal of uncertainty regarding Kittitas County’s retirement population in the longer term. The lead demographer at OFM shared that their statewide analysis shows the possible beginning of a trend towards more retirees living in large cities rather than moving to rural areas (Zhao, 2015). Furthermore, OFM projections assumes that as the baby boomer generation ages, “retirement migration to rural counties, for economic and quality of life reasons, may decline as the oldest old return to metro areas for better social and health services” (OFM, 2012, p. 11).

3.2

Central Washington University Enrollment

Central Washington University (CWU) tracks and forecasts student enrollment counts at its Ellensburg Campus. In fall 2015 there were 9,656 students on campus according to CWU records. On-campus student enrollment has grown by just over 1% annually since 2008, the first year for which data is available. This is similar to the rate of population growth county-wide during the same period. CWU enrollment analysts anticipate some short and medium term growth in enrollment followed by campus enrollment counts plateauing around 11,000 students (Matthews, 2015). There are a few factors that contribute to this conclusion about future enrollment. First is data from OFM indicating that growth in high school aged population in Washington State will decline in years to come. Secondly, there is increasing competition in higher education from new online degree programs as well as new public and private university campuses. Another source of uncertainty regarding the role that CWU will play in driving county-wide population growth is the percentage of graduating students who will choose to stay in the county after completing their degree. Unfortunately data about retention of university students in the county after graduation is not available. So there is little basis available for projecting future trends. According to OFM, this uncertainty over future CWU enrollment is reflected in the relatively wide range between the OFM High and OFM Low projections (OFM, 2012).

3.3

Access to Water

In 2011, the Washington State Legislature passed the Upper Kittitas Water Rule (effective 1/22/2011) which withdraws from appropriation all unappropriated groundwater within upper Kittitas County pending completion of a groundwater study. This rule limited all new groundwater withdrawals to those that are water budget neutral. Therefore property owners wishing to drill a new well would have to purchase water from a water bank within the same basin. This significantly raised the cost of providing water to new homes and commercial establishments located outside of areas served by existing water systems. This rule and those issued subsequently have the potential to shape the pattern of new development in Kittitas County and potentially impact countywide population and employment growth. To better understand the impacts of water restrictions to date in Kittitas County, BERK first analyzed unincorporated permit activity within the Upper County Moratorium Area impacted by the January 2011 rule. Exhibit 9 summarizes all residential units permitted between 2008 and 2015 and breaks them down as being located inside or outside of an existing water system. 2 As expected, total permit activity dipped in 2009 and 2010 reflecting the impacts of the economic recession. This same period showed a dip in the percentage of all units permitted that are within a water system, with a low of 46% in 2009. In 2011 the total number of units permitted started to increase, despite the passage of the Upper Kittitas Water Rule. However, 66% of these permitted units were inside a water system. From 2011 through

2

Included as existing water systems are water districts and Group A water systems. UGAs are also included based on the assumption that new development in these areas is served by the city or another water system.

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KITTITAS COUNTY POPULATION PROJECTION REVIEW AND ANALYSIS

2015 the share of permitted units inside water systems stays fairly constant. The total amount of permit activity increases significantly during this same period.

Exhibit 9. New Residential Units Permitted Within the Upper County Moratorium Area (Excludes permits in cities)

* 2015 reflects permit activity through November 24. Source: Kittitas County, 2015 (data); BERK, 2015 (analysis)

These findings indicate that there is no evidence that total permit activity in the Upper County was negatively impacted by the 2011 rule. However it is also important to compare Upper County permit activity to permit activity countywide to understand whether upper county permitting kept pace in recent years. Exhibit 10 breaks down all new residential units permitted by area of county: Upper County and Lower County. Between 2010 and 2012, the Upper County share of permitted units rose from 45% to 71%. This percentage remains near 70% until 2015 when it dips to 61%. Once again, it appears that the 2011 rule did nothing to negatively impact permit activity in the Upper County. Looking to the future, it is unclear if the 2011 rule and subsequent restrictions on groundwater withdrawals will negatively impact development activity or influence development patterns significantly. Unfortunately, there are not enough years of data available to get a full picture of permitting trends before the 2011 rule. Most of the permits prior to 2011 were issued during a significant downturn in the housing market and therefore may not reflect trends prior to 2008. The limited data available indicates that there is a possibility the 2011 rule resulted in shifting more permit activity to areas within water systems. But it is also possible that this shift is simply explained by the tremendous amount of recent development occurring in Suncadia (a master planned development with its own water district). Furthermore, the County indicates an intent to develop an Upper County water bank which will provide water to new rural homes built by individuals at a reduced cost compared to currently available options. 3 This could lower the cost of housing development in some Upper County areas.

3

This water bank will serve select areas of the Upper County eligible for mitigation. See https://www.co.kittitas.wa.us/health/programs/environmental-health/water-resources.aspx for more information.

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KITTITAS COUNTY POPULATION PROJECTION REVIEW AND ANALYSIS

Exhibit 10. New Residential Units Permitted by Area of County (Excludes permits in cities)

* 2015 reflects permit activity through November 24. Source: Kittitas County, 2015 (data); BERK, 2015 (analysis)

While short-term impacts appear unlikely, this may change in the longer term. Kitsap County Community Development staff indicate that restrictions on water access will intensify after 10 years when existing mitigation measures are evaluated for their effectives. Therefore it may be wise for the County to examine a future growth scenario that includes significantly less rural home development and more consolidation in cities, LAMIRD, and master planned resorts with ample water availability.

3.4

Kittitas County Employment Growth

Employment growth or loss can be a driver of population change. Exhibit 11 shows total non-farm employment inside Kittitas County between 2000 and 2014. Employment was growing at a rate of 2.5% between 2000 and 2008. The County then suffered job losses during the recession in 2009. Since then job growth has been stagnant or slow. In 2014 employment finally reached the level it had been in 2008. During the entire period employment grew at an average annual rate of 1.4%.

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KITTITAS COUNTY POPULATION PROJECTION REVIEW AND ANALYSIS

Exhibit 11. Kittitas County Total Non-Farm Employment, 2000 - 2014

Source: Washington Employment Security Department, U.S. Bureau of Labor Statistics, 2015

The sectors with the fastest average annual growth rates between 2000 and 2014 were Leisure and Hospitality (2.52%), Education and Health Services (2.04%), and State and Local Government (1.61%). The continued development of the Suncadia Resort outside of Cle Elum has likely been one important driver of growth in the Leisure and Hospitality sector. The sectors with the greatest loss in share of total employment were Transportation, Warehousing, and Utilities (-2.46%); and Manufacturing (-0.74%), a sub-category of “Goods Producing.” Exhibit 12 shows Kittitas County monthly employment data for the past three years. It shows significant growth has occurred since October 2014. Exhibit 13 compares average annual growth rates by sector for the 2000-2014 period to those during the past year (September 2014 – September 2015) as well as growth rates projected by ESD for the 2013 – 2018 period 4. During the past year, total nonfarm employment in Kittitas County grew by 12.1%, with the fastest growth in State and Local Government Education (26.2%), and Leisure and Hospitality (22.1%) sectors. For many sectors, these rates of growth are significantly higher than those experienced during the previous 14 years and those projected by ESD. It is possible some of the growth in Leisure and Hospitality jobs was due to the wildfires in neighboring Chelan and Okanogan Counties causing tourists to shift their travel plans to Kittitas County (Meseck, 2015). It is unclear whether this recent growth represents a temporary bump or a sign of continued growth in the years to come.

4

ESD projections are for the South Central region of Washington State which includes Kittitas, Yakima, Klickitat, and Skamania Counties.

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KITTITAS COUNTY POPULATION PROJECTION REVIEW AND ANALYSIS

Exhibit 12. Kittitas County Monthly Non-Farm Employment, 2013 – September 2015

Source: Washington State Employment Security Department, Labor Market and Performance Analysis, 2015

Exhibit 13. Kittitas County Average Annual Percent Change in Employment by Sector

Employment Sector Total Nonfarm Total Private Goods Producing Mining, Logging, and Construction Manufacturing Service-Providing Trade, Transportation, and Utilities Wholesale Trade Retail Trade Transportation and Warehousing Information and Financial Activities Professional and Business Services Education and Health Services Leisure and Hospitality Government Federal State and Local Government State and Local Gov. Education

2000-2014

Sept. 14 Sept. 15 *

1.42% 1.36% 0.91% 2.32% -0.74% 1.46% 0.12% 1.37% 0.18% -2.46% 2.41% 2.73% 2.04% 2.52% 1.51% -1.78% 1.61% 1.55%

12.10% 9.40% 0.00% -2.10% 3.60% 13.50% 5.00% 5.60% 3.80% 12.50% 5.80% 17.20% 3.60% 22.10% 16.80% 12.50% 17.00% 26.20%

ESD Projections 2013-2018 1.84%

2018-2023 1.32%

1.89% 1.61%

0.00% 0.76%

1.37%

0.95% 1.05% 0.89% 1.03% 0.43% 2.23% 1.89% 1.38% 1.25% 0.00% 1.21% 1.41%

1.89% 1.10% 1.66% 0.00% 1.39% 3.59% 2.07% 1.09% -1.28% 1.29% 1.20%

* ESD has not released seasonally adjusted 2015 employment counts that are comparable to the 2000-2014 data. Therefore growth rates are calculated separately for this one year period. Source: Washington State Employment Security Department, Labor Market and Performance Analysis, 2015

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3.5

Long Distance Commuting

A significant percentage of working Kittitas County residents are employed outside of the county. Exhibit 14 shows the job location of Kittitas County residents. 5 The share of working Kittitas County residents whose primary job location is inside Kittitas County declined significantly between 2002 and 2012, from 69.8% down to 53.8%. In 2013, the most recent year for which data is available, the share rose slightly to 54.4%. While it is likely not all of those working outside of the county commute to their job site every day, many of them do. Given the number of residents working outside of the county, it is worth considering whether growth in long distance commuting is a trend that could impact future population growth in Kittitas County.

Exhibit 14. Primary Job Location of Employed Kittitas County Residents, Share of Total

Source: U.S. Census Bureau, Center for Economic Studies, 2015

Exhibit 15 maps the primary job location of employed Kittitas County residents in 2012. Large clusters can be seen in the Seattle area and Yakima. According to the U.S. Census, over 33% of employed Kittitas County residents commuted over 50 miles to their job location. Exhibit 16 shows total counts of Kittitas County residents who work outside of Kittitas County. Over half of these workers are employed in Yakima and King Counties. The number of workers commuting to these two counties also increased significantly between 2006 and 2011.

5

Note that the Census employment data shown in Exhibit 14, Exhibit 15, and Exhibit 16 do not include selfemployed individuals as well as those who are not covered by unemployment insurance.

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KITTITAS COUNTY POPULATION PROJECTION REVIEW AND ANALYSIS

Exhibit 15. Primary Job Location of Employed Kittitas County Residents, 2012

Source: U.S. Census Bureau. 2015. OnTheMap Application. Longitudinal-Employer Household Dynamics Program. http://onthemap.ces.census.gov/

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KITTITAS COUNTY POPULATION PROJECTION REVIEW AND ANALYSIS

Exhibit 16. Kittitas County Residents Who Work Outside Kittitas County

Source: U.S. Census Bureau, Center for Economic Studies, 2015

The large number of commuters to Yakima County is not surprising given the proximity of the city of Yakima to Ellensburg. Employment centers in King County, however, are a fairly long drive from Kittitas County. Google Maps estimates the duration of a drive from Cle Elum to Bellevue is 1 hour and 20 minutes without considering traffic. The following section examines long-distance commuting to King County in more detail.

Profile of Long Distance Commuters to King County In 2013, 2,232 Kittitas County residents were employed in King County, about 16% of all employed residents counted by the Census. Of these Kittitas County residents, just over half live in cities and other Census Defined Places (CDP). The remainder live in other rural parts of the county.

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KITTITAS COUNTY POPULATION PROJECTION REVIEW AND ANALYSIS

Exhibit 17 breaks down these residents by their home location. Among cities and places, the largest share live in Ellensburg. Far fewer live in upper county locations that offer a shorter commute. In fact, the fastest growing area of Upper Kittitas County – Suncadia – has only eight workers who commute to King County. Among those who do not reside in cities or CDPs, only about half (573) reside in the northwestern half of the county, less than would be expected given the proximity to King County.

Exhibit 17. Kittitas County Residents Who Work in King County, By Home Location City / Place Ellensburg (city) Cle Elum (city) Roslyn (city) Kittitas (city) Easton (CDP) South Cle Elum (town) Snoqualmie Pass (CDP) Thorp (CDP) Ronald (CDP) Vantage (CDP) Suncadia (resort) Remainder of County Total

Count of residents employed in King County 744 132 79 72 32 29 24 24 21 4 8 1,063 2,232

Source: U.S. Census Bureau, Center for Economic Studies, 2015

As shown previously in Exhibit 16, the number of Kittitas County residents working in King County rose slowly and steadily from 1,485 to 1,632 between 2002 and 2006. Then, after a small decline, the number jumped to 2,241 between 2007 and 2009 (42% growth over two years). Since 2009 the number of people working in King County has stagnated, ending slightly lower at 2,232. One possible explanation for the rise between 2007 and 2009 was that it roughly corresponded to a period of job losses in Kittitas County. Perhaps workers in Kittitas County were forced to look further afield for employment after losing their jobs closer to home. As shown in Exhibit 11, Kittitas County employment rose only slightly (50 jobs) between 2007 and 2008, then declined by 680 jobs between 2008 and 2009. Employment inside Kittitas County then levels off between 2009 and 2013, mirroring the leveling off of Kittitas County residents commuting to King County for work. This pattern supports the hypothesis that growth in long-distance is inversely related to employment inside the county of residence. If true, we could expect growth in long distance commuting to King County only during periods of job losses in Kittitas County. One way to test this hypothesis is to break down employment by sector. If the new commuters to King County are working in the same sectors that experienced job losses in Kittitas County, it may be the case that at least some of those workers in Kittitas County subsequently found new work in King County. Exhibit 18 shows the breakdown of King County long distance commuters by three broad employment categories. 6 This chart shows that the category with the greatest job growth is “Other” which includes service sector jobs that are not trade related such as retail (see the key below the chart for details). Exhibit 19 shows the same breakdown of employment by three categories inside Kittitas County. In this chart we see only a small decline in the “Other” category between 2008 and 2009 amidst a period of fairly steady job growth. The only category showing sustained job losses in Kittitas County during the 2007 to 2009 period is “Goods Producing,” which, includes manufacturing and construction. During the 6

The Census only published data about place of work broken down into these three categories.

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KITTITAS COUNTY POPULATION PROJECTION REVIEW AND ANALYSIS

same period there were moderate gains in workers commuting to King County for goods producing jobs. Overall, however, there is not a strong match between job sectors with losses in Kittitas County and the job sectors with the greatest gains among commuters to King County. This finding does not support the hypothesis that job losses in Kittitas is a primary driver of long-distance commuting to King County.

Exhibit 18. Kittitas County Residents With Primary Jobs in King County (by category of employment)

Key: Goods producing: Agriculture; Forestry, Fishing and Hunting; Mining Quarrying and Oil Gas Extraction; Construction; Manufacturing TT&U (Trade, Transportation, and Utilities): Wholesale Trade; Retail trade; Transportation and Warehousing; and Utilities Other: Information; Finance and Insurance; Professional, Scientific and Technical Services; Management of Companies and Enterprises; Administrative and Support and Waste Management and Remediation Services; Educational Services; Arts, Entertainment, and Recreation; Accommodation and Food Services; Other Services (except Public Administration); and Public Administration Source: U.S. Census Bureau, Center for Economic Studies, 2015

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KITTITAS COUNTY POPULATION PROJECTION REVIEW AND ANALYSIS

Exhibit 19. Employment in Kittitas County, by Category

Source: Washington Employment Security Department, U.S. Bureau of Labor Statistics, 2015

Another possible explanation for growth in long-distance commuters is the large number of baby boomers approaching their retirement years. Perhaps some have moved away from the city but still work part time and only occasionally need to commute to the their workplace in King County. To explore this hypothesis, Exhibit 20 breaks down long distance commuters to King County by three age groups. Much of the growth that occurred between 2007 and 2009 was among workers age 30 to 54. There has been more modest growth in the 55 and older group. Therefore it seems pre-retirement baby boomers may not be a major driver of growth in long-distance commuting to Seattle.

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KITTITAS COUNTY POPULATION PROJECTION REVIEW AND ANALYSIS

Exhibit 20. Kittitas County Residents Working in King County, by Age Group

Source: Washington Employment Security Department, U.S. Bureau of Labor Statistics, 2015

Census data about the workplace location of Kittitas County residents is only available through the year 2013. As shown previously in Exhibit 12, employment has grown significantly inside Kittitas County since late 2014. While no data is available to directly measure the impact of this job growth on long-distance commuting to King County, analyzing traffic data on I-90 provides a very rough proxy for measuring the volume of commute activity between the two counties. This topic is analyzed in the following section.

3.6

Improvements on I-90

I-90 is a major transportation corridor connecting Kittitas County with King County and the Central Puget Sound Region. Washington State Department of Transportation (WSDOT) is currently improving and expanding 15 miles of the highway just east of Snoqualmie Pass between Hyak and Easton. The purpose of this project is to decrease the likelihood of congestion and delays due to avalanche, rock slides, rough pavement, and wildlife collisions. The project also increases capacity to accommodate projected traffic growth (WSDOT, 2008). These reliability improvements could potentially increase the attractiveness of western Kittitas County for commuters to Seattle and the central Puget Sound region. The average daily traffic volumes projected by WSDOT in the 2008 Environmental Impact Statement (EIS) (WSDOT, 2008) include the assumption that traffic volumes will increase on average 2.1% per year. According to the EIS, this assumption is based on historic growth in traffic volumes. It includes no mention of increased demand for travel that could be created by the improvements to I-90. Exhibit 21 compares WSDOT’s projected average daily traffic volumes to traffic count data published in WSDOT’s Annual Traffic Reports (WSDOT, 2015). It shows that over the past eight years traffic volumes have grown more slowly than had been projected by WSDOT. Between 2007 and 2015 WSDOT projected an average annual growth rate of 2.3%. From 2007 to 2014 the actual average annual growth rate was 0.5%.

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Exhibit 21. I-90 Average Annual Daily Traffic (Snoqualmie Pass East Project Area)

Source: (WSDOT, 2008; WSDOT, 2015)

Only limited insights can be drawn from Exhibit 21. One is that traffic on I-90 has remained fairly flat over the last 8 years. Traffic volumes actually dipped slightly between 2007 and 2008 when employment data indicated that commuting to King County was on the rise. However any gains in commuting could have easily been offset by losses in other commercial traffic due to the downturn in the economy during the same period. Overall, the most notable finding is that annual average daily traffic has not increased at the rate that had been projected by WSDOT. It remains to be seen whether this trend will change following the completion of the improvements to I-90.

3.7

Teleworking and Working From Home

Technological advancements are enabling more people to work out of their own homes. People working from home may be self-employed or they may be taking advantage of more flexible workplace policies such as allowing workers to telecommute one or more days per week. As teleworking has become more widespread it is worth considering the historic and potential future impacts on population growth in locations just outside of major metropolitan regions. As the analysis of long-distance commuter indicates, there are a large number of people who may be commuting long distances from Kittitas County to the Seattle region. It is possible the availability of increased telework options has made this lifestyle choice more desirable or at least feasible by reducing the number of days per week which the long distance commute is required. Therefore analyzing trends with regards to teleworking could help shed light on future population change in Kittitas County. Unfortunately, data about teleworking is limited. The American Community Survey asks respondents the question “What was your primary means of transportation during the survey week?” One of the choices is “Worked at home”. This question captures people who work from home full time or at least the majority of days. It does not capture people who telework just 1 or 2 days per week.

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KITTITAS COUNTY POPULATION PROJECTION REVIEW AND ANALYSIS

Exhibit 22 compares means of transportation to work from Census 2000 to the 2013 American Community Survey. It shows that the percentage of workers who worked at home declines from 5.7% in 2000 to 5.4% in 2013. In Washington State as a whole, this percentage grew from 3.3% to 4.3% during the same period. These findings indicate that full-time teleworking and working from home are not trends that appear to be on the rise in Kittitas County.

Exhibit 22. Kittitas County: Primary Means of Transportation to Work 2000

Workers 16 years and over Car, truck, or van – drove alone Car, truck, or van – carpooled Public transportation (excluding taxicab) Walked Other means Worked at home

2013 (5-year estimate)

Total

Percent of total

Total

Percent of total

15,209 10,410 2,166 79 1,242 443 869

100% 68.4% 14.2% 0.5% 8.2% 2.9% 5.7%

18,203 13,087 1,769 165 1,498 694 990

100% 71.9% 9.7% 0.9% 8.2% 3.8% 5.4%

Source: U.S. Census Bureau, 2000 and American Community Survey 5-Year Estimate, 2009 – 2013

3.8

New Transportation Technologies

The next 20 years may reveal big changes in how people commute from home to workplaces. One change on the horizon is autonomous vehicles, such as the self-driving cars currently being tested by Google. In 2013 the National Highway Traffic Safety Administration issued a statement of policy acknowledging the significant impacts that automated cars are likely to make within the next 10 to 20 years (NHTSA, 2013). However, the nature and timing of these impacts is still unclear given uncertainties regarding how these new technologies will be regulated and the pace of widespread adoption. Policy analysts interested in the impacts of these technologies on land use and development often describe two potential outcomes which are not mutually exclusively. One is the intensification of development in urban centers. In this scenario, self-driving cars drop off riders at their point of destination and then drive off to a peripheral parking lot or to pick up another rider. This greatly reduces the amount of parking needed in the densest urban areas and potentially frees up land currently used for parking to be put to higher use (Anderson et al., 2014; Litman, 2015). The second potential outcome is an increase in demand for homes at the periphery of urban regions as self-driving cars make long commutes less stressful and potentially enable travelers to use their time productively on tasks other than driving (ibid). This scenario, if realized, could potentially impact population and land use in Kittitas County. However, restrictions on water availability in rural areas closest to King County could mitigate these impacts significantly.

3.9

Impacts of Climate Change on Recreational Activity and Employment

Snoqualmie Pass is an area of Kittitas County that is relatively low in full-time population but receives an influx of recreational visitors and seasonal employees during ski season every winter. The winter of 2014/2015 had the lowest snowfall on record (WSDOT, 2015), forcing the Snoqualmie Summit ski area to close in February. An analysis of the impacts of climate change on Washington’s economy predicts that the probability of this kind of “warm winter” event at Snoqualmie Pass will rise considerably. Between 1971 and 2000, there was a 0.27 probability of winters included at least one month where temperatures stayed above freezing. Scientists predict this probability will rise to between 0.43 and 0.53

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KITTITAS COUNTY POPULATION PROJECTION REVIEW AND ANALYSIS

during the next 20 years 7 (Washington State Department of Ecology, 2006). The increased probability of such events will likely have a dampening impact on employment and recreational visitors in the winter months. It may also reduce demand for new construction of seasonal use homes in the Snoqualmie Pass area. However it is difficult to project the precise effect of these climate impacts on population and housing trends. Climate change will also increase the likelihood of wildfires in the forested areas of Kittitas County. The Department of Ecology (2006, p. 30) predicts that “[t]he full range of economic impacts of wildfire, including lost timber value, lost recreational expenditures, and health and environmental costs related to air pollution and other forest changes, could be many times larger than the preparedness and control costs [associated with firefighting and prevention]”. Such impacts could reduce growth in recreational jobs and potentially diminish demand for housing and population growth in forested areas.

4.0 SUMMARY OF FINDINGS Exhibit 23 provides a summary of trends that could impact future population growth in Kittitas County. Trends that could positively impact future population growth compared to OFM Medium projections are symbolized with an upward arrow. Trends that may diminish the rate of population growth compared to the OFM Medium projection are symbolized with a downward arrow. Trends that seem unlikely to impact population growth compared to the OFM Medium projection are symbolized with sideways arrows. Bolder arrow indicate a higher degree of certainty regarding likelihood of impact. Lighter dashed arrows are used for trends where there is much less certainty regarding likelihood of impact.

Exhibit 23. Summary of Trends that Could Impact Future Population Growth Trend / Forecast

Consideration in OFM’s 2012 projections

Retirement in-migration: Share of adult population not in workforce is growing at a rate faster than the state as a whole.

OFM migration projections do not treat Kittitas County as a retirement destination.

Continued in-migration of retirees could boost projections slightly. Long-term impact may be most pronounced in Suncadia and similar developments.

CWU enrollment: Forecast for short-term growth followed by plateauing campus student enrollment.

Uncertainty with regard to future enrollment is reflected in the wide range between high and low projections.

Slowing or stagnant growth in student enrollment may be contrary to OFM assumptions and could slightly reduce countywide growth and Ellensburg’s share of countywide growth in years to come.

Magnitude and geographic scope of impact

Likely direction of impact (compared to OFM Medium)

Positive impact

Possible negative impact

7

The report, written in 2006, indicates probability will rise to 0.43 given average winter temperature change projected for the 2020’s and 0.53 given temperature change projected for the 2040’s.

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KITTITAS COUNTY POPULATION PROJECTION REVIEW AND ANALYSIS

Trend / Forecast

Water restrictions: No evidence of short-term impacts. But longer-term impacts on rural development more likely. County employment: Beginning in 2014 there has been rapid growth exceeding short-term forecasts.

Consideration in OFM’s 2012 projections

Magnitude and geographic scope of impact

Likely direction of impact (compared to OFM Medium)

Not considered

Unclear. Longer-term impact most likely in rural areas not served by water systems with sufficient water rights.

Possible negative impact

Short-term employment forecasts considered by OFM.

It is unclear whether recent growth will persist. Longer-term historic trend has been moderate employment growth at a rate similar to population.

Uncertain

Not considered

Historic employment trends alone do not clearly indicate this factor will influence future population growth. However other trends (see below) may make long-distance commuting more attractive.

Possible positive impact, high uncertainty

I-90 improvements: Potential increased reliability for travel across Snoqualmie Pass. However, historic traffic volumes indicate very slow growth in demand for travel.

Not considered

Magnitude uncertain. Improvements may make long-distance commuting from Kittitas a more attractive option, particularly when paired with the emergence of new transportation technologies (see below).

Possible positive impact, high uncertainty

Teleworking: No growth in share of workers who work from home.

Considered by OFM.

No impact projected.

Not considered

Magnitude of impact uncertain. Most likely to impact areas in Upper Kittitas County.

Possible positive impact, high uncertainty

Not considered

Impacts may be limited to vacation home construction near Snoqualmie Pass and seasonal employment.

Possible negative impact, high uncertainty

Long-distance commuting: No growth in commuters to King County from 2009 to 2013, following period of growth.

New transportation technologies: Availability of self-driving vehicles may increase demand for homes further from employment centers in King County. Impacts of climate change: Higher probability of wildfires and “warm winter” events.

None.

Source: BERK 2015

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There is still a high level of uncertainty with regards to the precise magnitude of impact that each of these trends might have on future population growth. Therefore trying to quantify those impacts individually is unadvisable. Instead we suggest that the potential impacts of these trends should be considered in aggregate when selecting two or more population growth scenarios to test in the 20-Year Comprehensive Plan Update.

5.0 PROPOSED GROWTH PROJECTIONS FOR 20-YEAR COMPREHENSIVE PLAN UPDATE Given the uncertainty about the many factors which could shape future population growth in Kittitas County over the next 20 years BERK suggests using the Comprehensive Plan Update to test the impacts of two separate population growth scenarios, as shown in Exhibit 24. The first scenario (“Moderate Growth”) would maintain OFM’s Medium projection. This would represent a moderate pace of growth, slightly lower than experienced over the past few decades. This scenario may represent the combined longer-term impacts of water use restrictions and flat or declining CWU enrollment. The second scenario (“Higher Growth”) would adopt OFM’s High projection. In this scenario growth exceeds historic trends. The rate of growth is roughly equivalent to the fastest period of growth in recent history (1990 – 2010). Therefore it is not inconceivably out of reach given possible drivers of growth identified in this study. A third scenario (“Trend Growth”) is provided for comparison. This shows projected population using the average annual growth rate between 1990 and 2015.

Exhibit 24. Proposed Population Growth Scenarios

Moderate Growth (OFM Medium) Trend Growth Higher Growth (OFM High)

Population Growth 2015 - 2037 11,331 21,738 25,116

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Total Population 2037 54,001 64,408 67,786

Average Annual Growth Rate 2015 - 2037 1.08% 1.89% 2.13%

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KITTITAS COUNTY POPULATION PROJECTION REVIEW AND ANALYSIS

REFERENCES Anderson et al. (2014). Autonomous Vehicle Technology: A Guide for Policymakers. The RAND Corporation. Retrieved from http://www.rand.org/content/dam/rand/pubs/research_reports/RR400/RR4431/RAND_RR443-1.pdf Litman, T. (2015). Autonomous Vehicle Implementation Predictions Implications for Transport Planning. Victoria Transport Policy Institute. Retrieved from http://www.vtpi.org/avip.pdf Matthews, D. (2015, November 24). Director of Analytics and Research, Central Washington University (Personal communication). Meseck, D. W. (2015). Kittitas County Labor Area Summary September 2015. Employment Security Department. NHTSA. (2013). Preliminary Statement of Policy Concerning Automated Vehicles. National Highway Traffic Safety Administration. Retrieved from http://www.nhtsa.gov/staticfiles/rulemaking/pdf/Automated_Vehicles_Policy.pdf OFM. (2012). 2012 Projections: County Growth Management Population Projections by Age and Sex: 2010-2040. Retrieved from http://www.ofm.wa.gov/pop/gma/projections12/GMA_2012_county_pop_projections.pdf Washington State Department of Ecology. (2006). Impacts of Climate Change on Washington's Economy: A Preliminary Assessment of Risks and Opportunities. Retrieved from https://fortress.wa.gov/ecy/publications/publications/0701010.pdf WSDOT. (2008). I-90 Snoqualmie Pass East Project Final Environmental Impact Statement. Washington State Department of Transportation. Retrieved from http://www.wsdot.wa.gov/Projects/I90/SnoqualmiePassEast/Finaleis WSDOT. (2015). Annual Traffic Report. http://www.wsdot.wa.gov/mapsdata/travel/annualtrafficreport.htm

Retrieved

from

WSDOT. (2015). Snoqualmie Pass Monthly and Seasonal Totals and Averages. Retrieved from http://www.wsdot.com/winter/files/HistoricalSnowfallData1415season.pdf?v=16 Zhao, Y. (2015, December 1). Chief Demographer, Washington State Office of Financial Management (Personal communication).

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