Title Baileys Trail System
Country/Location U.S.
Size $500k
Revenue Model Not for Profit business providing recreational products and services to visitors
Private Investment/Finance Structure Revenue Sharing Agreement with impact investors
Public/Philanthropic Investment $11m state and local public funds
Env/Social Impact Mine land restoration, public access to outdoor recreation, eco-recreation tourism, local job retention and creation


Quantified Ventures has worked with several government bodies to help fund the Baileys Trail System – an 88-mile mountain bike trail through the Wayne National Forest in Southern Ohio, USA. The firm’s original intention was to build a Pay for Success’ model that would tie social outcomes, – such as increase in local taxes from visitor spending – to private investment, providing a new source of income for the area and helping restore the land from mining activities. The Covid pandemic, however, required a pivot away from a pay for success structure, but the project demonstrates the potential of the model for other national forests


Extractive resources, such as forestry, brick and coal mining, have provided an economic basis for communities across the Midwest for centuries. However, as supplies began to diminish and market demand for their resources declined, many communities have suffered a loss of economic activity, as well as a legacy of degraded land.

Athens County in Ohio is one such example; previously a coal and brick mining community, it now has over 5,500 abandoned mine features including mine portals, mine water seeps, contaminated ponds and gob piles. It also has one of the lowest household income averages in Ohio, and is classified as “economically distressed” by the Appalachian Regional Commission (ARC).

However, it’s also home to the Wayne National Forest, Ohio’s only national forest that covers over a quarter million acres of Appalachian foothills of south-eastern Ohio. Within this forest there are 26 miles of trail that are open to hikers and mountain bikers. Proposals to extend the trail have been discussed for around 25 years, but had not yet taken root.

Seth Brown, Vice President at Quantified Ventures, recognised the barriers that were preventing the proposal from being adopted. “Despite recreation being a proven strategy for economic development in rural areas, efforts to realize their opportunities get stuck due to investor reticence and an inability to leverage economic development best practices,” says Brown. “These projects often require a mix of private and public capital. However, it can be difficult to secure private investors for these bespoke deals due to perceived risk, lack of a track record, or the size of the deal not justifying the due-diligence time.”


Pay for Success

Quantified Ventures, an outcomes-based capital firm that focuses on health, social, and environmental impact, stepped in to help overcome these barriers in 2018. The year prior, the National Forest Foundation (NFF) had contracted Quantified Ventures to assess the feasibility of Pay for Success (PFS) financing to fund recreational infrastructure needs on U.S. Forest Service (USFS) land. Through a competitive process, the Baileys Mountain Biking Trail System (Baileys Trail System) on the Wayne National Forest was selected as the first use case.

Pay for Success is a financing mechanism in which investors provide up-front capital for an intervention, with repayment tied to the successful achievement of outcomes. It is a useful tool for aligning incentives, shifting the risk to the private sector, and building a financing technique around data and validated outcomes. This approach aims to facilitate market rate returns with measurable environmental impact.

The Baileys Trail System proposal aims to finance an 88-mile single track mountain biking trail designed for all level riders, as well as hikers, trail runners and nature lovers. The trail system will constitute both new and existing trails, increasing connectivity between Athens and other communities. A number of economic, environmental and social benefits are anticipated from this project over the next 10 years from the increased tourism and activity in the local communities, including:

  • $40m in increased spending
  • 78 new jobs and 150 retained jobs in Athens County
  • $500k avoided in local healthcare costs
  • $2m spent on mine land restoration, improving safety and environmental hazards

Brown says that the outcomes-focused approach was crucial for the success of the project: “Often outdoor recreation has been relegated as a ‘good to have” rather than a “must-have.’ By focusing on the outcomes of the project, we elevated the Baileys Trail System to an intentional asset development project.”


Engaging Government Stakeholders

A significant challenge of co-ordinating this project was the volume of cross-governmental bodies that all had interests in the project and the federal land it sits on. Among those bodies are five surrounding towns of the forest, Athens City Council, Athens County Commissioners,  the US Forest Service, and the local regional planning commission.

To bring the stakeholders together, Quantified Ventures helped to design and launch the Outdoor Recreation Council of Appalachia (ORCA) that was formed from these stakeholders to utilise outdoor recreation assets to realise community benefits. ORCA is a Regional Council of Governments formed under Ohio Law that enabled multiple governments to fund a “cross-boundary” project of mutual concern. The scale of government involved was a key resource that allowed the project to attract funding, but also make sure that the majority of benefits stayed in the local economy, as local government bodies made up a significant portion of the council.


Pivoting During the Pandemic

Originally, the financial structure was to be set up as a Pay for Success agreement, similar to other work by Quantified Ventures (see GFI Hive case studies on the Environmental Impact Bond and Soil and Water Outcomes Fund). That meant private investors would fund the up-front costs, and the members of ORCA would pay a fixed fee for twenty years to these investors, wherein at year five there would be an evaluation of how the increased visitors affected the local community. Funds would also be spent on remediating the mine features, helping to preserve the quality of the land and improve its eco-tourism offering.

If certain indicators reached a threshold at this point, e.g. number of visitors, then further payments would be triggered and delivered through increased revenue taxes paid from motels, restaurants, and other tourism driven businesses in the area. These would be calculated by an independent group from Ohio University, and extrapolated across the remaining 15 years to set a payments schedule.

Unfortunately, the arrival of the pandemic meant a huge revaluation on risks related to new projects, and ultimately ORCA decided that they did not have appetite to back a Pay for Success model with private investors. They opted instead for a non-profit structure to manage the trail and channel private investment. This non-profit, the Athens Wayne Outdoor Asset Development Corporation (AWOADC), was set up to provide services supporting the trail, such as events, campgrounds and bike rentals. Because this was a newly formed company without an established financial performance, ORCA decided that impact investment was the most economical choice for capitalisation. The investor base was sourced through local engagement and consists of a community foundation, an impact investment firm, and a family office, which are expecting annual payments with a 50% revenue share from AWOADC.


Brown describes how the public and private partnership works as an innovative and replicable model: “By unlocking the power and scale of the government (ORCA) with the nimble and creative power of the non-profit  (AWOADC), we have the best of both worlds. Government investment into infrastructure and a non-profit that can “activate” the infrastructure through services and offerings. The activation of the infrastructure is what creates opportunities for the private sector and economic growth.”

In total, $11.5m in funding has been raised for the trail’s construction, and to date 50 miles have been delivered.


Success to Date

An unexpected outcome of the pandemic has been the increased value that people place on outdoor facilities. An economic analysis conducted by Ohio University using the IMPLAN economic modelling estimates that the first 30 miles of the trail had:

  • 40,000 visits, half of which have been from outside Athens County
  • $3.7m in economic impact in Athens County, compared to $6m brought in by all Athens County trails in the previous year
  • 51 full time, part time, or seasonal jobs directly supported, 11 jobs indirectly supported

These results were in line with Quantified Ventures’ expectations from the early Pay for Success modelling. Brown shares that “by treating the project as infrastructure and economic development, rather than a project for hobbyists, we were able use the financial tools and governance structure that funds infrastructure and economic development projects: scaling the impact.”

The team hopes that the success of this project will increase confidence in the Pay for Success modelling going forward. Quantified Ventures are looking at seven other national forests and the possibility of private investment projects such as campground improvements, overnight facilities, and lodging. Brown says that there is possibility to bring out further environmental outcomes within this area, such as carbon or water quality uplifts from healthier forests.



Interview with Seth Brown, Vice President at Quantified Ventures

Photo: Courtesy Maksymilian Sleziak, Unsplash