Until recently, the bungee-jumping business was soaring beyond the wildest stretch of Carolyn and Michael Tessada's imaginations.
The Tessadas tied their fortune to the daredevilish fad after discovering that people were willing to pay $100 to hurl themselves 60 feet or more off towers, cranes and hot-air balloons for the thrill of bouncing up and down in midair on an elastic cord.
The couple launched Bungee Braves of New England Inc., based in Salem, Conn., in 1989 with only $10,000. In the next 2 1/2 years, the bungee-jumping craze ballooned into a $70 million-a-year national industry, unencumbered by regulatory measures or steep start-up costs.
But suddenly, the ride is getting bumpy. After a string of recent accidents that resulted in at least two deaths, a majority of states are trying to take some of the bounce out of bungee jumping by regulating or banning some forms of it. As often happens in a fledgling industry, bungee jumping has come to the end of its initial period of untrammeled growth and is entering an uncertain phase of government supervision.
If the trend continues, industry officials say, as many as one-third of the industry's companies might be left hanging by a thread. "It's killing me," says Mr. Tessada. "Every bungee company right now is hurting."
In April, Massachusetts in essence banned bungee jumps off cranes by enforcing a state law forbidding the use of the devices to hoist people off the ground. Ninety percent of the nation's bungee companies use cranes to suspend the 150-foot-high platform from which jumpers make their death-defying leaps.
That forced Bungee Braves to close its crane-jumping sites, which it had expected to generate $1 million in revenue between May and October. "By October, if things don't pick up, we're going to get out of the business altogether," says Mr. Tessada. Even if business improves, he says, his company will probably move to another region unless Massachusetts eases its stance. He supports a bill pending in the state Senate that would lift the crane ban as long as the industry complies with other regulations.
Other states are taking a harder look at the industry. Last week, New Jersey ordered a suspension of bungee jumping until bungee companies satisfy four requirements, including getting their equipment reinspected and their jumping procedures approved. The week before that, Pennsylvania ordered the inspection of all bungee companies using mobile cranes. And last month, Florida became the first state to order a 90-day ban on all bungee jumping.
A year ago, only three states regulated the industry. Today, 29 do. And by this time next year, state and industry officials predict, all will. The rash of recent accidents -- including jumping deaths in Michigan and Toronto -- has accelerated the trend, analysts say.
"If these regulations continue, you can expect to see 20% and even 30% of the companies out there going out of business," says Greg Glassock, president of the North American Bungee Association. While the association doesn't keep an exact count of U.S. bungee companies, it says the regulatory crackdown could close as many as 75.
It's not that the association or most bungee companies oppose all restrictions. To the contrary, they welcome some controls as a way to keep out fly-by-night operators that could tarnish the industry's image. What they oppose are bungee-jumping bans or curbs so tough that they in effect eliminate certain kinds of jumping.
So far, the main target of regulators is the mobile crane, which some states say is more dangerous than the fixed platform. Even the federal Occupational Safety and Health Administration has got into the act; it says it is looking into possible hazards to workers who operate the machines.
"The very fact that cranes are mobile and are used for other things contributes to the possibility of recklessness," says Tom Woodard, president of Air Boingo Inc., one of the nation's largest tower-jumping companies. Crane-jumping operators respond that their method is as safe as tower jumping -- and safer than driving a car -- if proper procedures are followed. Because of the high cost of building permanent towers, they say, any ban on cranes would force many reputable companies out of business.
"There were a lot of start-up opportunities for really small outfits within this industry" before the crane regulations, Mr. Glassock says. "Anyone with $25,000 to $30,000 could have gotten into the bungee field."
Such cheap beginnings may soon be a thing of the past. With Massachusetts banning cranes, for example, the Tessadas say they can't afford the $150,000 to $400,000 cost of building permanent bungee towers. Furthermore, they say they can't make enough money to sustain their business from jumps from hot-air balloons that take too long to get customers aloft and back down on the ground.
With some states requiring more than $1 million of liability insurance and imposing stiff inspection fees, state regulations "will definitely weed out a lot of people trying to get into the business," Mrs. Tessada says.
Georgia, for instance, recently began charging bungee companies $5,000 for initial registration, $1,000 for annual renewals and $500 for quarterly inspections to stop "the less scrupulous people from setting up shop," says Mark Lovelady, a safety specialist with Georgia's Department of Labor.
Already, regulations are putting off entrepreneurs in some states, industry officials say. Of 60 companies that have contacted Maryland officials since the state began regulating bungee jumping in November, none has been able to comply with the new guidelines, says Jim Morkosky, head of the Department of Labor and Industry's safety-inspection unit.
"With everything that's happening, I personally feel that a person would be foolish to start a bungee operation now," says Kermit Johnson, an entrepreneur who abandoned a plan to set up a bungee-jumping company in the Midwest.
As the bungee-jumping industry comes under pressure from regulators, its consultants are taking a beating, too. Bill Lovejoy, president of Drastic Elastic Bungie Jump Inc., which helps companies trying to get into the business, says his company now gets approached by potential clients once a month, down from once a week not long ago. "We're still getting calls," he says. "But there's also a lot of companies saying, `Let's step back and wait a few months to see what happens.'"
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