Economic Development Alliance of Lincoln County Post Office Box 716, Newport, Oregon
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1 Economic Development Alliance of Lincoln County Post Office Box 716, Newport, Oregon A public-private partnership serving Lincoln County For Immediate Release June 14 th, 2010 A 501 c) 6) nonprofit corporation Economic Impact of NOAA Fleet Estimated for Lincoln County With the welcoming of the NOAA Marine Operations Center Pacific at the official groundbreaking ceremony, June 3 rd, Lincoln County releases its own economic analysis related to this event. A basic I/O regional economic model was used to estimate impacts on total personal income over time for Lincoln County as a whole. The table that was created shows types of personal income sources, with columns showing the increase up to 30-plus years. Construction costs, maintenance and repair to the Port of Newport are included in the table. The impact of the crew jobs associated with the four NOAA vessels, direct support, administrative, and executive staff are all included. Another line estimate s local vendors to NOAA, which is hoped to increase as more companies can source NOAA s needs in the central coast. We have been working hard in the past 9 months to bring training to our local companies on government contracting assistance. The training will continue all the way until NOAA moves here, and beyond, if needed, according to Caroline Bauman, Executive Director of the Economic Development Alliance of Lincoln County. This group, in partnership with the Oregon Coast Community College Small Business Development Center, has brought the training sessions six times to various parts of the county. There has been growing interest in government procurement, and quite a few businesses are now qualified to bid on contracts to provide goods and services. The final estimate was made to take into account the additional vending. The table also provides for additional research, in the form of visits from other vessels, grants and related activities. The impact over time could be in the range of $32 million annually after 10 years. It can also be estimated as an additional 800 full time jobs in Lincoln County. Without taking into account the attraction of additional research, the impact is still about $20 million to the local economy. For information: Caroline Bauman, Economic Development Alliance of Lincoln County, Executive Director ecdev@orcoast.com or
2 ESTIMATE OF ECONOMIC IMPACT OF NOAA MARINE OPERATIONS CENTER PACIFIC ON THE CENTRAL OREGON COAST (NEWPORT AREA) BY CAROLINE BAUMAN Executive Director, Economic Development Alliance of Lincoln County June 1, 2010 With technical assistance from: Dr. Hans Radtke, Natural Resource Economist, Yachats, OR, Shannon Davis, The Research Group, Corvallis, OR, Lt. Andrew Colegrove, NOAA Marine Operations Center Pacific transition team, Will Summers, workforce analyst, and Erik Knoder, regional economist. *description of basic I/O regional economic modeling and economic impacts estimates are provided in A Demographic and Economic Description of the Oregon Coast: 2006 update March 2006, Oregon Coastal Zone Management Association
3 I. Introduction. The Port of Newport has been chosen by NOAA to be the home port for its North Pacific marine research fleet. This adds to the Newport area as a major marine research and management center. Other facilities and programs in the area include support for vessels fishing off the West Coast and Alaska, the Hatfield Marine Science Center with a wide spectrum of ongoing scientific and research projects, and Oregon Department of Fish and Wildlife Marine Management Section. The area also includes popular teaching and visitor centers such as the Oregon Coast Aquarium and Visitor Center at HMSC. The Marine Mammal Institute and Northwest Marine Renewable Energy Center of OSU are also undergoing expansion at this time. We expect the NOAA fleet that is homeported at Newport to expand the area s critical mass with regard to marine-related activities.
4 1. CONSTRUCTION PHASE (over 2 years) A, $19.5m state bond funds $25.7m Port of Newport lease revenue bonds = $45.2m total or 22.6 per year B. Construction total income coefficient = X $22.6m = $19.21 per year for two years = $38.42m total 2. MAINTENANCE AND REPAIR. Estimated on a straight line depreciation assumption of 30 $1.5m per year (.85 X 1.5 = $1.28m per year, construction coefficient) is $1.28m per year for 30 years. 3. NOAA EMPLOYEES. There will be 175 permanent, full-time jobs associated with the NOAA relocation. Each vessel has a crew of up to 15 with another 12 direct support jobs. The other 65 NOAA employees are administrative and general support staff. There will be a certain number of people who will move their families to Newport area. Some, especially crew members, may elect to work on NOAA boats without moving their families to Newport. The following is a suggested time line of NOAA personnel associated with the Newport center that will work and reside in the Newport area. Years Period > Estimated staff in the Newport area 20 crew 20 crew 30 crew 30 crew 15 support 30 support 40 support 40 support 40 admin 55 admin 65 admin 65 admin
5 Estimated annual $65,000 per job $4.9m $6.8m 8.8m 8.8m Estimated total personal income. Total personal income multiplier 1.6 X payroll 7.8m 10.9m 14.1m 14.1m 4. VENDORS TO NOAA FOR OPERATIONS AND MAINTENANCE The vessels need everything in the way of products and services as they are out at sea a large part of the year. The on-land administration and vessel upkeep need a wide range of products/services such as in maintenance of the vessels. The estimated NOAA $2.0m per vessel for these needs is $8m annually. The local area will capture no more than 50% of this business at the beginning. We anticipate this percentage to grow over time as companies move, grow and adapt to serving the needs of the fleet. The personal income coefficient for supplies and equipment is.61. Therefore the annual total personal income impact of supplies and equipment is in a range from 2.7 to 3.2m annually, over time. 5. VISITING RESEARCH VESSELS. Scientists and staff at Hatfield Marine Science Center presently conduct a range of oceanographic and marine system studies. The NOAA fleet will encourage and support additional research activities and programs. Our estimate is that an additional $17-18m in research grants will be associated with HMSC as a cumulative effect of NOAA combined with other institutions. Faculty, staff, graduate students and resulting expenditures of 0.5 can be expected from these additional research projects. If ½ of the local expenditures are in the form of payroll (4.5 X 1.6 payroll = $7.2m) and another ½ are for supplies and equipment (4.5 X.80 = 6.4m). The total personal income impact of additional research programs is estimated at $13.6m annually. Most likely these will begin after the third year and gradually increase to that level by the year periods.
6 6. TOTAL ANNUAL PERSONAL INCOME IMPACTS OF THE NOAA FLEET IN THE NEWPORT AREA BY PERIOD (X 1,000,000). Years Construction Phase Maintenance/Repair NOAA Employees NOAA Vendors Additional Research Total Personal Income Of NOAA Fleet The full time equivalent in Lincoln County is about $40,000 payroll income per year. Total personal income of $32,120,000 is equivalent to over 800 full time jobs in the Newport area.
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