HomeMy WebLinkAbout108Michelle Farfan
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David W. J oh nson < djoh nson @co jefferson.wa.us >
Thursday, December L7, 2014 11:22 AM
Jeff Chapman
David W. Johnson
Pleasant Harbor Economic Report
Wright Johnson Report.pdf
FYI per our conversation
David Wayne Johnson - LEED AP - Neighborhood Development
Associate Planner - Port Ludlow Lead Planner
Department of Community Development
Jefferson County
360.379.4465
Mission: To preserve and enhanbe the quality of lfe in Jffirson County by promoting a vibrant economy,
sound communities and a healthy environment.
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lefferon County Ospertment ol Communlty Oerlrelopmrenlry SEUAREffiT+S
W t Brrttr Bu.tdhg surts Hrre.
1
LEEO
AP
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<^1rn/.iii,ri ',.i,1 ,",1 )) WRIGHT JOHNSON
\P.t[,(^''\1rl'
\ :\'' iLl
p rofess io na I auth ors a.nd ana lys ts
ocT 15 2014
,ir!ii.fi$l}t{ f il\\1t1\ 'lt'i)
An Economic Analpis of Earnings
Pursuant to Jeffenon CountyBoand of C-ounuy C-ommissioners' Condition
63 g for the Pleas ant [:Iarbor ]daster Planned Res ort (Iv[PR)
By
\Tright Johnson, LLC
October2014
205 I7onh Avenue, Suite 201, Palm Beach, EL 33480
Telephone: (561) 282- 6099
E mail info@ wrightjohnsonllc.c om
L. Introduction
Wright Johnson, LLC, f V{},) has been retained to perform an economic assessrnent of earnings of
the Pleasant Fhrbor }vlaster Plarured Reson (JvPR) emplopes in conformiry with the Jefferson
Carrty Board of Counry Commissioners' condidon 639, which states:
"The developer shall commission a snrdy of the number of jobs expeoed to be created as a
direct or indirect resuh of the MPR that earn 80% or less of the Brinnon arca average
median income (AM). The developer shall provide affordable housing (e.g., no more than
30o/o of household income) for the Brinnon MPR worken roughly proportional to the
number of jobs created that eam 80o/o or less of the Brinnon area AJvII. The developer mly
satisfy this condition *rough dedication of land, payment of in lieu fee, or orrsite housing
development."
To accomplish this, the analpis estimates the number of direct and indirect jobs associated wfuh fie
proiect, as well as average wates associated with these jobs. The anal1ais utilizes the RIIiIS II model
to estimate these jobs and wages as discussed below.
2. Methods & fusumptions
The anallsis considers the impacts of the construction and operation of the MPRproject, which wil
operate within the following industry clusten :t
Residential Building C-onstuction - NAICS code 2361 This indrstrycomprises esablishrnents
primarily responsible for the construction or remodeling and renovation of single-farnily and
multifamily residential buildings. Included in this industry are residential housing general conuactors
(Le., new construction, remodeling, or renovating existing residential structures), for-sde builden
and remodelen of residential structures, residential project construction rumagement firms, and
residential des ign-build firrns.
Non-Residential Building Constuction - NAICS code 2362: This indrstry comprises
establishments primarily rcsponsible for the construction (including new wor\ additions, alterations,
maintenance, and reparn) of commercial and instinrtional buildings and related stnrctures, such as
stadiums, grain elevators, and indoor swimming facilities. This indrstry inctudes establishmenu
responsible for the on-site assembly of modular or prefabricated commercial and instinrtiond
buildingp. Included in this industry are comrrercial and institutional building general contractorc,
commercial and institutional building for-sale builders, commercial and institutionalbuilding design-
build fims, and commercial and insticutional building project construction manageurent firms.
Utility System C.onstrrrction - NAICS code 237t This industry comprises establishments
primarily engaged in the constn ction of water and sewer lines, mains, pumping stations, treatrnent
plana, and storage tant$. The workperformed mayinclude newwork, reconstruction, rehabilitation,
and rcpairs. Specialry trade contractors are included in this $oup if they are engaged in activities
primarily related to water, sewer line, and related structwes construction. All structues (including
' NAICS code definirions provided bythe U.S. Crnslx Bureau.
Page ll
building$ that are i"t grrl parts of water and sew€r net'u/orl$ (e.g., storage tanls, pumping stations,
water treatruent plauts, and sewage treatment plants) art included in this ind*..y'.
Food and Berrcrage Stores- NAICS code 445: Indrsuies in the Food and Beverage Stores
subsector usually reail food and beverage merchandise fiom fixed point-of-sale locations.
Establishrrrents in this subsector have special equipment (e.g., freezers, refriger,ated display cases,
refrigeraton) for displaying food and beverage goods. They have staff trained in the processing of
food products to $arantee the proper stonge and saniury conditions reguired by regulatory
authority.
Miscelleneous Store Rctailen - NAICS 453: Indutries in the Mscellaneous Store Retailers
subsector retail merchandise from fixed point-of-sale locations (except new or used nptor vehicles
and para; new fumiturc and home furnishings; new appliances and electronic products; new
building matcrials and garden equipment and supplies; food and bever:rges; health and personal care
goods; gasoline; new clot}ing and accessories; and new sporting goods, hobby goods, bools, and
music). Establishrnents in this subsector include stores with r:nigue characteristics lila florists, tsed
merchandise stores, and pet and pet supplystores as well as other store retailers.
Amusemen! Cambling, and Recreation Industries - NAICS 713: Indrsuies in the
Amuserneng Gambling, and Recrcation Indrstries subsector (1) operate facilities where patrcns can
primarilyenBage in sports, recreation, amusement, or gambling activities and/or (2) provide other
arnusement and recreation services, such as supplying and servicing arnusement devices in phces of
br:siness operated by othen; operating sports rearns, clubs, or leagues engaged io pl"y.g ganrcs for
recreational pulposes; and guiding tours without using transportation equipmenc
Accommodation - NAICS code 721: Industries in the Accommodation subsector provide
lodg*g or short-term accommo&tions for travelers, vacationers, and othen. There is a wide rurge
of establishments in rhese indutries. Some provide lodgrng only; while others provide rcals,
h.-dry services, and recreational facilfuies, as well as lodg"rg. Iodg-g establishrrrents are classified
in this subsector even if the provision of complementaryservices generates more revenue. The q,pes
of complementaryservices provided varyfrom establishrnentto establishment.
Food Services and Dinking Places - NAICS 722: Industries in the Food Services and Drinking
Places subsector prcpare rneals, snacls, and beverages to crrstomer orrder for immediate on-premises
and off-premises consumption There is a vride range of establishments in these indrsuies. Some
provide food and drink only; while othen provide various combinations of seating space,
waiter/waitress services and incidenral arrrenities, such as limited entertaftlment. The industries in the
subsector are grouped based on the tpe and level of services provided. Ttre indr:stry groups are
qpecial food services, such as food service conu:rctors, caterers, and mobile food services; drinking
places; and restaurants and ot}er eating places.
Other Personal Senices - NAICS 8129: fhis industry group comprises establishrnena primarily
engaged in prrcviding penonal services (except personal carc services, death care services, or dry"
cleaning and laundry services). This includes Pet Gre (except Veterinary) Senrices, Photofinishing,
Parking Lots and Garages, and All OtherPersonal Services, including \(edding Chapels.
Personal C-are Servic€s - NAICS 812t This industry grcup comprises establishrrnts that
provide appearmce care services to individr:al consurrcrs. These include Flair, Nai], and Skin Gre
Services and Other Personal Care Services.
Page l2
Lessors of Noruesidential Buildings (except Miniwarrhouses) - NAICS 53112: This industry
comprises esablishments primarilyengaged in acung as lessors of buildings (except miniwarehoues
and self-storage unia) that are not used as residences or dwellings. Included in t}ris industry arc: (t)
owner-lessors of nonresidential buildings; (2) establishments renting real estate and then acting as
lessors in subleasing it to others; and (:) establishments providing full seruice office space, whether
on a lease or service contract basis.
'V'ater, Sewage and Other Systems - NAICS 2213: Industries in this secor include \n/iater
treatrnent plants, water
collecq treaq and dispose
supp$ s)6rcrns, sewer s)6terns, and/or sewage ffeaunent facfities that
of waste.
The proposed project will be constructed and operated in four distinct phases. A sumnury of the
proposed project constnrction expenditure and operating employment data is summarized beloq by
phase:
Constnrction: Consrruction cost of the project is estimated at $201,413,493 (in 2014 dollars) over
the four phases. This includes onlythe har'd construction costs and excludes marlating, engineering,
legal, insurance, taxes, design and permining, sales ux, and contingencycosts (soft costs). Soft costs
are shown in the below tables, but are not included in the total anrcunt shown for each phase-
Maftia ElocklFueli LineVsanitary Updates
ftgneerihg & Consultants*
tr-egal, lndurance, Taxes*
,' 58E,536
,3,660,480
1,335,737
1,181,649
5,lz,l7o
Consulting Fees+
Fees and Petmitst
SiteWork
Excavation
Constnrction
317,000
2tr7,000
940,000
135,100
32,184,810
4,350,000
650,000Contingency+
Page l3
of Estinrated Construction Costs
Work & Infrastructure
'" General and Administration*
Contingency*
,,FeesdiidiFiif,uritst ,:,, l: :,
, ",,, iL32$00l
Amount
*Not included in total
As the crurent RINIS II rrnrhipliers are based on 2010 data, we mwt deflate the construction
expenditures to 2010 dollars. Accorrding to the Tumer C.onstnrction Building C-ost Index,
construction costs have been on an increase fiom 2010 through 2014. The cost index in 2010 was
799 vs. the 2nd iluart€r 2014 cost index of 896. Therefore, the construction costs for this prcject
will need co be reduced to 2010 dollars.
P tge l4
mQuartcr2Or.4
1st Quarbr 2014
4th Quarter 20fii
3rd Quarter 2o13
0.80
1-15
1-05
896
885
878
868
L.21
20ff}
20L2
2011
2010
2009
2008
2007
2006
2005
2004
2003
2002
2001
864
830
8L2
799
832
908
854
793
7L7
455
621
619
613
4.1
7.7
2.1.
l_6
4.0
8.4
6-3
10-6
9-5
5.4
0.3
l_o
The Turnor tsuilding C,ost hdex is delermlned by the
follqwing factors conridured on a nationrride basis:
labor ratgt and pro{ructivity, mat€rial prlces and the
competitiyo cond*tion +f the marL+tplace.
Ttmor
To conven this figurc to 2010 dollan we use the 2014 index of 896 and divide it bythe 2010 index
of 799. Thisgivesrsafigure of 896/799:t.L2l. Toconvertthe$201,413,493costin2014dollan
to 2010 dolla:s, the 2014 expenditure is divided by 1.L27, to yeld $129,608,684.
Facility Operatioru: Per the Developer, the project will generate an estimated 225 dtrcctoperating
jobs *rough variou operating components overthe four phases as summarized below.
Page l5
Phase 2014 Dollars 2010 Dollars
Phase 1 $ +s,860,349 $ 40,895557
Phase 2 33,259,910 29,659228
39,414234 35,747291Phase 3
Phase 4 82,879,000 73,906,608
Total $ 201A13,493 $ 179,608,684
721-Accorro-rodation
Plersonal Services,Wedding Chapel
Cogvention Ceuter
'CiftiSbOpl r.1, ;1,,: : ;1
i;::::'i,;',:',.i,1'Recr€atiio-n, t,,i,,,..,,,:,i
"It should be noted drat Securiuy, Shunle, Facilities, and Offices positions are included in
these operating components.
Given these construction costs and operaong jobs, the RIVIS II model can be used to estimate direct
and indirect consmrction and indireo employrnent associated with the projecl
Page l6
of Estinratetl
,.i:
3. Findings Er C-alculations
Shown in the chart below are the acnnl RIIIS II final demand and employment nnrltipliers for
Jefferson Cor:nry, \7A These rnuhiplien arc used to estimate errylopcent associated with the
project-
Toal Mukiplien
RIMS II Multiplies (2w2/20t0)
forOutptrt Earnings, Emplolmcnt, and Value Added by Detailed Industry
\trA
Building Constnrction and C.onstnrc.don gf Iq$estruc.Bnr
For the constnrction sector (NAICS code 230000) the final denund muhiplier is 9.7481, and the
employment nultiplier is 15147. The final demand muldplier is rsed to determine the total number
of jobs produced based on the e4penditures for corstruction of the proiect's buildings. This figue
is $179.609 million (in 2010 dollan). Therefore there would be $179.609 tirrrs 9.7481,or l/50.825
jobs supported bythis project, including dircct and indirect jobs for all four phases.
Tables 3'1 and 3-4 show the combined economic impaa of the project's building and infrxtructure
construction expenditures, by phase, for the 20 major industrial classifications in the RIIUS II
input/output model.
Page l7
Final Dcmand DinctEffect
Industry Ouput
(dollan)
Eamings
(dollan)
E mploynent
fiobs)
Value-
addcd
(dollen)
Eamings
(dollan)
Employmcnt
(iobs)
\Water, Sewage, and Other
Systems (221300)1.3818 0.3283 7.0101 0.8864 r.4796 1.6666
t.4324 0.4448 9.7487 0.757 1.3304 15147Corstnrction (23oooo)
Retail Trade (4A0000)L34A+0.3986 13.9498 0.8737 1.26W r.2553
1.3823 1.1363Real Estate (53 looo)t.2lL5 0.183 t4.2139 0.9235
1.1400Amusement and Recrcation
Iudustries (713800)1.3790 0.4170 25.6376 0.8563 1.2881
0.8141 1.5268 1.3275ltrorcls, Motels and Other
Accommodations (72 1A00)1.3920 0.3159 13.4116
1.3993 0.4169 19.6494 0.7622 1.3t32 7.t907Food Services and Drinldnt
Places (722000)
1.4149 o.4758 7.3369Penonal C:re Services
(812lo0)13.5848 0.9095 1.2770
Ottrer Penonal Services
(812e00)7.2447 0.1967 5.2349 0.7251 1.4955 1.7028
Multi rlier
Emplolment
0.630
2.703
1.190
264.410
10,465
2.413
4t.873
2.650
1.881
2.257
9.864
6.535
0.045
3.963
2.478
t5.377
2.511
3.2M
13.328
7.721
3.149
OutpuUEmployee
$ 149,351
164,W2
460,481
155,394
236,420
222,034
gg,g50
I 18,827
226,097
306,159
296,070
1s8J23
272,721
66p47
56,106
109,043
42,345
94,388
60,755
734,534
146,963 $
EarningdEmployee
$ 32,468
34,796
92,474
51,953
44,549
64107
28,030
M,753
. 54,348
63300
ll,609
61952
9080e
25,800
I 8,1 52
45,745
14,658
26,786
19,331
39,195
7,792
45,630Total398.6s0 $
Table 3-f shows an estimated 398.650 ernplopes will be crcated byconstruction activities in Phase I
of the proiefi. Output per new worker for the construction sector would be about $155,394, with
average annual eamingp of abow $51953. For all new workers, the corresponding figures are
$145,963 and $45,630.
Page l8
Industry group
Agriculture, forestry, fi shing
Mining
utilities
Constntction
Manufacturing
Wholesale trade
Retail trade
Transportation and warehousing
Inforrnation
Finance and insurance
Real estate and rental and leasing
Professional, scie,ntific, senrices
Management of companies
Administrative and waste management
Educational services
Healtb care and social assistance
Arts, entefiainrnent, and recreation
Accommodation
Food senrices and drinking places
Other services
Households
Industry group
Agriculture, forestry, fishing
Mining
Utilities
Constnrction
Manufacturing
Wholesale trade
Retail trade
Transportation and warfrousing
Inforuration
Finance and insurance
Real estate and rental and leasing
Professional, scientific, seryices
Management of courpanies
Administrative and waste management
Educational services
Health care and social assistance
Arts, entertaiment, and recreation
Accommodation
Food services and drinking places
Other services
Households
Total
OutpuU Employce
$ 149,351
164,902
460,491
155,394
236,420
222,034
89,950
118,827
226,087
306,159
286,070
158,323
272,727
66,047
56,106
109,043
42,345
94,3gg
60,755
134,534
Earnings/Employee
$ 32A68
34,796
82A74
51,953
44,549
64,407
28,030
4,753
54348
$AA6
11,609
61,952
90,909
25,800
18,152
45,745
14,659
26,786
19,331
39,195
7,792
Employment
0.457
1.960
0.863
191.762
7590
1.750
30.368
1.922
1.364
1.637
7.t54
4.740
0.033
2.874
1.797
1 1.152
1.821
2.325
9.666
5.600
2.284
289.118 $146,963 $45,(30
Table 3-2 shows an estinuted 289.118 employees will be creat€d byconstruction actffies in Phase 2
of the proiect. Output and eamings per emplope data for construction and total emplopes will be
the same as in Phxe 1.
I'age [9
Indu$ry group
Agriculture, forestry, fi shing
Mining
Utilities
Construction
Manufacturing
Wholesale trade
Retail trade
Transportation and warehousing
Information
Finance and insurance
Real estate and rental and leasing
Professional, scientific, senrices
Managernent of companies
Administrative and waste management
Educational services
Health care and social assistance
Arts, entertahment, and recreation
Accommodation
Food services and drinking places
Other services
Households
Total
OutpuUEmployee
$ 149,351
164,902
460,491
155,394
236,420
222,034
89,950
I lg,g27
226,097
306,159
296,070
158,323
272,727
66,M7
56,106
109,043
42,345
g4,3gg
60,755
134,534
f,lynings/Employee
$ 32,468
34,796
92,474
51,953
44,549
64,407
29,030
M,753
54,348
63,446
11,609
61,952
90,909
25,900
19,152
45,745
14,659
26,796
lg,33l
39,195
7,792
Emplopment
0.541
2323
1.023
227.245
8.994
2.074
35.987
2.278
1.617
1.940
8.478
5.6t7
0.039
3.406
2.r30
13.275
2.158
2.756
1 L455
6.636
2.706
342.616 $146,963 $45,630
Table 3-3 shows an estimated 342.616 employees will be created byconstruction activities in Phase 3
of the project.
Page ll0
Industry group
Agricultr're, forestry, fi shing
Mining
Utilities
Constnrction
Manufacturing
Wholesale trade
Retail trade
Transportation and warehousing
Information
Finance and irsurance
Real estate and rental and leasing
Professional, scientific, senrices
Managernent o f cornpanies
Administrative and waste management
Educational services
Health care and social assistance
Arts, entertainment, and recreation
Accommodation
Food services and drinking places
Other services
Households
OutpuU Employee
$ 149,351,
164,902
460,481
155,394
236,420
222,034
898s0
I lg,g27
226,087
306,159
286,070
158,323
272J27
66947
56,106
109,043
42,345
94,388
60,755
L34,534
146,963 $
EerningVEmployee
$ 32,468
34,796
82,4',14
51,953
44,549
64,407
28,030
44,753
54,348
63,406
11,609
61,952
90,909
25,800
I 8,1 52
45,745
14,658
26,'186
19331
39, I 95
7,'.192
Employment
1.138
4.885
2.tst
477.843
18.913
4.360
75.673
4.789
3.400
4.080
17.826
11.810
0.081
7.162
4.479
27.789
4.538
s.794
24.086
13.954
5.691
Total 720.U2 $45,630
Table 3-4 shows an estimated 720.442 emplopes will be created byconstnrction activities in Phase 4
of the project.
Page 111
li'
Opentioru-Phase 1
Phase 1 of project operations includes Food Services, ]vlarina and Fun Gnter
(Amusement/Recreation), Flotel Suites, and Retail employees. Tables 3.5 though 3-8 show the
economic impact of emplopes of prcjea's Phase I for the 20 r;rurjor industrial classifications in the
RIIvB tr input/output model.
Industry group
Agriculture, forestry, fi shing
Mining
Utilities
Construction
Manufacturing
Wholesale trade
Retail trade
Transportation and warehousing
Inforrnation
Finance and insurance
Real estate and rental and leasing
Professional, scientific, services
Managernent of courpanies
Adrninistrative and waste rnanagement
Educational services
Heallh care and social assistance
Arts, entertainment, and recreation
Accommodation
Food services and drinking places
Other services
Households
OutpuUEmployee
$ 154,519
157,895
4U,630
155,925
224,935
223,009
90,065
102,130
186,U2
3 I 1,159
172,1?5
I 19,149
217 39t
71,620
55,062
109,112
37,578
94,142
60,597
I44,E23
Earnings/Employee
s 32,070
52,632
83,601
51,915
37922
63,717
28,047
54,615
48,684
6/.378
10,895
49,645
86,957
25,962
17,,162
45,701
13,570
27,197
19,24t
40,694
8,310
2t)22
Employment
0.027
0.001
0.049
0.038
0.152
0.045
0.424
0.144
0.060
0.037
0.398
0.056
0.004
0,088
0,044
0.276
0.075
0.075
13.298
0.t32
0.057
Total 15.479 $71,20E $
Pagc 112
Table 3-5 shows that thert will be a total of 15.479 new jobs creat€d from the operation of the food
and beverage ponion of the project. Outptrt per new worlser for the Food Serrrices and Ddnking
Places sector would be about $60,597, with average annr:al earnings of about $19241. For all new
worlren, the corresponding figures are $71108 and$21/22.
Table 3-6 shows that there will be a total of 47.880 new jobs created from the operation of the
marina and fun center portion of the project. Grtprt per new worker for the Arts, Entenainment,
Page 113
Industry group
Agricultrue, forestry, fi shing
Mining
Utilities
Construction
Manufacturing
Wholesale trade
Retail trade
Transportation and warehousing
Information
Finance and insurance
Real estate and rental and leasing
Professional, scientific, services
Management of companies
Adrninistrative and waste management
Educational seryices
Health care and social assistance
Arts, entertainrnent, and recreation
Accommodation
Food services and drinking places
Other services
Households
EamingilEmployee
$ 33,654
55,556
E43ss
52,632
39,5M
63,014
28,083
47,273
47493
64,815
17,029
51I35
96,774
26,048
18,141
45,675
14,3gl
26,667
19,251
41,047
E,310
Emplo5ment
0.039
0.003
0.122
0.092
4.241
0.068
0.951
0.154
0.142
0.101
1.084
0.156
0.006
0.330
0.165
0.654
42.272
0.154
0-698
0.314
0.135
Total 47.880 $53,7E8 $16,273
OutpuUEmployee
$ 173,A77
t66,667
463,902
155,870
l7g,l56
221,918
89,945
l07,g7g
186,016
3lI,lll
160,434
t24,402
225,806
67,384
57,E23
l0g,04g
44,407
94,545
60,695
152,290
a:rd Recreation sector would be about $44301, with avenage annual eamings of about $14J81. For
all newworken, the corresponding figures are $53,788 and$76,273.
Table 3-7 shows that there will be a total of 0.611 new jobs created from the operation of the hotel
suites ponion of the project. Ourput per new worker for the Accomrnodation sector would be
aborn $98,941, with average annual eamingp of about $20,547. For all new workers, the
corresponding figurEs are $103 777 and $23,577 .
Industry group
Agriculture, forestry, fishing
Mining
Utilities
Construction
Manufactr:ring
Wholesale trade
Retail trade
Transportation and warehousing
Inforrnation
Finance and insurance
Real estate and rental and leasing
Professional, scientific, senrices
ffi an a gement of companies
Administrative and waste managernsnt
Educational services
Health care and social assistance
Arts, eirtertainment, and recreation
Accommodation
Food services and drir*ing places
Other services
Households
Total
OutpuU Employee
$ 143,939
166,667
463,964
154,867
193,34
220,930
89,863
99,738
2M,678
313,063
172,737
t22A7s
236,U2
71,928
55,172
tw,275
42,882
98,941
60,5E5
157,509
Eamings/Employee
$ 30,303
55,556
94,459
51,991
41,24
65,891
27,914
57J43
51,170
65,315
10,926
50,505
ros263
2s475
lsJel
45,913
tsA37
20,547
19,174
43,346
7,313
231577
Emplolment
0.007
0.001
0.044
0.045
0.062
0.0r3
0.202
0.170
0.034
0.022
0.190
0.039
0.002
0.099
0.022
0.132
0.029
5.046
0.312
0.081
0.027
6.637 $to3J77 $
Page l14
Industry group
Agriculture, forestry, fi shing
Mining
Utilities
Constnrction
Manufacturing
Wholesale tradE
Retail trade
Transportation and warehousing
Information
Finance and i:rsurance
Real estate and rental aod leasing
Professional, scientific, services
Managernent of companies
Administrative and waste management
Educational services
Health care and social assistance
Arts, enlertainmant, and recreation
Accornmodation
Food services and drinking places
Other se,r:riices
Households
OutpuU Employee
$ 136,5E5
166,667
4u,602
155,953
171,888
223,4U
89991
104,781
182,123
311,448
166,704
I13,699
222,222
63,895
56,426
109, I 18
42,799
94,637
60,502
142,290
EarningVEmployee
$ 34,146
Employment
0.009
0.001
0.020
0.020
0.053
0.017
5.2t9
0.069
0.040
4.027
a.Bl
0.033
0.001
0.058
0.029
0. l5l
0,028
0.029
0.t4
0.068
0.03I
84,071
52,752
38,950
63,830
28,000
48,461
48,045
63,973
10,910
47945
lll,lll
25304
18,809
45,740
t4263
26,814
19,122
39,',109
7,246
Total 6.276 $96,51E $28,560
Table 3-8 shows ttnt there will be a total of 6.276 new jobs crearcd from the operation of the food
and beverage store portion of the prqea. Output per new worker for the Retail uade sector would
be about $89891, with average annual earnings of about $28,000. For all nevr workers, the
corresponding figures arc $96,518 and $28,560.
Page 115
Industry group
Agricultwe, forestry, fi shing
Mining
Utilities
Constnrction
Manufacturing
Wholesale trade
Retail trade
Transportation and warehousing
Information
Finance and insurance
Real estate and rental and leasing
Professional, scie,ntific, services
Management of companies
Administrative and waste management
Educational services
Health care and social assistance
Arts, entertainnent, and recreation
Accomrrrodation
Food services and drinking places
Other services
Households
OutpuUEmployee
$ 143,939
t66,667
463,9U
154,967
193,34
220,930
89,863
99,739
20/.,678
313,063
172,737
122,475
236,E42
71,928
55,172
109,275
42,992
98,941
60,586
157,509
Earnhgi/Employee
$ 30,303
55,556
u,459
51,991
41,2M
65,891
2',1,914
57,743
51,170
65,315
10,926
50,505
105,253
25,475
18,39t
45,813
15,437
20,547
19,174
43,346
7,313
Employment
0.057
0.008
0.387
0.394
0.550
0.112
1.779
1.493
0.298
0.193
1.674
0.345
0.017
0.E72
0.189
1.160
0.254
44.405
3.271
0.713
0.238
Total 58.410 $103,777 $23577
Ooerations-Phase 2
Phase 2 of project operations includes Ftrotel Suites, Food Services,'Wedding Chapel Convention
Crnter, Spa, Gift Shop,'Waste Water lvlanagement, and Recreation emplopes. Tables 3-9 through
3-16 show the economic impact of employees of projeat Phase 2 for the 20 irr:njor indr:strial
classifications in the RIN$ II input/output model
Page 116
Table l-9 shows that there will be a total of 58.410 new jobs created from the operation of the hotel
suites ponion of the project. Ortput per new worker for the Accommodation sector would be
about $98,941, with average annual eamings of about $20547. For all new workers, the
corre qponding figures are $1A3,77 7 and $23,577 .
Table l-10 shows that there vrill be a toul of 25.005 new jobs created from the operation of the
food services portion of the project. Output per new sorker for the Food Services and Ddnliing
Page l17
Industry gfoup
Agriculture, forestry, fishing
Mining
Utilities
Construction
Manufacturing
Wholesale trade
Retail trade
Trarsportation and warehousing
Information
Finance and insurance
Real estate and rental and leasing
Professional, scientifi c, serices
Management of companies
Administrative and waste managernent
Educational senrices
Health care and social assistance
Arts, e,ntertainment, and recreation
Accommodation
Food services and drinking placrs
Other services
Households
OutpuflEmployee
$ 154,519
I 57,895
464,630
155,925
224,935
223,0W
90,065
102,130
186,942
3l 1,159
172,t75
I 19,149
2t7391
71,620
55,062
l0g,l 12
37,578
94,142
@,sg't
L44.,823
EanringslEmployee
$ 32,070
52,632
83,601
5I,975
37,922
63,'.?17
28,041
54,615
48,684
&,378
10,885
49,645
86,957
25,962
17,762
45,701
13,570
27,197
19,241
40,694
8,310
Employment
0,0u
0.002
0.079
0.05r
0,245
0,072
0.685
0.233
0.097
0.059
0.43
0.090
0.006
o.142
0.072
0.446
0.122
0.122
27.481
0.213
0,092
Total 25.005 $71,208 $21222
Places sector would be about $60,597, with average annual eamings of about $I9,24L. For all new
worlrers, the corresponding figures arc $71)08 and$Zt2ZZ.
Table 3-11 shows that there will be a total of 1.703 new jobs created from the operation of the
wedding chapel portion of the projea. Output per new worlrer for the Other Services seoor would
be about $319,509, whh average annual eamings of about $42,733. For all new worlsers, the
corresponding figtres xe $237 774 and $37,518.
Pagc 118
Industry group
A griculflue, forestry, frshing
Mining
Utilities
Construction
Manufacturing
Wholesale trade
Raail trade
Transportation and warehousing
Information
Finance and insurance
Real estate and rental and leasing
Frofessional, scientifi c, services
Managemsnt of compani s5
Administrative and waste rnaoagement
Educational services
Healft care and social assistance
Arts, entertainment, and recreation
Acconrrrodation
Food services and drinking places
Other services
Households
OutpuUEmployee
$ t57,895
142,857
46I,187
t55,7g',t
l5l,E6g
223,684
89,8EE
102,977
209,743
325,688
130,415
ll9,24l
272,727
53,270
56,180
l0g,g27
49,528
93,809
60,458
319,5@
Earnings/Employee
$ 35,088
Employment
0.002
0.000
0.007
0.009
0.042
0.007
0.084
0.040
0.030
0.014
0.142
0.024
0.000
0.096
0.009
0.054
0.014
0.017
0.067
1.033
0.01I
82,192
50,?25
39,720
65,789
27,E96
47,466
49,180
66,514
10,772
50,136
90,909
24,949
18,727
45,345
16,509
26,266
19,015
42,733
8,824
Total 1.703 $237fl4 $37518
Industry group
Agriculture, forestry, fi shing
Mining
utilities
Construction
Manufacturing
Wholesale nade
Retail trade
Transportation and warehousing
Information
Finance and insurance
Real estate and rental and leasing
Professional, scie,ntific, services
Ma.a gement of companies
Adrninistrative and waste managernent
Educational services
Health care and social assistance
Arts, entertainment, and recreation
Accommodation
Food services and drinking places
Other seruices
Households
Total
Employment
0,003
0.001
0.022
0,044
0.01I
0.005
0.106
0.012
0.010
0.023
6.2t7
0.021
0.000
0.087
0.0r2
0.w4
0.013
0.023
0.084
0.034
0.015
OutpuU Employee
$ 158,730
1g7,500
466,951
155,531
206,140
2222n
89,923
107,570
226,60t
326,964
gI,54g
136,465
142,957
87,459
56,452
109,304
43,3?l
95,339
60,571
154,M2
Earnings/Employee
$ 31,746
62,500
g5,2gg
51,4?9
39,474
64,915
28,016
43,E25
54,187
67,941
10J93
5E,166
142,851
28,603
20,161
45,543
t4440
27,542
t9129
42,417
6,309
6.818 $85,248 $12,8t9
Table 3-12 shows that there will be a rctal of 6.818 new jobs crrated from the operation of the
convention centcr potion of the projecr Output per new worker for the Real Estate and Rental
sector would be about $81,548, with average annual eamings of about $10593. For all new workers,
the corresponding figures are $85248 and $12,889.
Page 119
Industry group
Agriculture, forestry, fishing
Mining
Utilities
Construction
Manufacturing
Wholesale trade
Retail trade
Transportation and warehousing
Information
Finance and insurance
Real estate and rental and leasing
Professional, scientifi c, services
Management of companies
Administrative and waste management
Educational services
Health care and social assistance
Arts, e,ntertainment, and recreation
Accommodation
Food services and drinking places
Other services
Households
Employment
0.026
0.003
0.1 12
0.094
0.208
0.070
1.343
O.I E4
0.182
0.l lE
1.315
0.141
0.005
0.281
0.134
0.820
0.141
0.181
0.836
2t.7tt
0.t69
OutpuU Employee
$ 147287
142,957
459,854
t5sJ02
lgg,030
222,874
89,951
106,027
186,937
. 312,500
. 163,077
I 19,186
250,000
73,615
55300
t09p27
42,157
94,104
60,599
98,577
Earnings/Employee
$ 31,008
71,429
83,942
52,632
40,394
u,576
27,94?
47,991
49,423
9,236
10,924
47,965
83,333
27,697
19,433
45,761
14,535
27 2t1
19,136
36,456
'7282
Total 2E.075 $r03J84 $34,768
Table 3-13 shows tlut there will be a total of 28.075 new jobs created from the operation of the qpa
ponion of the prcjecl Output per new worlar for the Other Services sector would be about
$98,577, with average annual eamings of about $36,456. For all new worlcrs, the corresponding
figurcs arre $101,384 and $3a"768
Page 120
Industry group
Agriculture, forestry, fishing
Mining
Utilities
Constnrction
Manufacturing
Wholesale trade
Retail trade
Transportation and warehousing
Information
Finance and insruance
ReaI estate and rental and leasing
Professional, scieirtific, services
Management of companies
Administrative and waste rnanagernent
Educational services
Health care and social assistance
Arts, entertainment, and recreation
Accommodation
Food services and drinking places
Other services
Households
OuOut/Employee
s 136,585
166,667
464,602
155,963
l7l,888
223,404
89,991
I04,781
182,123
311,448
166,79
113,699
222,222
63,995
56,426
109,1 l8
42,799
94,637
60,502
142,290
Earnings/Employee
$ 34,146
84,071
52,752
389s0
63,830
28,000
49,461
48,045
63,9',13
10,910
47,945
lll,11l
25,4M
18,809
45,'140
14,263
26,8t4
19,122
39,709
7,246
28560
Employment
0.006
0.000
0.012
0.012
0.032
0.010
3.t32
0.041
0,024
0.016
0.139
0.020
0.000
0.035
0.017
0.090
0.017
0.017
0.0E6
0.041
0.019
Total 3.766 $96,51E $
Table 3-14 shows that there will be a mtal of 3J66 new jobs crearcd from the operation of the gilt
shop portion of the prcjecl Ourput per new worlcr for the Retail trade sector would be about
$89,991, with average annual eamings of about $28,000. For all new workers, the corresponding
figues are $96,518 and $28J60
Page 121
Industry group
Agriculture, forestry, fi shing
Mining
Utilities
Constnrction
Manufacturing
Whole.sale trade
Retail trade
Transportation and warehousing
Information
Finance and insurance
Real estate and rental and Ieasing
Professional, scientific, services
Managernent of conrpanies
Administrative and waste manageln€nt
Educational services
Health care and social assistance
Arts, errtertainrnent, and recreation
Accornmodation
Food services and drinking places
Other services
Households
OutpuUEmployee
$ 173,077
166,667
463,902
155,870
178,156
22l,9lg
89,945
707,979
186,016
3ll,lll
160,434
124,4U
225,806
67,3U
57,823
109,049
44,401
94,545
60,695
152,290
Errnln$/Employee
$ 33,654
55,556
84,485
52,632
39,504
63,014
29,093
47,273
47,493
64,815
I1,029
51,435
96J74
26,048
lE,l4l
45,675
14,381
26,667
t9asr
41,047
9,310
Employment
0.010
0.001
0.032
0.024
0.063
0.018
0.249
0.040
0.037
0.026
0.284
O.otl
0.002
0.086
0.M3
0.171
I1.071
0.040
0.183
.0.082
0.035
TotaI 12.540 $53,7tt $16273
Table 3-15 shows that there will be a toul o{ 12.540 new jobs created from the operatbn of the
recreation portion of the project. Output per new worker for the Arts, Entertainmeng and
Recreation sector would be about $44,401, with average annual eamings of about $14,381. For all
new workers, the corresponding figures are $53,788 and $15,273.
l'age 122
Industry gtroup
Agriculture, forestry, fishing
Mining
Utililies
Construction
Manufacturing
Wholesale trade
Retail trade
Transportation and warehousing
Inforrration
Finance and insurance
Real estate and rental and leasing
Professional, scicntifi c, services
Management of companies
Administrative and waste management
Educational senrices
Health care and social assistance
Arts, entertainrre,nt, and recreation
Accommodation
Food senrices and drinking places
Other services
Households
Total
Output/Employee
s 1u,44
t73469
238,gil
155,347
216,514
222,222
gg,gg6
107,200
240,8y
107,255
252,166
139,423
200,000
7l,g0g
56,433
l0g,lg3
43,103
95,156
60,730
140,514
Earnings/Employee
s 33,333
35,774
52,914
5 r,991
42202
65,134
27,966
51,200
57,927
64,011
11,265
53,28s
Employment
0.004
0.009
2.01I
0.30s
0.026
0.012
0.211
0.030
0.016
0.033
0.1 l0
0.119
0.000
0.036
0.021
0.132
o.o22
0.027
0.1l6
0.067
0.027
3.333 $t97,tt6 $
26,596
l g,05g
45,553
15,086
27,682
19,286
39,230
7,O42
46,E32
Table 3- 16 shows that there will be a total of 3.333 new jobs creat€d from the operation of the waste
water portion of the proiect. fttp.r per new worlcr for the IJtilities secor would be abotrt
$238,964, wfuh average arulral eamingp of abotrt $52,914. For all new workers, dre corresponding
figtrres arc$197,116 and W6,812.
Page 123
Industry group
Agriculhre, forestry, fishing
Mining
Utitities
Constnrction
Manufacturing
Wholesale trade
Retail trade
Transportation and warehousing
Information
Finance and insurance
Real estate and rental and leasing
Professional, scientific, services
Management of companies
Administrative and waste managemEnt
Educational services
Health care and social assistance
Arts, entertainment, and recreation
Accommodation
Food services and drinking places
Other services
Households
Employment
0.034
0.003
0.107
0.081
0.212
0.060
0.838
0.136
0.125
0.089
0.955
0.138
0.005
0.291
0.145
0.516
37.239
0.136
0.615
0.277
0.1l9
OutpuU Employee
$ 173,W7
166,667
463902
155,870
178,156
22t,9lg
89,945
107,879
186,016
3ll,1ll
l@,434
r24A02
225,906
67,394
57,823
109,049
44,401
94,545
60,695
152,290
EarningslEmployee
$ 33,654
55,556
84,485
52,632
39,504
63,014
29,093
47 273
47,493
64,815
I1,029
s1335
96,774
26,048
l8,l4l
45,675
14,381
26,667
19,251
41,04'7
8,310
Total 42.180 $53,78E $16,273
Openations-Phase 3
Phase 3 of project operations includes Golf (Amusements/Recreation), Food Services, and'Wasrc
'Water emplopes. Tables 3-12 thrcugh 3-19 show the economic impact of emplopes of prciect's
Phase 3 for the 20 najor industrial classifications in the RII\,{S II input/output model.
Page 124
Table 3-17 shows that there will be a total of 42.180 new jobs crcat€d from the operation of the golf
portion of the project. Outpu per nev/ worlrer for the Arts, Entertainment, and Recreation sector
would be about $44,401, wit} average annul earnings of about $14J81. For all new worlcrs, the
corresponding figrrres are $5 3,78 8 and $16,27 3.
Table 3- 18 shows that there will be a total of 5.954 new jobs created from the operation of the food
services portion of the pro)ect. Output per new worker for the Food Services and Drinking Places
Industry group
Agricultrue, forcstry, fishing
Mining
Utilities
Construction
Manufacturing
Wholesale trade
Retail trade
Transportation and warehousing
Information
Finance and insurance
Real estate and rental and leasing
Professional, scientific, services
Management of companies
Administrative and waste management
Blucational seryices
Health care and social assistance
Arts, entertainrnent, and recreation
Accommodation
Food services and drinking places
Other services
Households
Total
OutpuUEmployee
$ 154,519
l57,gg5
4&,630
155,925
224,935
223,009
90,065
102,130
186,842
31 1,159
772,175
I 19,149
217,391
71,620
55,062
109,1 12
37,578
94,142
60,597
144,923
Earnings/Employee
$ 32,070
52,632
93,601
51,975
37,922
63,717
28,041
54,615
48,684
&4,37E
l0,gg5
49,645
86,957
25,962
17,762
45,701
13,570
27,197
19,241
40,694
8,310
Employment
0.010
0.001
0.019
0.015
0.05E
0.017
0.163
0.055
0.023
0.014
0.153
0.021
0.001
0.034
0.017
0.106
0.029
0.029
5.1l5
0.051
0.022
5.954 $7t?08 $
Page 125
21,222
Industry group
Agricultue, forestry, fishing
Mining
Utilities
Consbuction
Manufacturing
Wholesale trade
Retail trade
Transportation and warehousing
Information
Finance and insurance
Real estate and rcntal and leasing
hofessional, scicntifi c, services
Management of companies
Administrative and waste management
Educational senrices
Health care and social assistance
Arts, entertainment, and recreation
Accommodation
Food services and drinking places
Other services
Households
OutpuUEmployee
$ t 44,q44
r7tA6e
238,9U
tss347
216,514
222222
gg,gg6
la7,2oo
240,954
307,255
252,166
t39423
200,000
71,909
56,433
109,183
43,103
95,156
60,730
140,514
Earningc/Employec
$ 33333
35,774
s2914
slB9l
n2a2
65,134
n,966
51,2W
57,927
64,011
n265
53,285
26,596
18,059
45,553
15,086
27,682
t9,286
39,230
7,042
46,832
Employment
0.009
0.019
4.022
0.609
0.052
0.025
0.422
0.059
0.031
0.067
0.2t9
0.237
0.000
0.072
0.042
0263
0.044
0^055
0.232
0.133
0.054
Total 6.666 S 197,116 $
sector would be about $60,5?7,wfuh average armual earnings of about $1924t. For all new worke$, ,
tlre corresponding figures are $71208 and$21222.
Table 3-19 shows *rat there will be a total of 6.666 new jobs created from the operation of the waste
water portion of the project. Output per new worker for the (ftilities sector would be about
$238964, with aver:age annual earnings of about $52,914. For all new wor*ers, the corn:sponding
figures are $197,116 and $46,832.
Page 126
Operatiors-Phase 4
Phase 4 of project operations includes 'Waste \?'ater emplopes. Table 3-20 shows the economic
impact of emplopes of project's Phase 4 for the 20 major indtrstrial classifications in the RIIIS II
input/outpw model
'Iable 3-20 shows that there will be a total of 8.333 new jobs created from the operation of the waste
water ponion of the proiect. Output per new worker for t}e Utilities sector would be about
$238,964, with average annuel eamings of about $529L4. For all new worlrers, the corresponding
figures are $197,116 and $46,832-
P age 127
Industry Etroup
Agriculture, forestry, fishing
Mining
Utilities
Construction
Manufacturing
Wholesale trade
Retail trade
Transportation and warehousing
Inforrution
Finance and insurance
Real estate and rental and leasing
Professional, scientific, services
Management of companies
Administrative and waste management
Educational services
Health care and social assistance
Arts, e,ntertainment, and recreation
Accommodation
Food services and drinking places
Other services
Households
Total
OutpuUBmployee
$ 1UA44
L73,469
238,964
155,347
216,514
222,222
g9,gg6
107,200
240,954
307,255
252,166
139,423
200,000
71,809
56,413
109,183
43,103
95,156
60,730
140,514
Earnings/Employee
$ 33,333
35,774
52,974
51,991
42,202
65,|y
27,966
s1300
57,927
64,01I
11,265
53,285
Employment
0.011
0.023
5.02E
0.761
0.065
0.031
0.527
0.074
0.039
0.084
0.274
0.29't
0.001
0.089
0.053
0329
0.055
0.069
0.29A
0.t6'7
0.06E
E333 $t97,tt6 $
26,596
18,059
45,553
15,086
27,692
19,286
39,23O
7,042
46,832
4. C-onchxion
The purpose of the analpis is to estimate the number of direct and indirect jobs CIsociated wfuh the
MPR projea and determine average wages corresponding to these |obs. Given these estimates, as
sumrrnrized above, the anabryis can deterrnine the number of jobs associated with the project thu
will eam an average wage of 80o/o or less of the Brinnon arca average median incorrr (A}a!. The
Brinnon area median income is estimated *$42,6792 and 80o/o of this AlvI[ amount is estimated at
$34,143.
Construction
An estimated 342 constnrction-rclated jobs will have average earnings of 80o/o or less of the
Brinnon area AJvII. This includes direct and indirea jobs associated wit}r the MPR project
construction and is summarized below, byphase, with average vxaBes for each industrygroup.
Constuction: Total Direct and Indirect obs at or Below the Brinnon Area AIvII
An estirnated 223 opemtions-rclated jobs will have average earningp of 80o/o or less of the Brinnon
area AMI. This includes direct and indirect jobs associated with the MPR project operation and is
summarized below, byphase, with average wages for each industrygroup.
5{ rpbov*- 8 a2>
2 U.S. Gnsts Bureau, 2@8-2012 American Commtrniry S*rey'. "Selected Economic Characterisrics." Data for
Briruron" Washington
Retail ta&
:
$ 32,468.
43322,
1?;404J:406 1:162
a'EPi ;:::i 4,,!.7,9
28,030
Page 128
35.987
2,478"r a:1,,:'
I
Total Direct and Indirect obs at or Below the Brinnon Area AIVII
Retail trade
Real estate aqd rentalaid leasiog ,
Admi nistrative and waste ma[agement
Educational services
Arts, enteilainment, and rocreation
.'6,797
1.903
0.575
0.259
42.404
s.304
14.512
$fishing
Accornmodation
Food
?i,@
t8;17i,
14JS0
20,853
Real estate and nental.and Ieasing :.
Administrative and wasE managem€xrt
Educatioaral services
futs, ente,rtaitrE€ot, aad recreatiou
Aocommodation
0.1s2
: :i:::i
r7:589
I0.523.
l;636
0.497
11.6s4
44.833
26.t24
l4;401
Food services and drinking places
Agriculture,
Retail fade
Administratiw and waste rnaragement
Educational services
Arts, entertain nent, and resreatiom
Accommodation
28,444
11,051
,
26,139:
1g,092:
14,38-1
2,6,991
19244
$
aud dri:oki-ng
Retail trade
Agriculture,
Agriculture, forestry, frshing
Re.tail trade
Real estate and rental and leasing
edministrative and waste managempnt
Educational services
Arts, atertainrnen! and recreation
Accommodation
Food serr.ices and drirrkitg places
0.01I
0,527
0.274
0.089
0.053
0.055
0.069
0.?,90
33,333
17,965
11,265
26,596
18,059
15,086
21,6E2
19,286
$
Pagc 129
' lg,22g
5. About RI\[S II Fina] Demand Methodology
The following rnaterial has been condensed from fib RIIvIs II User l{andbook
Introduction and C'eneral Comments
Effegtive planning for pullig ald private-r.:to.r projects_a1d programs at the Sate and local levels
reqrires a sptematic analpis of the economic impacts of these projects and programs on affeaed
regions. In tum, systematic anabtis of economic impacts must account for the inter-industry
relationships within regions becaue these relationships lrrg.ly detemrine how regional economies
are lilrelyto respond to project and program changes. Thus, regional input-ourput (I-O) nnrltiplien,
which account for inter-ind*try relatiorships within regions, are useful tools for conducting
regional economic impact analpis.
In the 1970s, the Bureau of Economic Analysis (BEA) developed a nathod for estirrating regronal
I-O multipliers known as R[}rtE (Regional Indtsrial ]fuhiplier System), which was based on the
wor{< of Garnick and Drake. In the 1980s, BEA completed an enhancenrent of N}v6, known as
RII\6 II (Regional Inpw-Outpw Nlodeling Sptern), and published a handbook for RII\4S II users.
ln L992, BEA published a second edfuion of the handbook in which the muhipliers qzere based on
more rrcent &ta and improved methodology. ln lgg7, BEApublished a thirrd edition of the
handbook tlut provides more detail on the use of the muhiplien and the &ta sources and methods
for estimating thenr.
RIMS II is based on an accounting framework called an I-O table. For each industry, an I-O table
shows the industrial distribution of inputs purchased and outputs sold. A q,pical I-O table in RIIIS
II is derived mainly from two data sources: BEA's national I-O table, which shows t}re input and
oulput structurc of nearly 500 U.S. industries, and BEA's regronat economic accounts, which are
rsed to adjwr the oationd I-O table to show a region's indutrial strucrue and trading patterns.
Using RIIVIS II for impact analpis has several advanages. RII/$ II rrnrltiplien can be estimated for
any region composed of one or more counties and for any indtutry, or grcup of industries, in the
national I-O table. The accessibfity of the main &ta sources for RIIvIS II keeps the cost of
estimating regional -9:p{:t_ry1"t*-.b l9w. Empirigal..tesp show that estimates based on relatively
expensive surve)t and RIIvIS Il-bxed estimatrs are similar in magnitude.
BEAs RINXS rrnrhiplien can be a cost-effective wayfor analysts to estinrate the economic impacts of
changes in a regional ecoromy. However, it is important to keep in mind tlraq like all economic
impact models, RII/6 provides approximate orrder-of-magnitude estimates of impacts. RIIIS
multiplien are best suited for estirmting the impacts of small changes on a regional economy. For
some applications, users may want, to supplerrrent RIIvXS estimates wfuh inforrrntion they gafrer
from the reglon rmdergoing the potential change. To use the muhipliers for impact analpis
effecdvely, users must provide geographically and indrstrially detailed information on the initial
changes in outpuq eamings, or employmeff that are associated with the project or prcgram under
sudy. The multipliers can then be used to estimate the total impact of the project or program on
regional oulput, eamings, and employment.
I'age 130
RINIS II is widely used in both the public and private sector. In the public sector, for example, tle
Department of Defense uses RIlvS II to estimate the regional impacts of miliary base closings.
State transponadon deparunents use NlvIS II to estimate the regional rmpacts of airpon
construction and exparsion. In the private-sector, analpts and consultants use RIIvS II to estimate
the regiond impacts of a variety of projeca, such as the development of shopprng rnalls and sports
stadiums.
RIMS II Methodology
RIN6 II uses BEA's benchrmrk and annual I-O tables for the nation. Since a particular region rmy
not contain all the industries found at the national level, some direct input requircments cannot be
supplied by that region's industries. Input reguiremenm that are not produced in a snrdy re gion are
identified using BEA's regional economic accounts.
The NlvlS II method for estimating regiond I-O multipliers can be viewed as a three-srcp prccess.
In the first step, the producer ponion of the national I-O table is made region-specific byusing six-
digit NAICS location quotients EA).The LQs estimate the extent to which input requirenrents are
supplied by firms wfuhin the region. RII/$ II uses LQs bxed on two types of data: BEA's penonal
income d"t (by place of resi&nce) are used to calculate LQ i" the service indusuies; and BEA's
wage-and-salarydata (byplace of worl$ are used to calculate LQs in the non-service indusuies.
In the second step, t}e household row and the household colurnn from the national I-O table are
rnade region-specific. The household row coefficients, which are derived from the valueadded row
of the national I-O table, are adjusted to refleo regional earnings lealoges resulting from individuals
working in the region but residing outside the region, The household colurnn coefficients, wtrich are
based on the personal consumption expenditurc colurnn of the national I-O table, are adjusted to
account for regional consumption lealsages stemming from penonal ta:<es and savingp. In the last
srcp, the l,eontief inversion approach is ued rc estirnate muldplien. This inversion approach
produces output, eamings, and employrrrent muhipliers, which can be used to trace the impacts of
changes in final demand on and indirealyaffecrcd industries.
Accuzcy of RIMS II
Empirical evidence suggests that RIIvS II commonly yields multiplien that are not substantially
different in magnitude from those generated by regional I-O modeli based on relatively expensive
surve)6. For example, a comparis on of. 224 industry specific muhiplien from surveybased ubles for
Colorado, \U?'xhington, and West Virginia indicates that the RIh/IS II avemte mukipliers
overestimate the average muhipliers from the surveybased ables by approximately 5 percent. For
the rnjorrty of individual industry-specific multipliers within these states, the difference beween
RMS II and surveybased muhipliers is less fian 10 percent. In addition, RIIV[S II and suney
muhiplien show statistically similar distributions of affected industries.
Adrantages of RIMS II
There are nurrerous a&antages to using RIivIS II. Fint, the accessibiliry of the main data sources
males it possible to estfunate rcgional nruldpliers without conducting relatively oipensive surve)c.
Second, the level of indusuial detail used in RINE II helps avoid aggregadon errors, which often
occur when indr:srries arc combined. Third, RII/6 II rnul-dpliers can be compared across areas
becaue they are based on a consistent set of estimating procedures nationwide. Fourth, RIlitS II
Pagc l3l
muhipliers are updated to rcflect t}e most recent local-area wage-and-salary and personal incorne
data
Orrcrview of Dffercnt Multiplien
RIMS II provides rsers with five qpes of muhiplien: final dernand muhiplien for output, for
eamings, and for employrrrnt; and direct-effect muldplien for earningp and for employrnent. These
muldplien masure the economic impact of a change in final demand, in eamings, or in employment
on a region's economy.
The final demand multiplien for orrprn are the basic multipliers from which all other RIII6 II
multiplien are derived. In this able, each column entqy indicates the change in outpm in each row
indusuythat rcsults from a $1 change in final demand in the column industry. The impact on each
row industry is calculated by muhiplying the final dernand change in the column industry by th.
muhiplier for each row. The total irnpact on regional output is cdculated by muhiplying the final
demand change in the column industry by the sum of all the multiplien for each row except the
household row.
RII/6 II provides two types of multipliers for estimating the impacts of changes on eamings: final
demand muhiplien and di€ct effect nnrhiplien. These muhipliers are derived from tfu table of
final demand output rrnrltiplien.
The final demand multipliers for eamings can be ued if data on final denrand changes are available.
In the final dernand earnings multiplier able, each column entry indicates the change in eamings in
each row industrythat results from a $1 change in final demand in the column indrstry. The impaa
on each row industry is calculated bymuhiplying the final demand change in the column industryby
the rrnrltiplien for each row. The total impact on regional eamings is calculated by muldplying the
final denund change in the column industry by the sum of the multipliers for each row.
E mploymert Multiplie rs
RIA S II provides two t)?es of muhipliers for estirmting the impacts of changes on employment:
final demand muhiplien and direct effect rnultipliers. These muhipliers are derived from tlre able
of find demand output muhipliers.
The final dernand multiplien for employment can be trsed if the data on final derrnnd changes are
available. In the find demand employment multiplier table, each column entry indicates the change
in employnrent in each row industry that results fiom a $1 million change in final denrand in the
column indrstry. The impact on each row industry is calculated by nnrltiplying the final demand
change in the column indrstry by the muldplier for each row. The total impact on regional
employnrcnt is calculated byoorluplyr"g the final demand change in the column indwtrybythe sum
of the muhiplien for each row.
The direa effect muhipliers for employment can be used if the data on the initial changes in
emplop'rent by indrstry are available. In the direct effect employnrnr muhiplier table, each entry
indicates the total.change in employment in the region that resuls from a change of one job in the
row industry, The total impact on regional employrrrent is calculated by multiplying the initial
change in employment in the row industry byth. multiplier for the row.
Page 132
Choosing a Multiplier
The choice of multiplier for estimating the impact of a project on output, earnings, and employment
depends on the availabiliry of estimates of the initial changes in find demand, earnings, 4nd
employment. If the estimates of the infuial changes in all three measures are available, the RIIvIS II
user can select any of the RIIvIS II multiplien. In theory all the impact estirnates should be
consistent. If the available estimates arc limited to initial changes in final demand, the user can select
a final demand multiplier for impact estirnation. If the available estirmtes are limircd to initid
changes in eamings or employment, the rser can select a direct effect multiplier.
The EF5 regulations provide that "jobs created indirectly'' by a regional center- affiliated business
rnay be credited to foreign investors who made a qualifying investment in the business. To show
this job creation, "reasonable" methodologies may be rsed. 8 Cmg04.6(-)(7). The RIL4S II
input/output model has been recognized by the USCIS as an acceptable methodology for showing
job creation resulting fiom a rcgionalcenter- affiliated investrrrent project.
1'age 133