REGIONAL ECONOMIC DEVELOPMENT

Transcription

1 REGIONAL ECONOMIC DEVELOPMENT BRIEF CHAMBER OF COMMERCE OF HUNTSVILLE/MADISON COUNTY Huntsville Regional Economic Growth Initiative CHAMBER OF COMMERCE OF HUNTSVILLE/MADISON COUNTY page 1

2 Table of Contents Huntsville Regional Economic Growth Initiative State of the Economy...6 UAH Economic Impact Study Huntsville Regional Economic Growth Initiative CHAMBER OF COMMERCE OF HUNTSVILLE/MADISON COUNTY page 2

3 Introduction Why has Huntsville been so successful? Is it that we are just lucky or is it something more? Luck has sometimes been described as the confluence of preparation and opportunity. We would propose that our community has been successful because we have positioned ourselves to be lucky! The resources entrusted to the Chamber by our HREGI investors, coupled with the insightful guidance of our public and private sector leadership has resulted in a series of significant wins in the economic development arena and enhancements to our region s quality of life. This document articulates the success made possible through the resources provided by our HREGI investors, and lays out the path forward for the next phase of the program. Our Chamber is a more dynamic and effective organization due to the unique position we have in the community. We enjoy a healthy partnership with our public sector partners, working to navigate through challenges and exploiting opportunities. A culture has developed where we can work with our partners to craft effective solutions to the issues which need to be addressed. We benefit from a wealth of experience and perspectives all of which bring value to the discussion. Our community provides fertile ground for leveraging HREGI Investments to realize significant gains. The Chamber engaged the University of Alabama in Huntsville (UAH) to provide an objective analysis of the economic impact of the projects we announced from The UAH research team determined the projects announced over the three-year period will result in an increase in the regional GDP of $4.2 billion, the creation of 15,200 operations related jobs, and just under $1 billion a year in additional payroll a 3,500% return (measured against the increase in GDP) on the $7 million invested in the HREGI program over the last five years. Investors in the HREGI Program entrusted the Chamber with the additional resources with the belief that they would be utilized in a manner that would enhance the economic vitality of the region. The results speak for themselves. When resources are leveraged properly, they yield positive results for our community and the region. The impact of these efforts is a stronger, more vibrant economy, and a higher quality of life. We need your support to ensure that we maintain the momentum we have created. Strong private sector leadership will ensure that the business community plays a proactive role in addressing the issues that will shape our community and region for decades to come. We look forward to working with you to grow our economy, enhance the workforce and education systems, and improve the quality of life of the Huntsville Region. We thank those who have made our success possible and look forward to welcoming new investors! Joe Newberry 2017 Board Chair Chamber of Commerce of Huntsville/Madison County Rose Allen HREGI Taskforce Chair Chamber of Commerce of Huntsville/Madison County Huntsville Regional Economic Growth Initiative CHAMBER OF COMMERCE OF HUNTSVILLE/MADISON COUNTY page 3

4 HREGI Investors as of February 15, 2017 DEVELOPMENT PARTNER DEVELOPMENT COUNCIL CHAIRMAN S COUNCIL PRESIDENT S CIRCLE Huntsville Hospital Regions Bank Madison County Commission REGIONAL PARTNERS Port of Huntsville Tennessee Valley Authority LEADERSHIP FORUM ADTRAN, Inc. The Boeing Company City of Madison Landers McLarty Corporation Redstone Federal Credit Union Vertiv Huntsville Regional Economic Growth Initiative CHAMBER OF COMMERCE OF HUNTSVILLE/MADISON COUNTY page 4

5 EXECUTIVE COUNCIL BBVA Compass Crestwood Medical Center Dynetics, Inc. General Atomics Lockheed Martin Corporation PNC Bank SAIC SES - Science and Engineering Services, LLC Teledyne Brown Engineering, Inc. CHAMBER TRUSTEES AEgis Technologies Group Aerojet Rocketdyne All Points Logistics, LLC Blue Cross & Blue Shield of Alabama Booz Allen Hamilton, Inc. DynCorp International First Commercial Bank Intuitive Research and Technology Corporation Jerry Damson, Inc. KBRwyle Lanier Ford Shaver & Payne P.C. Northrop Grumman Corporation PARSONS Raytheon Company S3 Sealy Management Company, Inc. Torch Technologies PROGRESS PARTNERS ASRC Federal Analytical Services Baron Services, Inc. BASF Corporation BB&T Bill Penney Toyota, Scion & Mitsubishi Bradley Arant Boult Cummings LLP Coates Transportation Group Colliers International Connected Logistics Corporate Office Properties Trust (COPT) Davidson Technologies, Inc. Google Huntsville-Madison County Builders Association IBERIABANK Hexagon US Federal J. Smith Lanier & Co. Keel Point, LLC L3 Technologies LogiCore Progress Bank Radiance Technologies Rosie s Restaurants, Inc., & Right Way Restaurants, Inc. (DBA Steak Out) SELEX Galileo Inc. ServisFirst Bank Turner Construction Vencore, Inc. Wells Fargo Bank Woody Anderson Ford PROGRESS INVESTORS 4SITE, Inc. AECOM Alpha Beta Technologies, Inc. Amanda Howard Real Estate Anglin Reichmann Snellgrove & Armstrong, PC Averbuch Realty Co., Inc. Scott Averbuch BancorpSouth Brown Precision, Inc. Bryant Bank CB&S Bank Century Automotive CFD Research Corporation Coast Personnel Services decibel Research Decisive Analytics Corporation Deloitte LLP DESE Research, Inc. Digium, Inc. Fite Building Company, Inc. Foreign Language Services Fountain, Parker, Harbarger Garver HEMSI Hiley Cars Huntsville Huntsville Botanical Garden Huntsville/Madison County Convention & Visitors Bureau Huntsville Tractor & Equipment, Inc. InterFuze Corporation Investor s Resource/Raymond James IronMountain Solutions The Lioce Group, Inc. LSINC Corporation MSB Analytics, Inc. National Bank of Commerce nlogic, LLC North Alabama Multiple Listing Service PALCO Telecom Service PHOENIX PROJECTXYZ, Inc. Public Financial Management, Inc. QTEC Renasant Bank RJ Young Company S&ME, Inc. Sierra Lobo, Inc. Sigmatech, Inc. Systems Products and Solutions, Inc. Technicolor Troy 7, Inc. Venturi, Inc. West Huntsville Land Co., Inc. Wilmer & Lee, P.A Huntsville Regional Economic Growth Initiative CHAMBER OF COMMERCE OF HUNTSVILLE/MADISON COUNTY page 5

6 STATE OF THE ECONOMY MEASURING ECONOMIC PERFORMANCE CHAMBER OF COMMERCE OF HUNTSVILLE/MADISON COUNTY State of the Economy RESEARCH & INFORMATION SERVICES ~ CHAMBER OF COMMERCE OF HUNTSVILLE/MADISON COUNTY page 6

7 More than 9,000 new jobs over the past 3 years 5-year projection: 8.5% growth; 38,000 new residents Expected to grow beyond 500,000 people by 2023 Athens LIMESTONE COUNTY MADISON COUNTY Population Density Huntsville Madison Redstone Arsenal 10,173-14,511 7,487-10,172 5,147-7,486 3,250-5, , Total Population (Esri) by Census Tracts State of the Economy RESEARCH & INFORMATION SERVICES ~ CHAMBER OF COMMERCE OF HUNTSVILLE/MADISON COUNTY page 7

8 Population Growth Trends Population Growth Southeast Metros Myrtle Beach, SC Fort Myers, FL Orlando, FL Charleston, SC Fayetteville, AR Sarasota, FL Nashville, TN Lakeland, FL Atlanta, GA Miami, FL Jacksonville, FL Port St. Lucie, FL Tampa, FL Huntsville, AL Pensacola, FL Greenville, SC Lexington, KY New Orleans, LA Daytona Beach, FL Columbia, SC 7.8% 7.7% 7.6% 7.4% 7.0% 6.7% 6.1% 6.0% 5.9% 5.7% 5.6% 5.5% 5.2% 11.6% 11.5% 10.3% 9.3% 9.2% 14.1% 13.1% #14 in the South Huntsville is one of the Top 40 fastest growing major metros in the country State of the Economy RESEARCH & INFORMATION SERVICES ~ CHAMBER OF COMMERCE OF HUNTSVILLE/MADISON COUNTY page 8

9 Population Growth Trends Population Growth Alabama 79,243 Huntsville 27,159 Remainder of Alabama (65 counties) 66% Huntsville (2 counties) 34% Huntsville accounted for 34% of Alabama s growth State of the Economy RESEARCH & INFORMATION SERVICES ~ CHAMBER OF COMMERCE OF HUNTSVILLE/MADISON COUNTY page 9

10 Gross Domestic Product Growth Bureau of Economic Analysis Metrics, % 50% Huntsville 53% 40% 30% 20% 10% United States 29% 21% Alabama 0% The Huntsville economy continued to grow during the recession State of the Economy RESEARCH & INFORMATION SERVICES ~ CHAMBER OF COMMERCE OF HUNTSVILLE/MADISON COUNTY page 10

11 Gross Domestic Product Growth Bureau of Economic Analysis Metrics, U.S. Metros Austin, TX Portland, OR Fayetteville, AR Provo, UT San Jose, CA Durham, NC Bakersfield, CA McAllen, TX Huntsville, AL Dallas, TX Raleigh, NC Corpus Christi, TX Charleston, SC San Antonio, TX Houson, TX Des Moines, IA Nashville, TN Killeen, TX Baton Rouge, LA Charlotte, NC 64% 59% 57% 57% 54% 52% 50% 49% 46% 46% 45% 44% 43% 42% 42% 40% 78% 76% 74% 71% #2 in the South Huntsville GDP growth is among the Top 10 major metros in the country State of the Economy RESEARCH & INFORMATION SERVICES ~ CHAMBER OF COMMERCE OF HUNTSVILLE/MADISON COUNTY page 11

12 Gross Domestic Product Growth Bureau of Economic Analysis Metrics, Huntsville $7.6 Billion Birmingham $6.5 Billion Mobile $2.0 Billion Montgomery $1.3 Billion Huntsville accounted for 25% of Alabama s GDP growth State of the Economy RESEARCH & INFORMATION SERVICES ~ CHAMBER OF COMMERCE OF HUNTSVILLE/MADISON COUNTY page 12

13 Combined Employment, GDP & Wages Metro Area Coincident Index, % 35% 30% 25% 20% 15% 10% 5% 0% Huntsville 34% United States % 11% Alabama The Huntsville economy continues to outpace the state and national economies in overall economic growth State of the Economy RESEARCH & INFORMATION SERVICES ~ CHAMBER OF COMMERCE OF HUNTSVILLE/MADISON COUNTY page 13

14 Employment Growth Bureau of Labor Statistics Metrics, % Huntsville 20% 15% 10% 5% 0% United States 9% 3% Alabama -5% Huntsville added more than 33,700 new net jobs (88% of total Alabama growth) State of the Economy RESEARCH & INFORMATION SERVICES ~ CHAMBER OF COMMERCE OF HUNTSVILLE/MADISON COUNTY page 14

15 Employment Growth Bureau of Labor Statistics Metrics, Huntsville 36,342 Alabama 58,258 Huntsville s employment growth was 62% of the Alabama total State of the Economy RESEARCH & INFORMATION SERVICES ~ CHAMBER OF COMMERCE OF HUNTSVILLE/MADISON COUNTY page 15

16 Wage & Salary Growth Bureau of Economic Analysis Metrics, (adjusted for inflation) 30% 25% 20% Huntsville 28% $1.9 billion more per year 15% 10% 5% 0% United States Alabama 13% 9% -5% Huntsville wage growth was not affected by the recession, but by sequestration State of the Economy RESEARCH & INFORMATION SERVICES ~ CHAMBER OF COMMERCE OF HUNTSVILLE/MADISON COUNTY page 16

17 Huntsville Metro Area Market Report Moody s Economic Forecast, November 2016 The Huntsville market is steady and balanced, and is expected to outperform the nation for the remainder of State of the Economy RESEARCH & INFORMATION SERVICES ~ CHAMBER OF COMMERCE OF HUNTSVILLE/MADISON COUNTY page 17

18 Huntsville Metro Area Market Report Moody s Economic Forecast, November 2016 Despite its recent troubles, Huntsville will outperform Alabama and the nation over the coming year, though potential trade disputes threaten goods producers. More high-paying jobs in research, engineering and manufacturing will create positive spillover in retail and housing. Potential new federal defense spending adds upside risk in the outlook for military contractors. HUN s well-built labor force, which includes a high concentration of mid-career professionals and college-educated residents, will help keep it a step ahead of the state and nation in the coming years. Jeremy Cohn November 2016 help@economy.com State of the Economy RESEARCH & INFORMATION SERVICES ~ CHAMBER OF COMMERCE OF HUNTSVILLE/MADISON COUNTY page 18

19 Huntsville Metro Area Market Report Moody s Economic Forecast, November ,000 2,500 Single-Family permits Multi-Family permits Moody s projection 2,000 1,500 1, New home construction is projected to increase by 10% over the next five years State of the Economy RESEARCH & INFORMATION SERVICES ~ CHAMBER OF COMMERCE OF HUNTSVILLE/MADISON COUNTY page 19

20 Huntsville Business Confidence Index Business Environment Expectations, Q vs. Q (Huntsville Metro Area) Business Confidence is up more than 10% over last quarter State of the Economy RESEARCH & INFORMATION SERVICES ~ CHAMBER OF COMMERCE OF HUNTSVILLE/MADISON COUNTY page 20

21 Media Recognition BOMA says HSV is TOPS Huntsville tops the Building Owners and Managers Association s list for hi-tech coolness and southern style- -and BOMA says we have the least expensive office space in the U.S. (FYI: New York City has the highest). HDT expands in Huntsville HDT Global announced it is expanding its operations in Huntsville (in Limestone County) at an event which featured Governor Robert Bentley, Mayor Tommy Battle, and Limestone County Commission Chairman Mark Yarborough. HDT manufactures rugged and durable products used for expeditionary applications in the most extreme and harsh environments. At the HSV facility, HDT will make the Deployable Rapid Assembly Shelters (DRASH) and AirBeam and Base-X models. This expansion will add roughly 120 new jobs to our area. 800 Hudson Way coming to Biotech Campus HudsonAlpha Institute for Biotechnology announced that it will break ground on a new building tomorrow. The 100,000-squarefoot building will foster job growth of several new and expanding life sciences companies, and also will house components of HudsonAlpha s research, Educational Outreach, genomic medicine and informatics programs. GE Aviation announces plans for Huntsville advanced manufacturing facilities -- Adjacent factories to produce raw material for ceramic matrix composites (CMCs) -- GE partnering with USAF Research Lab Title III Office on silicon carbide technology State of the Economy RESEARCH & INFORMATION SERVICES ~ CHAMBER OF COMMERCE OF HUNTSVILLE/MADISON COUNTY page 21

22 Media Recognition Study ranks Madison among the most affordable cities to buy a home in the U.S. 24/7 Wall St., January 2017 Alabama among top 10 states in business climate rankings Site Selection magazine, November 2016 Instead of Austin, Texas, Try Huntsville, Alabama The Wall Street Journal, November 2016 Huntsville is the least expensive U.S. office market Building Owners and Managers Association (BOMA), October 2016 Huntsville is among The 25 Best-Paying Cities for Software Engineers Forbes, September 2016 Huntsville is Business Facilities top metro in the STEM Growth Leaders category Business Facilities, August State of the Economy RESEARCH & INFORMATION SERVICES ~ CHAMBER OF COMMERCE OF HUNTSVILLE/MADISON COUNTY page 22

23 Economic Impacts of the Economic Development Announcements An analysis of the economic development projects announced by the Chamber of Commerce of Huntsville/Madison County for years 2013, 2014, and 2015 EXECUTIVE SUMMARY Analysis performed by: Center for Management & Economic Research, College of Business Administration, University of Alabama in Huntsville Dr. Brinda Mahalingam and Mr. Jeff Thompson January 2016 UAH: Economic Impacts Executive Summary January 2016 COMMISSIONED BY THE CHAMBER OF COMMERCE OF HUNTSVILLE/MADISON COUNTY page 23

24 Economic Impacts of Economic Development Announcements Introduction Huntsville is a technology-rich city, and a major hub in the North Alabama region. The population growth in this city over the past five years has been about 4.4%. The unemployment rate, currently 5%, is typically below the national and state unemployment rates. Nicknamed Rocket City because of its long and significant role with the U.S. space and missile programs, the city has been at the forefront in developing space technology. Huntsville/Madison County serves as the economic center of north Alabama, and relies significantly on the surrounding region for workforce, industry suppliers, shoppers, and resources necessary for industry success. The City of Huntsville in Madison County has successfully attracted new industries into the local area for many years. Several companies have located to this area for the rich resources as well as the highly educated and technical labor force. Economic development is an activity focused on growing jobs for residents, customers for businesses, suppliers for industry, and economic activity for the local economies. The diversity of an industrial base can also be managed through targeted development to maintain a more stable and resilient economy. Typically, economic development success is measured in terms of jobs and capital investment. Annual announcements of new and expanding industry are made by economic development organizations to show the level of success for the past year. However, the realization of the impacts from new and expanding industries normally occurs over several years as plants are built, employees are hired, and operations reach the planned levels. The actual impacts of economic development efforts are multifaceted and may exceed expectations. One of the most important steps in estimating impacts is the selection of the geographic region (county, state, etc.) to be affected by the new project or activity. Expansions of existing operations tend to be completed in less time than the establishment of new operations, which often require new facility investments. A single project may include multiple phases (construction, workforce training and hiring, etc.) over several years to reach announced levels. Each phase may uniquely impact the region depending on the size, scope, and integration with the existing industrial base. Economic impacts may be defined in various terms such as jobs, economic activity (output), payroll, and tax generation among other measures. The impacts are typically shown as direct impacts and multiplier impacts. Impacts are spread over the multiple industry sectors in the region and are affected by the extent to which a specific industry sector exists in the region analyzed. Spending (the direct impact) of a specific industry results in production and spending in other industries. The construction, equipment, and operations of an expansion, will result in the production of products and services in related spending (indirect impact). The employees working in the new or expanded operations will use their income to make personal purchases, which will increase spending (induced impact) in other industries not related to their employment. The indirect plus induced effects are combined into the multiplier effect. This impact study was conducted using IMPLAN software developed by MIG Inc. The Chamber of Commerce of Huntsville/Madison County provided the data and list of announcements from which this study was performed. Multi-Regional Input Output analysis was conducted where appropriate. The impact region for this analysis is comprised of the Alabama counties of Madison, Limestone, Morgan, Marshall, Jackson and Lincoln County, Tennessee. The major cities for which impact estimates are calculated include Huntsville, Madison, Athens, and Decatur. It is important to note that economic estimates are made possible by defining a set of assumptions for the analysis. Results of this and any economic impact analysis should be viewed in light of the assumptions used 2. 2 See page 59 for the statement of assumptions in this analysis January 2016 UAH: Economic Impacts Executive Summary COMMISSIONED BY THE CHAMBER OF COMMERCE OF HUNTSVILLE/MADISON COUNTY page 24

25 Economic Impacts of Economic Development Announcements Executive Summary The Huntsville Metropolitan Statistical Area (MSA), one of the Metropolitan Statistical Areas (MSAs) in United States, had a 2014 population of 441,086. It ranked as the 118th largest MSA in the U.S 1. It is arguably the economic center of north Alabama with business activities easily extending beyond the county of Madison and the state of Alabama. Performing regular analysis of the economic impacts of this community s economic development announcement activities can provide insight useful to the community, its leaders, and other interested stakeholders. The economic impact of a specified geographic range, which includes the surrounding regions are compiled in this report. The impact region for this study is defined as Madison County and the contiguous counties of Jackson, Limestone, Marshall, Morgan, in Alabama and Lincoln County, Tennessee. The study also analyses the impact on the major cities of Huntsville, Madison, Athens, and Decatur. Economic development announcements by the Chamber of Commerce of Huntsville/Madison County for the years 2013, 2014, and 2015 were used for the analysis. Economic impact can be defined in various terms such as jobs, economic activity (output), payroll, and tax generation among other measures. The impacts are typically shown through components of direct and multiplier impacts over one or more years. Projects announced include sites in Madison County inside and outside of the corporate limits of Huntsville City and Madison City as well as the City of Huntsville in Limestone County. The estimated economic impacts for the combination of economic development projects for in the region include: $4.2 billion expansion of the region s economy 15,200 operations-related jobs $989 million in additional annual payroll $1.46 billion impact from capital investments (building, equipment, etc.) 11,300 capital investment related jobs $567 million in capital investment-related payroll $128 million increase in net annual taxes generated (employment, state, local) $52 million in net local taxes (sales, property and other taxes) $30 million in local sales taxes $21 million in local property taxes $1 million in other taxes 1 Data from U.S. Census January 2016 UAH: Economic Impacts Executive Summary COMMISSIONED BY THE CHAMBER OF COMMERCE OF HUNTSVILLE/MADISON COUNTY page 25

26 Impacts by Major Industry Sector The top twenty-five sectors most impacted by the 2013, 2014, and 2015 economic development project announcements are shown in Table 3 and Table 4. Economic output, and employment effects are shown for each sector. Economic output dollars represent the value of all the potential direct plus multiplier transactions in the industry sectors present in the specified region. Note that the estimated economic impact value should be viewed as the size of the opportunity for the industries in the local region to provide products, services, and workforce to the new project(s). The sector rankings may differ between tables due to the Output-per-Job differences by sector. Note there are additional sectors impacted beyond those listed here. Table 3 Potential Economic Output Impacts for Top 25 Sectors Economic Opportunity Industry Sector Description 3 Year Total Small arms ammunition manufacturing $719,068,455 Aircraft manufacturing $589,389,184 Construction of new manufacturing structures $563,624,118 Construction of new commercial structures, including farm structures $454,414,899 Scientific research and development services $175,088,961 Wholesale trade $172,666,435 Motor vehicle gasoline engine and engine parts manufacturing $122,865,197 Owner-occupied dwellings $106,125,025 Architectural, engineering, and related services $75,076,408 Wired telecommunications carriers $70,836,318 Real estate $64,638,337 Business support services $56,854,514 Guided missile and space vehicle manufacturing $56,552,719 Industry Sector Description Economic Opportunity 3 Year Total Breweries $48,531,077 Telephone apparatus manufacturing $41,191,145 All other industrial machinery manufacturing $37,068,091 Retail - Motor vehicle and parts dealers $36,846,120 Broadcast and wireless communications equipment manufacturing $34,302,519 Search, detection, and navigation instruments manufacturing $32,709,956 Monetary authorities and depository credit intermediation $29,771,279 Offices of physicians $28,583,767 Other computer related services, including facilities management $25,518,679 Truck transportation $23,371,468 Limited-service restaurants $22,158,509 Other local government enterprises $21,903,383 January 2016 UAH: Economic Impacts Executive Summary COMMISSIONED BY THE CHAMBER OF COMMERCE OF HUNTSVILLE/MADISON COUNTY page 26

27 Table 4 Potential Employment Impacts for Top 25 Sectors Industry Sector Description Economic Opportunity 3 Year Total Construction of new manufacturing structures 7,325 Electroplating, anodizing, and coloring metal 2,025 All other transportation equipment manufacturing 1,702 Business support services 989 Construction of new commercial structures, including farm structures 959 Scientific research and development services 814 Wholesale trade 788 Aircraft manufacturing 595 Employment services 536 Architectural, engineering, and related services 500 Real estate 417 Limited-service restaurants 408 Full-service restaurants 408 Industry Sector Description Economic Opportunity 3 Year Total Aircraft engine and engine parts manufacturing 300 Retail - Motor vehicle and parts dealers 289 Retail - General merchandise stores 243 Offices of physicians 207 Motor vehicle gasoline engine and engine parts manufacturing 190 Services to buildings 184 Other computer related services, including facilities management 178 Wired telecommunications carriers 161 Truck transportation 160 Retail - Food and beverage stores 150 Monetary authorities and depository credit intermediation 140 Guided missile and space vehicle manufacturing 135 January 2016 UAH: Economic Impacts Executive Summary COMMISSIONED BY THE CHAMBER OF COMMERCE OF HUNTSVILLE/MADISON COUNTY page 27

28 Economic Impacts of Economic Development Announcements Table 5 Economic Impacts of Announcements (Thousands except Jobs*) Cumulative REGION Jobs Payroll Output Jobs Payroll Output Jobs Payroll Output Jobs Payroll Output Direct 1,686 $142,925 $480,161 3,591 $346,159 $1,305,061 2,905 $193,725 $1,461,503 8,182 $682,809 $3,246,725 Multiplier 1,628 $73,841 $214,174 2,929 $130,554 $407,694 2,479 $105,206 $366,599 7,036 $309,601 $988,467 Total Ops Impact 3,314 $216,766 $694,335 6,520 $476,713 $1,712,755 5,384 $298,931 $1,828,102 15,218 $992,410 $4,235,192 Capital Investment 4,073 $206,796 $533,397 3,258 $161,731 $422,836 4,001 $198,595 $505,944 11,332 $567,122 $1,462,177 Sales Taxes $6,908 $13,879 $9,569 $30,356 Property Taxes $4,864 $9,812 $6,178 $20,854 Other Taxes $218 $444 $324 $986 *Shown in 2015 Constant Dollars January 2016 UAH: Economic Impacts Executive Summary COMMISSIONED BY THE CHAMBER OF COMMERCE OF HUNTSVILLE/MADISON COUNTY page 28

29 The economic impacts will be realized over the period of years required to complete the announced projects. The impact estimates in this report are stated in 2015 constant dollars. Tax abatements have been used in the calculations to determine the net tax impacts. The cumulative impact estimates by county and major city are shown in Table 1. Table 1 Economic Development Impacts * ANNUAL OPERATIONS (Recurring) Jobs Labor Income ($000) Economic Output ($000) CAPITAL INVESTMENTS (One time) Jobs Labor Income ($000) Economic Output ($000) Madison County 11,725 $787,900 $2,694,565 7,229 $357,291 $949,997 Limestone County 3,067 $186,172 $1,460,005 3,958 $203,336 $488,821 Morgan County 246 $10,987 $49, $2,354 $8,304 Marshall County 48 $2,087 $9, $1,545 $4,233 Jackson County 68 $2,776 $12, $1,439 $6,645 Lincoln County 64 $2,488 $8, $1,157 $4,177 Region Total 15,218 $992,410 $4,235,192 11,332 $567,122 $1,462,177 Huntsville City 9,766 $662,139 $3,074,418 8,592 $425,632 $1,092,159 Madison City 942 $42,329 $131, $18,874 $53,248 Athens City 300 $14,113 $50, $10,840 $20,669 Decatur City 118 $5,249 $23, $1,125 $3,967 *Shown in 2015 Constant Dollars Local taxes collected as a result of new and expanding industries are important considerations in economic development. Recruiting projects is costly. Tax impacts are important measures of the return on investment. Local taxes include sales taxes, property taxes, and other business taxes and fees. Table 2 shows the annual impacts on local taxes for each year s economic development announcements. Table 2 Annual Local Tax Impacts* 2013 Projects ($000) 2014 Projects ($000) 2015 Projects ($000) TOTAL ($000) Sales Taxes $6,908 $13,879 $9,569 $30,356 Property Taxes $4,864 $9,812 $6,178 $20,854 Other Taxes $218 $444 $324 $986 Regional Total $11,990 $24,135 $16,071 $52,196 *In the year all projects are fully realized January 2016 UAH: Economic Impacts Executive Summary COMMISSIONED BY THE CHAMBER OF COMMERCE OF HUNTSVILLE/MADISON COUNTY page 29

30 The economic impacts on the North Alabama region from the economic development project announcements in 2013, 2014, and 2015 are tremendous. This economic development production has created opportunities in the region for 15,200 new jobs, a $4.2 billion annual expansion of the regional economy, and $52 million in additional annual local taxes. These charts show estimated impacts for a ten-year period starting with the year project construction begins. Figure 1 Cumulative Impacts of Economic Development Announcement *Shown in Current Dollars January 2016 UAH: Economic Impacts Executive Summary COMMISSIONED BY THE CHAMBER OF COMMERCE OF HUNTSVILLE/MADISON COUNTY page 30

31 The impacts from 2015 announcements are depicted in the Figure 4 graphs. The total job creation from capital investment is about 4,000 jobs. The total operating jobs grow from about 2,460 jobs in 2016 to over 5,300 jobs in The total economic output due to capital investment in 2015 is approximately $506 million, and the total economic output impact rises from $840 million to $2 billion in The total impact of taxes ranges from $7 million in 2016 to more than $15 million by Figure 4 Impacts of Economic Development 2015 Announcements *Shown in Current Dollars January 2016 UAH: Economic Impacts Executive Summary COMMISSIONED BY THE CHAMBER OF COMMERCE OF HUNTSVILLE/MADISON COUNTY page 31

32 The impacts for the announcements made in 2014 are shown in the Figure 3 graphs. The capital investment employment impacts total 3,258 capital investment jobs. The total job creation increased to more than 6,500 jobs by The economic output impact in terms of capital investment was $423 million. Operations related economic output grows from about $580 million in 2015 to approximately $1.9 billion over ten years. Total local tax impacts rose from roughly $8 million in 2015 to $24 million in ten year period. Figure 3 Impacts of Economic Development 2014 Announcements *Shown in Current Dollars January 2016 UAH: Economic Impacts Executive Summary COMMISSIONED BY THE CHAMBER OF COMMERCE OF HUNTSVILLE/MADISON COUNTY page 32

33 The graphs for 2013 shown in Figure 2 depict the impact assessments for employment, output, labor income, and local tax for the announcements made in The employment impacts of the announcements made in 2013 indicate an impact of 4,073 capital investment related jobs in The operations related jobs impact is estimated at 1,537 in 2014, and growing to 3,314 by 2015, and would continue at this level over the 10-year period shown. The economic output impact for the announcements made in 2013 indicate a total impact of over $533 million from capital expenditures, and a total output impact from about $322 million in 2014 growing to about $787 million by The Labor income impact from the 2013 announcements totals $100 million in 2014 growing to about $246 million by The impact on local taxes from the 2013 announcements is expected to be about $5.6 million in 2014, and grow to about $12 million after Figure 2 Impacts of Economic Development 2013 Announcements *Shown in Current Dollars January 2016 UAH: Economic Impacts Executive Summary COMMISSIONED BY THE CHAMBER OF COMMERCE OF HUNTSVILLE/MADISON COUNTY page 33

34 uahcmer.com Chamber of Commerce of Huntsville/Madison County 225 Church Street NW, Huntsville, AL hsvchamber.org Researchers Brinda Mahalingam, Ph.D., Economist Jeff Thompson, Project Director Karen Yarbrough, Editor Questions regarding the analysis and report should be directed to: Jeff Thompson, Project Director Huntsville Regional Economic Growth Initiative CHAMBER OF COMMERCE OF HUNTSVILLE/MADISON COUNTY page 34