ECONOMIC IMPACT OF THE SAN ANTONIO MEDICAL FOUNDATION IN BEXAR COUNTY

ECONOMIC IMPACT OF THE SAN ANTONIO MEDICAL FOUNDATION IN BEXAR COUNTY January 2012 Prepared by: Center for Community and Business Research The University of Texas at San Antonio Institute for Economic Development

This study was performed by the University of Texas at San Antonio Institute for Economic Development s Center for Community and Business Research. The project was supported with funding from the San Antonio Medical Foundation. Any findings, conclusions, or opinions are those of the authors and not necessarily those reflected by the University of Texas at San Antonio, the City of San Antonio, or the San Antonio Medical Foundation. Acknowledgements: This report was developed by Hisham Eid, Javier Oyakawa and Iliana Sanchez. The study also received assistance from Mark A. Green Jr., John Lira and Thomas Tunstall. Special thanks to Pam Leissner and Jim Reed from the San Antonio Medical Foundation.

EXECUTIVE SUMMARY Healthcare, medicine and biotechnology are the most dominant sectors of the Bexar County economy, creating an estimated total economic impact of $24.5 billion in annual revenue for 2009. Combined, these industries employ one of every six people in the San Antonio workforce and added over 33,000 net new jobs in Bexar County between 1999 and 2009. 1 The South Texas Medical Center represents a significant source of that growth in San Antonio, Bexar County and South Texas. In 2010, activity within the South Texas Medical Center created close to $3.1 billion of gross regional product, 45,686 employees and $5.4 billion in total economic output. This impact generated close to $64.1 million in estimated revenues from sales tax for the State of Texas and $70.1 million in annual revenues from property and sales tax for the City of San Antonio. The San Antonio Medical Foundation contracted with the Center for Community and Business Research (CCBR) at the University of Texas at San Antonio s Institute for Economic Development to perform a study that will estimate the economic impact of the South Texas Medical Center on Bexar County. Direct, indirect, and induced impacts from the operations of firms in the Medical Center are obtained using the input-output software IMPLAN. The direct impacts include the actual production and employment by the firms operating in the area. The indirect impacts include the revenue and personnel expenses of the suppliers while the induced impacts include expenses of the workers. The software organizes the information based on data from the Bureau of Economic Analysis (BEA) and several other federal and state agencies. 1 San Antonio s Healthcare And Bioscience Industry: Economic Impact In 2009, The Greater San Antonio Chamber of Commerce, www.sachamber.org.

TABLE OF CONTENTS EXECUTIVE SUMMARY... III INTRODUCTION... 1 OVERVIEW OF THE SAN ANTONIO MEDICAL FOUNDATION... 2 TECHNICAL BACKGROUND... 4 1. SIGNIFICANCE OF AN ECONOMIC IMPACT ANALYSIS... 4 2. ECONOMIC IMPACT ANALYSIS METHODS... 4 ECONOMIC IMPACTS...6 1. COMBINED IMPACTS OF THE MEDICAL CENTER IN 2010... 6 2. OPERATING BUDGETS... 7 3. OPERATING BUDGETS EXCLUDING WAGES AND RESEARCH EXPENDITURES... 8 4. WAGES AND SALARIES EXPENDITURES... 9 5. RESEARCH... 10 6. CONSTRUCTION ACTIVITIES... 11 7. MACHINERY AND EQUIPMENT EXPENDITURES... 12 8. STUDENT EXPENDITURES... 13 9. VISITOR EXPENDITURES... 14 10.MEDICALLY RELATED ESTABLISHMENTS ON THE OUTSIDE BORDER... 15 11.COMBINED IMPACTS OF THE MEDICAL CENTER AND SURROUNDING AREA'S... 16 DENSITY MAPS... 17 1. ESTABLISHMENTS: HEALTH AND MEDICAL SERVICES - SAN ANTONIO... 17 2. EMPLOYEES: HEALTH AND MEDICAL SERVICES - SAN ANTONIO... 18 3. ESTABLISHMENTS: HEALTH AND MEDICAL SERVICES - STMC... 19 4. EMPLOYEES: HEALTH AND MEDICAL SERVICES - STMC... 20 DISCUSSION... 21 APPENDICES... 23

"Our mission is to provide leadership and active stewardship of our land and other assets to improve health care, advance biomedical science and enhance community well-being." -San Antonio Medical Foundation INTRODUCTION The healthcare industry plays a vital role in stimulating the local economy. This growth is achieved by boosting revenue from third party payments, expanding job opportunities, and increasing wages while retaining healthcare dollars in the county s local economy. According to the Greater San Antonio Chamber of Commerce, healthcare, medicine and biotechnology activity in Bexar County 2 comprise the largest and most dominant sector of the local economy with an estimated total economic impact of $24.5 billion in 2009. Combined, these industries employ one of every six people in the greater San Antonio workforce and from 1999 to 2009 they added over 33,000 net new jobs in Bexar County. 3 The 12 hospitals located in the South Texas Medical Center 4 account for half of San Antonio s twentyfour hospitals (two non-profit, nineteen for profit and three public hospitals), 5 and over a third of Bexar County s 30 hospitals. 6 In addition, the South Texas Medical Center includes 45 medical related institutions: medical, dental and nursing schools, medical treatment and research and 5 specialty institutions. This center alone accounted for 26,913 medically related employees in 2010; and induced 5.4 million outpatient visits and $234.9 million in research funding for the same year. 7 The capital induced by medical and medically related activity in the South Texas Medical Center alone is a pillar of the San Antonio economy and represents a significant portion of the activity generated by the Healthcare & Bioscience industry in the city. 2 See Appendix B for a list of cities within Bexar County. 3 San Antonio s Healthcare And Bioscience Industry: Economic Impact In 2009, The Greater San Antonio Chamber of Commerce, www.sachamber.org 4 See Appendix A for a list of hospitals in the South Texas Medical Center 5 Texas in Focus: Alamo Region Healthcare, Texas Comptroller of Public Accounts. http://www.window.state.tx.us/specialrpt/tif/alamo/healthcare.php 6 Fast facts on Texas Hospitals An Overview Texas Hospitals 2010-2011, Texas Hospital Association. http://www.tha.org/healthcareproviders/advocacy/policyissues/index.asp 7 San Antonio Medical Foundation, 2010 South Texas Medical Center Area Progress Report. http://www.samedfoundation.org/sites/default/files/progress%20report%202010%20w%20ltr%20and%20basic% 20Data.pdf 1

The San Antonio Medical Foundation engaged the Center for Community and Business Research (CCBR), at the University of Texas at San Antonio s Institute for Economic Development, to perform a study that estimated the economic impact of the South Texas Medical Center on Bexar County. Impacts were developed based on organizational budgets, machinery and equipment purchases, wages, salaries, research expenditures, and student spending. Overview of the San Antonio Medical Foundation On December 27, 1944, a small committee from the San Antonio Chamber of Commerce met to discuss the relocation of the Texas University Medical School from Galveston to a more central location in the state, specifically in San Antonio, TX. Although the resolution fell two votes short in the Senate, the committee decided to create the San Antonio Medical Foundation as a permanent agency to work for a San Antonio Medical Branch of the University of Texas 8. The San Antonio Medical Foundation was established as a Texas non-profit charitable and educational corporation, organized on January 22, 1947 to carry forward efforts being made to secure a Medical Branch of the University of Texas for San Antonio. The primary duties are to promote, provide and assist in the development of facilities for medical, dental, nursing education and research, as well as hospitalization and treatment of the sick and afflicted. On April 4, 1957, 175.57 acres of land, located in the northwest side of San Antonio, was donated to the Foundation by Edgar Von Scheele, Carl E. Gaskin, Jr., George W. Delevan, and G.S. McCreless, later known as the Oak Hills Group. The donors were citizens of San Antonio who worked as farmers, ranchers and dairymen, and strongly believed in the greater need for higher quality healthcare and education in South Texas. Following an extended debate over where in San Antonio the Medical Center and Medical School should be established, the Board of Regents of the University of Texas adopted a resolution to position the South Texas Medical Center at the Oak Hills site, located in the Northwest San Antonio area next to Methodist Hospital. One hundred acres, of the initial 175.576-acre donation, were set aside to establish the Medical School and Health Science Center. The San Antonio Medical foundation was then tasked with raising approximately $2 million to purchase over 400 acres of additional land for the South Texas Medical center with the intention of establishing not only a medical school but a major health science 8 Historical facts throughout are gathered from History of San Antonio Medical Foundation and South Texas Medical Center, Matthews, Willbur L. (1988), and A History of Southwest Texas Methodist Hospital, 1955-1989, Hendricks, Frances K. (1983). 2

center. In just three days in December of 1961, the Foundation acquired an additional 300 acres, and by January 31, 1966 an additional 146 acres had been added. The Board of Regents had initially decided to acquire an estimated 600 acres of land for a projected 50-year requirement for the full development of a major Medical Center. In just five years, the Foundation had gained a total of 646 acres and was set to begin what has become one of the largest medical centers in the United States. Today, the entire South Texas Medical Center (STMC) is a medical complex consisting of the University of Texas Medical School, Dental School, Nursing School and 18 other institutions including six major hospitals located on a 900-acre area in northwest San Antonio. 9 Other support activities include banks, a post office, 2 power plants, pharmacies and housing facilities with approximately 300 acres still being held for future expansion 10. In 2008, the STMC projected a total of approximately $1.238 billion in construction and other capital expenditures over the subsequent five years. 11 In 2010 alone, in-progress or planned capital projects totaled $533.57 million, including major renovations and upgrades to Methodist Hospital, the University of Texas Health Science Center, the South Texas Veterans Health Care System and University Hospital. In addition, the Medical Center Alliance 12 is facilitating access and routes to medical care by improving street intersections and signage. 9 Refer to Appendix A. 10 From the South Texas Medical Center website at http://www.southtexasmedicalcenter.com/about/ 11 From the South Texas Medical Center website at http://www.southtexasmedicalcenter.com/about/ 12 From the South Texas Medical Center website at http://southtexasmed.com/who-we-are/medical-centeralliance/ 3

TECHNICAL BACKGROUND 1. Significance of an Economic Impact Analysis An economic impact study identifies the economic contribution an organization makes to the community in which it operates in by considering the expenditures associated with a particular enterprise or industry. In this case, we are analyzing the economic impact of the San Antonio Medical Foundation and South Texas Medical Center on Bexar County for the year 2010 in the healthcare industry. Based on the direct financial expenditures and the resulting purchases by organizations and individuals with whom the organization does business, we can determine a total economic impact by using multipliers. The idea of multipliers is based on the fact that when a person spends money at a gas station, for example, that purchase supports the payroll responsibilities of the attendant, who in turn will buy groceries, pay rent, and so on. 13 In addition, when San Antonio businesses attract purchases of goods and services from individuals and businesses outside of Bexar County, the local economy is strengthened. 2. Economic Impact Analysis Methods Spending by firms and their employees along with number of employees and establishments by sector is very important for the Medical Center s surrounding area. We collected information from several sources: Interviews with institutional representatives Responses to a short survey The San Antonio Medical Foundation Alteryx - DemographicsNow 14 Dunn & Bradstreet 15 Applied Geographic Solutions 16 US Census/Bureau of Labor Statistics/Bureau of Economic Analysis 13 Graefe, Martin & Wells, Matt. An economic impact study: how and why to do one - includes a portion of an economic impact study. Camping Magazine. FindArticles.com. November-December 1996. 14 Alteryx, DemographicsNow. 230 Commerce, Suite 250, Irvine, CA 92602 http://www.alteryx.com 15 The Dunn & Bradstreet Corporation (D&B.), Business List data. 103 JFK Parkway, Short Hills, NJ 07078 www.dnb.com 16 Applied Geographic Solutions. 2165 Emmons Road, Cambria CA 39428. http://www.appliedgeographic.com/ 4

CCBR used the input-output software IMPLAN. 17 Direct, indirect, and induced impacts from the operations of the firms in the Medical Center are obtained with this software. The direct impacts include the actual production and employment by the firms operating in the area. The indirect impacts include operational and personnel expenditures made by suppliers the inter-industry transactions (or exchanges) that follow-on from the direct economic activity, while the induced impacts Income flows created when workers spend money at stores, restaurants, and for housing in the area of study. The software organizes the information based on data from the Bureau of Economic Analysis (BEA) and several other federal and state agencies. 17 From the Minnesota IMPLAN Group, Inc., IMPLAN System (data and software), 502 2nd Street, Suite 301, Hudson, WI 54016 5

ECONOMIC IMPACTS Inside the South Texas Medical Center 1. Combined Impacts of the South Texas Medical Center in 2010 For 2010, medical and medically related activity in the Medical Center area: a. Created nearly $5.4 billion in total economic output (revenue) impact b. Supported 45,686 jobs in Bexar County c. Paid $2.3 billion in salaries and benefits to workers d. Produced $3.1 billion of gross regional product e. Added $64.1 million in State revenues f. Augmented $70.1 million in local government revenues 18 Table 1 summarizes the total impacts for 2010: TABLE 1 Medical Center 2010 Combined Medical Center Estimated Impacts 2010 Economic Impacts Output $3,724,518,887 $815,438,081 $910,764,736 $5,450,721,704 Employment 30,344 7,316 8,026 45,686 Payroll $1,800,076,781 $282,006,614 $238,923,132 $2,321,006,527 Fiscal Impacts Gross Regional Product $1,994,742,654 $510,808,712 $567,484,536 $3,073,035,901 Local Governments Revenues $0 $0 $0 $70,107,782 Estimated State Revenue $0 $0 $0 $64,078,409 These are the combined impacts from construction activities, employee wages, research activities, machinery and equipment purchases, expenditures of parents and friends visiting students, expenditures of patient visitors, and operating budgets (excluding wages and salaries and research expenditures). Data was obtained from the San Antonio Medical Foundation s 2011 progress report. 18 These local governments include county, city, independent school districts, area hospitals, among other regional institutions. 6

2. Operating Budgets For 2010, medical and medically related operating budget expenditures in the Medical Center area: a. Created nearly $4.9 billion in total impact in output (revenue) b. Supported 41,475 jobs in Bexar County c. Paid $2.1 billion in salaries and benefits to workers d. Produced $2.8 billion of gross regional product (value added) e. Added $63.1 million in State revenues f. Augmented $57 million in local government revenues Table 2 summarizes operating budget impacts for 2010: TABLE 2 Medical Center 2010 Operating Budget Medical Center Estimated Impacts 2010 Economic Impacts Output $3,409,417,391 $738,820,872 $838,301,486 $4,986,539,738 Employment 27,386 6,693 7,395 41,475 Payroll $1,706,896,671 $256,356,030 $219,024,214 $2,182,276,915 Fiscal Impacts Gross Regional Product $1,843,406,148 $467,076,362 $522,143,973 $2,832,626,483 Local Governments Revenues $0 $0 $0 $63,106,770 Estimated State Revenue $0 $0 $0 $57,038,907 7

3. Operating Budgets Excluding Wages and Research Expenditures For 2010, medical and medically related operating budgets expenditures excluding wages and research in the Medical Center area: a. Created nearly $2.4 billion in total impact in output (revenue) b. Supported 12,999 jobs in Bexar County c. Paid $256 million in salaries and benefits to workers d. Produced $624 million of gross regional product (value added) e. Added $32.6 million in State revenues f. Augmented $32 million in local government revenues Table 3 summarizes operating budget excluding wages and research impacts for 2010: TABLE 3 Medical Center 2010 Budget Expenditures (excluding wages and research) Estimated Impact 2010 Economic Impacts Output $1,585,244,189 $658,382,437 $110,203,339 $2,353,829,965 Employment 6,153 5,873 974 12,999 Payroll $0 $227,495,758 $28,855,936 $256,351,694 Fiscal Impacts Gross Regional Product $136,509,477 $418,495,910 $68,630,286 $623,635,672 Local Governments Revenues $0 $0 $0 $32,575,579 Estimated State Revenue $0 $0 $0 $32,141,843 8

4. Wage and Salary Expenditures For 2010, medical and medically related wages and salaries in the Medical Center area: a. Created close to $2.4 billion in total impact in output (revenue) b. Supported 27,531 jobs in Bexar County c. Paid $1.89 billion in salaries and benefits to workers d. Produced $2.15 billion of gross regional product (value added) e. Added $29 million in State revenues f. Augmented $23.5 million in local government revenues Table 4 summarizes wages and salaries impacts for 2010: TABLE 4 Medical Center 2010 Wages and Salaries Estimated Impact 2010 Economic Impacts Output $1,706,896,671 $0 $714,095,768 $2,420,992,440 Employment 21,233 0 6,298 27,531 Payroll $1,706,896,671 $0 $186,502,515 $1,893,399,187 Fiscal Impacts Gross Regional Product $1,706,896,671 $0 $444,794,393 $2,151,691,064 Local Governments Revenues $0 $0 $0 $29,047,259 Estimated State Revenue $0 $0 $0 $23,541,167 9

5. Research For 2010, medical and medically related research in the Medical Center area: a. Created nearly $212 million in total impact in output (revenue) b. Supported 945 jobs in Bexar County c. Paid $32.5 million in salaries and benefits to workers d. Produced $57.2 million of gross regional product (value added) e. Added $1.48 million in State revenues f. Augmented $1.35 million in local government revenues Table 5 summarizes research budget impacts for 2010: TABLE 5 Medical Center 2010 Research Estimated Impact 2010 Economic Impacts Output $117,276,519 $80,438,435 $14,002,379 $211,717,333 Employment 0 821 124 945 Payroll $0 $28,860,272 $3,665,762 $32,526,034 Fiscal Impacts Gross Regional Product $0 $48,580,452 $8,719,295 $57,299,747 Local Governments Revenues $0 $0 $0 $1,483,931 Estimated State Revenue $0 $0 $0 $1,355,896 10

6. Construction Activities For 2010, medical and medically related construction in the Medical Center area: a. Created over $389 million in total impact in output (revenue) b. Supported 3,232 jobs in Bexar County c. Paid $113.6 million in salaries and benefits to workers d. Produced $194.4 million of gross regional product (value added) e. Added $4 million in State revenues f. Augmented $4 million in local government revenues Table 6 summarizes construction impacts for 2010: TABLE 6 Medical Center 2010 Construction Expenditures Estimated Impact 2010 Economic Impacts Output $262,817,912 $64,305,622 $62,240,099 $389,363,632 Employment 2,169 523 540 3,232 Payroll $74,992,192 $21,350,243 $17,220,370 $113,562,806 Fiscal Impacts Gross Regional Product $119,009,900 $36,442,061 $38,977,448 $194,429,409 Local Governments Revenues $0 $0 $0 $3,986,507 Estimated State Revenue $0 $0 $0 $4,065,031 11

7. Machinery and Equipment Expenditures For 2010, medical and medically related machinery and equipment purchases in the Medical Center area: a. Created over $10.3 million in total impact in output (revenue) b. Supported 68 jobs in Bexar County c. Paid $3.4 million in salaries and benefits to workers d. Produced $7.5 million of gross regional product (value added) e. Added $643 thousand in State revenues f. Augmented $643 thousand in local government revenues Table 7 summarizes machinery and equipment expenditure impacts for 2010: TABLE 7 Medical Center 2010 Expenditures on Machinery and Equipment Estimated Impact 2010 Economic Impacts Output $7,587,806 $1,301,762 $1,464,600 $10,354,168 Employment 43 12 13 68 Payroll $2,515,615 $520,027 $383,442 $3,419,084 Fiscal Impacts Gross Regional Product $5,784,164 $820,876 $911,958 $7,516,998 Local Governments Revenues $0 $0 $0 $642,774 Estimated State Revenue $0 $0 $0 $642,778 12

8. Student Expenditures For 2010, medical and medically related student expenditures in the Medical Center area: a. Created over $27 million in total impact in output (revenue) b. Supported 370 jobs in Bexar County c. Paid $9.6 million in salaries and benefits to workers d. Produced $16.8 million of gross regional product (value added) e. Added $1.1 million in State revenues f. Augmented $1.1 million in local government revenues Table 8 summarizes student impacts for 2010: TABLE 8 Medical Center 2010 Student Expenditures Estimated Impact 2010 Economic Impacts Output $18,656,061 $4,699,065 $3,911,571 $27,266,697 Employment 296 39 35 370 Payroll $6,962,784 $1,629,456 $1,024,904 $9,617,145 Fiscal Impacts Gross Regional Product $11,573,697 $2,827,451 $2,434,766 $16,835,914 Local Governments Revenues $0 $0 $0 $1,125,705 Estimated State Revenue $0 $0 $0 $1,109,621 13

9. Visitor Expenditures For 2010, medical and medically related visitor expenditures in the Medical Center area: a. Created over $37 million in total impact in output (revenue) b. Supported 541 jobs in Bexar County c. Paid $12 million in salaries and benefits to workers d. Produced $21.6 million of gross regional product (value added) e. Added $1.25 million in State revenues f. Augmented $1.2 million in local government revenues Table 9 summarizes visitor impacts for 2010: TABLE 9 Medical Center 2010 Visitors Estimated Impact 2010 Economic Impacts Output $26,039,729 $6,310,761 $4,846,980 $37,197,470 Employment 450 48 43 541 Payroll $8,709,518 $2,150,858 $1,270,202 $12,130,578 Fiscal Impacts Gross Regional Product $14,968,745 $3,641,962 $3,016,390 $21,627,097 Local Governments Revenues $0 $0 $0 $1,246,026 Estimated State Revenue $0 $0 $0 $1,222,072 14

ECONOMIC IMPACTS Outside and Extended Border of the South Texas Medical Center 10. Medically related establishments - Outside & Extended Border STMC For 2010, medical and medically related activity in the outside border 19 of the Medical Center area: a. Created nearly $109.4 million in total economic output (revenue) impact b. Supported 944 jobs in Bexar County c. Paid $41.9 million in salaries and benefits to workers d. Produced $70.1 million of gross regional product e. Added $1.8 million in State revenues f. Augmented $1.66 million in local government revenues Table 10 summarizes the total impacts for 2010: TABLE 10 Medical Center 2010 Medical Related Businesses Outside and Extended border of Medical Center Economic Impacts Output $63,514,820 $18,968,951 $26,885,576 $109,369,347 Employment 559 167 218 944 Payroll $28,822,161 $6,159,832 $6,969,320 $41,951,313 Fiscal Impacts Gross State Produc $40,713,539 $12,548,253 $16,859,592 $70,121,384 Local governments $0 $0 $0 $71,950,291 Estimated State Revenue $65,741,951 19 See Appendix I 15

ECONOMIC IMPACTS The South Texas Medical Center and Extended Area s 11. Combined Impact of the STMC and surrounding area s For 2010, medical and medically related activity in the outside border 20 of the Medical Center area: a. Created nearly $5.56 billion in total economic output (revenue) impact b. Supported 46,630 jobs in Bexar County c. Paid $2.36 billion in salaries and benefits to workers d. Produced $3.1 billion of gross regional product e. Added $65.7 million in State revenues f. Augmented $72 million in local government revenues Table 11 summarizes the total impacts for 2010: TABLE 11 Medical Center 2010 Medical Related Businesses Outside Medical Center Economic Impacts Output $3,788,033,707 $834,407,032 $937,650,312 $5,560,091,051 Employment 30,903 7,483 8,244 46,630 Payroll $1,828,898,942 $288,166,446 $245,892,452 $2,362,957,840 Fiscal Impacts Gross State Produc $2,035,456,193 $523,356,965 $584,344,128 $3,143,157,286 Local governments $0 $0 $0 $71,950,291 Estimated State Revenue $65,741,951 20 See Appendix I 16

Density Maps The map below identifies health and medical services establishment density by census tracts 21 inside of San Antonio. The two census tracts that make up the South Texas Medical Center 22, outlined in blue, have some of the highest concentrations, above 100, of medical and medically related businesses in the city. 23 Establishments: Health and Medical Services by Census Tracts Key Above 100 70 to 100 25 to 70 1 to 25 Below 1 Medical Center Big City Ctr Small City Ctr Prim. Hwy Secd. Hwy Water Bodies 21 See Appendix G 22 Census tracts: 48029181401 & 48029181402. http://www2.census.gov/plmap/pl_trt/st48_texas/c48029_bexar/ct48029_001.pdf 23 Mapping by Alteryx s DemographicsNow software. http://www.alteryx.com/. Data collected by Applied Geographic Solutions (AGS). http://www.appliedgeographic.com/ 17

The map below identifies health and medical services employee density by census tracts inside of San Antonio. The two census tracts that make up the South Texas Medical Center, outlined in blue, have some of the highest concentrations, above1000, of medical and medically related employees in the city. 24 Employees: Health and Medical Services by Census Tracts Key Above 1000 500 to 1000 100 to 500 20 to 100 Below 20 Medical Center Big City Ctr Small City Ctr Prim. Hwy Secd. Hwy Water Bodies 24 Mapping by Alteryx s DemographicsNow software. http://www.alteryx.com/. Data collected by Applied Geographic Solutions (AGS). http://www.appliedgeographic.com/ 18

A closer look at the South Texas Medical Center reveals a higher density of Health and Medical service establishments in the southern block groups 25 of the center. 26 Establishments: Health and Medical Services by Block Groups Key Above 100 60 to 100 20 to 60 5 to 20 Below 5 Medical Center Prim. Hwy Secd. Hwy Maj. Rds Local Roads 25 See Appendix G 26 Mapping by Alteryx s DemographicsNow software. http://www.alteryx.com/. Data collected by Applied Geographic Solutions (AGS). http://www.appliedgeographic.com/ 19

Directly related to the higher density of medical service establishments in the southern block group areas is a higher density of Medical Service employees in the same areas. 27 Employees: Health and Medical Services by Block Groups Key Above 500 300 to 500 150 to 300 50 to 150 Below 50 Medical Center Prim. Hwy Secd. Hwy Maj. Rds Local Roads 27 Mapping by Alteryx s DemographicsNow software. http://www.alteryx.com/. Data collected by Applied Geographic Solutions (AGS). http://www.appliedgeographic.com/ 20

DISCUSSION The capital induced by the South Texas Medical Center is a pillar to the San Antonio economy. This study looks solely at the economic impacts and estimates the current impact (2010) to be $5.4 billion in Bexar County area. In addition, the Medical Center supports 45,686 jobs in Bexar County, provides $2.3 billion in salaries and benefits paid to workers, and generates close to $3.1 billion of gross regional product, $64.1 million in State revenues including $36.3 million in severance taxes, and $70.1 million in local government revenues. Since the establishment of the San Antonio Medical Foundation, the South Texas Medical Center has blossomed into a 900 acre medical complex that supports over 40 medically related treatment, education and research facilities, more than 20 medical professional office buildings, and several nursing facilities. This demand for growth has created support activities that strengthen the infrastructure of the center; some of these activities include banks, a post office, 2 power plants, pharmacies, and housing facilities. With over 300 acres being held for future expansion, there still remains an enormous potential for growth. Construction activities alone had an estimated $389.4 million total impact in output and a gross regional product total impact close to $194.4 million. These activities supported a total of 3,232 jobs. In addition to the planned construction and expansion projects that are scheduled in the South Texas Medical Center, a nine building 50,000 square foot facility is also in the planning phases. This medical complex, Spurs Lane Medical Center Project, will house a variety of physicians and medically related offices that will expand the entire centers capacity to conveniently provide quality healthcare and research to the community. This is a strong indicator that more funding and investment will be made to strengthen healthcare sector in the region. 28 Growth and development from the South Texas Medical Center is having a positive effect on the surrounding and bordering areas. The outside border of the Medical Center along with the Datapoint and Prue areas supported 944 jobs in Bexar County, provided $40.9 million in salaries and benefits paid 28 "Nine-building complex medical complex in the works." San Antonio Business Journal [San Antonio] 09 03 2012, Volume 26, Number 6. Pages 1 & 33. Print. 21

to workers, and generated close to $ 70.1 million of gross regional product, $1.8 million in State revenues, and $1.6 million in local government revenues. Since 1947, the San Antonio Medical Foundation has transformed the South Texas Medical Center into one of the leading collaborative healthcare and bioscience research hubs in the region. As good stewards of land management and pioneers in developing a sustainable medical center, the research institutions are given the opportunity to create significant advancements in healthcare and bioscience research. In addition, more medical facilities and services are being offered to a growing regional population and the healthcare and bioscience sector goals set forth in the SA 2020 initiative are becoming standards for the entire industry. These sectors will become cornerstones for growth and sustainable development for future generations in San Antonio and also to the entire South Texas region. 22

APPENDICES Appendix A List of Hospitals in the South Texas Medical Center This list is compiled from the San Antonio Medical Foundation s 2010 South Texas Medical Center Area Progress Report at http://www.samedfoundation.org/reports Hospitals in the South Texas Medical Center 1. Christus Santa Rosa Medical Center Hospital 2. Clarity Child Guidance Center 3. HealthSouth Rehabilitation Institute of San Antonio (RIOSA) 4. Methodist Ambulatory Surgery Hospital 5. Methodist Children s Hospital 6. Methodist Specialty & Transplant Hospital 7. Methodist Hospital 8. Methodist Heart Hospital 9. LifeCare Hospitals 10. Warm Springs Rehabilitation Hospital 11. Audie L. Murphy Veterans Hospital 12. St. Luke s Baptist Hospital 13. University Hospital 23

Appendix B List Cities in Bexar County This list is compiled from the Bexar County and Voter Information website at http://elections.bexar.org/electeds/cities/cities.html Cities in Bexar County 1. Alamo Heights 2. Balcones Heights 3. Castle Hills 4. China Grove 5. Converse 6. Elmendorf 7. Fair Oaks Ranch 8. Grey Forest 9. Helotes 10. Hill Country Village 11. Hollywood Park 12. Kirby 13. Leon Valley 14. Live Oak 15. Lytle 16. Olmos Park 17. San Antonio 18. Saint Hedwig 19. Schertz 20. Selma 21. Shavano Park 22. Somerset 23. Terrell Hills 24. Universal City 25. Windcrest 24

Appendix C South Texas Medical Center: Businesses and Employees by NAICS NAICS # of Businesses # of Employees 11 Agriculture, Forestry, Fishing and Hunting 6 10 21 Mining 1 2 22 Utilities 0 0 23 Construction 43 136 31/32/33 Manufacturing 37 278 42 Wholesale Trade 46 366 44/45 Retail Trade 122 580 48/49 Transportation and Warehousing 12 134 51 Information 28 155 52 Finance and Insurance 56 561 53 Real Estate and Rental Leasing 68 496 54 Professional, Scientific, and Technical Svcs 55 Management of Companies and Enterprises 56 Administrative/Support/Waste MGMT 61 Educational Services 62 Health Care and Social Assistance 71 Arts, Entertainment & Recreation 72 Accommodation and Food Services 81 Other Services (Except public admin) 92 Public Administration 130 6 139 44 807 15 87 128 4 1,483 147 929 6,028 15,131 86 761 466 2,788 Total 1,779 30,537 STMC *Business List data 2011 by D&B. All rights reserved. All D&B information is powered by DUNSRightTM, D&B's Quality. *Mapping by Alteryx s DemographicsNow software. http://www.alteryx.com 25

Appendix D STMC Extended Areas: Businesses and Employees by NAICS 62 Area # of Businesses # of Employees Datapoint 163 2103 Prue 111 855 Total 1,793 46,635 Datapoint Prue 26

Appendix E Observations from collected NAICS: Number of Establishments A basic sort reveals that the 45% of businesses in the Medical Center are related to the Healthcare and Social Assistance sector (NAICS 62). NAICS # Businesses Total % 21 Mining 1 0.06% 92 Public Administration 4 0.22% 11 Agriculture, Forestry, Fishing and Hunting 6 0.34% 55 Management of Companies and Enterprises 6 0.34% 48/49 Transportation and Warehousing 12 0.67% 71 Arts, Entertainment & Recreation 15 0.84% 51 Information 28 1.57% 31/32/33 Manufacturing 37 2.06% 23 Construction 43 2.42% 61 Educational Services 44 2.47% 42 Wholesale Trade 46 2.59% 52 Finance and Insurance 56 3.15% 53 Real Estate and Rental and Leasing 68 3.82% 72 Accommodation and Food Services 87 4.89% 44/45 Retail Trade 122 6.86% 81 Other Services (except public administration) 128 7.20% 54 Professional, Scientific, and Technical Services 130 7.31% 56 Administrative & Support & Waste MGT 139 7.81% 62 Health Care and Social Assistance 807 45.36% *Business List data 2011 by D&B. All rights reserved. All D&B information is powered by DUNSRightTM, D&B's Quality. 27

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Appendix F Observations from collected NAICS data: Employees by NAICS A basic sort by number of employees in each industry reveals that almost 50% of the employees in the South Texas Medical Center are employed the Healthcare and Social Assistance sector (NAICS 62). NAICS # of Employee's Total % 21 Mining 2 0.01% 11 Agriculture, Forestry, Fishing and Hunting 10 0.03% 71 Arts, Entertainment & Recreation 86 0.28% 48/49 Transportation and Warehousing 134 0.44% 23 Construction 136 0.45% 55 Management of Companies and Enterprises 147 0.48% 51 Information 155 0.51% 31/32/33 Manufacturing 278 0.91% 42 Wholesale Trade 366 1.20% 81 Other Services (except public administration) 466 1.53% 53 Real Estate and Rental and Leasing 496 1.62% 52 Finance and Insurance 561 1.84% 44/45 Retail Trade 580 1.90% 72 Accommodation and Food Services 761 2.49% 56 Administrative & Support & Waste MGT & Remediation Services 929 3.04% 54 Professional, Scientific, and Technical Services 1483 4.86% 92 Public Administration 2788 9.13% 61 Educational Services 6028 19.74% 62 Health Care and Social Assistance 15131 49.55% *Business List data 2011 by D&B. All rights reserved. All D&B information is powered by DUNSRightTM, D&B's Quality. 29

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Appendix G Definition of terms Block Group Census Tract Direct Economic Impact Fiscal Impact Gross Regional Product A cluster of census blocks having the same first digit of their four-digit identifying numbers within a census tract. BGs generally contain between 600 and 3,000 people, with an optimum size of 1,500 people. Most BGs were delineated by local participants as part of the U.S. Census Bureau's Participant Statistical Areas Program. Small relatively permanent geographic entities within counties (or the statistical equivalents of counties) delineated by a committee of local data users. Generally, census tracts have between 2,500 and 8,000 residents and boundaries that follow visible features. When first established, census tracts are to be as homogeneous as possible with respect to population characteristics, economic status, and living conditions. The set of expenditures applied to the predictive model (i.e., Input/Output multipliers) for impact analysis. It is a series (or single) of production changes or expenditures made by producers/consumers as a result of an activity or policy. These initial changes are determined by an analyst to be a result of this activity or policy. Applying these initial changes to the multipliers in an IMPLAN model will then display how the region will respond, economically to these initial changes. Increase or decrease in the productive potential of the economy. Economic impact extends beyond the boundaries of any single organization and is linked to both the environmental and social elements of sustainable development. They directly affect the economic well-being of area residents and businesses by changing employment levels and expenditures. Impact on the bottom line through expenditures. Market value of all final goods and services produced by labor and property within the state of Texas in a given period of time. 31

Indirect Induced Input NAICS Institution Output The impact of local industries buying goods and services from other local industries. The cycle of spending works its way backward through the supply chain until all money leaks from the local economy, either through imports or by payments to value added. The response by an economy to an initial change (direct effect) that occurs through re-spending of income received by a component of value added. IMPLAN's default multiplier recognizes that labor income (employee compensation and proprietor income components of value added) is not a leakage to the regional economy. This money is recirculated through the household spending patterns causing further local economic activity. The dollar value of a commodity required directly by an industry to produce a dollar of output. It is also referred to as the direct requirement coefficient. North American Industry Classification System is the standard used by Federal statistical agencies in classifying business establishments for the purpose of collecting, analyzing, and publishing statistical data related to the U.S. business economy. Organization, establishment, foundation or society devoted to the promotion of a particular cause or program. Output represents the value of industry production. In IMPLAN these are annual production estimates for the year of the data set and are in producer prices. For manufacturers this would be sales plus/minus change in inventory. For service sectors production = sales. For Retail and wholesale trade, output = gross margin and not gross sales. 32

Appendix H Map of the South Texas Medical Center located in the Northwest area of San Antonio over approximately 900+ acres with a projected expansion of an additional 300 acres. 29 29 From the San Antonio Medical Foundation website at http://www.samedfoundation.org/. 33

Appendix I Map of the South Texas Medical Center. - Area shaded in red represents the inside border of the STMC - Area shaded in blue represents the outside and extended border of the STMC. 34