Military Economic Analysis for the State of Louisiana December 2017 PREPARED BY: BUSINESS DEVELOPMENT ADVISORS ELLEN HARPEL, PHD AND MARTIN ROMITTI, PHD
EXECUTIVE SUMMARY... 3 ECONOMIC IMPACT ANALYSIS... 6 STATE OF LOUISIANA... 7 ACADIANA REGION... 10 BAYOU REGION... 12 CAPITAL REGION... 14 CENTRAL REGION... 17 NORTHEAST REGION... 20 NORTHWEST REGION... 22 SOUTHEAST REGION... 25 SOUTHWEST REGION... 28 STATEWIDE ECONOMIC IMPACT BY MILITARY FACILITY... 31 MILITARY CONTRACT SPENDING... 39 STATEWIDE MILITARY CONTRACT SPENDING... 40 MILITARY CONTRACT SPENDING BY REGION... 44 METHODOLOGY... 52 2
Executive Summary Business Development Advisors (BDA) is pleased to provide this report to Louisiana Economic Development (LED) to satisfy RS 29:65, which requires the Louisiana Military Advisory Council to complete a quadrennial statewide and regional military economic impact analysis. The previous military spending impact analysis was prepared in 2013 by BDA and The Roosevelt Group. BDA once again worked closely with The Roosevelt Group, which provided critical liaison support during this effort. The 2017 impact analysis considers fiscal year (FY) 2016 military spending in Louisiana across three categories: military facility and command activity, defense contracting, and military retiree spending. The Louisiana military facilities and activities studied include Barksdale Air Force Base, Fort Polk, Naval Air Station Joint Reserve Base (Belle Chasse), Marine Forces Reserve, US Coast Guard 8th District, Space and Naval Warfare Systems Center Atlantic (SPAWAR), the 377th Theater Sustainment Command, and the Louisiana National Guard. The defense contracting analysis incorporates FY16 Department of Defense (DOD) and US Coast Guard (USCG) contract data by place of performance in Louisiana. The annual gross pay associated with military retirees is also accounted for. Data for all categories was analyzed at the state level and among eight LED-defined regions. The data confirm the significant impact from military-related spending in the Louisiana economy. The economic impact analysis shows that military-related spending in all three categories accounted for $7.7 billion in economic output in Louisiana in fiscal year (FY) 2016. Over 77,000 employees are associated with this output, which equates to approximately 4% of total state payroll employment. 1 Table 1 demonstrates that military spending affects every region in Louisiana and is especially important in the Central and Northwest regions, home to Fort Polk and Barksdale Air Force Base respectively. Louisiana s military facilities and commands account for the majority of the total economic impact summarized in Table 1. 1 A percentage level between 3-4% for any particular economic sector is general considered to be of significant impact. 3
Table 1. Economic of Military Spending by Region and Statewide FY2016 Region State and Local Taxes Percent of Regional GDP Percent of Regional Payroll Acadiana $292,623,000 2,500 $10,623,000 0.67% 1.1% Bayou $870,749,000 5,400 $24,999,000 2.83% 4.75% Capital $410,416,000 3,500 $14,758,000 0.49% 0.91% Central $1,596,214,000 18,500 $59,315,000 10.56% 18.13% Northeast $148,749,000 1,500 $5,736,000 1.01% 1.41% Northwest $1,484,650,000 16,500 $56,041,000 4.04% 7.28% Southeast $2,507,393,000 24,100 $90,159,000 2.07% 4.03% Southwest $450,360,000 5,200 $18,001,000 1.99% 4.00% Statewide $7,761,154,000 77,200 $279,632,000 2.19% 4.04% Economic impact includes the direct, indirect and induced spending from military asset, contractor and retiree spending in Louisiana and by LED Region. Department of Defense and USCG contract spending is also an important component of overall military spending. In FY16, contract spending on work performed in Louisiana reached $1.5 Northwest $118,639,890 Northeast $3,519,752 Central $281,439,297 Capital $88,875,750 Southwest $5,488,954 Acadiana $53,762,772 Southeast $532,557,403 billion, the second highest level since 2012. Ship building and facilities support services are the leading sectors in which defense contracting work is performed in Louisiana. The map in Figure 1 displays total contract value per LED region. Figure 1. Louisiana DOD and USCG Contract Spending, FY16 Bayou $447,095,625 4
In addition, Louisiana boasted nearly 27,000 retirees who received annual gross pay totaling over $660 million in FY16. This income is contributed back to the state economy through the tax base, living expenses and personal spending. These figures may understate the impact of retirees living in nearby states who visit Louisiana for tourism, healthcare and recreational activities. This report is divided into two main sections. First, the Economic Analysis section calculates the economic impact of overall military spending and the three main components of that spending for the state and each of the eight LED regions. This section also provides an individual statewide economic impact summary for each of the military facilities and commands analyzed for this report. Second, the Military Contract Spending section describes summary statistics on DOD and USCG spending in the state of Louisiana and lists the top industries and defense contracting companies for the state and each of the eight LED regions. The report concludes with an overview of the methodology and data sources used to complete this analysis. 5
Economic Analysis 6
State of Louisiana Summary of Military Spending in Louisiana The 2017 impact analysis considers the economic impact of military spending in Louisiana across three categories: military facility and command activity, defense contracting, and military retiree spending. Table 2. Economic of Military Spending Statewide FY16 State and Local Taxes Percent of State GDP Percent of State Payroll $7,761,154,000 77,200 $277,632,000 2.20% 4.00% Economic impact includes the direct, indirect and induced spending from military asset, contractor and retiree spending. 1. Economic of Military Assets Louisiana is home to several military facilities and command activities. Barksdale Air Force Base (BAFB) directly contributes nearly 9,000 jobs and over $500 million in payroll to the economy. Estimated total spending at BAFB exceeded $686 million in FY16. Fort Polk directly contributes over 14,000 jobs and over $760 million in payroll to the economy. Estimated total spending at Fort Polk was $1.09 billion in FY16. Naval Air Station Joint Reserve Base (NAS JRB) New Orleans (Belle Chasse) is located in Plaquemines Parish. NAS JRB directly contributes over 6,000 jobs and over $440 million in spending to the economy. US Coast Guard, 8th District, has multiple offices and operations in the region, including the 8th District headquarters in New Orleans, the Coast Guard Air Station New Orleans, and the New Orleans sector office. Coast Guard operations directly contribute over 1,700 jobs and $169 million in spending to the state economy, most of which occurs in the Southeast region. Marine Forces Reserve (MARFORRES) headquarters is located in Federal City in the Algiers district of New Orleans. MARFORRES employs over 2,600 active and reserve military, civilians and contractors, most of whom are in the Southeast region, with annual expenditures of $140 million. Space and Naval Warfare Systems Center Atlantic (SPAWAR) occupies two office buildings in New Orleans near the University of New Orleans and contributes over 700 jobs (including contractors) and $65 million in spending to the economy. 7
The 377th Theater Sustainment Command in New Orleans has over 1,300 workers (including reservists) and contributes over $30 million in annual spending. The Louisiana National Guard has facilities throughout the state and contributes nearly $400 million in annual spending to the economy. Table 3 summarizes the total economic impact of employment and spending at these facilities, including direct, indirect and induced effects, on the state of Louisiana. Table 3. Economic of Military Asset Spending in Louisiana, FY16 $5,217,556,000 62,200 $188,828,000 $3,435,174,000 Sources: IMPLAN, Business Development Advisors 2. Economic of Military Contract Spending In addition to spending at military installations, the Department of Defense (DoD) contracts directly with Louisiana companies for many types of goods and services. Louisiana businesses also perform work on contracts that may or may not be managed by Louisiana-based companies. Total direct contract spending in the state by DoD and the US Coast Guard in FY 16 was $1.5 billion. However, it is likely that some of this contract spending overlapped with expenditures at Barksdale, Fort Polk and Belle Chasse. Given the nature of the data sources, it is not possible to know the exact extent of this overlap. In order to avoid possibly overstating the impact of military spending in the state, contracts performed in installation zip codes were subtracted from the total in order to make the economic impact calculations for the state. Table 4 summarizes the total economic impact, including direct, indirect and induced effects, of the remaining military contracts for which the place of performance was Louisiana. Table 4: Economic of DOD/USCG Contract Spending in Louisiana, FY16 $1,827,649,000 9,500 $51,187,000 $594,342,000 Figures do not include the Army Corps of Engineers. Sources: USAspending.gov, IMPLAN, Business Development Advisors Military contract funds flow through many parts of the regional economy and are not limited to defense companies. The top 10 sectors for contracts performed in the state are: Ship building and repairing Facilities support services Boat building Remediation services Oil and gas pipeline related construction 8
Petroleum refineries Military armored vehicle, tank and component manufacturing Deep sea freight transportation Coastal and Great Lakes freight transportation Commercial and institutional building construction These sectors accounted for over 80% of the obligated contract dollars in FY16. 3. Economic of Retiree Spending Louisiana attracts a sizeable number of military retirees who receive direct payments from the Department of Defense. Nearly 27,000 retirees who report their mailing address in a parish in Louisiana received annual gross pay totaling over $660 million in FY16. This income spent in the state supports a variety of household, personal services, leisure, and hospitality activities and contributes to the tax base. Table 5 summarizes the total economic impact, including direct, indirect and induced effects, of pay for military retirees living in Louisiana. Table 5. Economic of Military Retiree Spending, FY16 $715,949,000 5,500 $39,617,000 $224,817,500 Source: Military Retired Pay File, July 2017; IMPLAN, Business Development Advisors This figure may understate the impact of retiree spending since retirees who live in nearby communities in surrounding states also visit Louisiana to take advantage of shopping, recreational, tourism and healthcare resources. Veterans Veteran spending is not considered military spending and is therefore not included in the economic impact. However, it is worth noting that veteran expenditures were approximately $2.6 billion in 2016 for an estimated 287,000 veterans living in Louisiana parishes. 9
Acadiana Region The Acadiana Region is one of eight Louisiana Economic Development (LED) regions. It includes Acadia, Evangeline, Iberia, Lafayette, St. Landry, St. Martin, and Vermilion parishes. Summary of Military Spending in the Acadiana Region The 2017 impact analysis considers the economic impact of military spending in the Acadiana Region across three categories: military facility and command activity, defense contracting, and military retiree spending. Table 6. Economic of Military Spending in the Acadiana Region, FY16 State and Local Taxes Percent of Regional GDP Percent of Regional $292,623,000 2,500 $10,623,000 0.67% 1.11% Economic impact includes the direct, indirect and induced spending from military asset, contractor and retiree spending. 1. Economic of Military Assets The Acadiana region does not contain any of Louisiana s major military facilities, but it does have a Louisiana National Guard presence. The region also benefits indirectly from spending at other military facilities and activities around the state. Table 7 summarizes the total economic impact of employment and spending at these facilities, including direct, indirect and induced effects, on the Acadiana region of Louisiana. Table 7. Economic of Military Asset Spending in the Acadiana Region, FY16 $152,443,000 1,700 $5,326,000 $97,797,000 Sources: IMPLAN, Business Development Advisors 2. Economic of Military Contract Spending Table 8 summarizes the total economic impact, including direct, indirect and induced effects, of military contracts for which the place of performance was the Acadiana region of Louisiana. Total contract spending by place of performance in the region by DoD and the US Coast Guard in FY 16 was $61.1 million. However, in order to avoid possibly overstating the impact of military spending in the state, contracts performed in installation zip codes were subtracted from the total in order to make the economic impact calculations for the region. 10
Table 8: Economic of DOD/USCG Contract Spending in the Acadiana Region, FY16 $88,987,000 400 $2,464,000 $29,630,000 Figures do not include the Army Corps of Engineers. Sources: USAspending.gov, IMPLAN, Business Development Advisors Military contract funds flow through many parts of the regional economy and are not limited to defense companies. The top 5 sectors for contracts performed in the region are: Boat building Engineering services Ship building and repairing Fabricated structural metal manufacturing Other plastics product manufacturing These sectors accounted for over 94% of the obligated contract dollars in FY16. 3. Economic of Retiree Spending Louisiana attracts a sizeable number of military retirees who receive direct payments from the Department of Defense. Over 2,100 retirees who report their mailing address in a parish in the Acadiana region of Louisiana received annual gross pay totaling over $47 million in FY16. This income spent in the region supports a variety of household, personal services, leisure, and hospitality activities and contributes to the tax base. Table 9 summarizes the total economic impact, including direct, indirect and induced effects, of pay for military retirees living in the Acadiana region. Table 9. Economic of Military Retiree Spending in the Acadiana Region, FY16 $51,193,000 400 $2,833,000 $16,503,000 Source: Military Retired Pay File, July 2017; IMPLAN, Business Development Advisors Veterans Veteran spending is not considered military spending and is therefore not included in the economic impact. However, it is worth noting that veteran expenditures were approximately $246 million in 2016 for an estimated 33,000 veterans living in the parishes comprising the Acadiana region. 11
Bayou Region The Bayou Region is one of eight Louisiana Economic Development (LED) regions. It includes Assumption, Lafourche, St. Mary and Terrebonne parishes. Summary of Military Spending in the Bayou Region The 2017 impact analysis considers the economic impact of military spending in the Bayou Region across three categories: military facility and command activity, defense contracting, and military retiree spending. Table 10. Economic of Military Spending in the Bayou Region, FY16 State and Local Taxes Percent of Regional GDP Percent of Regional $870,749,000 5,400 $24,999,000 2.83% 4.75% Economic impact includes the direct, indirect and induced spending from military asset, contractor and retiree spending. 1. Economic of Military Assets The Bayou region does not contain any of Louisiana s major military facilities, but it does have a Louisiana National Guard and US Coast Guard (USCG) presence, including USCG units or teams in St. Mary and Terrebonne parishes. The region also benefits indirectly from spending at other military facilities and activities around the state. Table 11 summarizes the total economic impact of employment and spending at these facilities, including direct, indirect and induced effects, on the Bayou region of Louisiana. Table 11. Economic of Military Asset Spending in the Bayou Region, FY16 $117,204,000 1,350 $3,901,000 $71,913,533 Sources: IMPLAN, Business Development Advisors 2. Economic of Military Contract Spending In addition to spending at military installations, the Department of Defense (DoD) contracts directly with Louisiana companies for many types of goods and services. Louisiana businesses also perform work on contracts that may or may not be managed by Louisiana-based companies. Table 12 summarizes the total economic impact, including direct, indirect and induced effects, of military contracts for which the place of performance was the Bayou region of Louisiana. Total contract spending by place of performance in the region by DoD and the US Coast Guard in FY16 was $456 million. However, in order to avoid possibly overstating the impact of military 12
spending in the state, contracts performed in installation zip codes were subtracted from the total in order to make the economic impact calculations for the region. Table 12: Economic of DOD/USCG Contract Spending in the Bayou Region, FY16. $739,502,000 3,900 $20,321,000 $250,236,554 Figures do not include the Army Corps of Engineers. Sources: USAspending.gov, IMPLAN, Business Development Advisors Military contract funds flow through many parts of the regional economy and are not limited to defense companies. The top 5 sectors for contracts performed in the region are: Ship building and repairing Boat building Deep sea freight transportation Navigational services to shipping Other engine equipment manufacturing These sectors accounted for over 98% of the obligated contract dollars in FY16. 3. Economic of Retiree Spending Louisiana attracts a sizeable number of military retirees who receive direct payments from the Department of Defense. Over 600 retirees who report their mailing address in a parish in the Bayou region of Louisiana received annual gross pay totaling over $12 million in FY16. This income spent in the region supports a variety of household, personal services, leisure, and hospitality activities and contributes to the tax base. Table 13 summarizes the total economic impact, including direct, indirect and induced effects, of pay for military retirees living in the Bayou region. Table 13. Economic of Military Retiree Spending in the Bayou Region, FY16 $14,043,000 <150 $77,000 $4,410,000 Source: Military Retired Pay File, Nov. 2016; IMPLAN, Business Development Advisors Veterans Veteran spending is not considered military spending and is therefore not included in the economic impact. However, it is worth noting that veteran expenditures were approximately $86 million in 2016 for an estimated 14,000 veterans living in the parishes comprising the Bayou region. 13
Capital Region The Capital Region is one of eight Louisiana Economic Development (LED) regions. It includes Ascension, East Baton Rouge, East Feliciana, Iberville, Livingston, Pointe Coupee, St. Helena, West Baton Rouge and West Feliciana parishes. Summary of Military Spending in the Capital Region The 2017 impact analysis considers the economic impact of military spending in the Capital Region across three categories: military facility and command activity, defense contracting, and military retiree spending. Table 14. Economic of Military Spending in the Capital Region, FY16 State and Local Taxes Percent of Regional GDP Percent of Regional $410,416,00 3,500 $14,758,000 0.5% 0.91% Economic impact includes the direct, indirect and induced spending from military asset, contractor and retiree spending. 1. Economic of Military Assets The Capital region does not contain any of Louisiana s major military facilities, but it does have a substantial Louisiana National Guard presence and a US Coast Guard unit. The Louisiana National Guard (LANG) activities encompass the State Military Department, which provides emergency response, support and at-risk education, and the Gillis W. Long Center, which provides operational and training support and is home to several LANG units and elements of the Joint Staff. Louisiana National Guard direct spending in the Capital region exceeded $54 million in FY16. The region also benefits indirectly from spending at other military facilities and activities around the state. Table 15 summarizes the total economic impact of employment and spending at these facilities, including direct, indirect and induced effects, on the Capital region of Louisiana. Table 15. Economic of Military Asset Spending in the Capital Region, FY16 $196,038,000 2,250 $6,862,000 $127,081,000 Sources: IMPLAN, Business Development Advisors 2. Economic of Military Contract Spending In addition to spending at military installations, the Department of Defense (DoD) contracts directly with Louisiana companies for many types of goods and services. Louisiana businesses 14
also perform work on contracts that may or may not be managed by Louisiana-based companies. Table 16 summarizes the total economic impact, including direct, indirect and induced effects, of military contracts for which the place of performance was the Capital region of Louisiana. Total direct contract spending in the region by DoD and the US Coast Guard in FY 16 was $411 million. However, in order to avoid possibly overstating the impact of military spending in the state, contracts performed in installation zip codes were subtracted from the total in order to make the economic impact calculations for the region. Table 16: Economic of DOD/USCG Contract Spending in the Capital Region, FY16 $147,463,000 750 $4,193,000 $46,390,000 Figures do not include the Army Corps of Engineers. Sources: USAspending.gov, IMPLAN, Business Development Advisors Military contract funds flow through many parts of the regional economy and are not limited to defense companies. The top 5 sectors for contracts performed in the region are: Facilities support services Remediation services Oil and gas pipeline and related construction Petroleum refineries Petroleum bulk stations and terminals These sectors accounted for 88% of the obligated contract dollars in FY16. 3. Economic of Retiree Spending Louisiana attracts a sizeable number of military retirees who receive direct payments from the Department of Defense. Over 2,600 retirees who report their mailing address in a parish in the Capital region of Louisiana received annual gross pay totaling over $61 million in FY16. This income spent in the region supports a variety of household, personal services, leisure, and hospitality activities and contributes to the tax base. Table 17 summarizes the total economic impact, including direct, indirect and induced effects, of pay for military retirees living in the Capital region. Table 17: Economic of Military Retiree Spending in the Capital Region, FY16 $66,915,000 500 $3,703,000 $21,012,000 Source: Military Retired Pay File, July 2017; IMPLAN, Business Development Advisors 15
Veterans Veteran spending is not considered military spending and is therefore not included in the economic impact. However, it is worth noting that veteran expenditures were approximately $313 million in 2016 for an estimated 45,000 veterans living in the parishes comprising the Capital region. 16
Central Region The Central Region is one of eight Louisiana Economic Development (LED) regions. It includes Avoyelles, Catahoula, Concordia, Grant, LaSalle, Rapides, Vernon and Winn parishes. Summary of Military Spending in the Central Region The 2017 impact analysis considers the economic impact of military spending in the Central Region across three categories: military facility and command activity, defense contracting, and military retiree spending. Table 18. Economic of Military Spending in the Central Region, FY16 State and Local Taxes Percent of Regional GDP Percent of Regional $1,596,214,000 18,500 $59,315,00 10.56% 18.13% Economic impact includes the direct, indirect and induced spending from military asset, contractor and retiree spending. 1. Economic of Military Assets The Central region is home to Fort Polk, which directly contributes over 14,000 jobs and $760 million in payroll to the economy. Estimated total spending at Fort Polk was $1.09 billion in FY16. In addition to the military missions and tenants at Fort Polk, the Central region hosts the Louisiana National Guard at Camp Beauregard in Pineville. With approximately 600 full- and part-time people, Louisiana National Guard direct spending in the Central region exceeded $90 million in FY16. The region also benefits indirectly from spending at other military facilities and activities around the state. Table 19 summarizes the total economic impact of employment and spending at these facilities, including direct, indirect and induced effects, in the Central region of Louisiana. Table 19. Economic of Military Asset Spending in the Central Region, FY16 $1,432,783,000 17,350 $51,552,000 $927,586,000 Sources: Fort Polk, Louisiana National Guard, IMPLAN, Business Development Advisors 17
2. Economic of Military Contract Spending In addition to spending at military installations, the Department of Defense (DoD) contracts directly with Louisiana companies for many types of goods and services. Louisiana businesses also perform work on contracts that may or may not be managed by Louisiana-based companies. Total direct contract spending in the region by DoD and the US Coast Guard in FY 16 was $25 million. However, it is likely that some of this contract spending overlapped with expenditures at Fort Polk. Given the nature of the data sources, it is not possible to know the exact extent of this overlap. In order to avoid possibly overstating the impact of military spending in the region, contracts performed in Fort Polk zip codes were subtracted from the total in order to make the economic impact calculations for the region. Table 20 summarizes the total economic impact, including direct, indirect and induced effects, of military contracts for which the place of performance was Central Louisiana. Table 20: Economic of DOD/USCG Contract Spending in the Central Region, FY16 $47,613,000 <250 $1,354,000 $14,967,000 Figures do not include the Army Corps of Engineers. Sources: USAspending.gov, IMPLAN, Business Development Advisors Military contract funds flow through many parts of the regional economy and are not limited to defense companies. The top 5 sectors for contracts performed in the region are: Petroleum refineries Highway, street, and bridge construction Other specialty trade contractors Other heavy and civil engineering construction Industrial building construction These sectors accounted for nearly 65% of the obligated contract dollars in FY16. 3. Economic of Retiree Spending Louisiana attracts a sizeable number of military retirees who receive direct payments from the Department of Defense. Approximately 4,500 retirees who report their mailing address in a parish in Central Louisiana received annual gross pay totaling nearly $107 million in FY16. This income supports a variety of household, personal services, leisure, and hospitality activities and contributes to the tax base in the region. Table 21 summarizes the total economic impact, including direct, indirect and induced effects, of pay for military retirees living in Central Louisiana. 18
Table 21. Economic of Military Retiree Spending in the Central Region, FY16 $115,818,000 900 $6,409,000 $36,368,000 Source: Military Retired Pay File, July 2017; IMPLAN, Business Development Advisors This figure may understate the impact of retiree spending since retirees who live in nearby communities in Texas and other regions of Louisiana visit Central Louisiana to take advantage of shopping, recreational, tourism and healthcare resources. Fort Polk estimates over 17,000 military retirees and their family members live within 40 miles of the base. Veterans Veteran spending is not considered military spending and is therefore not included in the economic impact. However, it is worth noting that veteran expenditures were approximately $319 million in 2016 for an estimated 26,000 veterans living in the parishes comprising the Central region. 19
Northeast Region The Northeast Region is one of eight Louisiana Economic Development (LED) regions. It includes Caldwell, East Carroll, Franklin, Madison, Morehouse, Ouachita, Richland, Tensas, Union and West Carroll parishes. Summary of Military Spending in the Northeast Region The 2017 impact analysis considers the economic impact of military spending in the Northeast Region across three categories: military facility and command activity, defense contracting, and military retiree spending. Table 22. Economic of Military Spending in the Northeast Region, FY16 State and Local Taxes Percent of Regional GDP Percent of Regional $148,749,000 1,500 $5,736,000 1.01% 1.41% Economic impact includes the direct, indirect and induced spending from military asset, contractor and retiree spending. 1. Economic of Military Assets The Northeast region does not contain any of Louisiana s major military facilities, but it does have a Louisiana National Guard presence. The region also benefits indirectly from spending at other military facilities and activities around the state. Table 23 summarizes the total economic impact of employment and spending at these facilities, including direct, indirect and induced effects, on the Northeast Region of Louisiana. Table 23. Economic of Military Asset Spending in Northeast Louisiana, FY16 $105,460,000 1,100 $3,498,000 $64,105,000 Sources: IMPLAN, Business Development Advisors 2. Economic of Military Contract Spending In addition to spending at military installations, the Department of Defense (DoD) contracts directly with Louisiana companies for many types of goods and services. Louisiana businesses also perform work on contracts that may or may not be managed by Louisiana-based companies. Table 24 summarizes the total economic impact, including direct, indirect and induced effects, of military contracts for which the place of performance was Northeast Louisiana. Total contract spending by place of performance in the region by DoD and the US Coast Guard in FY16 was $6.3 million. However, in order to avoid possibly overstating the impact of military spending in 20
the state, contracts performed in installation zip codes were subtracted from the total in order to make the economic impact calculations for the region. Table 24: Economic of DOD/USCG Contract Spending in Northeast Louisiana, FY16 $5,840,000 <100 $166,000 $1,836,000 Figures do not include the Army Corps of Engineers. Sources: USAspending.gov, IMPLAN, Business Development Advisors Military contract funds flow through many parts of the regional economy and are not limited to defense companies. The top 5 sectors for contracts performed in the region are: Wired telecommunications carriers Perishable prepared food manufacturing Engineering services Ship building and repairing Fresh fruit and vegetable merchant wholesalers These sectors accounted for over 91% of the obligated contract dollars in FY16. 3. Economic of Retiree Spending Louisiana attracts a sizeable number of military retirees who receive direct payments from the Department of Defense. Over 1,500 retirees who report their mailing address in a parish in Northeast Louisiana received annual gross pay totaling over $34 million in FY16. This income spent in the region supports a variety of household, personal services, leisure, and hospitality activities and contributes to the tax base. Table 25 summarizes the total economic impact, including direct, indirect and induced effects, of pay for military retirees living in Northeast Louisiana. Table 25. Economic of Military Retiree Spending in the Northeast Region, FY 16 $37,449,000 300 $2,072,000 $11,759,000 Source: Military Retired Pay File, Nov. 2012; IMPLAN, Business Development Advisors, Center for Regional Economic Competitiveness Veterans Veteran spending is not considered military spending and is therefore not included in the economic impact. However, it is worth noting that veteran expenditures were approximately $148 million in 2016 for an estimated 18,000 veterans living in the parishes comprising the Northeast region. 21
Northwest Region The Northwest Region is one of eight Louisiana Economic Development (LED) regions. It includes Bienville, Bossier, Caddo, Claiborne, De Soto, Jackson, Lincoln, Natchitoches, Red River, Sabine and Webster parishes. Summary of Military Spending in the Northwest Region The 2017 impact analysis considers the economic impact of military spending in the Northwest Region across three categories: military facility and command activity, defense contracting, and military retiree spending. Table 26. Economic of Military Spending in the Northeast Region, FY16 State and Local Taxes Percent of Regional GDP Percent of Regional $1,484,650,000 16,500 $56,041,000 4.04% 7.28% Economic impact includes the direct, indirect and induced spending from military asset, contractor and retiree spending. 1. Economic of Military Assets The Northwest region is home to Barksdale Air Force Base, (BAFB), which directly contributes nearly 9,000 jobs and over $500 million in payroll to the economy. Estimated total spending at BAFB exceeded $686 million in FY16. In addition to the military missions and tenants at Barksdale, the Northwest region hosts Camp Minden, home to Louisiana National Guard units, as well as additional Guard units throughout the region. The region also benefits indirectly from spending at other military facilities and activities around the state. Table 27 summarizes the total economic impact of employment and spending at these facilities, including direct, indirect and induced effects, on the Northwest Region of Louisiana. Table 27. Economic of Military Asset Spending in Northwest Louisiana, FY16 $1,268,766,000 14,900 $44,500,000 $806,758,000 Sources: Barksdale AFB, IMPLAN, Business Development Advisors 2. Economic of Military Contract Spending In addition to spending at military installations, the Department of Defense (DoD) contracts directly with Louisiana companies for many types of goods and services. Louisiana businesses also perform work on contracts that may or may not be managed by Louisiana-based companies. 22
Total direct contract spending in the region by DoD and the US Coast Guard in FY 16 was nearly $19 million. However, it is likely that some of this contract spending overlaps with expenditures at Barksdale. Given the nature of the data sources, it is not possible to know the exact extent of this overlap. In order to avoid possibly overstating the impact of military spending in the region, contracts performed in Barksdale zip codes were subtracted from the total in order to make the economic impact calculations for the region. Table 28 summarizes the total economic impact, including direct, indirect and induced effects, of military contracts for which the place of performance was Northwest Louisiana. Table 28: Economic of DOD/USCG Contract Spending in Northwest Louisiana, FY16 $15,025,000 <100 $427,000 $4,733,000 Figures do not include the Army Corps of Engineers. Sources: USAspending.gov, IMPLAN, Business Development Advisors Military contract funds flow through many parts of the regional economy and are not limited to defense companies. The top 5 sectors for contracts performed in the region are: Electric power distribution Fiber can, tube, and drum products manufacturing Highway, street and bridge construction Janitorial services Cut and sew apparel contractors These sectors accounted for over 50% of the obligated contract dollars in FY17. 3. Economic of Retiree Spending Louisiana attracts a sizeable number of military retirees who receive direct payments from the Department of Defense. Nearly 7,000 retirees who report their mailing address in a parish in Northwest Louisiana received annual gross pay totaling over $185 million in FY16. This income spent in the region supports a variety of household, personal services, leisure, and hospitality activities and contributes to the tax base. Table 29 summarizes the total economic impact, including direct, indirect and induced effects, of pay for military retirees living in Northwest Louisiana. Table 29. Economic of Military Retiree Spending in the Northwest Region, FY16 $200,859,000 1,500 $11,114,000 $63,073,000 Source: Military Retired Pay File, July 2017; IMPLAN, Business Development Advisors This figure may understate the impact of retiree spending since retirees who live in nearby communities in Arkansas, Texas and other regions of Louisiana also visit Barksdale and 23
Northwest Louisiana for shopping, recreational, tourism and healthcare resources. Veterans Veteran spending is not considered military spending and is therefore not included in the economic impact. However, it is worth noting that veteran expenditures were approximately $457 million in 2016 for an estimated 49,000 veterans living in the parishes comprising the Northwest region. 24
Southeast Region The Southeast Region is one of eight Louisiana Economic Development (LED) regions. It includes Jefferson, Orleans, Plaquemines, St. Bernard, St. Charles, St. James, St. John the Baptist, St. Tammany, Tangipahoa, and Washington parishes. Summary of Military Spending in the Southeast Region The 2017 impact analysis considers the economic impact of military spending in the Southeast Region across three categories: military facility and command activity, defense contracting, and military retiree spending. Table 30. Economic of Military Spending in the Northeast Region, FY16 State and Local Taxes Percent of Regional GDP Percent of Regional $2,507,393,000 24,100 $90,159,000 2.07% 4.03% Economic impact includes the direct, indirect and induced spending from military asset, contractor and retiree spending. 1. Economic of Military Assets The Southeast region is home to several military facilities and activities. Naval Air Station Joint Reserve Base (NAS JRB) New Orleans (Belle Chasse) is located in Plaquemines Parish. NAS JRB directly contributes over 6,000 jobs and over $440 million in spending to the economy. US Coast Guard, 8th District, has multiple offices and operations in the region, including the 8th District headquarters in New Orleans, the Coast Guard Air Station New Orleans, and the New Orleans sector office. Coast Guard operations directly contribute over 1,700 jobs and $169 million in spending to the state economy, most of which occurs in the Southeast region. Marine Forces Reserve (MARFORRES) headquarters is located in Federal City in the Algiers district of New Orleans. MARFORRES employs over 2,600 active and reserve military, civilians and contractors, most of whom are in the southeast region, with annual expenditures of $140 million. Space and Naval Warfare Systems Center Atlantic (SPAWAR) occupies two office buildings in New Orleans near the University of New Orleans and contributes over 700 jobs (including contractors) and $65 million in spending to the economy. The 377th Theatre Sustainment Command in New Orleans includes over 1,300 jobs (including reservists) and contributes over $30 million in spending. The Southeast region has a significant Louisiana National Guard presence accounting for nearly 700 personnel and over $108 million in spending. 25
Table 31 summarizes the total economic impact of employment and spending at these facilities, including direct, indirect and induced effects, on the Southeast Region of Louisiana. Table 31. Economic of Military Asset Spending in the Southeast Region, FY16 $1,552,739,000 18,800 $58,166,000 $1,069,018,000 Sources: NAS JRB, USCG, SPAWAR, Marine Forces Reserve, 377th TSC, Louisiana National Guard. IMPLAN, Business Development Advisors 2. Economic of Military Contract Spending In addition to spending at military installations, the Department of Defense (DoD) contracts directly with Louisiana companies for many types of goods and services. Louisiana businesses also perform work on contracts that may or may not be managed by Louisiana-based companies. Total direct contract spending in the region by DoD and the US Coast Guard in FY 16 was $528 million. However, it is likely that some of this contract spending overlapped with expenditures at the facilities in New Orleans. In order to avoid possibly overstating the impact of military spending in the region, contracts performed in the relevant zip codes were subtracted from the total in order to make the economic impact calculations for the region. Table 32 summarizes the total economic impact, including direct, indirect and induced effects, of military contracts for which the place of performance was Southeast Louisiana. Table 32: Economic of DOD/USCG Contract Spending in the Southeast Region, FY16 $774,112,000 3,900 $22,003,000 $243,692,000 Figures do not include the Army Corps of Engineers. Sources: USAspending.gov, IMPLAN, Business Development Advisors Military contract funds flow through many parts of the regional economy and are not limited to defense companies. The top 5 sectors for contracts performed in the region are: Ship building and repairing Military armored vehicle, tank and tank component manufacturers Coastal and Great Lakes freight transportation Commercial and institutional building construction Deep sea freight transportation These sectors accounted for over 67% of the obligated contract dollars in FY16. 26
3. Economic of Retiree Spending Louisiana attracts a sizeable number of military retirees who receive direct payments from the Department of Defense. Approximately 6,600 retirees who report their mailing address in a parish in Southeast Louisiana received annual gross pay totaling over $166 million. This income spent in the region supports a variety of household, personal services, leisure, and hospitality activities and contributes to the tax base. Table 33 summarizes the total economic impact, including direct, indirect and induced effects, of pay for military retirees living in Southeast Louisiana. Table 33. Economic of Military Retiree Spending in the Southeast Region, FY16 $180,542,000 1,400 $9,990,000 $56,692,000 Source: Military Retired Pay File, July 2017; IMPLAN, Business Development Advisors This figure may understate the impact of retiree spending since retirees who live in nearby communities in Mississippi, Alabama and other regions of Louisiana but visit Southeast Louisiana to take advantage of shopping, recreational, tourism and healthcare resources. Veterans Veteran spending is not considered military spending and is therefore not included in the economic impact. However, it is worth noting that veteran expenditures were approximately $859 million in 2016 for an estimated 81,000 veterans living in the parishes comprising the Southeast region. 27
Southwest Region The Southwest Region is one of eight Louisiana Economic Development (LED) regions. It includes Allen, Beauregard, Calcasieu, Cameron and Jefferson Davis parishes. Summary of Military Spending in the Southwest Region The 2017 impact analysis considers the economic impact of military spending in the Southwest Region across three categories: military facility and command activity, defense contracting, and military retiree spending. Table 34. Economic of Military Spending in the Southwest Region, FY16 State and Local Taxes Percent of Regional GDP Percent of Regional $450,360,000 5,200 $18,001,000 2.00% 4.0% Economic impact includes the direct, indirect and induced spending from military asset, contractor and retiree spending. 1. Economic of Military Assets The Southwest region does not contain any of Louisiana s major military facilities, but it is connected economically to Fort Polk in the Central Region primarily via the town of DeRidder and Beauregard Parish, which border Vernon Parish, the home of Fort Polk. The Southwest region also has a Louisiana National Guard and US Coast Guard presence. The region also benefits indirectly from spending at other military facilities and activities around the state. Table 35 summarizes the total economic impact of employment and spending at these facilities, including direct, indirect and induced effects, on the Southwest region of Louisiana. Table 35. Economic of Military Asset Spending in the Southwest Region, FY16 $392,124,000 4,700 $15,023,000 $270,915,000 Sources: IMPLAN, Business Development Advisors 2. Economic of Military Contract Spending In addition to spending at military installations, the Department of Defense (DoD) contracts directly with Louisiana companies for many types of goods and services. Louisiana businesses also perform work on contracts that may or may not be managed by Louisiana-based companies. 28
Table 36 summarizes the total economic impact, including direct, indirect and induced effects, of military contracts for which the place of performance was Southwest Louisiana. Total contract spending by place of performance in the region by DoD and the US Coast Guard in FY 16 was approximately $15 million. However, in order to avoid possibly overstating the impact of military spending in the state, contracts performed in installation zip codes were subtracted from the total in order to make the economic impact calculations for the region. Table 36: Economic of DOD/USCG Contract Spending in the Southwest Region, FY16. $9,106,000 <100 $259,000 $2,870,000 Figures do not include the Army Corps of Engineers. Sources: USAspending.gov, IMPLAN, Business Development Advisors Military contract funds flow through many parts of the regional economy and are not limited to defense companies. The top 5 sectors for contracts performed in the region are: Roofing contractors Petroleum refineries Highway, street, and bridge construction Commercial and institutional building construction Electrical contractors and wiring contractors These sectors accounted for over 88% of the obligated contract dollars in FY16. 3. Economic of Retiree Spending Louisiana attracts a sizeable number of military retirees who receive direct payments from the Department of Defense. Over 1,900 retirees who report their mailing address in a parish in Southwest Louisiana received annual gross pay totaling over $45 million. This income spent in the region supports a variety of household, personal services, leisure, and hospitality activities and contributes to the tax base. Table 37 summarizes the total economic impact, including direct, indirect and induced effects, of pay for military retirees living in Southwest Louisiana. Table 37. Economic of Military Retiree Spending in the Southwest Region, FY16 $49,130,000 400 $2,719,000 $15,428,000 Source: Military Retired Pay File, July 2017; IMPLAN, Business Development Advisors This figure may understate the impact of retiree spending since retirees who live in nearby communities in Texas and other regions of Louisiana also visit Southwest Louisiana to take advantage of shopping, recreational, tourism and healthcare resources. At the same time, retirees in the Southwest region also appear to spend portions of their income in other regions. 29
Veterans Veteran spending is not considered military spending and is therefore not included in the economic impact. However, it is worth noting that veteran expenditures were approximately $160 million in 2016 for an estimated 22,000 veterans living in the parishes comprising the Southwest region. 30
Statewide Economic by Military Facility This section summarizes the statewide economic impact individually for each of the military facilities and commands analyzed for this report. Barksdale Air Force Base Economic Contribution Analysis Table 38 summarizes direct spending in the following categories for Barksdale Air Force Base in FY16. Table 38. Barksdale AFB and Expenditures Summary (full-time and part-time) 8,924 Payroll $533,963,657 Operations Expenditures $119,620,064 Construction Expenditures $32,938,293 TOTAL EXPENDITURES $686,522,014 Source: Barksdale Air Force Base, FY16. Economic Table 39 summarizes the total economic impact of employment and spending at Barksdale Air Force Base, including direct, indirect and induced effects, on the state of Louisiana. Table 39. Economic impact of Barksdale AFB spending in Louisiana, FY16 $1,199,609,000 14,100 $43,387,000 $786,097,000 Sources: IMPLAN, Business Development Advisors Barksdale s impact is statewide but concentrated in Northwest Louisiana. 2 spending and payroll associated with Barksdale account for: In this region, 2.9% of regional GDP 5.4% of regional payroll employment 2 The Northwest Region includes Bienville, Bossier, Caddo, Claiborne, De Soto, Jackson, Lincoln, Natchitoches, Red River, Sabine and Webster parishes. 31
Fort Polk Economic Contribution Analysis Table 40 summarizes direct spending in the following categories for Fort Polk in FY16. Table 40. Fort Polk and Expenditures Summary (full-time and part-time) 14,434 Payroll $764,576,827 Operations Expenditures $232,088,175 Construction Expenditures $92,801,491 TOTAL EXPENDITURES $1,089,566,493 Source: Fort Polk, FY16. Economic Table 41 summarizes the total economic impact of employment and spending at Fort Polk, including direct, indirect and induced effects, on the state of Louisiana. Table 41. Economic impact of Fort Polk Spending in Louisiana, FY16 $1,868,579,000 23,300 $67,157,000 $1,201,725,000 Sources: IMPLAN, Business Development Advisors. Fort Polk s impact is statewide but concentrated in Central Louisiana. 3 and payroll associated with Fort Polk account for: In this region, spending 8.4% of regional GDP 15.2% of regional employment Winn parishes. 3 The Central Region includes Avoyelles, Catahoula, Concordia, Grant, LaSalle, Rapides, Vernon and 32
Naval Air Station Joint Reserve Base, New Orleans Economic Contribution Analysis Table 42 summarizes direct spending in the following categories for NAS JRB New Orleans in FY16. Table 42. NAS JRB and Expenditures Summary, FY16 (full-time and part-time) 6,015 Payroll $355,614,819 Operations Expenditures $49,837,346 Construction Expenditures $35,285,714 TOTAL EXPENDITURES $440,737,879 Source: NAS JRB New Orleans, FY16. Economic Table 43 summarizes the total economic impact of employment and spending at NAS JRB New Orleans, including direct, indirect and induced effects, on the state of Louisiana. Table 43. Economic of NAS JRB Spending in Louisiana, FY16 $765,428,000 9,200 $27,859,000 $506,611,000 Sources: IMPLAN, Business Development Advisors NAS JRB New Orleans s impact is statewide but concentrated in southeast Louisiana. 4 region, spending and payroll associated with NAS JRB New Orleans account for: In this 0.6% of regional GDP 1.3% of regional employment 4 The Southeast Region includes Jefferson, Orleans, Plaquemines, St. Bernard, St. Charles, St. James, St. John the Baptist, St. Tammany, Tangipahoa, and Washington parishes. 33
US Coast Guard Economic Contribution Analysis Table 44 summarizes direct spending in the following categories for the US Coast Guard, 8 th District in Louisiana in FY16. Table 44. USCG, 8 th District and Expenditures Summary, FY16 (full-time and part-time) 1,762 Payroll $150,495,944 Operations Expenditures $19,012,640 Construction Expenditures n/a TOTAL EXPENDITURES $168,508,584 Economic Table 45 summarizes the total economic impact of employment and spending at US Coast Guard, 8th District, including direct, indirect and induced effects, on the state of Louisiana. Table 45. Economic of USCG, 8th District Spending in Louisiana, FY16 $293,320,000 3,000 $10,641,000 $203,483,000 Sources: IMPLAN, Business Development Advisors The US Coast Guard 8th District s impact is statewide but concentrated in southeast Louisiana. 5 In this region, spending and payroll associated with the US Coast Guard 8th District account for: 0.2% of regional GDP 0.4% of regional employment 5 The Southeast Region includes Jefferson, Orleans, Plaquemines, St. Bernard, St. Charles, St. James, St. John the Baptist, St. Tammany, Tangipahoa, and Washington parishes. 34
Marine Forces Reserve Economic Contribution Analysis Table 46 summarizes direct spending in the following categories for Marine Forces Reserve in Louisiana in FY16. Table 46. Marine Forces Reserve and Expenditures Summary, FY 16 (full-time and part-time) 2,605 Payroll $121,905,841 Operations Expenditures $16,073,493 Construction Expenditures $2,247,956 TOTAL EXPENDITURES $140,227,290 Source: MARRFORRES, FY16 Economic Table 47 summarizes the total economic impact of employment and spending from Marine Forces Reserve, including direct, indirect and induced effects, on the state of Louisiana. Table 47. Economic of Marine Forces Reserve Spending in Louisiana, FY16 $247,766,000 3,600 $8,926,000 $166,889,000 Sources: IMPLAN, Business Development Advisors The Marine Forces Reserve s impact is statewide but concentrated in southeast Louisiana. 6 In this region, spending and payroll associated with MARFORRES account for: 0.2% of regional GDP 0.6% of regional employment 6 The Southeast Region includes Jefferson, Orleans, Plaquemines, St. Bernard, St. Charles, St. James, St. John the Baptist, St. Tammany, Tangipahoa, and Washington parishes. 35
SPAWAR New Orleans Economic Contribution Analysis Table 48 summarizes direct spending in the following categories for SPAWAR New Orleans in Louisiana in FY16. Table 48. SPAWAR New Orleans and Expenditures Summary, FY 16 (full-time and part-time) 714 Payroll $58,294,638 Operations Expenditures $5,928,760 Construction Expenditures $800,000 TOTAL EXPENDITURES $65,023,398 Source: SPAWAR Atlantic, FY16 Economic Table 49 summarizes the total economic impact of employment and spending from SPAWAR New Orleans, including direct, indirect and induced effects, on the state of Louisiana. Table 49. Economic of SPAWAR New Orleans Spending in Louisiana, FY16 $112,737,000 1,100 $4,560,000 $78,298,000 Sources: IMPLAN, Business Development Advisors SPAWAR New Orleans s impact is statewide but concentrated in southeast Louisiana. In this region, spending and payroll associated with SPAWAR account for: 0.1% of regional GDP 0.2% of regional employment 36
377th Theater Sustainment Command Economic Contribution Analysis Table 50 summarizes direct spending in the following categories for the 377 th Theater Sustainment Command (TSC) in Louisiana in FY16. Table 50. 377 th TSC and Expenditures Summary, FY 16 (full-time and part-time) 1,337 Payroll $26,474,992 Operations Expenditures $7,412,998 Construction Expenditures n/a Source: 377th TSC, FY16 TOTAL EXPENDITURES $33,887,990 Economic Table 51 summarizes the total economic impact of employment and spending from 377th TSC, including direct, indirect and induced effects, on the state of Louisiana. Table 51. Economic of 377th TSC Spending in Louisiana, FY16 $57,235,000 1,600 $2,106,000 $39,130,000 Sources: IMPLAN, Business Development Advisors The 377th TSC s impact is statewide but concentrated in southeast Louisiana. In this region, spending and payroll associated with TSC account for: 0.04% of regional GDP 0.2% of regional employment 37
Louisiana National Guard Economic Contribution Analysis Table 52 summarizes direct spending in the following categories for the Louisiana National Guard in FY16. Table 52. Louisiana National Guard and Expenditures Summary, FY 16 Total LANG Personnel 1,884 TOTAL EXPENDITURES $394,479,192 Source: Louisiana National Guard, FY16 Economic Table 53 summarizes the total economic impact of employment and spending from the Louisiana National Guard, including direct, indirect and induced effects, on the state of Louisiana. Table 53. Economic of Louisiana National Guard Spending in Louisiana, FY16. $672,882,000 6,300 $24,192,000 $452,941,000 Sources: IMPLAN, Business Development Advisors The Louisiana National Guard s impact is statewide. Spending and payroll associated with the Louisiana National Guard account for: 0.2% of state GDP 0.3% of state employment 38
Military Contract Spending 39
Statewide Military Contract Spending This section profiles Louisiana defense contract awards statewide for FY16. Department of Defense (DOD) and US Coast Guard (USCG) contract spending in Louisiana reached $1.5 billion in FY16 - its highest level since FY12 (Figure 2). Figure 2. Total Value of DOD & USCG Contracts, Louisiana, FY 2012 - FY 2016 Billion $2.00 $1.80 $1.60 $1.40 $1.20 $1.00 $0.80 $0.60 $0.40 $0.20 $0.00 $1.78 $1.52 $1.47 $1.37 $1.07 FY 2012 FY 2013 FY 2014 FY 2015 FY 2016 Source: USASpending.gov, Data extracts as of October 23, 2017 Of these contracts, approximately twothirds were awarded by either the Department of the Navy or US Coast Guard (figure 3). The Department of the Army accounts for over 20% of total contracts awarded. Figure 3. Military Contracts Performed in Louisiana by Awarding Agency Source: USASpending.gov, Data extracts as of October 23, 2017 40
Louisiana is a significant place of performance for defense work initially awarded in other states (Figure 3). Virginia, Maryland and Florida are the leading out-of-state sources for military contracts performed in Louisiana. Figure 4. Military Contracts Performed in Louisiana by Contract Recipient State FY16 Source: USASpending.gov, Data extracts as of October 23, 2017 Contract performed in Louisiana are concentrated among a handful of industries, products, and contractors. Table 54 indicates that ten industries account for nearly 82% of Louisiana s contract dollars, led by the Ship Building and Repairing industry. Table 54. Top Ten Defense Industry Categories in Louisiana (by $ amount), FY2016 Rank Industry Obligated Dollar Amount % of Total Value 1 Ship Building and Repairing $603,160,201 39.6% 2 Facilities Support Services $109,019,925 7.2% 3 Boat Building $91,317,259 6.0% 4 Remediation Services $88,173,401 5.8% 5 Oil and Gas Pipeline Related Construction $85,959,373 5.6% 6 Petroleum Refineries $79,290,033 5.2% 7 Military Armored Vehicle, Tank and Component Manufacturing $56,919,747 3.7% 8 Deep Sea Freight Transportation $48,462,149 3.2% 9 Coastal and Great Lakes Freight Transportation $39,899,057 2.6% 10 Commercial and Institutional Building Construction $37,231,529 2.4% Top Ten Vendors Total $1,239,432,674 81.4% All Other $282,524,001 18.6% Total $1,521,956,675 100.0% Source: USASpending.gov, Data extracts as of October 23, 2017. Note: The data above do not include U.S. Army Corps of Engineers contracts. 41
Manufacturing accounts for the majority (60%) of contracts awarded to Louisiana companies, followed by Administrative and Support Services, which includes facilities support services, and Transportation and Warehousing (figure 5). Figure 5. Military Contracts in Louisiana by Industry Sector, FY16 Source: USASpending.gov, Data extracts as of October 23, 2017 Table 55 provides more insight into the types of products purchased. Combat ships and landing vessels dominate the list, but housekeeping services, other ship and marine-related activities, environmental services, construction and fuels are also important product categories. Table 55. Top Ten Defense Products or Services Provided by Louisiana Companies, FY2016 Rank Industry Obligated Dollar Amount % of Total Value 1 COMBAT SHIPS AND LANDING VESSELS $553,794,899 36.4% 2 HOUSEKEEPING- FACILITIES OPERATIONS SUPPORT $107,718,164 7.1% 3 TRANSPORTATION/TRAVEL/RELOCATION-MARINECHARTER $90,892,122 6.0% 4 SMALL CRAFT $85,830,405 5.6% 5 CONSTRUCTION OF OTHER NON-BUILDING FACILITIES $78,701,118 5.2% 6 LIQUID PROPELLANTS AND FUELS, PETROLEUM BASE $78,180,676 5.1% 7 OTHER ENVIRONMENTAL SERVICES $53,616,952 3.5% 8 COMBAT, ASSAULT, AND TACTICAL VEHICLES, WHEELED $51,072,583 3.4% 9 ENVIRONMENTAL SYSTEMS PROTECTION- ENV REMEDIATION $37,295,485 2.5% 10 NON-NUCLEAR SHIP REPAIR $30,794,246 2.0% Top Ten Vendors Total $1,167,896,649 76.7% All Other $354,060,026 23.3% Total $1,521,956,675 100.0% Source: USASpending.gov, Data extracts as of October 23, 2017. Note: The data above do not include U.S. Army Corps of Engineers contracts. Table 56 lists the top Louisiana-based defense contractors for FY16 based on contract value. 42
Table 56. Top Louisiana Defense Contractors, by Contract Value, FY2016 Rank Industry Obligated Dollar Amount % of Total Value 1 BOLLINGER SHIPYARDS LOCKPORT, L.L.C. $365,152,796 24.0% 2 TEXTRON INC. $247,491,126 16.3% 3 CB&I FEDERAL SERVICES LLC $196,798,726 12.9% 4 TIYA SUPPORT SERVICES, L.L.C. $72,604,338 4.8% 5 PLACID REFINING COMPANY LLC $68,694,540 4.5% 6 GRAVOIS ALUMINUM BOATS, LLC $52,118,603 3.4% 7 HORNBECK OFFSHORE OPERATORS, LLC $44,962,607 3.0% 8 HIGH DESERT SUPPORT SERVICES, LLC $34,761,990 2.3% 9 SWIFTSHIPS SHIPBUILDERS, L.L.C. $30,857,035 2.0% 10 JGILS, LLC $26,601,517 1.7% Top Ten Vendors Total $1,140,043,277 74.9% All Other $381,913,397 25.1% Total $1,521,956,675 100.0% Source: USASpending.gov, Data extracts as of October 23, 2017Note: The data above do not include U.S. Army Corps of Engineers contracts. 43
Military Contract Spending by Region Acadiana Region Table 57. Top Defense Industry Sectors (by $ amount), Acadiana Region, FY16 Rank Industry Obligated Dollar Amount % of Total Value 1 Boat Building $51,898,731 84.9% 2 Engineering Services $2,336,066 3.8% 3 Ship Building and Repairing $1,707,825 2.8% 4 Fabricated Structural Metal Manufacturing $1,146,246 1.9% 5 Other Plastics Product Manufacturing $734,137 1.2% 6 Petroleum Refineries $510,299 0.8% Search, Detection, Navigation System and Instrument 7 Manufacturing $384,627 0.6% 8 Other Miscellaneous Manufacturing $366,371 0.6% 9 Technical and Trade Schools $323,781 0.5% 10 Support Activities for Forestry $281,408 0.5% Top Ten Vendors Total $59,689,492 97.6% All Other $1,442,528 2.4% Total $61,132,020 100.0% Source: USASpending.gov. Data extracts as of October 2017. Data do not include US Army Corps of Engineers contracts Table 58. Top Defense Contractors by Contract value, Acadiana Region, FY16 Rank Vendor Name Obligated Dollar Amount % of Total Value 1 GRAVOIS ALUMINUM BOATS, LLC $52,118,603 85.3% 2 TRUSTON TECHNOLOGIES, INC. $2,722,424 4.5% 3 GRAVOIS ALUMINUM BOATS $1,401,902 2.3% 4 MARITIME INTERNATIONAL, INC. $1,145,682 1.9% 5 AMERICAN POLLUTION CONTROL CORPORATION $705,907 1.2% 6 RALPHS OF LAFAYETTE INC. $604,030 1.0% 7 PELICAN AVIATION CORP $510,299 0.8% 8 C AND C TECHNOLOGIES INCORPORATED $369,186 0.6% 9 ACADIAN AMBULANCE SERVICE, INC. $289,432 0.5% 10 ESGARD INCORPORATED $205,939 0.3% Top Ten Vendors Total $60,073,404 98.3% All Other $1,058,616 1.7% Total $61,132,020 100.0% Source: USASpending.gov. Data extracts as of October 2017. Data do not include US Army Corps of Engineers contracts 44
Bayou Region Table 59. Top Defense Industry Sectors (by $ amount), Bayou Region, FY16 Rank industry Obligated Dollar Amount % of Total Value 1 Ship Building and Repairing $404,533,079 88.7% 2 Boat Building $19,367,189 4.2% 3 Deep Sea Freight Transportation $12,951,914 2.8% 4 Navigational Services to Shipping $6,809,268 1.5% 5 Other Engine Equipment Manufacturing $3,049,026 0.7% 6 Industrial Building Construction $2,556,554 0.6% 7 Commercial and Institutional Building Construction $1,395,521 0.3% 8 Motor and Generator Manufacturing $731,608 0.2% 9 Power Boiler and Heat Exchanger Manufacturing $653,923 0.1% 10 Other Metal Valve and Pipe Fitting Manufacturing $512,069 0.1% Top Ten Vendors Total $452,560,150 99.2% All Other $3,442,189 0.8% Total $456,002,339 100.0% Source: USASpending.gov. Data extracts as of October 2017. Data do not include US Army Corps of Engineers contracts Table 60. Top Defense Contractors by Contract value, Bayou Region, FY16 Rank Vendor Name Obligated Dollar Amount % of Total Value 1 BOLLINGER SHIPYARDS LOCKPORT, L.L.C. $365,152,796 80.1% 2 SWIFTSHIPS SHIPBUILDERS, L.L.C. $30,857,035 6.8% 3 SWIFTSHIPS, LLC $23,472,552 5.1% 4 ALPHA MARINE SERVICES, INC. $17,148,632 3.8% 5 CHAND, L.L.C. $11,354,442 2.5% 6 JUSTIN J REEVES, L.L.C. $3,960,075 0.9% 7 BORDELON MARINE, L.L.C. $2,178,890 0.5% 8 OFFSHORE SERVICE VESSELS, L.L.C. $510,323 0.1% 9 SEPARATOR SPARES AND EQUIPMENT, LLC $460,299 0.1% 10 DANOS & CUROLE MARINE CONTRACTORS, INC. $445,524 0.1% Top Ten Vendors Total $455,540,568 99.9% All Other $461,772 0.1% Total $456,002,339 100.0% Source: USASpending.gov. Data extracts as of October 2017. Data do not include US Army Corps of Engineers contracts 45
Capital Region Table 61. Top Defense Industry Sectors (by $ amount), Capital Region, FY16 Rank industry Obligated Dollar Amount % of Total Value 1 Facilities Support Services $106,594,603 25.9% 2 Remediation Services $87,568,917 21.3% 3 Oil and Gas Pipeline and Related Construction $85,032,071 20.7% 4 Petroleum Refineries $68,694,540 16.7% 5 Petroleum Bulk Stations and Terminals $14,411,211 3.5% Research and Development in the Physical, Engineering, & Life 6 Sciences $10,350,583 2.5% 7 Testing Laboratories $5,280,917 1.3% 8 Deep Sea Freight Transportation $4,328,906 1.1% 9 Industrial Building Construction $3,789,441 0.9% 10 Environmental Consulting Services $3,751,283 0.9% Top Ten Vendors Total $389,802,471 94.7% All Other $21,802,522 5.3% Total $411,604,993 100.0% Source: USASpending.gov. Data extracts as of October 2017. Data do not include US Army Corps of Engineers contracts Table 62. Top Defense Contractors by Contract value, Capital Region, FY16 Rank Vendor Name Obligated Dollar Amount % of Total Value 1 CB&I FEDERAL SERVICES LLC $196,798,726 47.8% 2 TIYA SUPPORT SERVICES, L.L.C. $72,604,338 17.6% 3 PLACID REFINING COMPANY LLC $68,694,540 16.7% 4 HIGH DESERT SUPPORT SERVICES, LLC $34,761,990 8.4% 5 ARS ALEUT REMEDIATION LLC $4,623,629 1.1% 6 US OCEAN $4,328,906 1.1% 7 GULF SOUTH RESEARCH CORPORATION $4,225,942 1.0% 8 INNOVATIVE EMERGENCY MANAGEMENT, INC. $3,463,745 0.8% 9 WORKFORCE COMMISSION, LOUISIANA $3,265,916 0.8% 10 I S I PROFESSIONAL SERVICES LLC $3,190,158 0.8% Top Ten Vendors Total $395,957,889 96.2% All Other $15,647,103 3.8% Total $411,604,993 100.0% Source: USASpending.gov. Data extracts as of October 2017. Data do not include US Army Corps of Engineers contracts 46
Central Region Table 63. Top Defense Industry Sectors (by $ amount), Central Region, FY16 Rank industry Obligated Dollar Amount % of Total Value 1 Petroleum Refineries $4,496,255 18.1% 2 Highway, Street, and Bridge Construction $3,712,702 15.0% 3 Other Specialty Trade Contractors $3,153,067 12.7% 4 Other heavy and civil engineering construction $2,707,765 10.9% 5 Industrial Building Construction $1,988,849 8.0% 6 Other Miscellaneous Manufacturing $1,601,594 6.5% 7 Septic Tank and Related Services $1,151,948 4.6% 8 Environmental Consulting Services $952,191 3.8% 9 Site Preparation Contractors $931,770 3.8% 10 Ambulance Services $693,262 2.8% Top Ten Vendors Total $21,389,403 86.3% All Other $3,403,515 13.7% Total $24,792,918 100.0% Source: USASpending.gov. Data extracts as of October 2017. Data do not include US Army Corps of Engineers contracts Table 64. Top Defense Contractors by Contract value, Central Region, FY16 Rank Vendor Name Obligated Dollar Amount % of Total Value 1 TARVER LAND DEVELOPMENT, LLC $12,908,525 52.1% 2 FREEMAN HOLDINGS OF LOUISIANA LLC $3,736,051 15.1% 3 MTP DRIVETRAIN SERVICES, L.L.C. $1,889,188 7.6% 4 LAGNIAPPE PORTA JOHNS, L.L.C. $1,151,948 4.6% 5 ARTEMIS ADVANTAGE LLC $952,191 3.8% 6 MED-EXPRESS AMBULANCE SERVICE, INC. $693,262 2.8% 7 W. B. MCCARTNEY OIL COMPANY $594,058 2.4% 8 AMERICAN MOVING AND STORAGE OF LEESVILLE, INC $559,477 2.3% 9 TARPAN CONSTRUCTION, LLC $503,130 2.0% 10 WEST LOUISIANA ICE SERVICES $497,964 2.0% Top Ten Vendors Total $23,485,795 94.7% All Other $1,307,122 5.3% Total $24,792,918 100.0% Source: USASpending.gov. Data extracts as of October 2017. Data do not include US Army Corps of Engineers contracts 47
Northeast Region Table 65. Top Defense Industry Sectors (by $ amount), Northeast Region, FY16 Rank Industry Obligated Dollar Amount % of Total Value 1 Wired Telecommunications Carriers $2,699,017 42.7% 2 Perishable Prepared Food Manufacturing $969,136 15.3% 3 Engineering Services $829,913 13.1% 4 Ship Building and Repairing $640,551 10.1% 5 Fresh Fruit and Vegetable Merchant Wholesalers $619,257 9.8% 6 Heavy and Civil Engineering Construction $266,890 4.2% 7 Professional and Management Development Training $131,498 2.1% 8 Petroleum Refineries $51,611 0.8% 9 Chartered Passenger Air Transportation $26,370 0.4% 10 Welding and Soldering Equipment Manufacturing $22,330 0.4% Top Ten Vendors Total $6,256,573 98.9% All Other $67,421 1.1% Total $6,323,994 100.0% Source: USASpending.gov. Data extracts as of October 2017. Data do not include US Army Corps of Engineers contracts Table 66. Top Defense Contractors by Contract value, Northeast Region, FY16 Rank Vendor Name Obligated Dollar Amount % of Total Value 1 UNITED TELEPHONE COMPANY OF THE NORTHWEST $1,816,400 28.7% 2 CHAD PODY CONSTRUCTION COMPANY, L.L.C. $1,449,170 22.9% 3 S E HUEY CO $969,136 15.3% 4 ROBERTSON FRUIT & PRODUCE, INC. $895,329 14.2% 5 CENTURYTEL ACQUISITION LLC $853,835 13.5% 6 TALLULAH VICKSBURG REGIONAL AIRPORT $131,498 2.1% 7 MONROE WELDING SUPPLY, INC. $72,611 1.1% 8 EMBARQ FLORIDA, INC. $24,164 0.4% 9 D E INVESTMENTS, INC. $22,330 0.4% 10 DANKEN TRAIL BAR B-Q $22,023 0.3% Top Ten Vendors Total $6,256,496 98.9% All Other $67,497 1.1% Total $6,323,994 100.0% Source: USASpending.gov. Data extracts as of October 2017. Data do not include US Army Corps of Engineers contracts 48
Northwest Region Table 67. Top Defense Industry Sectors (by $ amount), Northwest Region, FY16 Rank industry Obligated Dollar Amount % of Total Value 1 Electric Power Distribution $3,515,608 18.7% 2 Fiber Can, Tube, and Drum Products Manufacturing $2,291,189 12.2% 3 Highway, Street, and Bridge Construction $1,735,101 9.2% 4 Janitorial Services $1,641,584 8.7% 5 Cut and Sew Apparel Contractors $884,544 4.7% 6 Miscellaneous Fabricated Metal Product Manufacturing $843,800 4.5% 7 Plumbing, Heating, and Air-Conditioning Contractors $824,390 4.4% 8 Hotels and motels $709,850 3.8% 9 Other Plastics Product Manufacturing $684,378 3.6% 10 Showcase, Partition, Shelving, and Locker Manufacturing $497,409 2.6% Top Ten Vendors Total $13,627,853 72.4% All Other $5,183,236 27.6% Total $18,811,089 100.0% Source: USASpending.gov. Data extracts as of October 2017. Data do not include US Army Corps of Engineers contracts Table 68. Top Defense Contractors by Contract value, Northwest Region, FY16 Rank Vendor Name Obligated Dollar Amount % of Total Value 1 SOUTHWESTERN ELECTRIC POWER CO $3,515,608 18.7% 2 OMEGA CONTAINER, INC. $3,134,989 16.7% 3 F. J. BURNELL, INC. $1,735,101 9.2% 4 ARC OF CADDO-BOSSIER, THE $1,719,284 9.1% 5 LOUISIANA ASSOCIATION FOR THE BLIND, THE $905,260 4.8% 6 FIRE TECH SYSTEMS, INC. $824,390 4.4% 7 INTEGRICO COMPOSITES OF LOUISIANA, L.L.C. $684,378 3.6% 8 MAXIM EVAPORATORS OF AMERICA, LLC $655,573 3.5% 9 MC GILL AIRCRAFT PARTS INC $506,967 2.7% 10 J & P SALES INC $497,409 2.6% Top Ten Vendors Total $14,178,958 75.4% All Other $4,632,131 24.6% Total $18,811,089 100.0% Source: USASpending.gov. Data extracts as of October 2017. Data do not include US Army Corps of Engineers contracts 49
Southeast Region Table 69. Top Defense Industry Sectors (by $ amount), Southeast Region, FY16 Rank Industry Obligated Dollar Amount % of Total Value 1 Ship Building and Repairing $196,875,071 37.2% 2 Military Armored Vehicle, Tank and Component Manufacturing $56,919,747 10.8% 3 Coastal and Great Lakes Freight Transportation $39,899,057 7.5% 4 Commercial and Institutional Building Construction $31,998,218 6.1% 5 Deep Sea Freight Transportation $31,181,330 5.9% 6 Boat Building $20,032,943 3.8% 7 Heavy and Civil Engineering Construction $17,913,449 3.4% 8 Other Support Services $17,369,811 3.3% 9 Inland Water Freight Transportation $8,517,667 1.6% 10 Highway, Street, and Bridge Construction $7,846,378 1.5% Top Ten Vendors Total $428,553,670 81.1% All Other $100,010,054 18.9% Total $528,563,724 100.0% Source: USASpending.gov. Data extracts as of October 2017. Data do not include US Army Corps of Engineers contracts Table 70. Top Defense Contractors by Contract value, Southeast Region, FY16 Rank Vendor Name Obligated Dollar Amount % of Total Value 1 TEXTRON INC. $247,491,126 46.8% 2 HORNBECK OFFSHORE OPERATORS, LLC $44,962,607 8.5% 3 JGILS, LLC $26,601,517 5.0% 4 PATRIOT SHIPPING LLC $26,270,908 5.0% 5 BIRDON AMERICA INC $20,067,647 3.8% 6 APC CONSTRUCTION, LLC $19,204,594 3.6% 7 HERNANDEZ CONSULTING LLC $13,252,318 2.5% 8 BIS SERVICES, L.L.C. $13,109,022 2.5% 9 LAMAIN CRESCENT JOINT VENTURE LLC $8,709,647 1.6% 10 FRAZIER INVESTMENTS INC $8,581,032 1.6% Top Ten Vendors Total $428,250,417 81.0% All Other $100,313,307 19.0% Total $528,563,724 100.0% Source: USASpending.gov. Data extracts as of October 2017. Data do not include US Army Corps of Engineers contracts 50
Southwest Region Table 71. Top Defense Industry Sectors (by $ amount), Southwest Region, FY16 Rank Industry Obligated Dollar Amount % of Total Value 1 Roofing Contractors $4,141,191 28.1% 2 Petroleum Refineries $3,862,417 26.2% 3 Highway, Street, and Bridge Construction $2,625,437 17.8% 4 Commercial and Institutional Building Construction $1,734,224 11.8% 5 Electrical Contractors and Wiring Contractors $689,658 4.7% 6 Industrial Gas Manufacturing $635,784 4.3% 7 Environmental Consulting Services $389,335 2.6% 8 Elevator and Moving Stairway Manufacturing $148,133 1.0% 9 Specialty Trade Contractors $131,309 0.9% 10 Sawmills $95,369 0.6% Top Ten Vendors Total $14,452,856 98.1% All Other $272,742 1.9% Total $14,725,598 100.0% Source: USASpending.gov. Data extracts as of October 2017. Data do not include US Army Corps of Engineers contracts Table 72. Top Defense Contractors by Contract value, Southwest Region, FY16 Rank Vendor Name Obligated Dollar Amount % of Total Value 1 GUNTER CONSTRUCTION, INC. $7,621,481 51.8% 2 FREEMAN HOLDINGS OF LOUSIANA, LLC $3,828,414 26.0% 3 KEILAND CONSTRUCTION, L.L.C. $1,881,929 12.8% 4 ARCH CHEMICALS, INC $635,784 4.3% 5 QUANTITATIVE ECOLOGICAL SERVICES, INC. $389,335 2.6% 6 PELICAN LUMBER AND EXPORT, INC. $146,657 1.0% 7 READYMAT US LLC $91,890 0.6% 8 CENTURY GROUP INC $66,420 0.5% 9 DHARA, L.L.C. $18,360 0.1% 10 ERA HELICOPTERS, LLC $18,818 0.1% Top Ten Vendors Total $14,699,089 99.8% All Other $26,509 0.2% Total $14,725,598 100.0% Source: USASpending.gov. Data extracts as of October 2017. Data do not include US Army Corps of Engineers contracts 51
Methodology This paper describes the methodology used by Business Development Advisors to complete the Statewide Military Economic Analysis for the State of Louisiana under the direction of Louisiana Economic Development (LED). Economic Analysis Economic impact analysis attempts to estimate the total contribution of different types of economic activities to a regional and/or state economy. An infusion of spending in one sector of the economy spurs additional economic activity in other sectors as the money is re-spent, generating a multiplier effect. Multipliers quantify direct industry impacts but also recognize inter-industry linkages and the successive rounds of spending that occur within the regional economy. The total economic contribution of this added spending is estimated by tracing the flow of money between industries and households until all of the initial investment eventually leaves a region through foreign or domestic trade or is collected as a tax. The IMPLAN (IMpact analysis for PLANning) modeling system is used in this analysis to estimate the economic contribution of key state-based military assets. IMPLAN, a widely used proprietary software, is specifically tailored to reflect the expenditure patterns and industry mix of Louisiana and to make estimates of the direct, indirect, and induced effects from various economic activities. Direct effects refer to the gross expenditures and employment of the studied industry. Indirect effects are the spending and employment of suppliers and contractors to produce inputs for the industry. Induced effects include household spending on goods and services by both industry employees and the employees of contractors and suppliers (both direct and indirect employees). Total economic impact is the sum of direct, indirect, and induced effects. Project Approach The economic impact analysis we have prepared for LED is built on three major components: Expenditures at Louisiana military facilities Department of Defense and US Coast Guard contracts performed in Louisiana (excluding Army Corps of Engineers contracts) Pay to military retirees in the state As input for the model, data was gathered on the operations expenditures, jobs and payroll, and construction spending by each installation and asset. This data was provided by the installations themselves or through publicly available data sources. Fort Polk and Barksdale personnel also 52
provided additional detailed data on several categories of spending such as healthcare, education, utilities, and other types of operational spending that enabled a more thorough modeling of economic impact than we have been able to conduct for similar projects in other states. In the case of federal contracts, the model inputs were gathered from the USAspending.gov database recording the place of performance for Department of Defense and U.S. Coast Guard related work in Louisiana. The place of performance represents the geographic area where the majority of the work was done under the award or contract and is not necessarily the same as the address of the prime contractor or recipient. Finally, we obtained data from the DoD Military Retired Pay File for 2016 on pay to military retirees in Louisiana. Based on this data and the results from the model, four major types of economic impacts are reported in the study: represents the value of industry production. In this case, this is the value generated by state-based military assets. refers to all employees required to produce the outputs, including wage and salary employees; full-time and part-time employees; and the self-employed. Labor Income refers to all forms of employment income, including employee compensation (wages and benefits) and proprietor income. Tax impacts include the estimated state and local tax revenue generated from industry outputs for the following categories: dividends; employee and employer contributions to social insurance taxes; sales, property, motor vehicle, severance, and other taxes related to production and imports; corporate taxes; and taxes on households consisting of income taxes, fees, motor vehicles, property tax, and other associated personal taxes. In addition to reporting statewide figures, estimates of the four major types of economic impacts were also generated for the eight Louisiana Economic Development (LED) regions. The map below shows LED s eight regions. 53
Figure 6. LED Regions Source: www.louisianaeconomicdevelopment.com For this task, model-building consisted of identifying the appropriate geography and selecting appropriate inputs and model assumptions based on rigorous economic standards. We constructed nine customized models for the eight LED regions plus the state of Louisiana to serve as the primary input-output analysis tools for both the 2013 and 2017 studies. To determine the regional break-outs when specific information was not available, two approaches were utilized. Either the estimation of regional benefit was based on the U.S. Census Bureau s Local Dynamics program, which tracks place of work with place of residence for those working at military bases, or IMPLAN s Multi-Region Input- Analysis feature was used to distribute economic impacts. While the data categories, data sources and regions are the same for the 2013 and 2017 reports, it is important to note that the economic output findings are not directly comparable across the two time periods because of updates made to the IMPLAN model in the intervening years. Additionally, careful efforts were made so as not to duplicate (double-count) or otherwise overstate the economic impact results. For instance, steps were taken to remove from the contract analysis any contracts where the place of performance covered a military base zip code, excluding from the installation analysis units stationed at military bases but already covered in other portions of the analysis, and determining typical construction amounts rather than inputting large single year sums that may be atypical. Construction expenditures are highly variable from year to year and can substantially affect overall economic impact. While this study seeks to capture the vast majority of expenditures originating from each of the state s military assets, not all expenditures may have been captured. For example, certain economic activities could not be measured given time and resources available for this study. Spending by visitors to the installations who come from out of the area, certain supplies that are not obtained through on-site contracting, and the spending associated with employees and retirees who live in nearby states may not be fully represented by the data used for this analysis. 54