IMPLAN Blog

Since we’re currently in the middle of tornado season and on the heels of a prediction of an active 2018 Atlantic Hurricane Season, this would be an appropriate time for a discussion on natural disasters.

I’ve seen first-hand the destruction of natural disasters. I experienced Hurricanes Fran and Lloyd, plus the 2011 Super Outbreak of tornadoes while living in North Carolina and Alabama, respectively. It doesn’t take long after surveying the debris and downed trees or hearing the stories of survivors to realize the emotional and physical impacts of these events. But one thing that’s often talked about but harder to pin down is the economic impacts from nature’s fiercest displays of force.

That being said, let’s pose the question: “What results and trends can we expect when a natural disaster event occurs in a given region?” Seems simple enough, right? Well, the answer might be a little more complex than you’d expect.

In the spirit of Tax Season ending this week, and the new tax year ahead, let’s revisit the topic of the New Markets Tax Credit (NMTC) Program. Across the country, low income communities lack much needed investment, funding, and care as is apparent by the state of disrepair many of them have fallen into. Enter the New Markets Tax Credit Program. As stated by the Community Development Financial Institution (CDFI Fund’s) website, “the New Markets Tax Credit Program (NMTC Program) aims to break [the] cycle of disinvestment” in low income communities “by attracting the private investment necessary to reinvigorate struggling local economies”. The NMTC Program is jointly administered by the CDFI Fund and the Internal Revenue Service (IRS). While many communities and initiatives attempt to secure this elusive funding, only few are granted it due to the rigorous process that must be undergone to qualify.

Understanding the importance of Economic Impact Analysis for Project Feasibility

We all know what happens when plans go awry. Money is lost, people lose their jobs, and buildings are abandoned mid-construction. One of the most common examples of poor planning is the Death Star. That’s right, the Death Star. From the famous Star Wars original trilogy, the Death Star conveys the idea of economic poor planning in matters of cost and execution. According to the Washington Post in January 2013, a petition reached the White House to build the Death Star. The White House of course denied the petition as it would be morally irresponsible to build a giant super weapon that could destroy worlds, and that its cost would be astronomically high (about 850 quadrillion dollars—that’s 850 with 15 zeros behind it).

1. Intro

In recent years, there has been growing interest in using multiregional social accounting matrix (SAM) models. These models require reliable estimates of inter-regional trade. Because detailed data on the commodity-specific trade between counties are not available, several estimation techniques have been used.

There’s never an easy path to affecting policy change whether we’re talking on the national, state, or local level. But among the tools available to give clarity to the conversation, economic contribution and economic impact analyses rank among the most widely used.

Funding. It’s a word that strikes fear in public and private institutions alike. An almost sisyphean task that repeats on daily, monthly, annual cycles without end. It echos on the radio, online, in emails from museums, charities, and alma maters. And in the end, how do you know if the chase for funding had the desired, tangible effect?

IMPLAN can be used to quantify the impact of a given industry on its local economy, including ones as varied and nuanced as Tourism.

Late last year, we published an example of this—a case study highlighting how the City of Baltimore and the Waterfront Partnership illustrated the need for reinvestment in its Inner Harbor using impact analysis. Much news media attention and high level support (from the city’s then-mayor and the CEO of the Greater Baltimore Committee) for the reinvigoration of the harbor was garnered as a result of the analysis using IMPLAN data. You can read that case study here.

So, you’re a business professional, consultant, researcher, or local government or agency hoping to gain insight and quantify the impact of an industry, a new or existing business, expected growth or changes, or a specific event to the economy of a particular region.

You're going to want to choose a widely used database and software package that uses input-output analysis based on interdependencies of economic sectors.

In 2015, a study released by Bootstrap Solutions with help from the University of Nevada-Reno outlined the economic benefits brought to Idaho by the Idaho Army National Guard in the Treasure Valley. Results from this study found that the annual activities of the Idaho Army National Guard supported 2,800 direct and indirect jobs and contributed more than $155 million to the local economy. The study appeared sound and was very well-received. That’s when things got interesting.