This is a special edition newsletter for the Recovery Act at SRS. It represents a team effort between the client; Creative Energy, Inc., which designed and executed the layout; and my planning, writing, and photo assignments.

1. April 26, 2011
Study Team Selects Solid Parameters
The purpose of the Recovery Act funds is to stimulate the
regional economy and accelerate environmental clean-up of
this 310-square-mile, 60-year-old
nuclear weapons facility. SRNS
and SRR received $1.4 billion and
$200 million, respectively, to fund
important clean-up projects at the
Site.
A team of economists from
three business schools at universities in the Central Savannah River
Area of South Carolina and Georgia were commissioned to conduct
this detailed analysis of the impact
of DOE’s ARRA funds.
The authors are from USCA,
Claflin University, Augusta State
University and SRNS. The local
area was defined as Aiken, Barn-
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Printed on Recycled Paper
Savannah River Site
Aiken, SC 29808
well and Allendale counties, South
Carolina, and Richmond and Columbia counties in Georgia.
The study team adopted the
economic impact software program
IMPLAN (Impact Analysis for PLANning), which is also used by companies such as Bristol-Myers Squibb
Co. and Deloitte and Touche, LLP,
and government entities such as the
Federal Reserve. It studied the period from April 1, 2009, to October 1,
2010. During this period, SRNS and
SRR spent about $819 of SRS’ $1.6
billion in Recovery Act funds. Out of
this amount, about $282 million was
invested in the local community.
Reported economic impacts
were estimated over 2.5 years and
include the 1.5 years of SRNS and
SRR spending from the beginning of
April 2009 to the beginning of October 2010. An additional 12 months
forecast the economic spill down
effect of the study data.
April 26, 2011
Putting Americans To Work
Special Edition
Economic Impact of ARRA Funding at SRS
Barnwell County Courthouse Statue
The U.S. Congress passed the
American Recovery and Reinvestment Act (ARRA) in early 2009 to
jumpstart a national economy that
was sinking as quickly as tossed
pennies falling to the bottom of a
fountain. Halfway through the twoand-a-half-year project, not only had
ARRA slowed the effect of a plummeting economy, it had invested in
the five-county region surrounding
the Savannah River Site (SRS) to
ensure far-reaching benefits will
extend past September 2011, the end
of the stimulus funding from the U.S.
Department of Energy (DOE).
The Recovery Act at SRS has,
in effect, turned copper pennies
into gold coins that were dispersed
throughout five counties adjacent to
the Site.
This finding, among others, is
described in a study of the Recovery
Act’s economic impacts on the local
community, which was released in
April by The O’Connell Center for Executive Development at the University
of South Carolina Aiken (USCA) and
commissioned by Savannah River
Nuclear Solutions (SRNS), the Site’s
management and operations contractor, and Savannah River Remediation
(SRR), the liquid waste contractor.
“Without the Savannah River Site
I’d be gone, too. That’s my bread
and butter.”
Jess Walker, owner, Carolina Bar-B-Que
Recovery Act Impact Facts
$819
$282.3
$524.5
ARRA Spending between
April 2009 to October 2010
SRNS and SRR spending
in local community
Good and Services produced
million
million
million
Metrics through April 6, 2011
www.srs.gov/recovery
4,600
employed

2. April 26, 2011
Findings show Recovery Act Buffered Recession’s Fury
The study’s findings are both impressive and reassuring to a community that has experienced more than
its share of the nation’s economic
burden. It found that the Recovery
Act did lessen the local impacts of
the economic downturn through the
retention and creation of jobs and by
bolstering the community through additional goods, services, and state and
local tax revenues.
The study determined that ARRAfunded projects have been key to buffering the impacts of the recession to
the five-county area – Aiken, Barnwell
and Allendale counties, South Carolina, and Richmond and Columbia
counties in Georgia – and securing
local economic growth and stability.
It showed economic spending
produced a dramatic multiplier effect.
Every dollar of the Recovery Act
spent in this local area created 86
cents of additional economic activity in the region. Jobs creation also
had a similar benefit. For every job
funded by SRNS and SRR stimulus
funds, an additional 0.90 jobs were
created in the local community.
Therefore, the $282 million that
SRS spent in the region on payroll
($212.5 million), local subcontracts
($48 million) and living expenses
($21.8 million) had a much higher
impact, equivalent to $525 million in
goods and services produced. The
number of people spending their
newly acquired paycheck in the community increased by 90 percent, from
$282 million
$584.5
million
As SRNS, SRR and their contractors supplied jobs and salaries in the
region adjacent to SRS, employment
numbers and the amount written on
paychecks grew. The benefits to the
local economy are measured by the
number of jobs created or retained
and the amount of personal income
local residents are able to accumulate.
The 1.86 economic activity
multiplier and the 1.90 employment
multiplier were derived by adding the
actual amount of money spent in the
region and the number of jobs it created to the benefits reflected by the
indirect and induced impacts of the
money.
The direct, indirect and induced
effects yield the total employment,
value of goods and services, income
and tax revenue impact of ARRAfunded projects. As a result, the
study estimates four different kinds of
effects the ARRA funding has had on
the local economy:
1. Direct effects are associated
with SRNS’ and SRR’s direct gross
receipts and include the gross industry output, number of workers and
labor earnings.
2. Indirect effects represent the
relationship between different firms
working through input purchases of
goods and services.
3. Induced effects are economic
impacts that arise from the spending of household income earned by
workers employed by the projects
conducted by SRNS and SRR. For
example, all businesses affected by
this spending will hire additional workers who will also spend a portion of
their income in the local economy.
4. Total economic impact of
SRNS and SRR spending of the
ARRA funds is calculated as the sum
of the direct, indirect, and induced effects of the SRNS and SRR projects.
$819
million
in spending
between April 2009
and October 2010
SRNS and SRR spent
$282.3
million
in the local community
This was used for subcontractors, labor and
living expenses
Economic Impact of ARRA Funding
Goods and
services
produced:
$524.5
million
Employment:
4,600
2,420 to 4,600. For individual families
living in the five-county region, the
proof was in their checkbooks: the
average household income increased
by almost $500 a year, although some
families benefited more than others.
The $525 million generated from
the Recovery Act’s multiplier effect is
Additional Benefits:
• Household income
increase:
$470/year
• State and local
tax revenue:
$35 million
• Federal tax
increase:
$47 million
far-reaching as it provided $81 million
in additional local, state and federal
tax revenue for the five counties.
In addition, the study found the
positive impact the Recovery Act had
on the five-county region would likely
spill over one year after Recovery Act
funding ends in September 2011.
The $282 million spent in the
local five-county region has the
economic multiplier impact of
1.86
Every dollar spent created
another 86 cents of regional
impact activity.
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Impact of ARRA Funding on Employment, Output and Household Income
“We have about 30 employees ... .
Most of these folks are local.
They’re within the local unions or
live in the surrounding counties.”
Scott Stephens, president and
chief executive officer, Grade South
“2009 came and that’s when it
really hit us hard. We had no
business. ... 2010 came, and
that’s when everything
skyrocketed back up for us.
Now, 2011 is here, and we’re
doing better than we were doing
in 2010.”
Alyssa Mackie, assistant general manager,
Country Inn and Suites
Economic Climate before the Recovery Act
The stimulus package could not
have come at a better time. The
severity of the recession debilitated
the largely rural five-county area. The
stimulus funds buffered the impact of
the economic devastation, enabling
the local economy to begin to rebound.
All five counties had increased
unemployment in 2008-2009. Allendale County, S.C., and Columbia
County, Ga. showed drops of 5.59
and 7.13 percent, respectively. A
large portion of the five-county region
was operating on economic reserves
during much of 2008 and the early
part of 2009.
Barnwell County was the hardest
hit during the study period. In January 2008, its unemployment rate was
11.2 percent; two years later, it had
grown to 20.1 percent. The local area
had an overall increase in unemployment from 9 percent in January 2008
to 14.1 percent in January 2010.
Local employers responded to
the crisis by decreasing their demand
for labor, in effect lowering industrial
output, household income and tax
revenues with one sweep across the
region.
On top of the decrease in jobs
and the lower industrial output, the
region was further plagued by an
average labor force participation rate
that was below state and national averages. In the five-county study area,
only 60.7 percent of capable labor
force participants were in the labor
market. This deficiency indicated a
stressed economic area in need of
additional financial support.
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