Orestimba Creek Feasibility Study - Stanislaus County

Economics Appendix – Draft Report - Orestimba Creek Feasibility Study, Stanislaus County, California – September 2012
employees. Examples of induced benefits include employees' expenditures on items such as
retail purchases, housing, doctors and dentists, banking, and insurance.
Additionally, the input-output model can be used to quantify the multiplier effect that occurs when new
employment is added in a geographical area via the designated economic activities. The multiplier effect
is generated when new employment is added in one sector, but generates additional employment in other
sectors which supply goods and services (indirect impact) and consumer services to employees (induced
impact).
The measurement of the economic impacts in this analysis was performed based on an inputoutput
model called RECONS based upon the interconnectivity of sectors previously used in
IMPLAN developed at the University of Minnesota specifically for use in regional analysis.
RECONS was developed by the USACE Institute for Water Resources (IWR). This following
discussion and report summarizes the results of the RECONS analysis on the Modesto
Metropolitan Statistical Area (MSA). The USACE IWR and the Louis Berger Group developed
the regional economic impact modeling tool called RECONS (Regional ECONomic System) to
provide estimates of regional and national job creation and retention and other economic
measures such as income, value added, and sales. The modeling tool automates calculations and
generates estimates of jobs and other economic measures such as income and sales associated
with USACE’s American Recovery and Reinvestment Act (ARRA) spending and annual Civil
Work program spending. This is done by extracting multipliers and other economic measures
from more than 1,500 regional economic models that were built specifically for USACE’s
project locations. These multipliers were then imported to a database and the tool matches
various spending profiles to the matching industry sectors by location to produce economic
impact estimates. The Tool was intended for use as a means to document the performance of
direct investment spending of the USACE as directed by the ARRA. The Tool also allows the
USACE to evaluate project and program expenditures associated with the annual expenditure by
the USACE.
The economic impacts presented show the Modesto Metropolitan Statistical Area (MSA) and the State of
California’s inter-related economic impacts resulting from an infusion of flood reduction construction
funds.
The Modesto MSA is geographically identified by the US Census Bureau for purposes of providing
information concerning the US Census demographics. Below is a map showing the Modesto MSA and
the location of Newman within the MSA.
78