BY MAIRE O’NEILL
Regional Coalition of LANL Communities board members want to take a deeper look at results of a 2019 University of New Mexico Bureau of Business and Economic Research study commissioned by Los Alamos National Laboratory which has caused some consternation among RCLC member communities.
A version of the study was presented Feb. 8 at an RCLC retreat by Steve Vierck of the office of the State Land Commissioner and included a slide that was removed from the finalized version of the study before it was released by LANL. The author of the report, BBER director Dr. Jeffrey Mitchell, was invited Jan. 24 by RCLC executive director Eric Vasquez to give the retreat presentation but had a prior commitment. The invitation stated that per a request from one of the RCLC member governments, some community activists would be presenting their review of the economic impact of the Laboratory on the region.
The slide in question showed that the cost to Santa Fe County of the Lab’s presence nearby was $1,414,655, with Taos County at $809,406 and Rio Arriba at $3,215,566. Mitchell later explained in an email to Vasquez, that the estimation of the costs of services is actually one of the most straightforward calculations in the report.
“We got total expenditures from local government entities and apportioned costs to LANL as households supported by LANL as a share of total number of households. Moreover, the aggregated number in the report shouldn’t be any more problematic than those for the individual counties as it is just the sum of the seven counties,” Mitchell said. “Honestly, the only difference is that while the aggregate number shows the region as a whole wins, ….the county detail shows that while as a whole the seven counties shows there are some winners and some losers, despite a net positive balance. I suspect that LANL was less interested in presenting that. Bottom line: the data is the same, just presented with different levels of detail.”
On June 26, an article by Molly Montgomery entitled “Inequities Edited Out Of Los Alamos National Lab Study” appeared in the Rio Grande Sun. The article did not distinguish between fiscal impact and economic impact, with fiscal impact being what a county would spend on services because of Lab employees living in that county, whereas economic impact would include the revenue a county would receive from taxes generated from those employees as well as money they spend on goods and services.
During an agenda item on the study at Friday’s virtual meeting, Vasquez said there was a request made by “some board members” to have a discussion about possible next steps around the study based off recent media coverage.
“We do not have a formal presentation. For the board’s recollection, UNM BBER performed a study on the economic impact of Los Alamos National Laboratory on the region and the state and also the breakdown county by county which was published last year,” Vasquez said. “We reviewed that study in our retreat in February. At that time a slide was included that was presented to us by BBER which showed the fiscal impact on a county-by-county basis and that slide is the main issue because it shows uneven distribution of fiscal impact.”
Board secretary Espanola Mayor Javier Sanchez said he would like to get more information on the data on the slide.
“What was concerning to me was as a statistician and as an economist, not that I’m necessarily either of those, is the need to determine what methods were used to come up with that and a little more in depth knowledge about where the data came from,” he said.
Santa Fe City Councilor Michael Garcia said it was important to look at the study further.
“I think it’s great to have information as to not only what the impact is on the greater community but we need to start planning for the impact that it does have on the communities,” he said.
Board vice chair and Town of Taos Councilor Darien Fernandez said he too would like the RCLC to examine the issue further. (Fernandez told the Los Alamos Reporter that he was the board member who asked for the item to be placed on the agenda.)
“Since the article came out in the Rio Grande Sun, I have been contacted by numerous constituents and several of my Council members with grave concerns about what was shown in the study about the discrepancy and how the BBER study shows that certain communities in counties surrounding the Lab are not really seeing a net economic benefit at the moment,” Fernandez said. “I don’t think this is for us to judge the Lab or attack them but really to examine the methodology, what the discrepancy really is, and if there really is a discrepancy, what we can do as a coalition to address that to ensure that all of our member communities are seeing an economic benefit and that the RCLC can show its relevancy.”
He said he has also been approached by constituents about why the Town of Taos still belongs to the RCLC.
“My comment to them has always been that we’re trying to work regionally to make sure that the Lab’s mission is diversified and that the entire region can see some economic benefit from the Lab’s activities. And I think the RCLC board is in a good position to work together to further examine the results of this BBER study,” Fernandez said.
Board treasurer Los Alamos County Councilor David Izraelevitz said if the board wanted to look at the data, he was not going to object.
“I am concerned about the logic behind the expectation that the Laboratory is a net negative to the region, so I’m as curious as anyone for BBER to explain the reasoning behind that. If it’s the pleasure of the RCLC to understand that, or to do a more detailed analysis, that’s fine,” he said.
Board member Ohkay Owingeh Pueblo Gov. Ron Lovato said he wholeheartedly supports a further look into the BBER study.
“There’s been a multitude of reports and studies that show the economic disparity between certain quadrants of our region and others. And I think it’s important that we understand it, look into it to the degree we can and advocate for some changes to address it,” he said.
RCLC chair Santa Fe County Commissioner Henry Roybal said he thought the board probably needed to take a deeper dive to looks at what the impacts are and where the numbers came from and get a deeper evaluation.
Izraelevitz said it will be interesting to see the methodology behind the report.
“There’s no question that Los Alamos County benefits greatly from having the Laboratory as do other communities when they have a major source of employment in their community. That is not I think the question, the question is, ‘is this a negative impact on surrounding communities’?. I’m very confused by that conclusion. I can’t think of a thought experiment where the Laboratory magically disappears and all the surrounding communities do better financially, so I am curious to see how that conclusion came to be,” he said. “My other request is that the next time we have a presentation that it be done by the author of this report. At the retreat, we had a surrogate who I believe was not as prepared as the author of the report would have been.”
Vasquez said he had been in contact with Mitchell.
“At this time he is the director of the BBER at UNM. Because he is a UNM employee he is subject to their guidance. Currently, there are a couple of IPRA requests in to UNM for more information about the study as well. Because of that he is not able to talk with us until those are resolved but hopefully eventually that will become possible.” Vasquez said. He added that he thinks the study does not indicate that there’s a negative economic impact but that there is a fiscal impact for some RCLC members which is different to an economic impact.
Chair Roybal said it could be a long way out before the board could get the author present and that if it was going to be a year from now, he didn’t know if the board was going to want to wait that long to get information.
Mayor Sanchez said he thought the board could ask what statistics were looked at and how they are put into any kind of a business model. He said he hoped that could be done separate from the specifics of the BBER study and that what would be important to him would be how the revenues and expenses are calculated for the region.
Fernandez suggested also inviting Lab officials to speak directly on the study so the board could pose their questions to them as well because he thought it was important to hear from everyone.
Izraelevitz said if the board is interested in having a new study that uses an appropriate methodology he is all in favor.
“If we’re going to look at the old report, I’d like to have the author of the old report present. If we’re going to have a new report, with more detail and more scope as we want it, then let’s just do that. That seems to be what we’re pointing toward anyway,” he said.
Vasquez said CPLC spoke to BBER about conducting such a report and priced it out to see whether or not it would be affordable and were given a price estimate they “could work around”.
“The bigger issue was that we were informed that the vast majority of the data that was used for the study for expenditures that came out of the Lab was supplied directly by the Lab and BBER did sign a non-disclosure agreement with them. We could hire BBER or another firm to do the study again but we could not get access to the same data. Dr. Mitchell at BBER did tell me that the quality of the data was exceptional. He informed me that he has never had data to that granular level that they got into. The problem is that he cannot share it with us unless the Lab would give us permission to use it as well,” Vasquez said.
Izraelevitz suggested that if the board can’t get the author of the BBER report to explain its conclusions that it go ahead and find someone who can and that can be vetted by the individual economic development directors from the RCLC member communities. He noted that the board had gone through a frustrating exercise at the February retreat with someone who was reading from the report explaining what the slides meant.
“I think it was very flawed in its methodology just given nonsensical conclusions that it drew, that somehow the Laboratory going away would have a positive fiscal impact on the surrounding communities. I just don’t understand how that could be. I’m not disagreeing that Los Alamos has a very large impact – it’s basically 95 percent of the economic activity in our county. But I can’t believe that Santa Fe County or the City of Espanola would be better off economically if the Laboratory were not there,” he said. “Then let’s just go ahead and hire somebody that can do the study and they can get the information from the Laboratory or from the state or whatever and let’s have it vetted by the people who are smart about it. I’m not an economist. I don’t pretend to be. It just doesn’t make sense to me, their conclusions.”
Sanchez said he thinks the board needs to look beyond personal opinions with regard to the BBER report and that it would be dangerous to discard it and say the board disagrees with its conclusions. He agreed that clarification was needed from UNM and also suggested asking the Lab to allow UNM to speak to the data so that the board could review the data and on a parallel path, look at a potential independent report as well.
Fernandez agreed noting that having a second study done was not on the agenda for formal action.
“I think it’s relevant for all of our communities to get a better understanding of that report and in addition consider an independent report of our own so we have more information to look at, because this issue is central to the direction that we want to take together as a coalition to make sure that the region has an equitable benefit rather than just one community as suggested in the current BBER report,” he said. “I don’t think any of us are suggesting or asking for the Lab to just go away. We recognize that there are many positives of having such a brain trust in our region especially with the work around AIDS research and the current work on Coronavirus and renewable energy and a lot of our activist constituents recognize that the Lab can have some positive benefits as well. If we can continue to push for diversification of the Lab’s mission beyond just its historical purpose of weapons development and do so in a way that truly benefits more of the region, then I think we do our constituents a favor and we continue to show the relevance of the RCLC.”
Chair Roybal asked Vasquez to get a timeline from BBER to see when the author of the report would be available and to look into what it would take to do an additional study.