By Dr. Michael Izard-CarrollNovember 1, 2017
BUFFALO, NY--A team of economists and analysts from the U.S. Army Corps of Engineers' Institute for Water Resources, Michigan State University and the Alward Institute for Collaborative Science met with the Corps of Engineers, Buffalo District at the Buffalo District headquarters in August 2017 to review the Regional Economic System (RECONS) model, which is a program used to assess the regional, state, and national impacts of projects.
"We meet on an annual basis to review new methods and innovative approaches which could be used to enhance the model. Continuous improvement is what we strive for; the team is always looking for ways to provide more accurate and defensible regional economic impact estimates" said Steve Stalikas, an economist with the Corps of Engineers, Buffalo District. "Buffalo District has a leading role on the navigation module, considering we have significant experience developing navigation models, analyzing waterborne commerce data, and estimating origin-destination transportation rates".
RECONS is a regional economic impact modeling tool that was developed to provide accurate and defendable estimates of regional economic impacts associated with Corps of Engineers spending. It automates calculations and generates estimates of jobs, labor income, and sales associated with USACE annual Civil Works program spending, as well as the economic activities associated with USACE core programs (e.g. commercial navigation and recreation). The RECONS model was initially developed to estimate the regional economic impact of the 2009 American Recovery and Reinvestment Act (ARRA). RECONS is the only Corps of Engineers certified Regional Economic Development (RED) model for agency-wide use.
The Institute for Water Resources (IWR), the organization that created RECONS, is a Corps of Engineers Field Operating Activity located within the Washington, D.C. National Capital Region (NCR) in Alexandria, Virginia, and with satellite centers in New Orleans, LA; Davis, CA; Golden, CO; and Pittsburgh, PA. The IWR was created in 1969 to analyze and anticipate changing water resources management conditions, and to develop planning methods and analytical tools to address economic, social, institutional, and environmental needs in water resources planning and policy.
"Although RECONS was developed in part to provide an easy and consistent means for the field to conduct RED analysis, it has also benefited and evolved from user feedbacks and collaboration with the field." said RECONS developer Dr. Wen Chang, a senior economist with the Corps of Engineers Institute for Water Resources. "In the past couple of years, we have worked extensively with Steve Stalikas and other economists at Buffalo District to modify and improve the model, where the District is also leading the Navigation component of the model. This is exactly the kind of field support and collaboration we are striving for to not just make the model better, but to make it a practical and meaningful tool for the field."
Since its inception, IWR has been a leader in the development of strategies and tools for planning and executing the Corps of Engineers water resources planning and water management programs. The Institute also plays a prominent role within a number of the Corps of Engineers' technical Communities of Practice (CoP), including the Economics CoP, with the Corps' Chief Economist, Dr. David Moser, residing at IWR's NCR office, along with a critical mass of economists, sociologists and geographers specializing in water and natural resources investment decision support analysis and multi-criteria tradeoff techniques.
Federal lawmakers budget billions of dollars each year by determining how, where, and when money should be spent for a particular project, program, or service. With such a vast and complicated budget to work with, economists and analysts work to provide the high-stakes decision-makers an enormous amount of information in order for them to make educated, informed decisions with respect to how the taxpayers' dollars should be spent.
Between 2010 and 2013, Corps of Engineers Civil Works projects reflected an average total net of $110 billion in National Economic Development benefits and $34 billion in returns to the U.S. Treasury. Each dollar invested in Civil Works generated about $16 in economic benefits and five dollars in U.S. Treasury revenues. Historically, the Civil Works budget is around $6 billion annually.
For any decision, a lawmaker must know what value the project, program or service has to the nation. For organizations like the Corps of Engineers, the public is able to see where money goes as bridges are built, dams are repaired, and waterways are dredged. Those who hold the purse strings need to know the economic impact associated with their investment decisions; with RECONS, that information is available. With the powerhouse of great minds working routinely to improve the system, those in charge of the nation's budget will be able to make decisions with greater confidence.