Leadership Los Alamos looks at economic snapshot

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By Carol A. Clark

The impact on the local economy from the nation’s financial crisis was highlighted during the February session of Leadership Los Alamos.


Executive Director Kevin Holsapple of the Los Alamos Commerce and Development Corporation presented the economic snapshot and discussed key issues during a segment of the day-long program held at the Los Alamos Research Park Friday.


“Some issues include the need to increase the availability of housing in the county, both affordable and market rate,” Holsapple said, referencing the long-term and assuming economic conditions improve. “We also need to increase retail opportunities, retain Los Alamos National Laboratory as the area’s best wealth producing employer and at the same time, diversify the economy to broaden our economic base.”


There also is a significant need to both maintain and increase funding to the governments, particularly the schools, to maintain and expand upon services, he said.


“Because of the increased GRT revenue the country receives from the lab, they are in relatively good shape,” Holsapple said. “But the schools definitely need our attention and the community should be applauded for the recent positive outcome of the school bond election, which is exactly the right kind of thing needed to address this issue.”


Holsapple addressed the decline in the local housing market during the last three years, which he said mirrors the economic situation impacting the entire country.


“We had 338 homes sell in 2006 compared to 192 in 2007 and 170 in 2008,” Holsapple said. “There are currently 180 active listings of homes for sale in the county. The median sale price in 2006 was $303,000 compared to $295,000 in 2007 and $250,000 last year.”


Holsapple also mentioned several local vs. national comparisons:


• Cost of Living Index for Los Alamos County is at 127.9 percent / 100 nationally;


• Rental Units in the county make up 20.2 percent of housing / 33 percent nationally;


• Home Cost Index 167.4 / 100;


• Health Cost Index 118.7 / 100;


• School Expenditures Per Pupil $6,630 / $6,058;


• Pupil to Teacher Ratio 14.9 / 15.9;


• K-12 Achievement Index (10 = best), 9.8 / 5.1;


• Water Quality Index (100 = best), 74 / 55; and


• Air Quality Index (100 = best), 95 / 48.


He listed small businesses that closed in the last few years as well as new businesses and existing businesses that have expanded.


“It’s normal that businesses come and go,” he said. “It’s tragic for the people involved, but often times, people don’t see the balance of new businesses opening up.”


Holsapple mentioned that more than 18,000 people work in Los Alamos. Among them, 50.7 percent live in Los Alamos County, 22.4 percent commute from Santa Fe County and 17.8 percent from Rio Arriba County. Another 3.4 percent live in Sandoval County, 2.6 percent in Bernalillo County, 1.3 percent in Taos County, .3 percent live in Valencia County and .2 percent in Torrance County.


“Over time we’re in line to see a decrease in the number of people living here if we don’t create a diversity of available housing and sufficient retail,” Holsapple said. “We find more of our work force coming in from other counties if we don’t plan for the future.”


The local economy is like a bucket, he said. It has money put into the top of it from the local basic economy including the lab, tourists, outside payments such as Medicare and companies like M-tech and others that import dollars into the community.


Then there are the retailers who circulate money a number of before it leaks out of the bucket, he said. The problem is that the money comes in but finds all kinds of ways to leak out, he said.


An example is a company with half its employees living off the hill. They get paid and most of their salary is taken back and spent in their individual communities. Money also leaks from the bucket in the purchase of products manufactured elsewhere, Holsapple said.


“That money is shipped out of our local economy,” he said. “The goal is to keep the hole as small as you can, live here and try as many times as you can to have the money re-circulate. The minute someone thinks they have to leave the hill to buy something, local money leaks out of the bucket. This is why the focus needs to be in making sure we have sufficient housing and retailers and to help the lab and other local industries stay strong to ensure money keeps coming into bucket.”


There are 4,375 acres of urbanized land in Los Alamos County, Holsapple said. Of that, 2,777 acres are residential. There are 141 acres of commercial land, 11 acres of industrial and 1,446 acres taken up by county facilities, parks and the like, Holsapple said.


There also are 4,100 acres of open space lands within Los Alamos County control and another 44,000 acres of accessible federal lands within a four mile perimeter of Los Alamos and White Rock, Holsapple said.


“One of the real issues is there is too little supply of commercial land for commercial development to meet the demand,” he said. “The people who populate the offices frequent local retailers and area dining. So to the extent that we can supply space, it helps the economy. Even if you double the amount of space for development, it’s a drop in the bucket to the amount of surrounding space adjacent to the community.”


Holsapple stressed the importance of not looking at the issues in isolation. They must be looked at together because the interplay between the issues is so important and must be considered together.


Housing, increased retail, helping the lab and other industries remain strong and finally, helping the municipal government and the schools be strong.


“Throughout the day, Leadership Los Alamos participants received a well-rounded variety of perspectives from local business people including the real estate, construction and retail industries that matched up to the key issues we discussed,” Holsapple said.