OCAST fuels $3 billion for economy
OCAST fuels $3 billion for economy

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By Jim Stafford

Published: December 15, 2007

Investment in Oklahoma research and development by the state's technology-based economic development agency fueled a $3 billion boon to the state's economy in fiscal 2006, officials said Friday.

And they have a study conducted by the Oklahoma Commerce Department to prove it, said Michael Carolina, executive director of the Oklahoma Center for the Advancement of Science and Technology.

The study, conducted by Jon Chiappe, senior research analyst at the department, concluded that technology-based companies and research institutions supported by OCAST are responsible for $1.7 billion in direct contributions to the economy while generating another $1.4 in indirect economic activity.

"One of the things that we have not captured in our leverage ratio is the impact that OCAST-assisted companies or research institutions have on our economy,” Carolina said. "This whole thing captures the added value that OCAST has on the state's economy.”

OCAST routinely reports its annual and cumulative return on investment to the state for tax dollars allocated to it, which was 17.36 to one through fiscal 2007. That means for the $151.8 million allocated to OCAST since 1987, it has returned $2.6 billion to the state through federal research grants awarded researchers or investments in tech-based start-up companies.

With the new study conducted by the Commerce Department, the agency has attempted to further identify the impact it has had on the state's economy.

"This is an added benefit,” Carolina said of the data reported in the study. "It says in addition to the leverage ratio, OCAST is helping to generate dollars that go into Oklahoma's tax base, which can then support roads and bridges, health care, education, all those things.”

The findings are key supporting evidence for OCAST's request for a $17.5 million increase in its annual budget for fiscal 2009. The agency is asking the state Legislature to appropriate $40 million for next year, up 78 percent from the $22.4 million budget awarded in fiscal 2008.

The Commerce Department study looked at state and local tax revenues generated by OCAST supported companies, worker output and payroll impacts by companies and research institutions. Data was taken from annual surveys completed by companies and researchers that receive support from OCAST and represents a "point in time” Chiappe said.

"So the inputs were jobs, the industries these companies are located in, and, if it was available, wage data,” Chiappe said of the study. "We've done (similar studies) for companies before. We haven't done anything here at the Department of Commerce for a state agency.”

OCAST's annual "Impact Report” that measures state investment and how those investments attract outside funds will be released in a few weeks, Carolina said.

Related Topics: Public Finance, State Budgets