City of Alexandria Releases Report Analyzing Economic, Fiscal Impact of Arena Development
The arena would bring more than 22,000 year-round jobs. Employee earnings would total more than $2 billion
ALEXANDRIA, VA-Last June, the Alexandria Economic Development Partnership hired HR&A Advisors to conduct a study of both the economic and fiscal impacts of the proposed arena development in Potomac Yard. Today (Feb. 16), the City of Alexandria released a report detailing the study.
It focuses on two development scenarios. One is referred to as a “Baseline” scenario “that reflects planned development under current market conditions,” according to the report. The other is the “Arena + Accelerated Development” scenario. This includes the proposed arena and entertainment district along with “an accelerated build of the site based on the demand” of entertainment.
The Baseline scenario includes buildings like residential high-rises and townhomes. It could be completed anywhere from 2030 to 2046, and includes no arena. The Arena scenario would happen over a number of years. While the arena itself would be complete by 2028 private development would happen in three phases with the last completed by 2036.
HR&A used the e IMpact analysis for PLANning input-output model, created by MIG, Inc., to look at the project’s economic impacts from construction and annual ongoing operations. The model estimates job creation and employee wage/income both during and after construction. It considers employees directly affected, like those who will work contruction, and those indirctly affected such as people who work at surrounding businesses.
HR&A found that the Baseline scenario would bring 345 construction jobs to Alexandria, whereas the Arena scenario would bring 2,535. That last number would increase with private development. The total income earned by workers in the Baseline scenario would be $29 million while the income would be $256 million in the Arena scenario.
Ongoing, year-round jobs in the city in the Baseline scenario would number 9,190. In the Arena scenario, the number would be 22,340. As explained above, the number of jobs would increase with the phases of private development.
The income workers would receive as the result of ongoing work would total more than $1 billion in the Baseline scenario and more than $2 billion in the Arena scenario.
To determine fiscal impact, HR&A utilized the range of assessed local and state taxes to study both one-time and ongoing net fiscal impacts from construction and operation of the development. They found that in the case of the Baseline scenario, Alexandria’s total net fiscal impact from year-round jobs would be $5 million. They also found that in the Arena scenario that number would amount to $33.9 million.
In considering each scenario, HR&A also looked at the 30-year impact to show how the development would support the city in the longterm. In the Baseline scenario, the city would earn $57.9 million. In the Arena scenario, it would earn $464.5 million.
The report says that HR&A’s purpose was strictly for analysis of the project. The company is not in “discussion or development of 1) any underwriting or financing contemplated for development of the project, and 2) non-tax revenue that the jurisdictions may generate from the project/site.”
To review the full report, click HERE.
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