Los Alamos National Laboratory reported this week it spent a record $413 million in procurement contracts with small businesses across New Mexico in the 2020 fiscal year, which ended Sept. 30.

This was a 43 percent increase from the $289 million spent at New Mexico small businesses in 2019 and more spending is expected this year, lab Director Thom Mason said.

Santa Fe County accounted for about $41.5 million spent at about 125 small businesses, according to a news release from the lab.

“Last year’s increase in small business subcontracting was largely the result of our increased efforts to collaborate with small business partners and to bring in new business partnerships,” Mason wrote in an email. “We hit the ground running on that goal in FY19 and really saw the pace ramp up in FY20.”

When Triad National Security — a consortium composed of Battelle Memorial Institute, the Texas A&M University System and the University of California — took over management of the lab in 2019, it set clear priorities to strengthen the lab’s effect on economic growth in the region, Mason said.

The lab reported 84 percent of its small business spending in New Mexico went to companies with owners who are socially and economically disadvantaged ($144 million); women-owned firms ($140 million); so-called HUBZone businesses ($50 million), which are identified by the Small Business Administration as located in “historically underutilized business zones”; and veteran-owned businesses ($17 million.)

In addition to direct lab spending at small-businesses, some 57 percent of lab employees live outside Los Alamos County and contribute to the economies of their home communities. The lab estimated the collective salaries of its 2,900 employees who live in Santa Fe County at $301 million.

Earlier this week, the lab announced it will be leasing office space in downtown Santa Fe for the first time in 58 years, a move that could increase its economic impact in the city. The lab has signed a 10-year lease for 28,000 square feet in the Firestone Building at North Guadalupe and West Alameda streets for 75 employees.

(5) comments

Jay Coghlan

A more recent (August 2020) UNM Bureau of Business and Economic Research (BBER) report is available at https://regionalcoalitionnm.org/wp-content/uploads/2020/08/LANL-Economic-Impact-Presentation-081720.pdf

It shows that the county governments surrounding Los Alamos County suffer a net economic loss from the Los Alamos Lab (see slide 16). The exception, of course, is Los Alamos County, which in terms of median household income is already the fourth richest county in the USA.

Jay Coghlan

Nuclear Watch New Mexico

www.nukewatch.org

Khal Spencer

Jay, that is a powerpoint and it also uses 2016-2018 data just as the 2019 report. Do you know if it is based on a new analysis or just a powerpoint put together out of the 2019 report?

Khal Spencer

Here is the BBER study, unless there is yet another more recent one.

https://bber.unm.edu/media/publications/UNMBBER_LANLImpactAnalysis_Revised_101419.pdf

Erich Kuerschner

Thank you Greg, You seem to be among the few that understand NM economics. If New Mexico can’t distinguish between inputs and outputs, it will continue to wallow in poverty. What matters is not how many jobs are created or how many dollars are infused, but to what PURPOSE (outputs) this effort is expended. It is possible that Teya Vitu is among those that DOES understand. His reporting is limited to what actually occurs, and as far as I am able to understand, is simply not commenting on whether these LANL efforts help or harm NM in the aggregate. It would indeed be helpful if, at some point, such an investigation were to be undertaken, before the harm is compounded.

Greg Mello

It does not follow from the fact that LANL spends $X, that any "economic development" results, let alone that this development occurs in proportion to the dollars spent. The mistake Teya and the editors of this newspaper are making is to identify the input with the output -- to simplify the problem of economic development down to a logical identity: spending money = economic development. It would follow from this logic that any entity, doing anything whatsoever, with any amount of political, social, and environmental impact whether positive or negative, is creating "economic development." BBER makes this mistake as well, driven as it is by its paying clients' needs for supportive reports and trapped as it is in the same faulty economic logic. Meanwhile all the data we see around us -- 70+ years of data -- and all actual economic development theory applicable in peripheral zones of capitalist economies, and all common sense, tell us otherwise. Frankly, the premise of this article, and all the other articles like it, constitute a kind of journalistic malpractice, apparently based in some weird hypnotic trance -- or perhaps a canonical case of the Stockholm Syndrome. Our politicians and journalists are trapped in the grips of the neoliberal paradigm, which as Margaret Thatcher put it is based on the notion that "society" as such does not exist, only individuals. Any notion of a social contract is missing altogether. The results have been catastrophic in this state; no amount of virtue-signalling corporate paternalism (always trumpeted fortissimo) can correct them. As a result we welcome any entity that spends money, no matter on what, calling it "economic development." This Governor is doing that every day, and in the process privatizing much of the state's future, with little useful career creation for New Mexicans. It's not done with malice, or illegally; rather the corruption is in the economic paradigm that is applied. Returning to the case at hand, where is the "economic development" LANL has created while spending very roughly $150 billion dollars in the Santa Fe region over 70+ years? Of course we all know individuals who have profited, but that is not the same as actual economic development, the purpose of which is not to enrich a few well-paid individuals but rather to build up society as a whole, for everybody. By the way, we are seeing the recent LANL-sponsored BBER study misquoted as saying that LANL does not produce economic development in surrounding counties. What it actually said was that LANL likely causes negative fiscal impacts in surrounding county governments, which is important but different. LANL's economic and social failures are far more extensive and deep.

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