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arise directly out of the activities which take place there. Then there are the <br />indirect impacts which take place generally off the premises and a good example of <br />those would be the visitor's expenditures that arise throughout the community. <br />Fundamentally, the direct impacts can be looked at as being caused in connection <br />with the provision of the airport or of the aviation services at the airport. The <br />indirect impacts can be looked at as a result of the use of the aviation services or <br />the expenditures incurred due to the maintenance by the corporation or a business of <br />an airplane that they. might use at the airport or the use of the airport for special <br />courier or messenger services or for the provision of the medical samples and <br />testing brought in from other parts of North Carolina and the whole Mid-South <br />Piedmont region that might be brought in for testing at the Duke Medical Center or <br />other institutions in this area. The third type of economic impact is what is <br />termed the induced impact. The induced impact essentially is a function of a <br />phenomenon which is termed the multiplier effect. These are transactions that occur <br />elsewhere in the economy of the region as the money which is originally generated is <br />spent and respent and respent again through 5 or 6 or 7 cycles before it finds its <br />way out of the Orange County area altogether. The process of estimating the <br />economic impact is one which draws upon a tool, an economic modeling tool developed <br />by the Bureau of Economic Analysis of the U.S. Department of Commerce. The Bureau <br />of Economic Analysis has made available to localities such as Orange County a <br />modeling system which is referred to as "reams", which means short-hand for the <br />regional input-output modeling system which captures the benefit of the <br />sophisticated and costly analysis that the bureau has undertaken for its national <br />accounts and makes them available on a local basis. In undertaking this work for <br />Orange County, Wilbur Smith Associates made contact with the Bureau of Economic <br />Analysis and ordered from them a series of economic multipliers that were tailored <br />~- specifically to the Orange County region. They are developed on computer disk and <br />are specific to the Orange County area. In being specific they recognized certain <br />. characteristics of the local economy so that the data reflects as accurately as <br />possible the characterist~es of the local economy. These would include the <br />estimates of the make-up of the population which would use the airport, the plane <br />mix, the likely tenants of the airport, the initial year economic activity would <br />take place and that which would take place in subsequent years. The two years were <br />analyzed as pant of the economic impact analysis with 1989 the initial year. That's <br />the base year for which data is available representing the present. Forecast <br />information which had been developed as part of the preliminary development plans <br />was used far the year 2008 which was the second point in time used as part o£ the <br />analysis. The studies give a very goad idea of the make-up of activities that take <br />place at airports of comparable size. He illustrated how it is possible by drawing <br />on the experience of other places to simulate reasonably well the type of activities <br />which can be expected to take place at the Orange County airport when it comes into <br />operation. The financial transactions are codified to prepare them for use with <br />this computerized model called reams, described earlier. They represent <br />expenditures in various categories of economic activity. Basically the reams input- <br />output modeling system takes a dollar, figuratively speaking, which is spent in <br />anyone of some 53l different categories of expenditure ,and, based on the bureau of <br />economic analyses work, it traces the flow of economic activity which that dollar in <br />final demand would stimulate. <br />He next discussed the results of the study. He listed the economic impacts <br />which are estimated to be generated in the year 1989 if the airport were active at <br />this time. The direct impacts due to the provision of the airport service are <br />estimated at approximately 1.8 million dollars. The indirect impacts which are <br />expected to arise based on the use of the aviation services at the airport are <br />estimated to be $979,000. These expenditures were codified and put into the reams <br />