Local businesses and others annually benefit economically from Minot AFB

From the left, Senior Airman Brian Jonathan Loanzon, 5th Maintenance Squadron non-destructive inspection journeyman, along with Airman 1st Class Charles Pridgen, 5th Maintenance Squadron non-destructive inspection apprentice, perform a magnetic particle inspection at Minot Air Force Base, Dec. 13, 2017, shown in this photo by Airman 1st Class Dillon J. Audit. Submitted Photo

MINOT AIR FORCE BASE – About 9 percent of Verendrye Electric Cooperative’s revenue is from Minot Air Force Base, said Tom Rafferty, Member Services and Communication manager.

“We serve 44 of the 150 launch sites in the Minot missile field,” said Rafferty.

He said the the remainder of the missiles are served by McLean Electric Cooperative, North Central Electric Cooperative, Burke-Divide Electric Cooperative and Mountrail-Williams Electric Cooperative.

Verendrye Electric has offices in Velva and Minot. The cooperative covers several counties in north central North Dakota including Ward, Renville, McLean, McHenry, Pierce, Sheridan and Wells. Minot and Minot Air Force Base are in its coverage area.

At Minot AFB, Verendrye Electric has a warehouse and three linemen are there full time.

Verendrye Electric Cooperative is an example of the economic impact Minot Air Force Base has on Minot and surrounding areas in terms of payroll, purchases and jobs created.

For several years the base’s economic impact has remained at more than half a billion dollars. In fiscal year 2017, the most recent report, the base added more than $550.4 million to the local area.

Maj. Douglas Bauer, commander of the base’s 5th Comptroller Squadron, said some of the key factors for the slightly lower economic impact this past fiscal year was a decrease in Minot AFB construction projects but there was an increase in procurements such as healthcare services and educational services.

The report also shows the level of investment the Air Force is making in sustaining operations at Minot AFB.

Bauer presented the Comptroller Squadron’s prepared annual economic analysis report to the Minot Area Chamber of Commerce’s Military Affairs Committee.

Minot AFB consists of over 5,300 acres of land. There are also right of way easements for over 19,000 acres that make up the missile site complexes around the region, Bauer said.

He said the base has over 474 industrial buildings, 954 military housing units, 14 dormitory and visiting quarters and 14 temporary lodging facilities.

In addition, he said there are miles of utility distribution lines, the roads, the flightline with its runways and taxiways, over 1,100 vehicles and many more items such as communications and electronic systems that need to be maintained.

“Obviously, it takes a great deal of manpower and resources to maintain and operate all the assets associated with the base,” Bauer said.

As of Sept. 30, 2017, Bauer said 5,551 active duty and Air Force Reserve personnel were assigned to Minot AFB. In addition, there were 5,584 accompanying family members.

“Civilian employees also make up a significant portion of the workforce at Minot Air Force Base,” Bauer said. He said a total of 1,060 civilians work at the base.

He said this brings the base population to around 12,000 people – military members, family members and civilian employees.

Bauer said the base had a 1 percent increase in population from fiscal year 2016 to fiscal year 2017.

The 5,551 active-duty personnel received a total of over $321 million while payroll for the Air Force Reserve forces assigned to the base was $229,000 for a total military payroll of more than $322 million.

“Sixty percent of the base’s airmen and their families live off base in Minot or surrounding communities,” Bauer added.

He said the total payroll for civilians exceeded $59 million.

“If you combine the annual payrolls for all the personnel at Minot Air Force Base – the military and civilian – you get a figure of over $381 million. This equates to payroll earnings of over $1.4 million each day or an average pay distribution of $14.6 million. Much of that is spent here in the local community,” Bauer said.

He said the multiyear comparison of payroll shows an increase from fiscal year 2016 to fiscal year 2017.

Many dollars are spent each year to maintain buildings, roads and other infrastructure at Minot Air Force Base, Bauer said.

He said there are also construction projects that upgrade or projects for constructing buildings. “These construction projects and refurbishments enhance employment opportunities for area residents,” Bauer said.

During fiscal year 2017 over $46 million was spent for construction, the Minot missile field, and operations and maintenance.

He said service contracts with local contractors was over $15 million. These include only contracts in the local economic area or contracts requiring the use of locally supplied goods or services such as school bus service and grounds maintenance.

“Many dollars are spent in the community to keep Minot Air Force Base running. The commissary and the (Base) Exchange spent over $1.9 million in the local area. He said medical claims paid to local medical facilities through the Tricare system slightly more than $11.8 million.

“Education impact aid to local school districts and tuition assistance to military members to advance off-duty education goals exceeded $9.2 million,” Bauer said.

He said expenditures for downtown lodging by personnel assigned temporary duty at Minot AFB was around $595,000.

Other materials, equipment and supplies procurements totaled more than $11 million.

“Altogether, money spent for construction, services and other procurement totaled over $96 million,” Bauer said.

He said the multi-year chart for construction, services and other expenditures shows a decrease in expenditures from fiscal year 2016 to fiscal year 2017. “This was driven by a 13 percent decrease in construction projects,” Bauer said.

Indirect jobs show how the base money ripples through the local economy.

Bauer said an estimated 2,063 indirect jobs were sustained in the Minot area in fiscal year 2017. The number of indirect jobs is determined based on an average annual pay of $49,348, resulting in an estimated annual dollar value of jobs created at $101.8 million.

“To determine the total base economic impact on the Minot community, we add the annual payroll of the base, $381.7 million, the base’s annual expenditure for construction, services, materials and equipment, $96.9 million, and the value of indirect jobs created, $101.8 million. This produces a grand total of over half a billion dollars. This figure represents the economic contributions Minot Air Force Base makes to the local community,” Bauer said.

In addition to the total economic impact figure but not part of the economic model, Bauer said military retirees make up 3 percent of the permanent Minot population and receive a combined income of $32.4 million.

“These dollars also contribute to the economic well being of the community. The multi-year comparison of retired pay shows an overall increase of 11 percent for the period of 2013 through 2017,” Bauer said.

“The bottom line – Minot Air Force Base will have a positive economic impact on the city of Minot and surrounding communities in FY18 and beyond,” Bauer said.