Sandia LabNews

Sandia's effect on New Mexico's economy, community highlighted in 2010 economic impact report

Sandia bought more than $500 million worth of goods and services in fiscal year 2010 from New Mexico companies, 40 percent more than in the previous fiscal year, according to a new report from Small Business Utilization Dept. 10222.

The purchases are part of the more than $1 billion spent overall on procurement of goods and services, the 2010 Sandia National Laboratories Economic Impact on the State of New Mexico report shows. The report — released this week at the Sandia- sponsored 2010 Economic Impact Summit — shows the important role Sandia plays in the state and local economy and the community.

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“Sandia National Laboratories has a long and distinguished record of encouraging and partnering with highly qualified, diverse small business suppliers who assist us in achieving our national security mission. We are fully committed to continuing this track record,” Labs Director Paul Hommert says.

Outreach efforts make a difference

The increase in money flowing into New Mexico’s economy is due to Sandia’s outreach efforts — meeting with business organizations, chambers of commerce, and business owners, holding town halls, and hosting a Supplier Engagement Summit where suppliers discussed their needs in working with the Labs, says Don Devoti, manager of the Small Business Utilization Department.

“We’re being more transparent in our operations and by letting these companies know we really want their business. I think that exposure and our efforts to open up Sandia and our procurement process to the local community has paid off,” Don says.

Here are some of the numbers showing Sandia’s overall impact:

  • $1.3 billion was spent on labor and non-contract-related payments.
  • $950 million was paid for contract-related payments.
  • $68 million was sent to the state of New Mexico for corporate taxes.
  • $66 million was spent through procurement card purchases, in which Sandia employees use cards similar to credit cards for low-priced commercial goods and services necessary to conduct business.

Sam Felix, senior manager of Supply Chain Integration Dept. 10220, says the report also shows Sandia employs 9,300 people — about 8,200 of them in Albuquerque.

Economic models estimate Sandia’s purchases and salaries have a total impact on the local economy of almost $7 billion, or three times greater than the amount spent, the report says.

“When our community is dealing with tough economic times, we hope that Sandia’s jobs, the Labs’ partnership with businesses, and its volunteerism and charitable donations to local programs will help the Albuquerque area weather the storm and emerge even stronger when the economy improves,” Sam says.

Saving taxpayers $64 million

Buyers with Sandia’s Supply Chain Management Center saved taxpayers about $64 million through cost savings on purchase orders, using negotiated savings, such as volume discounts, Sam says.

The report also shows Sandia’s long-standing commitment to small businesses. Sandia’s small business advocates encourage buyers to give qualified small businesses opportunities to sell their products and services to Sandia. Nationwide, the Labs spent $552 million at small businesses. Almost $330 million, or 60 percent, of that was spent at small companies in New Mexico.

The Small Business Act mandates that federal contractors utilize small businesses, including those that are small disadvantaged businesses, small businesses owned by women, veterans and service-disabled veterans, and small businesses located in impoverished areas called Historically Underutilized Business (HUB) zone businesses. Overseeing this mandate is Sandia’s Small Business Utilization Department, which annually negotiates small business subcontracting goals with NNSA.

Sandia also helps the state’s economy through participation in the New Mexico Small Business Assistance (NMSBA) Program. The Sandia NMSBA Program has created and retained 1,549 jobs, decreased operating costs by $45.7 million, increased revenues by more than $82.4 million, and invested more than $17.4 million in expansion efforts and purchases of local goods and services since its inception, according to the report.

And, the Sandia Science & Technology Park, a 250-acre master-planned research park adjacent to the Laboratories, employs more than 2,000 people at an average wage of $71,612.

Sandia employees contributed more than $4.2 million to the United Way of Central New Mexico in 2010. They also logged in more than 100,000 volunteer hours in 2009. And, they donate on average 2,000 books, 23,000 school supplies, 63,000 pounds of food, 435 holiday gifts, and 500 pairs of new shoes to the community each year, the report says.