UT-Battelle Partnership Yields Large Economic and Quality of Life Benefits

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KNOXVILLE — More than $30 million in state and local tax revenue and 20,708 full-time jobs are among the key economic benefits of a partnership between the University of Tennessee and Battelle to manage Oak Ridge National Laboratory.

The findings are from a report titled “Economic Impact of UT-Battelle on the State of Tennessee,” released today at the fall meeting of the UT Board of Trustees. The report looks at activity for the first five years of UT-Battelle, the not-for-profit partnership formed in 2000 to manage the lab for the U.S. Department of Energy. DOE recently extended the partnership’s management contract through March 2010.

UT’s Center for Business and Economic Research (CBER) conducted the study for the university. CBER Director William Fox directed the analysis of the direct, indirect and multiplier or “ripple” effects of the partnership in 2005.

“Our objective was to provide an overview of the economic benefits of the UT-Battelle partnership through its management of the Oak Ridge National Laboratory,” Fox said. “Along with the straight-forward economic benefits, our study summarizes the ways our region benefits from the synergy of the two institutions.”

In 2005, the lab employed 3,990 full-time workers and paid $302.4 million in payroll in Tennessee. It also purchased $137.9 million in goods and services in the state.

Total benefits of spending in Tennessee include:

• $820.3 million increase in gross state product;
• $683.8 million in personal income;
• $30.1 million in state and local tax revenue, and
• 16,718 additional full-time equivalent jobs beyond those at ORNL.

There’s no question that the existence of the partnership between the university and the laboratory has resulted in additional benefits that are not always quantified. A large benefit relates to UT’s ability to recruit top scientists because they want to work at the lab and conversely; the lab has been able to recruit many of their top scientists because of its link to the university,” Fox said.

ORNL is the region’s sixth largest employer, but its payroll effects are more significant because of its relatively high wages and spending, compared to the region’s other large employers, according to the report.

The UT-Battelle partnership supports 35 joint appointments — all of whom are high-caliber, world-class scientists. The lab also provides graduate assistantships and internships that offer the kind of work and research opportunities that can only be experienced at a national lab.

“The partnership impacts the region’s quality of life through its ability to attract a highly trained group of workers to the lab and other nearby firms. Along with providing the highly-educated labor needed by start up businesses, the workforce enhances the quality of the University of Tennessee and the overall education process,” Fox noted.

The report also cites research about how a highly trained workforce includes a large percentage of younger, tech-savvy workers who place a high priority on quality of life. That interest and involvement in the community brings about additional positive impacts.

Among the other main qualitative benefits are the lab’s technology transfer and economic development efforts as well as its support of other organizations with related missions. The report notes growth in inventions, licenses and options, and revenue for business development efforts, most of which stayed in Tennessee. The highlights of the year studied include:

• 90 ORNL “work for others” research agreements, valued at $53 million;
• 10 research and development agreements valued at $10.5 million;
• 167 new invention disclosures, 151 new licenses and options and 28 new fee bearing licenses;
• More than $2.5 million in revenue from licensing.

Since the UT-Battelle partnership formed in 2000, its technology and resources have played a role in the creation of 61 companies that generated $36 million in revenue in 2005, supporting 285 full-time and 33 part-time jobs in 2005, according to the study.

To view the entire report visit http://cber.bus.utk.edu/ and to learn more about UT-Battelle, visit http://www.ut-battelle.org/.

William Fox (865-974-5441)
Karen Collins (865-974-5186 or 865-216-6862)