Indiana s 21st Century Research & Technology Fund Research and Analysis by Michael J. Hicks, PhD, Director, Center for Business and Economic Research and George & Frances Ball Distinguished Professor of Economics, Miller College of Business Srikant Devaraj, PhD, Research Assistant Professor, Center for Business and Economic Research Ball State University Phase I Report November 7, 2016 Macroeconomic Impact & Trends i
About CBER The Center for Business and Economic Research (CBER) is an economic policy and forecasting research center at Ball State University. CBER offers economic data through a suite of web tools available online at http://cberdata.org. In addition to research and data delivery, CBER serves as a business forecasting authority in Indiana s east central region. Center for Business and Economic Research, Ball State University 2000 W. University Ave. (WB 149) Muncie, IN 47306 765-285-5926 cber@bsu.edu www.bsu.edu/cber facebook.com/ballstatecber twitter.com/ballstatecber This study was funded by the Indiana Economic Development Corporation. Contents pg 1 Introduction pg 1 Background pg 2 Metrics pg 3 Description of Fund pg 3 Trend of Dollar Amount versus Awards pg 3 Leverage Ratio pg 4 Industry Share pg 5 Regional Focus pg 6 Indiana High Growth Fund (IHGF) pg 6 Venture Capital pg 7 Changes to R&D Efforts pg 7 Federal Obligation to State by Agency pg 7 Number of Patents pg 8 Academic R&D Expenditures in Science and Engineering pg 8 University R&D Expenditures pg 9 Trend for Selected Industry Sectors pg 10 Aggregate Effects of Fund Investments pg 10 State Return on Investment pg 10 Changes Since 2010 pg 11 Conclusion pg 11 Future Research pg 12 Credits pg 13 Appendix: Analysis of Fund Distribution ii
Introduction The purpose of this study is to comprehensively examine the performance of the 21st Century Research and Technology Fund and the Indiana Angel Network Fund, both of which have been managed by Elevate Ventures. We focus on the changes since the previous study conducted in 2010 by our office, the Center for Business and Economic Research at Ball State University. To perform this study, we use data from January 2010 through December 2014 to examine individual fund recipients and provide a comprehensive description, over time of the quantity, type, industry and regional focus of 21st Century Fund and Indiana Angel Network Fund recipients. We then analyze the diversity and key sectoral changes in the Indiana economy in those industries targeted by the 21st Century Fund. This component is linked to more recent IEDC studies on key sectors. We also identify the aggregate impact to output, investment and employment in Indiana associated with the 21st Century Fund, the Angel Fund, SBIR/STTR, and the Indiana High Growth Fund. Using the Indiana REMI model, we estimate the long-term effect of these funds under alternative funding scenarios and under differential assumptions regarding impacts. We include model results and a draft entrepreneurial climate analysis for Indiana s counties. Finally, we include a description of the focus of the fund and how its intent of translating innovation to economic growth is supported by this focus, how that focus changed since the previous study, and how the implementation of a new focus is designed to influence the Indiana economy. The purpose of this study is to comprehensively examine the performance of the 21st Century Research & Technology Fund, the Indiana Angel Network Fund, SBIR/STTR matching funds, and the Indiana High Growth Fund. Background The Indiana General Assembly created the state s 21st Century Research and Technology Fund in 1999 to stimulate research and development efforts in the state. The Indiana 21st Century Research and Technology Fund was comprehensively reviewed in 2010 by the Center for Business and Economic Research. This process recommended several changes to the structure of the fund, several of which were implemented by the General Assembly. Evaluation is needed for these changes, along with the new goals, within the context of the state and national economies and the accompanying fiscal conditions. With the passage of Small Business Jobs Act of 2010, the State Small Business Credit Initiative (SSBCI) was formed to support state-level programs that lend funds to small businesses and that leverage private lending. Such funds (combined with the leveraged private funds) can then be used by businesses for creating or expanding jobs in the state. Indiana received $34 million as a result of this SSBCI initiative from the U.S. Treasury and allocated the funds to four state initiatives the Indiana Angel Network Fund, the Indiana Seed Fund Holdings, Terms 21st Century Research and Technology Fund (21st Century Funds): Startup capital awarded by the State of Indiana to accelerate growth and job creation through research and technology in pre-revenue and early revenue Hoosier companies. Managed by Elevate Ventures Inc. Elevate Ventures Inc.: Provides business analysis and advisory services to Indiana s firms and nonprofits. Manager of Indiana s 21st Century and Angel funds, among others. Indiana Angel Network Fund (Angel Funds): Seed money provided by the State of Indiana to empower Hoosier entrepreneurs in business creation and improvement. Managed by Elevate Ventures Inc. Indiana High Growth Fund (IHGF): Funds issued to private lending corporations, who then issue loans to high growth opportunity businesses by leveraging them into further private funding mechanisms. Indiana Seed Fund Holdings (Seed Fund): A pre-venture capital fund designed to promote business formation and growth of Indiana based companies, which are at a preliminary stage of operation. Investments usually made over a 2-3 year period. Managed by Elevate Ventures Inc. REMI: Common abbreviation for Regional Economic Models Inc., an economic estimation tool that incorporates the strongest aspects of four major modeling approaches: input-output, general equilibrium, econometric, and economic geography. SBIR/STTR: Abbreviations for two similar grants Small Business Innovation Research and Small Business Technology Transfer. Grants by the U.S. Department of Energy s Office of Science to support scientific excellence and technological innovation in small, for-profit firms. State Small Business Credit Initiative (SSBCI): Program from the U.S. Treasury to support state-level programs that lend funds to small businesses and that leverage private lending with the intent of job creation and business expansion. 1
Figure i: The Evolution of 21 Century Research & Technology Fund and Related Funds in Indiana, 2005-2014 Source: Elevate Ventures This timeline highlights the development and growth of several state and federal funding/investment instruments and their managing organizations that ultimately lead to the new fund management operating model. 2005: IEDC created, administers 21st Century Fund Oct 2011: 21st Century Fund is sole member of Angel Fund for SSBCI capital funds allocation Dec 2011: 21st Century Fund is sole member of Indiana High Growth Fund & Indiana Seed Fund Holdings for SSBCI capital funds allocation Mar 2011: IEDC & Elevate Ventures enter contract for INVEST Indiana Initiative Aug 2012: Indiana High Growth Fund executes agreement with High Growth Initiative Oct 2013: KPMG reviews business practices of Elevate Ventures Jan 2015: Elevate Ventures begins awarding Indiana Seed Fund Holdings Earlier 2010 2011 2012 2013 2014 2015 Sep 2010: Ball State publishes study on 21st Century Fund performance May 2011: SSBCI approved for $34 M funding Dec 2011: Indiana High Growth Fund executes argeements with Cambridge Ventures, Indiana Community Business Credit Corp, & Lynx Capital Corp Sep 2012: IEDC & Elevate Ventures enter contract for the Northern Regional Entrepreneurship Action Plan execution Oct 2014: Elevate Ventures begins awarding SBIR/SSTR Phase I matching funds Feb 2015: Elevate Ventures begins funding Elevate Purdue Foundry Fund the Indiana High Growth Fund and the 21 Fund Investments. In 2011, IEDC and Elevate Ventures Inc. a 501(c)(3) corporation in Indiana collaborated and formed a 21st Century Fund Limited Partnership. Elevate Ventures manages Indiana s 21st Century Fund and SSBCI Funds. Figure i shows a timeline of major milestones during the operation of the fund. Metrics We use the following metrics to evaluate the performance of the 21st Century Research and Technology Fund, the Indiana Angel Network Fund, the Indiana High Growth Fund, and the SBIR/ STTR matching funds. Leverage ratio: Leveraged funds 21st Century, Angel, SBIR/ STTR, and IHGF funds award amount Distribution of funds by industry and region between 2010 and 2014: Measures the diversification of 21 Fund by industry and its regional impact in stimulating the job growth across Indiana s regions. Federal obligation to Indiana by agency: Federal obligation to state allows 21 Fund to evaluate the amount and trend of grants received by the state from various federal agencies. This metric will help 21 Fund to understand the growth potential of specific industry sectors that are associated with the agency over time, along with the success in leveraging state funds into federal research dollars. Research and development expenditures in science and engineering across universities in Indiana: This metric provides 21 Fund with information regarding the growth and share of academic expenditures across various disciplines under science and engineering. They also offer 21 Fund to target spin-off companies arising from university research. Industry sector trends: This metric show the trends in specific industries targeted (or) could be potentially targeted by 21 Fund, measured in terms of growth in employment, establishments and payroll. Estimate the overall economic impact of the 21st Century Fund, Angel Fund, Indiana High Growth Fund, and SBIR/STTR matching funds. State ROI: The return on investment for Hoosier taxpayers is a more challenging metric than standard financial metrics. Indiana benefits from employment, earnings, and investment by both businesses and households that would not typically be considered in a financial analysis of business investment. Moreover, the timing of benefits to taxpayers will likely be longer, and more geographically diffused than a typical ROI to an investor. We discuss this in the aggregate effects section. 2
Description of Fund Trend of Dollar Amount versus Awards As shown in Figure 1, a total of 74 projects have been funded from 2010 to 2014 through 21st Century, Angel, SBIR/STTR, and Indiana High Growth (IHGF) funds. The number of awards funded from 21st Century Funds wavered between 2010 and 2014. However, the awards from the Angel Fund (commenced in 2012) have been increasing steadily from six awards in 2012 to 18 awards in 2014 thus far. The IHGF was disbursed to individual companies through four initiatives Lynx Capital Corporation ($881,000 funded in 2011), Indiana Community Business Credit Corporation ($1 million funded in 2011), Cambridge Ventures L.P. ($1.28 million funded in 2011), and Indiana Statewide Certified Development Corporation ($273,000 funded in 2012). In this study, we classify these four initiatives as financial institutions, where they are provided with a combined total of $3.43 million for distributing to individual firms based on their own objectives. Since 2010, a total of $27 million has been awarded through 21st Century, Angel, SBIR/STTR, and IHGF funds for various projects. As shown in Table 1, 21st Century Funds have awarded $20 million between 2010 and 2014. Also in that time, Angel Funds have awarded $7.1 million, SBIR/STTR have awarded $0.2 million, and IHGF have awarded $3.4 million. Leverage Ratio Firms would seek additional funding from various public/private sources as there are limits to receive award through 21st Century, Angel, SBIR/STTR, and IHGF funds. The leverage ratio (i.e., leveraged funds 21st Century, Angel, SBIR/STTR, and IHGF funds award amount) was 9.82 in 2010 for the fund recipients. Between 2011 and 2014, the leverage ratio has been in the range of 2.04 and 5.89. Figure 2 displays the leverage ratio for each year. For additional data on leverage ratio, see Appendix Table A1. Figure 1: Trend of Dollar Amount vs. Awards Distributed, 2010-2014 Source: Elevate Ventures Investment Programs Summary - As of December 2014 $10 M $8 M $6 M $4 M $2 M $0 21st Century Funds Angel Funds 8 deals 2010 3 deals 6 deals 2011 SBIR/STTR Indiana High Growth Fund 6 deals 7 deals 2012 2 deals 12 deals 3 deals 2013 5 deals 8 deals 6 deals 2014 Table 1: Type of Award Source: Elevate Ventures Investment Programs Summary - December 2014 Type of Award Number of Award Amount ($) 21st Century Fund 30 $20,025,000 Angel Fund 36 $7,108,765 SBIR/STTR 4 $200,000 Indiana High Growth Fund 4 $3,429,325 Figure 2: Leverage Ratio Source: Private Funding --> June 2014 Investment Portfolio Report Bar Graph: Award Amounts Amount Funded --> Elevate Ventures Investment Programs Summary - As of December 2014 $60 M $50 M $40 M $30 M $20 M 12 21st Century, Angel Funds, SBIR/STTR, and IHGF Private funding Leverage ratio (Leveraged funds award amount for 21st Century, Angel Funds, SBIR/STTR, and IHGF) 8 10 6 4 Line Graph: Leverage Ratio $10 M 2 $0 2010 2011 2012 2013 2014 0 3
Industry Share We obtain the North American Industry Classification System (NAICS) codes of all the Fund awardees using manta.com, a publicly available online database of individual businesses. We then classify the funds by their first two-digits of industry NAICS codes to designate the major economic sector. Information and professional, scientific, and technical services projects received a total of 32 deals between January 2010 and December 2014 through 21st Century, Angel, SBIR/STTR, and IHGF funds, which is about 43.3 percent of the total deals among the nine industries to which the funding has been awarded. As a part of fund s goal to assist in diversifying the state s economy, awards were distributed among other sectors such as wholesale trade (12.2 percent), manufacturing (12.2 percent), retail trade (10.8 percent), and other industries accumulating to 21.6 percent. As for the dollar amount, the professional, scientific and technical services industry secured $6.57 million (21.4 percent), followed by information industry with $6.56 million (21.3 percent), wholesale trade with $5.2 million (16.9 percent) and other industries amounting to $12.4 million (40.4 percent). Table 2 shows a breakdown of deals and award amounts by industry. In terms of award type, information sector has been the most funded industry under both 21st Century Fund and Angel Funds with 23.3 percent and 30.5 percent of the total number of deals respectively from 2010 to 2014. The information sector also received highest share of award amounts from 21st Century Funds (23.5 percent) and Angel Funds (25.5 percent). This is followed by professional, scientific and technical services with 23.6 percent of total 21st Century Fund awards and 25.3 percent of total Angel Fund awards. See Figure 3 for the share of awards by industry for each type of awards. For additional data on deals and award amounts by industry and fund type, see Appendix Table A2. Table 2: Awards by Industry Source: Manta.com Elevate Ventures Investment Programs Summary - December 2014 Industry Number of Award Amount ($) Total 74 $30,763,090 Information 19 $6,560,481 Professional, scientific, and technical services 13 $6,574,986 Wholesale trade 9 $5,210,000 Manufacturing 9 $2,054,740 Retail trade 8 $3,283,750 Finance and insurance 7 $4,429,322 Health care and social assistance 3 $1,374,812 Educational services 4 $1,075,000 Arts, entertainment, and recreation 2 $200,000 Figure 3: Industry Share of 21st Century Fund and Angel Awards, 2010-2014 Source: NAICS code --> Manta.com Award Amount --> Elevate Ventures Investment Programs Summary - As of December 2014 Manufacturing 9 deals $2.1 M Wholesale trade 9 deals $5.2 M Retail trade Finance and 8 deals $3.3 M insurance Health care... 7 deals $4.4 M 3 deals $1.4 M ALL DEALS 2010-2014 (74 deals) Education... 4 deals $1.1 M Arts... 2 deals $0.2 M 5 deals $4.2 M 2 deals $1.5 M 7 deals $4.7 M 4 deals $0.2 M $2.7 M $1.0 M 21ST CENTURY FUND 3 deals $1.0 M 7 deals $4.7 M INDIANA HIGH GROWTH FUND Finance and insurance 4 deals $3.4 M 4 deals $0.5 M 2 deals $0.8 M 5 deals 2 deals $0.4 M $0.5 M $0.1 M Professional, scientific, and technical svcs 13 deals $6.6 M Information 19 deals $6.6 M 4 deals $1.0 M ANGEL FUND 2 deals $0.2 M Information Professional, scientific, and technical services Manufacturing Retail trade Health care and social assistance Educational services $0.1 M 2 deals $0.1 M $0.1 M 5 deals $1.8 M 1s $1.8 M Wholesale trade Finance and insurance Arts, entertainment, and recreation SBIR/STTR 4
Figure 4: Distribution of by County Source: Elevate Ventures Investment Programs Summary - As of December 2014 Number of 20+ 10-19 1-9 0 Tippecanoe 5 deals $1.2 M Greene $0.6 M St. Joseph 3 deals $0.8 M Monroe 3 deals $0.3 M Madison Hamilton 3 deals 14 deals $1.5 M $4.9 M Marion 34 deals $17.4 M Elkhart $37,500 Hancock $0.1 M Scott $0.5 M Lagrange 3 deals $0.2 M Whitley $1.0 M Allen $0.1 M Dearborn $1.9 M Regional Focus The 21st Century, Angel, SBIR/STTR, and IHGF funds awarded 74 deals in 15 Indiana counties. Marion County received the most deals (34 deals, 46.0 percent), followed by Hamilton County (14 deals, 18.9 percent). The 13 other counties received a combined 26 deals, 35.1 percent. Figures 4 and 5 show the county distribution of awards. Figure 6 reveals that Marion County received most of its funding in information (29.4 percent), followed by finance and insurance (24.3 percent), wholesale trade (15.5 percent), and other industries (30.8 percent). Hamilton County received 51.5 percent of its funding towards wholesale trade, followed by 30.8 percent towards professional, scientific, and technical services; and other industries (17.8 percent). The fund is making efforts through the Regional Entrepreneurship Action Plan to facilitate the growth of potential companies and to stimulate an environment of robust job creation across the whole state. For additional data on distribution of deals, see Appendix Tables A3 and A4. Vanderburgh 2 deals $0.8 M Figure 5: Share of and Award Amounts by County Source: Elevate Ventures Investment Programs Summary - As of December 2014 Figure 6: Industry Share of by County Source: Elevate Ventures Investment Programs Summary - As of December 2014 Madison 4.1% deals 4.8% amount Tippecanoe 6.8% deals Saint Joseph 4.1% deals 2.6% amount 4.0% amount Monroe 4.1% deals 1.0% amount Lagrange 4.1% deals 0.7% amount 100% 80% 60% Information Professional, scientific, and technical services Wholesale trade Manufacturing 56.7% 15.9% Hamilton 18.9% Others* 12.2% % OF ALL DEALS Marion 45.9% 14.3% * Other Counties: Allen, Elkhart, Greene, Scott, Vanderburgh, Whitley 56.7% 40% 20% 0% Marion Co. Hamilton Co. Others Retail trade Finance and insurance Health care and social assistance Educational services Arts, entertainment, and recreation % OF TOTAL AMOUNTS AWARDED 5
Table 3: Indiana High Growth Fund Distribution of Awards Source: Elevate Ventures Investment Programs Summary - As of December 2014 IHGF Awards Number of 2012 2013 2014 2015 Total Award Totals ($) Number of Award Totals ($) Number of Award Totals ($) Number of Award Totals ($) Number of Award Totals ($) Total, all IHGF Awards 6 $891,164 11 $1,091,672 5 $870,000 2 $325,000 24 $3,177,836 Lynx Capital Corporation 3 $203,664 2 $182,500 3 $345,000 1 $150,000 9 $881,164 Indiana Community Business Credit Corporation 2 $312,500 4 $687,500 0 n/a 0 n/a 6 $1,000,000 Cambridge Ventures, L.P. 1 $375,000 1 $100,000 2 $525,000 1 $175,000 5 $1,175,000 Indiana Statewide Certified Development Corp 0 n/a 4 $121,672 0 n/a 0 n/a 4 $121,672 Indiana High Growth Fund (IHGF) A total of 24 deals worth $3.18 million were awarded by four initiatives of IHGF. Table 3 shows the distribution of deals by type of IHGF initiative over time and total award amount for each year. Firms from Marion County received 66.7 percent of the IHGF deals, followed by Hamilton County with 20.8 percent of IHGF deals. Figure 7: 21st Century and Angel Fund vs Venture Capital Source: 21st Century and Angel Funds --> Elevate Ventures Investment Programs Summary - As of December 2014 VC --> PricewaterhouseCoopers National Venture Capital Association $200 M 40 Venture Capital Figure 7 shows the venture capital dollars and deals from 2010 to 2014 along with 21st Century, Angel, SBIR/STTR, and IHGF fund awards. Though this group had overall far fewer dollars relative to venture capital in this time period, it received just as many deals as venture capital overall. For additional data on venture capital deals, see Appendix Table A5. Line Graph: Amount Awarded $150 M $100 M $50 M 30 20 10 Bar Graph: Number of $0 M 2010 2011 Amount awarded to... 21st Century, Angel, SBIR, IHGF Venture capital 0 2012 2013 2014 Number of deals to... 21st Century, Angel, SBIR, IHGF Venture capital The largest number of overall deals have been awarded to Marion County (34 deals) and Hamilton County (14 deals), resulting in a total of $22,305,850. A portion of this amount can be attributed to a high percentage of awards received from the Indiana High Growth Fund. 6
Changes to Research and Development Efforts Federal Obligation to State by Agency Figure 8 shows that the federal obligation to the state of Indiana compared to the U.S. had been in the range of 0.54 percent to 0.80 percent during 2008-2012. Similarly, the federal obligation to Indiana as compared to all midwestern states was in the range of 7.2 percent and 8.4 percent for the same period. In 2009, the federal funding from various agencies to Indiana had increased by $437 million (an increase of 65.06 percent) to $1.1 billion from $672 million in 2008. During the same period, the total federal funding to all the states increased by $13 billion, which is an 11.1 percent increase from 2008. However, in 2010, the total federal funding to Indiana fell by $120 million (a decrease of 10.87 percent) relative to previous year and has been steadily falling since then. Figure 9 shows federal obligation to Indiana by each agency from 1992 to 2012. For additional data on federal obligation, see Appendix Table A6. Figure 8: Total Federal Obligation to Indiana, 1992-2012 Source: National Science Foundation The largest contribution to Indiana for research and development in 2009, in terms of dollar amount, came from the Department of Defense with increase of $274 million (87 percent increase relative to previous year; with 53.1 percent share of total obligation), the Department of Health and Human Services with an increase of $63 million (29.8 percent increase with 24.7 percent share of total obligation), and the National Science Foundation with an increase of $59 million (an increase of 75 percent with 12.5 percent share). After 2009, the percentage share of obligation for most agencies stayed at the same level. Number of Patents Figure 10 shows the trend of patents issued in Indiana since 1996. The number of patents filed in Indiana was fairly constant between 1998 and 2003 and then declined until 2008. From 2009 onward, the number of patents has reliably increased with a 21.2 percent improvement between 2009 and 2013. The percentage of Indiana s patents as a share of total United States patents has increased slightly from 1.4 percent in 2009 to 1.6 percent in 2013. Area Graph: Amount of Federal Obligation $1,200 M $1,000 M $800 M $600 M $400 M $200 M Total federal obligation to Indiana ($) Indiana's share of total federal obligation to all midwestern states (%) 12% 10% 8% 6% 4% 2% Line Graph: Share of Federal Obligation Figure 10: Indiana Patent Trends, 1996-2013 Source: U.S. Patent and Trademark Office 2,000 1,500 1,000 500 Patents issued within Indiana $0 M '92 '94 '96 '98 '00 '02 '04 '06 '08 '10 0% '12 0 '96 '97 '98 '99 '00 '01 '02 '03 '04 '05 '06 '07 '08 '09 '10 '11 '12 '13 Figure 9: Percent Share of Federal Obligation by Agency, 1992-2012 Source: National Science Foundation Figure 11: Indiana s Total Academic R&D Expenditures in Science and Engineering, 1995-2012 Source: National Science Foundation 100% Dept of Agriculture $1,200 M Federally financed 80% 60% 40% Dept of Defense (incl Homeland Security) Dept of Energy Dept of Health & Human Svcs NASA $1,000 M $800 M $600 M $400 M State and local govt Industry Institution funds All other sources 20% Nat l Science Foundation $200 M 0% '92 '94 '96 '98 '00 '02 '04 '06 '08 '10 '12 Others $0 '95'96'97'98'99'00'01'02'03'04'05'06'07'08'09'10'11'12 7
Academic R&D Expenditures in Science and Engineering As of 2012, Indiana s total academic expenditures for research and development (R&D) in science and engineering stood at $1.15 billion. Figure 11 shows that about 50 percent of it is attributed to federally financed expenditures, which were $584.9 million. The rest of expenditures were spread across state and local government expenditures at $56.7 million, industry expenditures at $60.5 million, expenditures through institution funds at $359 million, and all other sources contributing to $88.8 million. The percent share from various sources has stayed almost the same since 1995. For additional data on Indiana s R&D expenditures, see Appendix Table A7. University R&D Expenditures By Discipline Figure 12 shows the breakdown of the total university R&D expenditures in Indiana by science and engineering fields in 2012. The life sciences discipline received about 49 percent of the total expenditures and engineering received 24.6 percent, followed by physical sciences (9.5 percent), social sciences (6.6 percent), math and computer sciences (5.23 percent), and others (5.11 percent). By University Figure 13 displays the academic R&D expenditures in science and engineering fields for Indiana s major public and private universities in 2012. Purdue University and Indiana University had the highest R&D expenditures with 46.6 percent and 40 percent respectively. About 40.6 percent of total R&D expenditures for Purdue University had been in engineering followed by life sciences with 39.5 percent. About 70 percent of Indiana University s R&D expenditure was focused in the life sciences field. For additional data on university R&D expenditures, see Appendix Table A8. Non-Federal Expenditures Public and private universities have relied upon non-federal funding for their R&D in the science and engineering fields. The non-federal includes financing from state and local government, institutions, businesses, and any other sources. While Purdue University and Indiana University have accounted for more than 50 percent of nonfederal funds, Ball State University had relied heavily on non-federal funds after 2007. Figure 14 shows the percent share of non-federal expenditures by universities in Indiana. Figure 12: University R&D Expenditures in Indiana by Science and Engineering Disciplines, 2008 & 2012 Source: National Science Foundation Figure 13: University R&D Expenditures in Indiana by University, 2008 & 2012 Source: National Science Foundation Figure 14: Percent Share of Non-Federal Expenditures by University, 1995-2012 Source: National Science Foundation 100% 80% 60% 40% $283.6 M Engineering $198.9 M $460.4 M Physical sciences $109.0 M Social $89.9 M sciences $75.7 M Others* $129.9 M Life sciences $497.4 M 2008 $563.2 M 2012 Indiana (all campuses) $411.9 M Purdue (all campuses) $430.0 M 2008 $536.4 M 2012 Math and computer sciences 2008: $38.1 M 2012: $60.1 M Notre Dame $97.2 M $143.3 M Psychology* 2012: $24.0 M Sciences, nec* 2012: $22.2 M Environmental sciences* 2012: $12.5 M * The 2008 category Others is roughly equivalent to the 2012 categories of Psychology, Sciences, nec, and Enviromental sciences Ball State 2008: $8.0 M 2012: $4.7 M Rose-Hulman 2008: $3.5 M 2012: $1.1 M Valparaiso 2008: $0.9 M 2012: $2.0 M Indiana State (all campuses) 2008: $1.7 M 2012: $1.9 M Wabash 2008: $0.6 M 2012: $0.5 M DePauw 2008: $0.4 M 2012: $0.0 M 20% 0% Ball State Indiana (all campuses) Indiana State Notre Dame Purdue (all campuses) '95 '96 '97 '98 '99 '00 '01 '02 '03 '04 '05 '06 '07 '08 '09 '10 '11 '12 8
Trend for Selected Industry Sectors The 21st Century and Angel funds have been investing in various projects across disciplines such as software publishers/information technology, life sciences/health care, engineering, and retail. While these are broad categories, it is imperative to see how the industryspecific fields have performed over the years. Considering 1998 as the base year (100 points), Figure 15 displays the employment index, the establishment index, and the annual payroll index for selected industries in Indiana. Between 1999 and 2012, the software publishers sector had experienced the highest increase in employment (52.6 percent increase), closely followed by navigational instrument manufacturing (51.85 percent increase). These two sectors also saw more employment growth from 2010 to 2012. The engineering services sector and the computer systems design sector showed an increase in employment of 37.93 percent and 23.86 percent respectively. Semiconductor manufacturing and metalworking machinery manufacturing saw a decrease in employment of about 65.19 percent and 50.49 percent respectively. The number of establishments has been steadily increasing in the computer systems design industry from 1998. There has been a 55.39 percent increase in establishments in computer systems design since then. At the same time, the semiconductor and other electronic component manufacturing and the metalworking machinery manufacturing industry experienced a 33.02 percent and a 38.74 percent decrease in their number of establishments since 1998. Since 2010, the software publishers saw an increase in the number of establishments, followed by navigational instrument manufacturing. As of 2012, the annual payroll index (adjusted for inflation) for navigational manufacturing was up 120.54 percent, engineering services had increased by 81.21 percent, and software publishers were up by 52.74 percent from 1998. Since 2010, the increase in payroll was significant for navigational instrument manufacturing, followed by computer systems design. However, semiconductor manufacturing saw a decrease of 55.02 percent in annual payroll between 1998 and 2012, followed by metalworking machinery with a decline of 54.13 percent and pharmaceutical and medicine manufacturing with a decline in annual payroll of 39.62 percent. For additional data on Industry Indexes, see Appendix Tables A9, A10, and A11. Figure 15: Industry Indexes, 1998-2012 Source: United States Census Bureau 250 200 150 100 50 0-50 250 200 150 100 50 0-50 250 200 150 100 '98 '98 '99 Aerospace Computer Engineering '00 '01 '02 Aerospace Computer Engineering '99 '00 '01 '02 A: Employment Index '03 '03 Metalworking Navigational Pharmaceutical '04 '05 '06 B: Establishments Index '07 Metalworking Navigational Pharmaceutical '04 '05 '06 '07 C: Annual Payroll Index '08 '08 Semiconductor Software '09 '10 '11 '12 Semiconductor Software '09 '10 '11 '12 50 0-50 '98 Aerospace Computer Engineering '99 '00 '01 '02 '03 Metalworking Navigational Pharmaceutical '04 '05 '06 '07 '08 Semiconductor Software '09 '10 '11 '12 9
Aggregate Effects of Investments In order to estimate the effects the 21st Century Fund investments have made on Indiana s economy, we examine these investments in the context of a regional economic model. This model is designed to estimate the effects the investments make on the state s economy, considering the average effect of a gross business investment. In this way, the 21st Century investments can be considered in the short run to have contributed to the state s economy. In the long run, the specific benefits of the investment on productivity, employment, business profitability and other factors should be considered. To model this, we view the expenditures of the 21st Century Fund, SSBCI, and the Indiana High Growth Funds from 2010 through 2014 in a regional model (REMI regional model of Indiana). The results depict the cumulative short run effect of these investments across the state in three areas: employment, gross domestic product and personal income. Results appear in Table 4. We see from these results that these investments have contributed a total of 323 jobs, and increase in GDP of $18 million and growth in personal income of $16 million. State Return on Investment Estimating a rate of return on a public investment is far more challenging than a private investment since the projected benefits are much more varied than private investment returns. Public investment considers impacts to employment, the quality of employment options (such as wages or educational requirements), the impact on overall GDP, tax revenue collections, private or intergovernmental investment, housing investment, etc. Table 4 from the preceding section demonstrates the estimated economic effects of the 21st Century Research and Technology Fund, the Indiana Angel Network Fund, the Indiana High Growth Fund, and SBIR/STTR matching funds from 2010 through 2014. These economic impacts offer the basis for a potential evaluation of the return to investment for Indiana. To make the comparison, we offer several benchmark rates of return for the 2010-2014 period, acknowledging that many of the investments from the 21st Century Fund were made in the final year, and so are far from realizing mature returns. We compare federal funds rates and corporate AAA bond yield over this period. We compare also the Federal Thrift Savings Plan letter fund (C, F, G, I, S), the U.S. Aggregate Bond rate of return, two broad stock indices (the S&P and Dow Jones), along with Morgan Stanley s benchmark EFEA Index. To estimate the return on investment to 21st Century Fund investments we compare two calculations against these benchmarks. The first of these is the estimated state income tax receipts from the earnings reported in Table 4. Using the effective tax rate on wages, which is the total Indiana state income taxes divided by the reported wages in tax year 2012, the mid-point of our estimate. The second is a state ROI Table 4: Economic Effects of Fund Investments Source: Author calculations using REMI Note: Includes fund investments for 21st Century, Angel, SBIR/SBTTR, and IHGF. Employment (cumulative #) 2010 2011 2012 2013 2014 76 128 217 253 332 GDP ($) $4 million $7 million $12 million $14 million $18.5 million Personal income ($) $3 million $6 million $10 million $12 million $16 million Table 5: State ROI Estimates and Benchmarks, 2010-2014 Source: Author calculations Rate of Return Comparisons estimate modified from a proposed ROI estimate by Bessette (2003). We modify this format proposing that ROI may be estimated as: ROI = [ (GSP-I) / I ] - 1 Average Annual Returns (Not Compounded) Federal funds 0.33% Corporate yield (AAA Moody s) 0.83% TSP G Fund 2.15% TSP F Fund 4.65% TSP C Fund 13.83% TSP S Fund 16.38% TSP I Fund 6.36% U.S. Aggregate Bond Index 4.38% S&P 500 Index 13.80% DJIA U.S. Index 16.09% EAFA Index (Morgan Stanley) 6.20% 21st Century Indiana PIT 1.32% State output ROI 20.10% Permits a single year ROI estimate for a state, where gross state product (GSP), and total investment (I) are used to estimate the state investment ROI. We label this as State output ROI. Our results appear in Table 5. From these, we estimate that traditional investments in federal funds linked investments will have low rates of return over this period, as did corporate bonds for low risk borrowers. Federal retirement investment funds did better, while stock indices offered the best returns. 10
These options are illustrated to demonstrate the range of riskadjusted returns. For the 21st Century Fund, the personal income tax collections offered returns higher than the traditional low risk investments, while the state output ROI offered a very competitive 20.10 percent per year. We summarize by noting that the benefits of state R&D investments are aimed at several different areas, a circumstance not normally considered in traditional investment. However, measured against these higher irks benchmarks, the 21st Century Fund ROI is competitive, even in the short term. Changes Since 2010 The 21st Century Fund modified its practices slightly after 2010. That year saw a comprehensive review of the 21st Century Fund by Ball State University and the passage of the Federal Small Business Jobs Act in 2010, which paved the way for the State Small Business Credit Initiative (SSBCI). One change involved increasing the leverage of private sector funds. The funds disbursed through SSBCI are expected to have a 3:1 leverage ratio (with a desired goal of 10:1) by end of the allocation time period s reporting period (U.S. Department of Treasury 2014). In 2011, IEDC and Elevate Ventures Inc an Indiana 501(c)(3) corporation collaborated under a professional service contract as a part of INVEST Indiana Initiative. In the same year, IEDC and Elevate Ventures created the 21st Century Fund Limited Partnership, which became the sole member of Indiana Angel Network Fund LLC, Indiana High Growth Fund LLC, and Indiana Seed Fund Holdings LLC. The SSBCI funding of $34 million is distributed in three equal tranches to these funds (KPMG Review of Elevate Ventures Business Practices 2013). Elevate Ventures started managing the 21st Century Fund and the SSBCI Funds in 2011. Elevate Ventures follows a due diligent process of accepting and evaluating the applications for both funds on behalf of IEDC. To protect its investment dollars, the fund takes convertible debt or equity instruments from awardees. Elevate Ventures monitors and reviews awardees on an ongoing basis. Elevate Ventures leads/hosts events such as the Venture Capital Investor Event and Innovation Showcase Summary, the Chicago Venture Capital Investor Event, webinars, etc., that help awardees to participate, to expand their network, to get advice on pitches, and to create opportunities for follow-on funding. Conclusions The 21st Century Research and Technology Fund and the Indiana Angel Network Fund have been instrumental in assisting startup firms in Indiana financially for various research and development purposes. The Angel Funds program, initiated in 2012, has seen an increasing trend in the number of awards. The most number of deals has been offered to the information industry and professional, scientific, and technical services by both 21st Century and Angel Funds. Marion County has received about 28 deals. Through economic gardening and entrepreneurial assistance activities, IEDC will be able to expand its award reach to other counties in Indiana. The Department of Defense, the Department of Health and Human Services, and the National Science Foundation funded almost 87 percent of total federal obligation to the state. Academic research has been imperative to the development through research and development. Apparently, the total federal funding to research universities has been increasing since 1995. The increase in R&D activities associates with creation or increasing employment among various industries and from 2012 data we can ascertain that most increase have come from technologically advanced manufacturing, biosciences, and emerging media and information technology sectors. Future Research In our next report, using econometric models, we will evaluate the performance of fund recipients as measured against a control pool of all similar businesses in Indiana. Also, we will conduct a review of policies designed to better integrate the fund s objectives and procedures in the state s economic development efforts. 11
Credits Research and Data Bessette, Russell W. 2003. Measuring the economic impact of university-based research. The Journal of Technology Transfer 28(3-4): 355-361. Elevate Ventures. 2014. Investment Programs Summary. December 2014.. 2014. Investment Portfolio Summary. KPMG. 2013. Review of Elevate Ventures Business Practices. Manta.com. 2014. NAICS Data. National Science Foundation. 2012. https://ncsesdata.nscf.gov/webcaspar/. PricewaterhouseCoopers National Venture Capital Association. 2014. Historic Trends. https://www.pwcmoneytree.com/historictrends/ CustomQueryHistoricTrend. U.S. Bureau of the Census. 2012. County Business Patterns. http://www.census. gov/econ/cbp/. U.S. Department of Treasury. 2014. SSBCI. http://www.treasury.gov/ resource-center/sb-programs/documents/ SSBCI_FAQs.pdf U.S. Patent and Trademark Office. 2013. Patent Trends. http://www.uspto.gov/ web/offices/ac/ido/oeip/taf/cst_utl.htm. Photos Flickr Creative Commons. pg i: Source unknown. pg ii: Source unknown. pg 1: Bryanesque. pg 9: Source unknown. pg 11: Nicolas Zein. Graphics and Design Victoria Meldrum. Manager of Publications and Web Services, Center for Business and Economic Research, Ball State University. Authors Michael J. Hicks, PhD. Director, Center for Business and Economic Research; and George & Frances Ball Distinguished Professor of Economics, Miller College of Business, Ball State University. Srikant Devaraj, PhD. Research Assistant Professor, Center for Business and Economic Research, Ball State University. Acknowledgements Thank you to Karthik Kumar Balaji (graduate student) and Natalie Martin (undergraduate student) for their contributions. About Ball State CBER The Center for Business and Economic Research (CBER) is an economic policy and forecasting research center at Ball State University. CBER offers economic data through a suite of web tools available online at http://cberdata.org. In addition to research and data delivery, CBER serves as a business forecasting authority in Indiana s east central region holding the annual Indiana Economic Outlook and quarterly meetings of the Ball State University Business Roundtable. CENTER FOR BUSINESS AND ECONOMIC RESEARCH 2000 W. University Ave. (WB 149), Muncie, IN 47306 765-285-5926 cber@bsu.edu www.bsu.edu/cber facebook.com/ballstatecber twitter.com/ballstatecber 12
Appendix: Analysis of Fund Distribution pg 12 Table A1: Leverage Ratio pg 12 Table A2: Industry Share by Fund Type - Number of and Award Amounts pg 13 Table A3: Funded Projects by County pg 13 Table A4: Funded Projects by County and Industry pg 13 Table A5: Venture Capital versus 21st Century and Angel Funds pg 14 Table A6: Total Federal Obligation to Indiana by Agency pg 14 Table A7: Indiana s Total Academic R&D Expenditures by Source pg 15 Table A8: Total Academic R&D Expenditures by Universities pg 15 Table A9: Establishment Index for Selected Industries pg 16 Table A10: Employment Index for Selected Industries pg 16 Table A11: Annual Payroll Index for Selected Industries Table A1: Leverage Ratio Source: Author calculations Calendar Year Amount Funded Private Funding Leverage Ratio 2010 $5,600,000 $54,975,821 9.82 2011 $7,631,164 $37,557,994 4.92 2012 $5,460,647 $32,145,552 5.89 2013 $4,323,490 $14,952,864 3.46 2014 $7,747,789 $15,770,658 2.04 Total $30,763,090 $155,402,889 5.05 Table A2a: Industry Share by Fund Type - Overall Number of and Award Amounts Source: NAICS code --> Manta.com Award Amount --> Elevate Ventures Investment Programs Summary - As of December 2014 Industry All # Award Amt % % Award Information 19 $6.6 M 25.7% 21.3% Professional, scientific, and technical svcs 13 $6.6 M 17.6% 21.4% Wholesale trade 9 $5.2 M 12.2% 16.9% Manufacturing 9 $2.1 M 12.2% 6.7% Retail trade 8 $3.3 M 10.8% 10.7% Finance and insurance Health care and social assistance 7 $4.4 M 9.5% 14.4% 3 $1.4 M 4.1% 4.5% Educational svcs 4 $1.1 M 5.4% 3.5% Arts, entertainment, and recreation 2 $0.2 M 2.7% 0.7% Table A2b: Industry Share by Fund Type - Number of and Award Amounts Source: NAICS code --> Manta.com Award Amount --> Elevate Ventures Investment Programs Summary - As of December 2014 Industry # 21st Century Fund Angel Fund SBIR/STTR Indiana High Growth Fund Award Amt % % Award # Award Amt % Information 7 $4.7 M 23.3% 23.5% 11 $1.8 M 30.6% 25.5% 1 $0.1 M 25.0% 25.0% 0 $0 0% 0% Professional, scientific, and technical svcs 13 % Award # 7 $4.7 M 23.3% 23.6% 5 $1.8 M 13.9% 25.3% 1 $0.1 M 25.0% 25.0% 0 $0 0% 0% Wholesale trade 5 $4.2 M 16.7% 21.0% 4 $1.0 M 11.1% 14.1% 0 $0 0% 0% 0 $0 0% 0% Manufacturing 2 $1.5 M 6.7% 7.5% 5 $0.5 M 13.9% 6.4% 2 $0.1 M 50% 50% 0 $0 0% 0% Retail trade 4 $2.7 M 13.3% 13.7% 4 $0.5 M 11.1% 7.7% 0 $0 0% 0% 0 $0 0% 0% Finance and insurance Health care and social assistance 1 $0.2 M 3.3% 1.0% 2 $0.8 M 5.6% 11.3% 0 $0 0% 0% 4 $3.4 100% 100% 1 $1.0 M 3.3% 5.0% 2 $0.4 M 5.6% 5.3% 0 $0 0% 0% 0 $0 0% 0% Educational svcs 3 $1.0 M 10% 4.7% 1 $0.1 M 2.8% 1.8% 0 $0 0% 0% 0 $0 0% 0% Arts, entertainment, and recreation 0 $0 0% 0% 2 $0.2 M 5.6% 2.8% 0 $0 0% 0% 0 $0 0% 0% Award Amt % % Award # Award Amt % % Award
Table A3: Funded Projects by County and Number of Source: Elevate Ventures Investment Programs Summary - As of December 2014 County # of Award Amount Total 74 $30,763,090 Marion 34 $17,427,308 Hamilton 14 $4,878,542 Tippecanoe 5 $1,240,000 Madison 3 $1,475,000 Saint Joseph 3 $800,000 Monroe 3 $300,000 Lagrange 3 $229,740 Vanderburgh 2 $175,000 Dearborn 1 $1,875,000 Whitley 1 $1,000,000 Greene 1 $600,000 Scott 1 $500,000 Hancock 1 $125,000 Allen 1 $100,000 Elkhart 1 $37,500 Table A4: Funded Projects by County and Industry Source: Elevate Ventures Investment Programs Summary - As of December 2014 County Information Professional, Scientific, and Technical Services Wholesale Trade Manufacturing Retail Trade Finance and Insurance Health Care and Social Assistance Educational Services Arts, Entertainment, and Recreation All Total $6,560,481 $6,574,986 $5,210,000 $2,054,740 $3,283,750 $4,429,322 $1,374,812 $1,075,000 $200,000 $30,763,090 Marion $5,123,000 $1,749,986 $2,700,000 $500,000 $2,200,000 $4,229,322 $125,000 $600,000 $200,000 $17,427,308 Hamilton $374,981 $1,500,000 $2,510,000 $0 $243,750 $0 $249,812 $0 $0 $4,878,542 Dearborn $0 $1,875,000 $0 $0 $0 $0 $0 $0 $0 $1,875,000 Madison $0 $0 $0 $1,000,000 $0 $0 $0 $475,000 $0 $1,475,000 Tippecanoe $0 $350,000 $0 $50,000 $840,000 $0 $0 $0 $0 $1,240,000 Whitley $0 $0 $0 $0 $0 $0 $1,000,000 $0 $0 $1,000,000 Saint Joseph $800,000 $0 $0 $0 $0 $0 $0 $0 $0 $800,000 Greene $0 $600,000 $0 $0 $0 $0 $0 $0 $0 $600,000 Scott $0 $500,000 $0 $0 $0 $0 $0 $0 $0 $500,000 Monroe $50,000 $0 $0 $50,000 $0 $200,000 $0 $0 $0 $300,000 Lagrange $0 $0 $0 $229,740 $0 $0 $0 $0 $0 $229,740 Vanderburgh $175,000 $0 $0 $0 $0 $0 $0 $0 $0 $175,000 Hancock $0 $0 $0 $125,000 $0 $0 $0 $0 $0 $125,000 Allen $0 $0 $0 $100,000 $0 $0 $0 $0 $0 $100,000 Elkhart $37,500 $0 $0 $0 $0 $0 $0 $0 $0 $37,500 Table A5: Venture Capital vs. 21st Century and Angel Funds Source: 21st Century and Angel Funds --> Elevate Ventures Investment Programs Summary - As of December 2014 Venture Capital --> PricewaterhouseCoopers National Venture Capital Association Year Venture Capital 21st Century Research and Technology Fund, Indiana Angel Network Fund, SBIR/STTR, and Indiana High Growth Fund # of Award Amount # of Award Amount 2010 16 $79,969,300 8 $5,600,000 2011 14 $177,927,100 9 $7,631,164 2012 17 $84,161,300 14 $5,460,647 2013 15 $25,413,100 15 $4,323,490 2014 9 $22,356,900 28 $7,747,789 14
Table A6: Total Federal Obligation to Indiana by Agency Source: National Science Foundation Year Dept of Agriculture Dept of Defense (incl Homeland Security) Dept of Energy Dept of Health and Human Services NASA National Science Foundation (NSF) 1992 $16,207,000 $189,005,000 $36,756,000 $72,937,000 $6,708,000 $38,132,000 $7,258,000 $367,003,000 1993 $15,647,000 $334,800,000 $21,156,000 $87,543,000 $7,790,000 $39,670,000 $7,041,000 $513,647,000 1994 $15,809,000 $222,148,000 $17,105,000 $88,241,000 $10,006,000 $44,094,000 $6,208,000 $403,611,000 1995 $16,342,000 $229,642,000 $21,849,000 $91,482,000 $11,447,000 $40,988,000 $14,580,000 $426,330,000 1996 $15,757,000 $254,922,000 $19,080,000 $93,707,000 $7,511,000 $42,649,000 $6,140,000 $439,766,000 1997 $16,956,000 $201,363,000 $28,212,000 $100,561,000 $7,872,000 $46,507,000 $8,927,000 $410,398,000 1998 $14,097,000 $176,279,000 $17,778,000 $106,863,000 $7,708,000 $44,117,000 $10,893,000 $377,735,000 1999 $17,845,000 $190,939,000 $16,533,000 $116,659,000 $10,689,000 $47,660,000 $13,539,000 $413,864,000 2000 $21,726,000 $270,220,000 $16,831,000 $134,987,000 $7,180,000 $57,472,000 $4,431,000 $512,847,000 2001 $20,018,000 $297,949,000 $18,639,000 $156,099,000 $8,036,000 $59,580,000 $8,440,000 $568,761,000 2002 $16,959,000 $213,182,000 $14,594,000 $203,789,000 $14,982,000 $62,943,000 $11,133,000 $537,582,000 2003 $17,706,000 $221,750,000 $21,063,000 $220,422,000 $11,801,000 $67,915,000 $13,036,000 $573,693,000 2004 $18,455,000 $220,734,000 $18,651,000 $199,448,000 $11,087,000 $78,045,000 $10,323,000 $556,743,000 2005 $18,811,000 $205,517,000 $20,347,000 $216,631,000 $14,952,000 $84,136,000 $6,424,000 $566,818,000 2006 $16,487,000 $231,561,000 $24,501,000 $211,463,000 $16,952,000 $72,988,000 $9,262,000 $583,214,000 2007 $23,526,000 $243,340,000 $17,333,000 $215,899,000 $8,207,000 $81,179,000 $7,161,000 $596,645,000 2008 $18,666,000 $315,000,000 $19,157,000 $211,516,000 $9,574,000 $79,027,000 $19,089,000 $672,029,000 2009 $21,708,000 $589,266,000 $51,355,000 $274,642,000 $8,140,000 $138,320,000 $25,787,000 $1,109,218,000 2010 $24,950,000 $483,330,000 $39,994,000 $264,634,000 $6,364,000 $128,673,000 $40,744,000 $988,689,000 2011 $22,711,000 $466,003,000 $20,476,000 $220,724,000 $8,337,000 $125,484,000 $39,265,000 $903,000,000 2012 $21,293,000 $408,002,000 $22,676,000 $206,814,000 $12,403,000 $118,104,000 $49,006,000 $838,298,000 Others All Table A7: Indiana s Total Academic R&D Expenditures by Source Source: National Science Foundation Year Federally Financed State and Local Government Industry Institution Funds All Other Sources All 1995 $198,508,000 $22,715,000 $34,713,000 $101,577,000 $19,521,000 $377,034,000 1996 $204,059,000 $23,478,000 $35,705,000 $108,218,000 $19,799,000 $391,259,000 1997 $209,811,000 $24,066,000 $33,483,000 $114,146,000 $20,123,000 $401,629,000 1998 $214,189,000 $25,751,000 $40,494,000 $126,410,000 $19,484,000 $426,328,000 1999 $224,035,000 $27,877,000 $41,727,000 $149,209,000 $17,570,000 $460,418,000 2000 $228,768,000 $34,377,000 $42,343,000 $178,613,000 $25,040,000 $509,141,000 2001 $247,944,000 $45,456,000 $41,625,000 $203,717,000 $45,676,000 $584,418,000 2002 $276,401,000 $54,494,000 $43,339,000 $225,350,000 $51,134,000 $650,718,000 2003 $327,720,000 $51,364,000 $51,182,000 $236,893,000 $58,593,000 $725,752,000 2004 $365,360,000 $54,007,000 $55,162,000 $310,792,000 $55,820,000 $841,141,000 2005 $380,320,000 $60,879,000 $62,805,000 $206,200,000 $49,418,000 $759,622,000 2006 $392,627,000 $62,211,000 $62,684,000 $248,368,000 $57,611,000 $823,501,000 2007 $400,563,000 $57,417,000 $87,573,000 $280,610,000 $67,645,000 $893,808,000 2008 $436,187,000 $58,634,000 $98,908,000 $292,547,000 $68,345,000 $954,621,000 2009 $434,826,000 $56,511,000 $93,510,000 $344,394,000 $75,975,000 $1,005,216,000 2010 $505,952,000 $53,570,000 $52,169,000 $328,495,000 $108,032,000 $1,048,218,000 2011 $559,030,000 $57,495,000 $59,483,000 $355,795,000 $109,981,000 $1,141,784,000 2012 $584,896,000 $56,752,000 $60,516,000 $359,336,000 $88,827,000 $1,150,327,000 15